Unassociated Document


    
      Exhibit
        10.1 

      EMPLOYMENT
        AGREEMENT

       

      THIS
        AGREEMENT
        (the
        "Agreement") dated July 13, 2005 by and between Touchstone Resources USA,
        Inc.,
        a Delaware corporation (the "Company"), and Roger Abel (the
        "Executive").

      


      WITNESSETH:

       

      WHEREAS,
        the
        Company desires to secure the employment of the Executive in accordance with
        the
        provisions of this Agreement; and

      


      WHEREAS,
        the
        Executive desires and is willing to be employed by the Company in accordance
        herewith.

      


      NOW
        THEREFORE,
        in
        consideration of the premises and mutual covenants contained herein, and
        other
        good and valuable consideration, the receipt and sufficiency of which is
        hereby
        acknowledged, and intending to be legally bound hereby, the parties hereto
        agree
        as follows:

      


      1. Employment Term.
        Executive shall be employed by the Company for a term commencing on August
        15,
        2005 and expiring on August 14, 2007 (the "Initial Term"), or until the
        employment relationship is terminated pursuant to Section 4 hereof. Upon
        the
        expiration of the Initial Term, this Agreement will continue in full force
        and
        effect until terminated in accordance with the provisions of Section 4 hereof
        or
        terminated by Company or Executive upon written notice delivered not less
        than
        ninety (90) days prior to the proposed termination date. 

      


      
        
          2.
            Duties;
            Dedicated
            Services and Best Efforts.

        

      

      


      (a)  Duties.
        Executive shall hold the position of Chief Executive Officer and shall have
        such
        responsibilities, duties and authority consistent with such position as may
        from
        time to time be determined by the Company’s board of directors.

      


      (b) Dedicated
        Services and Best Efforts.
        The
        Executive agrees to devote his best efforts, energies and skill to the faithful,
        competent and diligent discharge of the duties and responsibilities attributable
        to his position, and to this end, will devote substantially his fulltime
        attention to the business and affairs of the Company.  The
        Executive also agrees that he shall not take personal advantage of any business
        opportunities that arise during his employment that may benefit the Company.
        All
        material facts regarding such opportunities must be promptly reported to
        the
        Company's board of directors for its consideration. The
        Company acknowledges and agrees that the Executive has certain ongoing business
        obligations, all of which are set forth in Schedule 2(b) hereto, and that
        Executive shall be permitted to fulfill such obligations provided that such
        activities do not materially interfere with the Executive’s performance of his
        duties and obligations hereunder.

      


      (c) Board
        of Directors.
        Concurrent with the commencement of his employment hereunder, Executive shall
        be
        appointed to serve on the board of directors of the Company as its Chairman.
        So
        long as Executive is employed by the Company as its Chief Executive Officer
        pursuant to this Agreement, the Company shall nominate Executive for election
        as
        a director of the Company at every annual or special meeting of stockholders
        of
        the Company held for the purpose of electing directors. 

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      3. Compensation
        and Benefits.
        On and
        after the commencement of Executive's employment, the Executive shall receive,
        for all services rendered to the Company hereunder, the following:

      


      (a) Base
        Salary.
        The
        Executive shall be paid a base annual salary equal to Five Hundred Eighty
        Thousand Dollars ($580,000).
        The Executive's annual base salary shall be payable in equal installments
        in
        accordance with the Company's general salary payment policies but no less
        frequently than monthly. 

      


      (b) Incentive
        Compensation.
        The
        Executive may be eligible to receive awards under the Company's incentive
        compensation plans, including without limitation, any stock option plans,
        applicable to high-level executives of the Company, in accordance with the
        terms
        thereof and on a basis commensurate with his position, responsibilities and
        performance. Any such compensation shall be determined by an independent
        compensation committee of the board of directors of the Company in its sole
        discretion. Nothing herein shall affect any rights or obligations of the
        Executive or the Company created pursuant to any stock option plan or stock
        option agreement between the parties hereto. 

