Exhibit 10.9


 




 





EMPLOYMENT
AGREEMENT


 


by and
among


 


RHINO
RESOURCES, INC.


 


RHINO
ENERGY LLC


 


and


 


NICHOLAS
R. GLANCY




 





 


Effective Date:                   ,
2008


 





















 


EMPLOYMENT AGREEMENT


 


THIS EMPLOYMENT AGREEMENT (“Agreement”)
is made and entered into as of the dates written below, dated effective as of
the      th day of                     ,
2008 (the “Effective Date”), by and among (i) Rhino
Resources, Inc., a Delaware corporation (the “Company”), (iii) Rhino Energy LLC, a Delaware limited
liability company (“Rhino”), and (iii) Nicholas
R. Glancy (“Executive”) and joined in by Rhino GP, LLC, a
Delaware limited liability company (“Rhino GP”) for the sole purpose set forth
in the last sentence of Paragraph 1 hereof.


 


Recitals:


 


Executive is currently
employed by Rhino pursuant to an Amended and Restated Employment Agreement
dated March 31, 2008 among Rhino, Rhino GP and Executive (the “Prior
Agreement”).  The Company desires to have
the Executive become an employee of the Company upon the completion of an initial
public offering of common stock of the Company, (the “Offering”) the completion
upon which the Company will directly and indirectly will own all of the
interests in Rhino.  Rhino desires to
continue the employment of Executive until such time as Executive becomes an
employee of the Company as provided above or until the end of the Employment
Term, as defined below, if the Offering does not occur.  For purposes of this Agreement, the term “Employer”
shall mean the entity (Rhino or the Company) employing Executive at the
applicable time.  The Company and Rhino
desire to enter into this Agreement in order to amend and restate the terms of
Executive’s employment.  Executive
desires to enter into this Agreement, and Executive is willing to accept
employment on the terms hereinafter set forth in this Agreement.


 


Agreement:


 


NOW, THEREFORE, in
consideration of the premises and mutual covenants herein and for other good
and valuable consideration, the parties hereby agree as follows:


 


1.                                       Term of Employment.  Unless
terminated earlier in accordance with the provisions of Section 7,
Executive’s employment under this Agreement shall be effective for a term
commencing on the Effective Date and ending on May 31, 2011 (the “Employment
Term”).  From the Effective Date until
the closing of the Offering, should it occur, Executive shall be employed by
Rhino.  Upon the closing of the Offering,
Executive shall become an employee of the Company; provided, however, that any
obligations or references specifically applicable to Rhino (as opposed to just
the Employer) herein shall remain in effect. 
Upon the parties’ execution and delivery of this Agreement, the Prior
Agreement shall be deemed voided by this Agreement and is hereby declared null
and void, ab initio.


 


2.                                       Position and Duties.  As of
the Effective Date, Executive shall serve as the President and Chief Executive
Officer of the Company and Rhino, and Chief Executive Officer of the
subsidiaries of the Company and Rhino. 
In such positions, Executive shall report directly to the Chairman of
Rhino of the Board of Directors of the Company (the “Board”) and, upon the
completion of the Offering, to the Board. Executive shall have the customary
authority, responsibilities and duties of such position(s), subject to the
direction and definition of such authority, responsibilities, and duties from
time to time set by the Board of the Company or the


 





















 


Manager of Rhino, as applicable.  During the Employment Term, Executive will
devote all of his business time and efforts to the performance of his duties
hereunder.  Executive may (i) with
the prior approval of the Chairman of the Board or Manager of Rhino, as
applicable, serve as a director or trustee of up to three (3) corporate or
charitable entities as well as trade associations related to the natural
resources industry, and (ii) manage his personal investments, to the
extent that such activities do not materially inhibit or materially interfere
with the performance of Executive’s duties under this Agreement.  Executive shall be subject to all of the
employment and personnel policies and procedures in effect from time to time
and applicable to executive employees of Employer.  Executive’s regular place of employment
during the Employment Term shall be at the Employer’s executive offices in
Lexington, Fayette County, Kentucky, and Executive shall engage in such travel
as may be reasonably required in connection with the performance of his duties
hereunder.


