CHANGE OF CONTROL
EMPLOYMENT AGREEMENT
AGREEMENT by and between Offshore
Logistics, Inc., a Delaware corporation (the
"Company") and Xxxxxx X. Small (the "Executive"),
dated as of the lst day of August, 1997.
The Board of Directors of the Company
(the "Board"), has determined that it is in the
best interests of the Company and its stockholders
to assure that the Company will have the continued
dedication of the Executive, notwithstanding the
possibility, threat or occurrence of a Change of
Control (as defined below) of the Company. The
Board believes it is imperative to diminish the
inevitable distraction of the Executive by virtue
of the personal uncertainties and risks created by
a pending or threatened Change of Control and to
encourage the Executive's full attention and
dedication to the Company currently and in the
event of any threatened or pending Change of
Control, and to provide the Executive with
compensation and benefits arrangements upon a
Change of Control which ensure that the
compensation and benefits expectations of the
Executive will be satisfied and which are
competitive with those of other corporations.
Therefore, in order to accomplish these
objectives, the Board has caused the Company to
enter into this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS
FOLLOWS:
1. Certain Definitions. (a) The
"Effective Date" shall mean the first date during
the Change of Control Period (as defined in
Section 1(b)) on which a Change of Control (as
defined in Section 2) occurs. Anything in this
Agreement to the contrary notwithstanding, if a
Change of Control occurs and if the Executive's
employment with the Company is terminated prior to
the date on which the Change of Control occurs,
and if it is reasonably demonstrated by the
Executive that such termination of employment (i)
was at the request of a third party who has taken
steps reasonably calculated to effect a Change of
Control or (ii) otherwise arose in connection with
or anticipation of a Change of Control, then for
all purposes of this Agreement the "Effective
Date" shall mean the date immediately prior to the
date of such termination of employment.
(b) The "Change of Control Period" shall
mean the period commencing on the date hereof and
ending on the third anniversary of the date
hereof; provided, however, that commencing on the
date one year after the date hereof, and on each
annual anniversary of such date (such date and
each annual anniversary thereof shall be
hereinafter referred to as the "Renewal Date"),
unless previously terminated, the Change of
Control Period shall be automatically extended so
as to terminate three years from such Renewal
Date, unless at least 60 days prior to the Renewal
Date the Company shall give notice to the
Executive that the Change of Control Period shall
not be so extended.
2. Change of Control. For the purpose
of this Agreement, a "Change of Control" shall
mean:
(a) The acquisition by any individual,
entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Ex-
change Act")) (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 20% or
more of either (i) the then outstanding shares
of common stock of the Company (the "Out-
standing Company Common Stock") or (ii) the
combined voting power of the then outstanding
voting securities of the Company entitled to
vote generally in the election of directors
(the "Outstanding Company Voting Securities");
provided, however, that for purposes of this
subsection (a), the following acquisitions
shall not constitute a Change of Control: (i)
any acquisition directly from the Company,
(ii) any acquisition by the Company, (iii) any
acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the
Company or any corporation controlled by the
Company or (iv) any acquisition by any
corporation pursuant to a transaction which
complies with clauses (i), (ii) and (iii) of
subsection (c) of this Section 2; or
(b) Individuals who, as of the date
hereof, constitute the Board (the "Incumbent
Board") cease for any reason to constitute at
least a majority of the Board; provided,
however, that any individual becoming a
director subsequent to the date hereof whose
election, or nomination for election by the
Company's stockholders, was approved by a vote
of at least a majority of the directors then
comprising the Incumbent Board shall be
considered as though such individual were a
member of the Incumbent Board, but excluding,
for this purpose, any such individual whose
initial assumption of office occurs as a
result of an actual or threatened election
contest with respect to the election or
removal of directors or other actual or
threatened solicitation of proxies or consents
by or on behalf of a Person other than the
Board; or
(c) Consummation by the Company of a
reorganization, merger or consolidation or
sale or other disposition of all or
substantially all of the assets of the Company
or the acquisition of assets of another
corporation (a "Business Combination"), in
each case, unless, following such Business
Combination, (i) all or substantially all of
the individuals and entities who were the
beneficial owners, respectively, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities
immediately prior to such Business Combination
beneficially own, directly or indirectly, more
than 50.1% of, respectively, the then out-
standing shares of common stock and the
combined voting power of the then outstanding
voting securities entitled to vote generally
in the election of directors, as the case may
be, of the corporation resulting from such
Business Combination (including, without
limitation, a corporation which as a result of
such transaction owns the Company or all or
substantially all of the Company's assets
either directly or through one or more
subsidiaries) in substantially the same pro-
portions as their ownership, immediately prior
to such Business Combination of the Outstand-
ing Company Common Stock and Outstanding
Company Voting Securities, as the case may be,
(ii) no Person (excluding any employee benefit
plan (or related trust) of the Company or such
corporation resulting from such Business Com-
bination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the
then outstanding shares of common stock of the
corporation resulting from such Business
Combination or the combined voting power of
the then outstanding voting securities of such
corporation except to the extent that such
ownership existed prior to the Business
Combination and (iii) at least a majority of
the members of the board of directors of the
corporation resulting from such Business
Combination were members of the Incumbent
Board at the time of the execution of the
initial agreement, or of the action of the
Board, providing for such Business
Combination; or
(d) Approval by the stockholders of the
Company of a complete liquidation or
dissolution of the Company.