      


      (c) Stock
        Options.
        Upon
        execution of this Agreement, the Company shall deliver to the Employee an
        option
        to acquire 4,876,540 shares of the Company’s common stock, $0.001 par value per
        share (the “Common Stock”), in the form attached hereto as Exhibit
        A.
        

      


      (d) Vacation.
        The
        Executive shall be eligible for five (5) weeks of paid vacation each year
        of his
        employment hereunder. The Executive shall be permitted to carry over and
        accrue
        unused vacation time for a period of up to two years. Except as required
        by
        applicable law, in no event shall the Executive be entitled to receive any
        cash
        compensation in lieu of unused vacation time. 

      


      (e) Expenses.
        Subject
        to and in accordance with the Company's policies and procedures, and, upon
        presentation of itemized accounts, the Executive shall be reimbursed by the
        Company for reasonable and necessary business-related expenses, which expenses
        are incurred by the Executive on behalf of the Company.

      


      (f) Deductions
        from Salary and Benefits.
        The
        Company will withhold from any salary or benefits payable to the Executive
        all
        federal, state, local, and other taxes and other amounts as required by law,
        rule or regulation.

      


      4. Termination.
        This
        Agreement may be terminated by either the Executive or the Company at any
        time,
        subject only to the provisions of this Section 4.

      


      (a) Voluntary
        Termination.
        If
        Executive terminates his own employment, the Company shall be released from
        any
        and all further obligations under this Agreement, except that the Company
        shall
        be obligated to pay Executive his salary and benefits owing to Executive
        through
        the effective date of termination. Executive shall also be entitled to any
        reimbursement owed in accordance with Section 3(e). Executive's obligations
        under Sections 5, 7 and 8 hereof and shall survive the termination of
        Executive's employment, and Executive shall remain bound thereby. 

       

      
        
          
          

        

        
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      (b) Death.
        This
        Agreement shall terminate on the date of the Executive's death, in which
        event
        salary, benefits, and reimbursable expenses owing to the Executive through
        the
        date of the Executive's death shall be paid to his estate.

      


      (c) Disability.
        Executive’s employment hereunder shall automatically terminate in the event
        Executive shall have become Disabled (as hereinafter defined). For the purposes
        of this Agreement, the term “Disabled” shall mean the occurrence of any physical
        or mental illness, condition or incapacity which causes Executive to be unable
        to perform substantially all of the duties and services required of him under
        this Agreement for a period of one hundred twenty (120) days during any
        twelve-month period. In case of such termination, the Executive shall be
        entitled to receive salary, benefits, and reimbursable expenses owing to
        the
        Executive through the date of termination and the Company shall have no further
        obligation or liability to the Executive. The Executive's obligations under
        Sections 5, 7 and 8 hereof shall survive the termination of Executive's
        employment, and Executive shall remain bound thereby.

      


      (d) Termination
        by Employer for Cause.
        This
        Agreement may be terminated by the Company for "Cause" at any time. Upon
        such
        termination for “Cause”, the Company shall be released from any and all further
        obligations under this Agreement, except that the Company shall be obligated
        to
        pay the Executive his salary and benefits owing to the Executive through
        the
        effective date of such termination. The Executive shall also be entitled
        to any
        reimbursement owed in accordance with Section 3(e). The Executive's obligations
        under Sections 5, 7 and 8 hereof shall survive the termination of Executive's
        employment, and Executive shall remain bound thereby.

      


      Cause.
        "Cause"
        for Termination shall mean the following conduct of the Executive: 

      


      (i) Breach
        of
        any material provision of this Agreement by the Executive if not cured within
        two (2) weeks after receiving written notice thereof;

      


      (ii) Misappropriating
        funds or property of the Company; any attempt to obtain any personal profit
        from
        any transaction in which the Executive has an interest that is adverse to
        the
        Company; or any breach of the duty of loyalty and fidelity to the Company;
        

      


      (iii) Conviction
        of a felony or plea of guilty or nolo
        contendere
        to a
        felony;

      


      (iv) Any
        act
        of dishonesty or moral turpitude by the Executive that causes the Company
        to be
        in violation of governmental regulations and that subjects the Company either
        to
        sanctions by governmental authority or to civil liability to its employees
        or
        third parties; or

      


      (v) Disclosure
        or use of confidential information of the Company, other than as specifically
        authorized and required in the performance of the Executive's
        duties.