 


3.                                       Base Salary.  The
Employer shall pay Executive a base salary (the “Base Salary”) at the annual
rate of $385,000 per year, through May 31, 2009, $395,000 per year through
May 31, 2010 and thereafter $405,000 per year, all payable in regular
installments in accordance with the usual executive payroll practices of the
Employer.  Executive’s Base Salary and
other compensation may be processed and paid through Rhino.


 


4.                                       Incentive Compensation. 
Executive shall be permitted to participate in any annual or long-term,
cash or equity based, incentive plan or other similar arrangements of the
Employer, as they may exist from time-to-time, for which Executive is eligible
pursuant to the terms of such plan or arrangement.


 


5.                                       Discretionary Bonus.  The
Employer may consider and approve an annual performance-based discretionary
bonus (“Discretionary Bonus”) for Executive of up to forty percent (40%) of
Executive’s Base Salary.  The
Discretionary Bonus will be on a calendar year basis for all of 2008, 2009 and
2010.  The Discretionary Bonus for the
period January 1, 2011 through the end of the Employment Term will be
pro-rated for the partial year.  A
Discretionary Bonus shall be considered separate from any other form of
compensation contained under this Agreement, including Base Salary.  Any Discretionary Bonus approved by the
Employer shall be paid to Executive within seventy-five (75) days of the end of
the calendar year to which it relates, with the final Discretionary Bonus
determined and paid on the last day of the Employment Term.


 


6.                                       Other Benefits.


 


(a)                                  Retirement Benefits. 
During the Employment Term, Executive shall be provided with the
opportunity to participate in the Employer’s qualified 401(k) profit
sharing plan and non-qualified deferred compensation plan (if any), as they may
exist from time to time, in each case, in accordance with the terms of such
plans.


 


(b)                                 Welfare Benefits; Vacation. 
During the Employment Term, Executive shall be provided with the
opportunity to participate in the Employer’s medical plan and other employee
welfare benefits on a comparable basis as such benefits are generally provided
by the Employer from time to time to Employer’s other executives, in each case,
in accordance with the terms of such plans; provided, however, the premiums for
all such plans shall be paid by the


 


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Employer. 
Executive shall be entitled to three (3) weeks of paid vacation
each year during the Employment Term.


 


(c)                                  Indemnification. 
Subject to the Company’s bylaws, the Company and Rhino shall indemnify
and hold harmless Executive from and against any loss, cost, damage, expense,
or liability incurred by Executive for any action taken by Executive in the
scope of Executive’s employment for the Employer, provided such action (i) is
within the scope, duties, and authority of Executive, (ii) is not in
willful violation of any law, regulation, or code of conduct adopted by the
Employer, and (iii) does not constitute gross negligence or intentional
misconduct by Executive.  The obligations
of the Company and Rhino under this Section 6 (c) shall survive the termination of this Agreement.  If there is any conflict between this Section 6(c) and
the Company’s bylaws, the Company’s bylaws shall control.


 


(d)                                 Reimbursement of Business Expenses. 
During the Employment Term, all reasonable business expenses incurred by
Executive in the performance of his duties hereunder shall be reimbursed by the
Employer upon receipt of documentation of such expenses in a form reasonably
acceptable to the Employer, and otherwise in accordance with the Employer’s expense
reimbursement policies.  Any
reimbursement of any costs and expenses by the Employer to Executive under this
Agreement shall be made by the Employer in no event later than the close of
Executive’s taxable year following the taxable year in which the cost or
expense is incurred by Executive.  The
expenses incurred by Executive in any calendar year that are eligible for
reimbursement under this Agreement shall not affect the expenses incurred by
Executive in any other calendar year that are eligible for reimbursement
hereunder and Executive’s right to receive any reimbursement hereunder shall
not be subject to liquidation or exchange for any other benefit.


 


(e)                                  Continuing Legal Education.  The
Employer shall pay or reimburse Executive for the reasonable costs and expenses
of continuing legal education necessary for Executive to maintain Executive’s
compliance with the rules and requirements of the Kentucky Supreme Court.