3. Employment Period. The Company
hereby agrees to continue the Executive in its
employ, and the Executive hereby agrees to remain
in the employ of the Company subject to the terms
and conditions of this Agreement, for the period
commencing on the Effective Date and ending on the
third anniversary of such date (the "Employment
Period").
4. Terms of Employment. (a) Position
and Duties. (i) During the Employment Period,
(A) the Executive's position (including status,
offices, titles and reporting requirements),
authority, duties and responsibilities shall be at
least commensurate in all material respects with
the most significant of those held, exercised and
assigned to the Executive at any time during the
120-day period immediately preceding the Effective
Date and (B) the Executive's services shall be
performed at the location where the Executive was
employed immediately preceding the Effective Date
or any office or location less than 35 miles from
such location.
(ii) During the Employment Period,
and excluding any periods of vacation and sick
leave to which the Executive is entitled, the
Executive agrees to devote reasonable attention
and time during normal business hours to the
business and affairs of the Company and, to the
extent necessary to discharge the responsibilities
assigned to the Executive hereunder, to use the
Executive's reasonable best efforts to perform
faithfully and efficiently such responsibilities.
During the Employment Period it shall not be a
violation of this Agreement for the Executive to
(A) serve on corporate, civic or charitable
boards or committees, (B) deliver lectures,
fulfill speaking engagements or teach at edu-
cational institutions and (C) manage personal
investments, so long as such activities do not
significantly interfere with the performance of
the Executive's responsibilities as an employee of
the Company in accordance with this Agreement. It
is expressly understood and agreed that to the
extent that any such activities have been
conducted by the Executive prior to the Effective
Date, the continued conduct of such activities (or
the conduct of activities similar in nature and
scope thereto) subsequent to the Effective Date
shall not thereafter be deemed to interfere with
the performance of the Executive's
responsibilities to the Company.
(b) Compensation. (i) Base Salary.
During the Employment Period, the Executive shall
receive an annual base salary ("Annual Base
Salary"), which shall be paid at a monthly rate,
at least equal to twelve times the highest monthly
base salary paid or payable, including any base
salary which has been earned but deferred, to the
Executive by the Company and its affiliated
companies in respect of the twelve-month period
immediately preceding the month in which the
Effective Date occurs. During the Employment
Period, the Annual Base Salary shall be reviewed
no more than 12 months after the last salary
increase awarded to the Executive prior to the
Effective Date and thereafter at least annually.
Any increase in Annual Base Salary shall not
serve to limit or reduce any other obligation to
the Executive under this Agreement. Annual Base
Salary shall not be reduced after any such
increase and the term Annual Base Salary as
utilized in this Agreement shall refer to Annual
Base Salary as so increased. As used in this
Agreement, the term "affiliated companies" shall
include any company controlled by, controlling or
under common control with the Company.
(ii) Annual Bonus. In addition to
Annual Base Salary, the Executive shall be
awarded, for each fiscal year ending during the
Employment Period, an annual bonus (the "Annual
Bonus") in cash at least equal to the Executive's
highest bonus under the Company's Annual Incentive
Compensation Plan, or any comparable bonus under
any predecessor or successor plan, for the last
three full fiscal years prior to the Effective
Date (annualized in the event that the Executive
was not employed by the Company for the whole of
such fiscal year) (the "Recent Annual Bonus").