      


      
        
          
          

        

        
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      (e) Termination
        by Company Without Cause.
        Upon
        termination of this Agreement by the Company for any reason other than Death,
        Disability or for Cause during the Initial Term: (i) the Company shall continue
        to be obligated to pay to the Executive his base salary (as though no
        termination occurred) for a severance period (the “Severance Period”) of one
        year, if the termination occurred during Executive’s first year of employment,
        or six months, if the termination occurred during Executive’s second year of
        employment, (ii) the Executive shall continue to vest in the options granted
        to
        him under Section 3(d) of this Agreement during such Severance Period as
        though
        he continued to remain employed by the Company during such Severance Period;
        and
        (iii) Executive shall, in return therefore and as a condition thereto, comply
        with his obligations under Section 8 hereof and execute a general release
        of all
        claims against the Company, its affiliates, subsidiaries, and officers,
        directors and agents in a form acceptable to the Company. The Executive's
        obligations under Sections 5, 7 and 8 hereof and shall survive the termination
        of the Executive's employment, regardless of the circumstances of any such
        termination, and the Executive shall remain bound thereby. 

      


      5. Business Opportunities.

      


      (a) Business
        Opportunities.
        The
        Executive agrees that during the period of his employment hereunder, the
        Executive will not take personal advantage of any business opportunities
        that
        are similar or substantially similar to the business of the Company. In
        addition, all material facts regarding any such business opportunities must
        be
        promptly and fully disclosed by the Executive to the board of directors as
        soon
        as the Executive becomes aware of any opportunity, and in no event later
        than
        forty-eight (48) hours after learning of such opportunity. 

       

      (b) Non-Solicitation.
        The
        Executive agrees that during the period of employment hereunder and for the
        Severance Period (provided that if Executive receives a lump sum payment,
        the
        number of months’ base salary represented by such payment), the Executive will
        not request or otherwise attempt to induce or influence, directly or indirectly,
        any present customer, distributor or supplier, or Prospective Customer,
        distributor or supplier, of the Company, or other persons sharing a business
        relationship with the Company to cancel, to limit or postpone their business
        with the Company, or otherwise take action which might be to the material
        disadvantage of the Company. The Executive agrees that during the period
        of
        employment hereunder and for and for the Severance Period (provided that
        if
        Executive receives a lump sum payment, the number of months’ base salary
        represented by such payment), Executive will not hire or solicit for employment,
        directly or indirectly, or induce or actively attempt to influence, hire
        or
        solicit, any employee, agent, officer, director, contractor, consultant or
        other
        business associate of the Company to terminate his or her employment or
        discontinue such person's consultant, contractor or other business association
        with the Company. 

       

      
        
          
          

        

        
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      (c) Non-Competition.
        The
        Employee agrees that during the period of his employment hereunder and for
        the
        Severance Period (provided
        that if Executive receives a lump sum payment, the number of months’ base salary
        represented by such payment), he will not directly or indirectly, as owner,
        partner, joint venture, stockholder, employee, broker, agent, principal,
        trustee, corporate officer or director, licensor or in any capacity whatsoever
        engage in, become financially interested in, be employed by, render consulting
        services to, or have any connection with, any business which is competitive
        with
        the business activities of the Company or its subsidiaries ("Competitive
        Business"), in any geographic area where, during the time of his employment,
        the
        business of the Company or any of its subsidiaries is being or had been
        conducted in any manner whatsoever; provided,
        however,
        that
        the Executive may own any securities of any corporation which is engaged
        in such
        business and is publicly owned and traded but in an amount not to exceed
        at any
        one time two percent of any class of stock or securities of such
        company.