 


(f)                                    Rhino Benefits.  To
the extent the Company does not have employee benefits or benefit plans called
for or referred to under this Agreement, and which are available to employees
of Rhino, Executive shall be a part of and have the rights, privileges and
benefits under any employee benefits or benefit plans maintained by Rhino to
the extent he would have been entitled to the same as an employee of Rhino.


 


7.                                       Termination. 
Notwithstanding any other provision of this Agreement:


 


(a)                                  For Cause by the Employer or Voluntary
Resignation by Executive Without Good Reason.  If Executive is terminated by
the Employer for Cause (as defined in Section 12(d)) or if Executive
voluntarily resigns without Good Reason (as defined in Section 12(j)),
Executive shall be entitled to receive as soon as reasonably practicable after
his date of termination or such earlier time as may be required by applicable
statute or regulation: (i) any earned but unpaid Base Salary through the
date of termination; (ii) payment in respect of any vacation days accrued
but unused through the date of termination; and (iii) reimbursement for
all business expenses properly incurred in accordance with the Employer’s
policy prior to the date


 


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of termination and not yet reimbursed by the
Employer (the aggregate benefits payable pursuant to clauses (i), (ii), and (iii) hereafter
referred to as the “Accrued Obligations”); and except as provided herein
Executive shall have no further rights to any compensation (including any Base
Salary or bonus, if any) or any other benefits under this Agreement.  All other accrued and vested benefits, if
any, due Executive following termination of employment shall be determined and
paid in accordance with the plans, policies, and practices of the Company or
Rhino, as applicable.


 


(b)                                 Without Cause by the Employer or Voluntary
Resignation by Executive for Good Reason.  If Executive is terminated by
the Employer other than for Cause, Disability (as defined in Section 12(g))
or death, or if Executive voluntarily resigns for Good Reason, Executive shall
receive:  (i) the Accrued
Obligations; and (ii) subject to Section 7(f) and Section 7(h),
Base Salary for a period of twelve (12) months from the termination of
employment, payable in a lump sum as provided in Section 7(f).  Except as provided herein, Executive shall
have no further rights to any compensation (including any Base Salary) or any
other benefits under this Agreement.  All
other accrued and vested benefits, if any, due Executive following termination
of employment pursuant to this Section 7(b) shall be determined in
accordance with the plans, policies and practices of the Company or Rhino, as
applicable.


 


(c)                                  Death.  Following termination of
employment for death, Executive’s estate shall be entitled to receive the
Accrued Obligations.  Except as provided
herein, Executive’s estate shall have no further rights to any compensation
(including any Base Salary) or any other benefits under this Agreement.  All other accrued and vested benefits, if
any, due Executive following a termination of employment for death shall be
determined in accordance with the plans, policies, and practices of the Company
or Rhino, as applicable.


 


(d)                                 Disability.  Following termination of
employment for Disability, Executive shall be entitled to receive the Accrued
Obligations.  Except as provided herein,
Executive shall have no further rights to any compensation (including any Base
Salary) or any other benefits under this Agreement.  All other accrued and vested benefits, if
any, due Executive following a termination of employment for Disability shall
be determined in accordance with the plans, policies, and practices of the
Company or Rhino, as applicable.


 


(e)                                  No Mitigation or Offset.  In no
event shall the benefits set forth in this Section 7 be subject to
mitigation or offset.


 


(f)                                    Release.  Notwithstanding any other
provision of this Agreement to the contrary, Executive acknowledges and agrees
that any and all payments to which Executive is entitled under this Section 7
which are described as being subject to this Section 7(f) are
conditioned upon and subject to Executive’s execution of, and not having
revoked within any applicable revocation period, a general release and waiver,
in such reasonable and customary form as shall be prepared by the Employer, of
all claims Executive may have against the Employer and its directors, officers,
subsidiaries and affiliates, except as to (i) matters covered by
provisions of this Agreement that expressly survive the termination of this
Agreement or are covered by the grant referred to in Section 9 hereof, and
(ii) rights to which Executive is entitled by virtue of his participation
in the employee benefit plans, policies and arrangements of the Company or
Rhino, as applicable.  Unless such
release becomes irrevocable within 55 days of


 


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Executive’s termination of employment,
Executive shall not be entitled to any severance benefits that are described as
being subject to this Section 7(f). 
If the release has become irrevocable within such 55-day period, the
Employer shall pay such severance benefits to Executive within 60 days of his
termination of employment.


 


(g)                                 Resignation.  Upon
Executive’s termination of employment for any reason, Executive shall be deemed
to have immediately resigned from all offices and boards, with the Employer and
any of the Employer’s subsidiaries or affiliates and shall, immediately upon
the request of the Employer, confirm such resignations in writing.


 


(h)                                 Section 409A Delay in Payment. 
Notwithstanding anything in this Agreement to the contrary, if at the
time of Executive’s termination of employment with the Employer, Executive is a
“specified employee,” as defined in Section 409A of the Code, and the
deferral of the commencement of any severance benefits otherwise payable under
this Agreement as a result of such termination of employment is necessary in
order to avoid the additional tax under Section 409A of the Code, then the
Employer will defer the payment of any such severance payments until the date
that is six months following Executive’s termination of employment with the
Employer (or the earliest date as is permitted under Section 409A of the
Code).  Any payment deferred pursuant to
this Section 7(h) will be accumulated and paid to Executive (without
interest) in a lump sum.


 


(i)                                     Termination of Employment.  For
purposes of this Agreement, a termination of Executive’s employment means a “separation
from service” for purposes of Section 409A of the Code and the applicable
Treasury regulations thereunder.


 


8.                                       Covenants.


 


(a)                                  Confidentiality. 
Executive agrees that Executive will not at any time during Executive’s
employment with the Employer or thereafter, except in performance of Executive’s
duties for and obligations to the Employer hereunder, use or disclose, either
directly or indirectly, any Confidential Information (as hereinafter defined)
of the Employer or its subsidiaries or affiliates that Executive may learn by
reason of his association with the Employer. 
The term “Confidential Information” shall mean any past, present, or
future confidential or sensitive plans, programs, documents, agreements,
internal management reports, financial information, or other material relating
to the business, strategies, services, or activities of the Employer,
including, without limitation, information with respect to the Employer’s
operations, processes, products, inventions, business practices, finances,
principals, vendors, suppliers, customers, potential customers, marketing
methods, costs, prices, contractual relationships, including leases, regulatory
status, compensation paid to employees, or other terms of employment, and trade
secrets, market reports, customer investigations, customer lists, and other
similar information that is proprietary information of the Employer or its
subsidiaries or affiliates; provided, however, the term “Confidential
Information” shall not include any of the above forms of information which has
become public knowledge, unless such Confidential Information became public
knowledge due to an act or acts by Executive or his representative(s) in
violation of this Agreement. 
Notwithstanding the foregoing, Executive may disclose such Confidential
Information when required to do so by a court of competent jurisdiction, by any
governmental agency having supervisory authority over the business of the
Employer or its


 


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subsidiaries or affiliates, as the case may
be, or by any administrative body or legislative body (including a committee
thereof) with jurisdiction to order Executive to divulge, disclose or make
accessible such information; provided, further, that in the event that
Executive is ordered by any such court or other government agency,
administrative body, or legislative body to disclose any Confidential
Information, Executive shall (i) promptly notify the Employer of such
order, (ii) at the reasonable written request of the Employer, diligently
contest such order at the sole expense of the Employer as expenses occur, and (iii) at
the reasonable written request of the Employer, seek to obtain, at the sole
expense of the Employer, such confidential treatment as may be available under
applicable laws for any information disclosed under such order.