      


      (d) Scope.
        The
        parties hereto agree that, due to the nature of the Company's business, the
        duration and scope of the non-solicitation and non-competition provisions
        set
        forth above are reasonable. In the event that any court determines that the
        duration or the geographic scope, or both, are unreasonable and that such
        provisions are to that extent unenforceable, the parties hereto agree that
        such
        provisions shall remain in full force and effect for the greatest time period
        and in the greatest area that would not render it unenforceable. The Executive
        agrees that damages are an inadequate remedy for any breach of such provisions
        and that the Company, shall, whether or not it is pursuing any potential
        remedies at law, be entitled to seek in any court of competent jurisdiction,
        equitable relief in the form of preliminary and permanent injunctions without
        bond or other security upon any actual or threatened breach of either of
        these
        competition provisions. If the Executive shall violate this Section 5, the
        duration of this Section 5 automatically shall be extended as against the
        Executive for a period equal to the period during which the Executive shall
        have
        been in violation of this Section 5. The covenants contained in this Section
        5
        are deemed to be material and the Company is entering into this Agreement
        relying on such covenants.

      


      6. Representations and Warranties of the Executive.
        The
        Executive, hereby represents and warrants to the Company as follows: (i)
        The
        Executive has the legal capacity and unrestricted right to execute and deliver
        this Agreement and to perform all of his obligations hereunder; (ii) the
        execution and delivery of this Agreement by the Executive and the performance
        of
        his obligations hereunder will not violate or be in conflict with any fiduciary
        or other duty, instrument, agreement, document, arrangement, or other
        understanding to which Executive is a party or by which he is or may be bound
        or
        subject; and (iii) except as set forth in Exhibit B attached hereto, the
        Executive is not a party to any instrument, agreement, document, arrangement,
        including, but not limited to, invention assignment agreement, confidential
        information agreement, non-competition agreement, non-solicitation agreement,
        or
        other understanding with any person (other than the Company) requiring or
        restricting the use or disclosure of any confidential information or the
        provision of any employment, consulting or other services. 

      


      7. Disclosure
        of Innovations; Assignment of Ownership of Innovations; Protection of
        Confidential Information.
        Employee
        hereby represents and warrants to the Company that Employee understands that
        the
        Company’s business consists of oil and gas exploration and development and that
        Executive may have access to or acquire information with respect to Confidential
        Information (as defined below), including software, processes and methods,
        development tools, scientific, technical and/or business
        innovations.

       

      
        
          
          

        

        
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      (a)  Disclosure
        of Innovations.
        Executive agrees to disclose in writing to the Company all inventions,
        improvements and other innovations of any kind materially relevant to the
        Company’s present business that Executive may make, conceive, develop or reduce
        to practice, alone or jointly with others, during the term of Executive’s
        employment with the Company, whether or not such inventions, improvements
        or
        other innovations are related to and grow out of Executive ’s work for the
        Company and whether or not they are eligible for patent, copyright, trademark,
        trade secret or other legal protection (“Innovations”). 

       

      (b)  Assignment
        of Ownership of Innovations.
        Executive agrees that all Innovations will be the sole and exclusive property
        of
        the Company and Executive hereby assigns all of Executive’s rights, title or
        interest in the Innovations and in all related patents, copyrights, trademarks,
        trade secrets, rights of priority and other proprietary rights to the Company.
        At the Company’s request and expense, during and after the period of Executive’s
        employment with the Company, Executive will assist and cooperate with the
        Company in all respects and will execute documents, and, subject to Executive’s
        reasonable availability, give testimony and take further acts requested by
        the
        Company to obtain, maintain, perfect and enforce for the Company patent,
        copyright, trademark, trade secret and other legal protection for the
        Innovations. Executive hereby appoints an authorized officer of the Company
        as
        Executive’s attorney-in-fact to execute documents on his behalf for this
        purpose.