 


(b)                                 Non-Compete. 
During the Employment Term and for one (1) year immediately
following a termination of employment for any reason, other than a termination
by Employer without Cause or a resignation by Executive with Good Reason,
Executive shall not, without the prior written consent of the Employer, participate
or engage in, directly or indirectly (as an owner, partner, employee, officer,
director, independent contractor, consultant, advisor or in any other capacity
calling for the rendition of services, advice, or acts of management, operation
or control) any business for an individual or entity whose principal business
involves coal mining or coal marketing in the following regions: Central
Appalachia, Northern Appalachia, Illinois Basin, Western Colorado, and any
other region in which the Employer or any of the Employer’s subsidiaries
conduct business.  Provided, however,
that nothing contained in this Section 8(b) shall prohibit Executive
from engaging in the private practice of law subsequent to Executive’s
termination of employment (including the outside representation of coal
companies), subject in all cases to the confidentiality obligations of Section 8(a).


 


(c)                                  Non-Solicitation. 
During the Employment Term and for two (2) years immediately
following a termination of Employment for any reason, Executive shall not,
without the prior written consent of the Employer, solicit or induce any
then-existing employee of the Employer or any of its subsidiaries to leave
employment with the Employer or any of its subsidiaries, or contact any
then-existing customer or vendor under contract with the Employer or any of its
affiliates or subsidiaries for the purpose of obtaining business similar to
that engaged in, or received (as appropriate), by the Employer.


 


(d)                                 Cooperation. 
Executive agrees that during the Employment Term or following a
termination of employment for any reason, Executive shall, upon reasonable
advance notice, assist and cooperate with the Employer with regard to any
investigation or litigation related to a matter or project in which Executive was
involved during Executive’s employment. 
The Employer shall reimburse Executive for all reasonable and necessary
expenses related to Executive’s services under this Section 8(d) (i.e.,
travel, lodging, meals, telephone, overnight courier) within ten (10) business
days of Executive submitting to the Employer appropriate receipts and expense
statements.


 


(e)                                  Survivability.  The
duties and obligations of Executive pursuant to this Section 8 shall
survive the termination of this Agreement and Executive’s termination of
employment for any reason.


 


(f)                                    Remedies.  Executive acknowledges that the
protections of the Employer set forth in this Section 8 are fair and
reasonable, and that any violation of such protections


 


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would cause serious and irreparable harm and
damage to the Employer and its subsidiaries and affiliates.  Executive agrees that remedies at law for a
breach or threatened breach of the provisions of this Section 8 would be
inadequate and, therefore, the Employer shall be entitled, in addition to any
other available remedies (including money damages), without posting a bond, to
equitable relief in the form of specific performance, temporary restraining
order, temporary or permanent injunction, or any other equitable remedy that
may be then available.


 


(g)                                 Limitation.  The terms of this Section 8
are intended to limit disclosure and competition by the Executive to the
maximum extent permitted by law.  If the
duration, scope, or nature of any limitation or restriction imposed by any
provision of this Section 8 is finally determined by any court or tribunal
of competent jurisdiction to be in excess of what is valid and enforceable
under applicable law, such provision shall be construed to cover only that duration,
scope or activity that is valid and enforceable.  Executive hereby acknowledges that this Section 8
shall be given the construction which renders its provisions valid and
enforceable to the maximum extent, not exceeding its express terms, possible
under applicable law.


 


9.                                       Offering Incentives.  By a
grant separate from this document, the Employer shall grant to Executive
certain stock in the Company upon, and subject to, the closing of the Offering
on terms acceptable to the Company in its sole discretion.  The terms of such grant shall be determined
by the Company, but shall have a value of $1,800,000 upon the closing of the
Offering, based upon the issuance price of stock or units in such Offering.  In addition to the foregoing, in the event an
Offering is completed, the Employer shall pay to the Executive, within [      ]
days after the completion of the offering, a one-time cash bonus of
$250,000.  Nothing herein shall require
the Company to complete any Offering.


 


10.                                 Representations of Executive. 
Executive hereby represents to the Employer that Executive has full
lawful right to enter into this Agreement and carry out Executive’s duties
hereunder, and that performance of Executive’s obligations hereunder will not
constitute a breach of or default under any employment, confidentiality,
non-competition or other agreement. 
Executive further represents to the Employer that Executive is not
listed in the Office of Surface Mining’s Applicant Violator System
database.  Executive shall provide prompt
notice to the Employer of Executive’s first employment subsequent to a
termination of employment.