       

      (c) Protection
        of Confidential Information of the Company.
        Executive understands that Executive's work as an employee of the Company
        creates a relationship of trust and confidence between Executive and the
        Company. During and after the period of Executive's employment with the Company,
        Executive will not use or disclose or allow anyone else to use or disclose
        any
        "Confidential Information" (as defined below) relating to the Company, its
        products, services, consultants, suppliers or customers except as may be
        necessary in the performance of Executive's duties hereunder. "Confidential
        Information" shall include, but not be limited to, information consisting
        of
research
        and development, patents, trademarks and copyrights and applications thereto,
        technical information, computer programs, software, methodologies, innovations,
        software tools, know-how, knowledge, designs, drawings, specifications,
        concepts, data, reports, processes, techniques, documentation, pricing,
        marketing plans, customer and prospect lists, trade secrets, financial
        information, salaries, business affairs, suppliers,
        profits, markets, sales strategies, forecasts, employment information and
        any
        other information not available to the general public, whether written or
        oral,
        which Executive knows or has reason to know the Company would like to treat
        as
        confidential for any purpose, such as maintaining a competitive advantage
        or
        avoiding undesirable publicity. Executive will keep Confidential Information
        secret and will not allow any unauthorized use of the same, whether or not
        any
        document containing it is marked as confidential. These restrictions, however,
        will not apply to Confidential Information that has become known to the public
        generally through no fault or breach of Executive's or that the Company
        regularly gives to third parties without restriction on use or disclosure.
        

       

      8. Company Property.
        All
        records, files, lists, including computer generated lists, drawings, documents,
        software, documents, equipment, models, binaries, object modules, libraries,
        source code and similar items relating to the Company's business that the
        Executive shall prepare or receive from the Company and all Confidential
        Information shall remain the Company's sole and exclusive property ("Company
        Business Property"). Upon termination of this Agreement, the Executive shall
        promptly return to the Company all property of the Company in his possession,
        including Company Business Property. The Executive further represents that
        he
        will not copy or cause to be copied, print out, or cause to be printed out
        any
        Company Business Property other than as specifically authorized and required
        in
        the performance of the Executive's duties. The Executive additionally represents
        that, upon termination of his employment with the Company, he will
        not
        retain in his possession any such Company Business Property.

      


      
        
          
          

        

        
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      9. Cooperation.
        The
        Executive and Company agree that during the term of Executive’s employment they
        shall, at the request of the other party, render all assistance and perform
        all
        lawful acts that each party considers necessary or advisable in connection
        with
        any litigation involving either party or any director, officer, employee,
        shareholder, agent, representative, consultant, client, or vendor of the
        Company.

      


      10. Attorney’s
        Fees.
        In the
        event an arbitration, suit or action is brought by the Company or Executive
        under this Agreement to enforce any of its terms, or in any appeal there
        from,
        the non-prevailing party shall pay or reimburse the prevailing party for
        all
        reasonable attorneys fees and other expenses incurred in connection
        therewith. 

      


      11. Choice
        of Law and Jurisdiction.
        This
        Agreement shall be construed, interpreted and the rights of the parties
        determined in accordance with the laws of the State of Texas. Each of the
        parties hereto hereby irrevocably consents and submits to the exclusive
        jurisdiction of the state courts of the State of Texas, and of the United
        States
        District Court located in Houston, Texas in connection with any suit, action,
        or
        other proceeding concerning this Agreement or enforcement of Sections 5,
        7 and 8
        hereof. The Executive waives and agrees not to assert any defense that the
        court
        lacks jurisdiction, venue is improper, inconvenient forum or otherwise. The
        Executive waives the right to a jury trial and agrees to accept service of
        process by certified mail at the Executive's last known address.

      


      12. Successors
        and Assigns.
        Neither
        this Agreement, nor any of the Executive's rights, powers, duties or obligations
        hereunder, may be assigned by the Executive. This Agreement shall be binding
        upon and inure to the benefit of the Company and its successors and assigns.
        

      


      13. Waiver.
        Any
        waiver or consent from the Company with respect to any term or provision
        of this
        Agreement or any other aspect of the Executive's conduct or employment shall
        be
        effective only in the specific instance and for the specific purpose for
        which
        given and shall not be deemed, regardless of frequency given, to be a further
        or
        continuing waiver or consent. The failure or delay of the Company at any
        time or
        times to require performance of, or to exercise any of its powers, rights
        or
        remedies with respect to any term or provision of this Agreement or any other
        aspect of the Executive's conduct or employment in no manner (except as
        otherwise expressly provided herein) shall affect the Company's right at
        a later
        time to enforce any such term or provision.