 


11.                                 Miscellaneous.


 


(a)                                  Satisfaction of Obligations Under Prior
Agreement; Term Bonus.  The Company, Rhino and Executive hereby
acknowledge that this Agreement amends, restates and supersedes the Prior
Agreement.  Notwithstanding the
foregoing, Executive remains entitled to the Term Bonus set out in the Prior
Agreement; provided, however, the full amount of such Term Bonus ($566,666),
subject to proper tax withholdings shall be paid upon by the Employer on November 1,
2008.  If Executive’s employment is
terminated without Cause prior to payment of such Term Bonus, the Term Bonus
shall be pro-rated as provided in the Prior Agreement.


 


(b)                                 Resolution of Disputes.  Except (i) as otherwise provided in Section 11(d) or
(ii) in the event of any action by the Employer to enforce the provisions
of Section 8 of this Agreement, the Employer and Executive agree that any
controversy or claim arising out of or relating to this Agreement or the breach
thereof shall be settled by arbitration administered by


 


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the American Arbitration Association in
accordance with its Commercial Arbitration Rules then in effect.  Venue for any arbitration pursuant to this
Agreement will lie in Lexington, Kentucky. 
Any award entered by the arbitrator(s) shall be final, binding and
nonappealable and judgment may be entered thereon by either party in accordance
with applicable law in any court of competent jurisdiction.  This arbitration provision shall be
specifically enforceable.  Each party
shall be responsible for its own expenses relating to the conduct of the
arbitration (including reasonable attorneys’ fees and expenses) and shall share
the fees of the American Arbitration Association and the arbitrator(s), if
applicable, equally.


 


(c)                                  Governing Law.  This
Agreement will be governed by, and interpreted in accordance with, the laws of
the Commonwealth of Kentucky applicable to agreements made and to be wholly
performed within the Commonwealth of Kentucky, without regard to the conflict
of laws provisions of any jurisdiction which would cause the application of any
law other than that of the Commonwealth of Kentucky.  Executive hereby consents to the jurisdiction
of the state and federal courts of the Commonwealth of Kentucky, including the
Fayette Circuit Court, and hereby waives any objection to venue of any action
brought in such courts.


 


(d)                                 Entire Agreement; Amendments.  This
Agreement contains the entire understanding of the parties with respect to the
employment of Executive by the Employer. 
There are no restrictions, agreements, promises, warranties, covenants
or undertakings between the parties with respect to the subject matter herein
other than those expressly set forth or referred to herein.  This Agreement may not be altered, modified,
or amended except by written instrument signed by the parties hereto.  Sections 7 and 8 hereof shall survive the
termination of Executive’s employment with the Employer, except as otherwise
specifically stated therein.


 


(e)                                  Neutral Interpretation.  This
Agreement constitutes the product of the negotiation of the parties hereto and
the enforcement of this Agreement shall be interpreted in a neutral manner, and
not more strongly for or against any party based upon the source of the
draftsmanship of the Agreement.   Each
party has been provided ample time and opportunity to review and negotiate the
terms of this Agreement and consult with legal counsel regarding the Agreement.


 


(f)                                    No Waiver.  The failure of a party to
insist upon strict adherence to any term of this Agreement on any occasion
shall not be considered a waiver of such party’s rights or deprive such party
of the right thereafter to insist upon strict adherence to that term or any
other term of this Agreement.  No waiver
of any term or condition of this Agreement on the part of the Employer shall be
effective for any purpose whatsoever unless such waiver is in writing and
signed by the Chairman of the Board of the Employer.


 


(g)                                 Severability.  In
the event that any one or more of the provisions of this Agreement shall be or
become invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions of this Agreement shall not be
affected thereby.


 


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(h)                                 Successors.


 


(i)                                     This
Agreement is personal to Executive and shall not be assignable by Executive
otherwise than by will or the laws of descent and distribution.  This Agreement shall inure to the benefit of
and be enforceable by Executive’s legal representatives.


 


(ii)                                  This
Agreement shall inure to the benefit of and be binding upon Rhino, the Company
and their successors and assigns.  The
Company, or Rhino, as applicable, shall require any successor (whether direct
or indirect, by purchase, merger, reorganization, consolidation, acquisition of
property or stock, liquidation, or otherwise) to all or a substantial portion
of its business and/or assets, by agreement in form and substance reasonably
satisfactory to Executive, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform this Agreement if no such succession had taken place.  Regardless of whether such an agreement is
executed, the Company shall cause this Agreement to be binding upon any
successor of the Company or Rhino and such successor shall be deemed the “Employer”
for purposes of this Agreement.


 


(i)                                     Notice.  For the purpose of this
Agreement, notices and all other communications provided for in this Agreement
shall be in writing and shall be deemed to have been duly given if delivered
personally, if delivered by overnight courier service, if sent by facsimile
transmission or if mailed by United States registered mail, return receipt
requested, postage prepaid, addressed to the respective addresses or sent via
facsimile to the respective facsimile numbers, as the case may be, as set forth
below, or to such other address as either party may have furnished to the other
in writing in accordance herewith, except that notice of change of address
shall be effective only upon receipt; provided, however, that (i) notices
sent by personal delivery or overnight courier shall be deemed given when
delivered; (ii) notices sent by facsimile transmission shall be deemed
given upon the sender’s receipt of confirmation of complete transmission, and (iii) notices
sent by United States registered mail shall be deemed given two days after the
date of deposit in the United States mail.


 


If to the Company or Rhino,
to:


 


Rhino Resources, Inc.

411 W. Putnam Ave.

Greenwich, CT 06830

Attn:  Arthur Amron


 


If to Executive, to such
address as shall most currently appear on the records of the Employer.


 


(j)                                     Withholding.  The
Employer may withhold from any amounts payable under this Agreement such Taxes
(as defined in Section 12(l)) as may be required to be withheld pursuant
to any applicable law or regulation.


 


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(k)                                  Counterparts.  This
Agreement may be signed in counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument.


 


(l)                                     Code Section 409A.  It is
intended that any amounts payable under this Agreement and the Employer’s and
Executive’s exercise of authority or discretion hereunder shall comply with
Code Section 409A (including the Treasury regulations and other published
guidance relating thereto) so as not to subject Executive to the payment of any
interest or additional tax imposed under Code Section 409A.  To the extent any amount payable under this
Agreement would trigger the additional tax imposed by Code Section 409A,
the Agreement shall be modified to avoid such additional tax.


 


(m)                               Confidential Terms. 
Executive agrees to maintain as confidential the terms and conditions of
this Agreement, provided however Executive may disclose the terms of this
Agreement to his legal counsel, and accountant or tax preparer, or as may be otherwise
required by law.


 


(n)                                 Waiver of Jury Trial. 
EXECUTIVE HEREBY VOLUNTARILY AND IRREVOCABLY WAIVES THE RIGHT TO A TRIAL
BY JURY WITH REGARD TO ANY ACTION ARISING UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR THE EMPLOYMENT OF THE EXECUTIVE BY THE EMPLOYER.


 


12.                                 Definitions.


 


(a)                                  Accrued Obligations.  “Accrued
Obligations” has the meaning set forth in Section 7(a).


 


(b)                                 Base Salary.   “Base
Salary” has the meaning set forth in Section 3.


 


(c)                                  Board.  “Board” has the meaning set
forth in Section 2.


 


(d)                                 Cause.  “Cause” for termination by the
Employer of Executive’s employment with the Employer means any of the
following:


 


(i)                                     the willful and continued failure of
Executive to perform substantially his duties (other than any such failure
resulting from incapacity due to disability), after a written demand for
substantial performance is delivered to Executive by the Chairman of the Board,
or Manager of Rhino, as applicable, which specifically identifies the manner in
which the Board or Manager believes that Executive has not substantially
performed his duties;


 


(ii)                                  Executive’s conviction of, or plea of guilty
or no contest to (A) a felony or (B) a misdemeanor involving
dishonesty or moral turpitude; or


 


(iii)                               the willful engaging by Executive in any illegal conduct, gross
misconduct, or other material breach of this Agreement which is materially and
demonstrably injurious to the business or reputation of the Employer.