      


      14. Notices.
        All
        notices, requests, demands, and other communications hereunder must be in
        writing and shall be deemed to have been duly given if delivered by hand
        or
        mailed within the continental United States by first class, registered mail,
        return receipt requested, postage and registry fees prepaid, to the applicable
        party and addressed as follows:

      


      
        
          
          

        

        
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      (a) If
        to the
        Company:

       

      Touchstone
        Resources USA, Inc.

      111
        Presidential Boulevard

      Suite
        165

      Bala
        Cynwyd, PA 19004

      Attn:
        Board of Directors

       

      With
        a
        copy to:

      


      Duane
        Morris LLP

      240
        Princeton 

      Hamilton,
        NJ 08619-2304

      Attn:
        Vincent A. Vietti, Esquire

      


      (b) If
        to the
        Executive:

       

      Roger
        Abel
8045
        Chalk Knoll Dr.
Austin,
        TX 78735

       

      15. Construction
        of Agreement.

      


      (a) Severability.
        In the
        event that any one or more of the provisions of this Agreement shall be held
        to
        be invalid, illegal or unenforceable, the validity, legality or enforceability
        of the remaining provisions shall not in any way be affected or impaired
        thereby.

      


      (b) Headings.
        The
        descriptive headings of the several paragraphs of this Agreement are inserted
        for convenience of reference only and shall not constitute a part of this
        Agreement.

      


      16. Entire
        Agreement and Amendments.
        This
        Agreement, including all Exhibits which shall form parts hereof, contains
        the
        entire agreement of the parties concerning the Executive's employment and
        all
        promises, representations, understandings, arrangements and prior agreements
        on
        such subject are merged herein and superseded hereby. The provisions of this
        Agreement may not be amended, modified, repealed, waived, extended or discharged
        except by an agreement in writing signed by the party against whom enforcement
        of any amendment, modification, repeal, waiver, extension or discharge is
        sought. No person acting other than pursuant to a resolution of the board
        of
        directors of the Company shall have authority on behalf of the Company to
        agree
        to amend, modify, repeal, waive, extend or discharge any provision of this
        Agreement or anything in reference thereto or to exercise any of the Company's
        rights to terminate or to fail to extend this Agreement.

      


      17.  Survival.
        The
        Executive's obligations under Paragraphs 5, 7, and 8 shall survive and continue
        pursuant to the terms and conditions of this Agreement following specific
        termination.

      


      18.  Understanding.
        The
        Executive represents and agrees that he fully understands his rights to discuss
        all aspects of this Agreement with his private attorney, that to the extent
        he
        desires, he availed himself of this right, that he has carefully read and
        fully
        understands all of the provisions of this Agreement, that he is competent
        to
        execute this Agreement, that his decision to execute this Agreement has not
        been
        obtained by any duress and that he freely and voluntarily enters into this
        Agreement, and that he has read this document in its entirety and fully
        understands the meaning, intent, and consequences of this
        Agreement.

      


      
        
          
          

        

        
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      19. Counterparts.
        This
        Agreement may be executed in counterpart, each of which shall be deemed an
        original, and both of which together shall constitute one and the same
        instrument.


      20. Injunctive Relief.
        The
        Executive and Company hereby agree and acknowledge that in the event of a
        breach
        or threatened breach of this Agreement by the Executive, the Company may
        suffer
        irreparable harm and monetary damages alone would not adequately compensate
        the
        Company. Accordingly, the Company will be entitled to injunctive relief to
        enforce this Agreement.

      
 

      IN
        WITNESS WHEREOF,
        the
        Company and Executive have caused this Agreement to be executed on and as
        of the
        day and year set forth above.

      


      TOUCHSTONE
        RESOURCES USA, INC.

      


      


      By:
        /s/
        Stephen P. Harrington  

      Name:
        Stephen P. Harrington 

      Title:
        Chief Executive Officer

      


      EXECUTIVE   

      


      /s/
        Roger Abel      

      Roger
        Abel

      



      
        
          
          

        

        
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