 


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For
purposes of this definition, no act or failure to act, on the part of
Executive, shall be considered “willful” unless it is done, or omitted to be
done, by Executive in bad faith or without reasonable belief that Executive’s
action or omission was in the best interests of the Employer. Any act, or
failure to act, based upon specific authority given pursuant to a resolution
duly adopted by the Board or upon instructions of the Chairman of the Board or
the Manager of Rhino, or based upon the advice of counsel of the Employer which
Executive honestly believes is within such counsel’s competence shall be
conclusively presumed to be done, or omitted to be done, by Executive in good
faith and in the best interests of the Employer.  The Employer shall give written notice to
Executive of the termination for Cause. 
Such notice shall state in detail the particular act or acts of the
failure or failures to act that constitute the grounds on which the Cause
termination is based and such notice shall be given within six (6) months
of the occurrence of, or, if later, the Employer’s actual knowledge of, the act
or acts or the failure or failures to act which constitute the grounds for
Cause.  Executive shall have thirty (30)
days upon receipt of the notice in which to cure such conduct, to the extent such
cure is possible and reasonable.


 


(e)                                  Code.  “Code” means the Internal
Revenue Code of 1986, as amended from time to time.


 


(f)                                    Company.   “Company” means Rhino
Resources, Inc., a Delaware corporation.


 


(g)                                 Disability.   “Disability” means the
inability of Executive to perform his normal duties as a result of any physical
or mental injury or ailment for (i) any consecutive ninety (90)-day period
or (ii) any one hundred eighty (180) days (whether or not consecutive)
during any three hundred sixty five (365) calendar day period.


 


(h)                                 Employment Term.   “Employment
Term” has the meaning set forth in Section 1.


 


(i)                                     Executive.   “Executive” means Nicholas R.
Glancy.


 


(j)                                     Good Reason.  “Good
Reason” for termination by Executive of Executive’s employment means the
occurrence (without Executive’s express written consent) of any one of the
following acts by the Employer or failures by Employer to act:


 


(i)                                     the assignment to Executive of any duties
inconsistent in any material respect with those of the office to which
Executive is assigned pursuant to Section 2 hereof (including status,
office, title and reporting requirements), or any other diminution in any
material respect in such position, authority, duties or responsibilities unless
agreed to by Executive;


 


(ii)                                  a reduction in Base Salary;


 


(iii)                               a reduction in Executive’s welfare benefits plans, qualified retirement
plan, or paid time off benefit; or


 


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(iv)                              any purported termination of Executive’s employment under this
Agreement by the Employer other than for Cause or Disability.


 


Prior
to Executive’s right to terminate this Agreement, he shall give written notice
to the Employer of his intention to terminate his employment on account of Good
Reason.  Such notice shall state in
detail the particular act or acts of the failure or failures to act that
constitute the grounds on which Executive’s Good Reason termination is based
and such notice shall be given within six (6) months of the occurrence of
the act or acts or the failure or failures to act which constitute the grounds
for Good Reason.  The Employer shall have
thirty (30) days upon receipt of the notice in which to cure such conduct, to
the extent such cure is possible and reasonable.


 


(k)                                  Manager.  “Manager” means Wexford
Capital LLC, the Manager of Rhino.


 


(l)                                     Taxes.  “Taxes” mean the incremental
United States federal, state and local income, excise and other taxes payable
by Executive with respect to any applicable item of income.


 


[signature page to follow]


 


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IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the
dates written below.


 


 


	
  EXECUTIVE:

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Nicholas
  R. Glancy

  
	
   

  
	
  Date
  signed:

  	
   

  	
   

  
	
   

  
	
   

  
	
  RHINO RESOURCES, INC.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  
	
  Date
  signed:

  	
   

  	
   

  
	
   

  
	
   

  
	
  RHINO ENERGY LLC

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  
	
  Date
  Signed:

  	
   

  	
   

  
						



 


13

















 


	
  RHINO GP, LLC

  
	
   

  
	
  For the sole purpose set forth in Section 1 hereof

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  
	
  Date
  Signed:

  	
   

  	
   

  
						



 


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