Each such Annual Bonus shall be paid no later than
the end of the third month of the fiscal year next
following the fiscal year for which the Annual
Bonus is awarded, unless the Executive shall elect
to defer the receipt of such Annual Bonus.
(iii) Incentive, Savings and
Retirement Plans. During the Employment Period,
the Executive shall be entitled to participate in
all incentive, savings and retirement plans,
practices, policies and programs applicable
generally to other peer executives of the Company
and its affiliated companies, but in no event
shall such plans, practices, policies and programs
provide the Executive with incentive opportunities
(measured with respect to both regular and special
incentive opportunities, to the extent, if any,
that such distinction is applicable), savings
opportunities and retirement benefit opportuni-
ties, in each case, less favorable, in the
aggregate, than the most favorable of those pro-
vided by the Company and its affiliated companies
for the Executive under such plans, practices,
policies and programs as in effect at any time
during the 120-day period immediately preceding
the Effective Date or if more favorable to the
Executive, those provided generally at any time
after the Effective Date to other peer executives
of the Company and its affiliated companies.
(iv) Welfare Benefit Plans. During
the Employment Period, the Executive and/or the
Executive's family, as the case may be, shall be
eligible for participation in and shall receive
all benefits under welfare benefit plans,
practices, policies and programs provided by the
Company and its affiliated companies (including,
without limitation, medical, prescription, dental,
disability, salary continuance, employee life,
group life, accidental death and travel accident
insurance plans and programs) to the extent ap-
plicable generally to other peer executives of the
Company and its affiliated companies, but in no
event shall such plans, practices, policies and
programs provide the Executive with benefits which
are less favorable, in the aggregate, than the
most favorable of such plans, practices, policies
and programs in effect for the Executive at any
time during the 120-day period immediately
preceding the Effective Date or, if more favorable
to the Executive, those provided generally at any
time after the Effective Date to other peer ex-
ecutives of the Company and its affiliated
companies.
(v) Expenses. During the
Employment Period, the Executive shall be entitled
to receive prompt reimbursement for all reasonable
expenses incurred by the Executive in accordance
with the most favorable policies, practices and
procedures of the Company and its affiliated
companies in effect for the Executive at any time
during the 120-day period immediately preceding
the Effective Date or, if more favorable to the
Executive, as in effect generally at any time
thereafter with respect to other peer executives
of the Company and its affiliated companies.
(vi) Fringe Benefits. During the
Employment Period, the Executive shall be entitled
to fringe benefits, including, without
limitation, tax and financial planning services,
payment of club dues, and, if applicable, use of
an automobile and payment of related expenses, in
accordance with the most favorable plans,
practices, programs and policies of the Company
and its affiliated companies in effect for the
Executive at any time during the 120-day period
immediately preceding the Effective Date or, if
more favorable to the Executive, as in effect
generally at any time thereafter with respect to
other peer executives of the Company and its
affiliated companies.
(vii) Office and Support Staff.
During the Employment Period, the Executive shall
be entitled to an office or offices of a size and
with furnishings and other appointments, and to
exclusive personal secretarial and other
assistance, at least equal to the most favorable
of the foregoing provided to the Executive by the
Company and its affiliated companies at any time
during the 120-day period immediately preceding
the Effective Date or, if more favorable to the
Executive, as provided generally at any time
thereafter with respect to other peer executives
of the Company and its affiliated companies.
(viii) Vacation. During the
Employment Period, the Executive shall be entitled
to paid vacation in accordance with the most
favorable plans, policies, programs and practices
of the Company and its affiliated companies as in
effect for the Executive at any time during the
120-day period immediately preceding the Effective
Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with
respect to other peer executives of the Company
and its affiliated companies.
5. Termination of Employment. (a)
Death or Disability. The Executive's employment
shall terminate automatically upon the Executive's
death during the Employment Period. If the
Company determines in good faith that the
Disability of the Executive has occurred during
the Employment Period (pursuant to the definition
of Disability set forth below), it may give to the
Executive written notice in accordance with
Section 12(b) of this Agreement of its intention
to terminate the Executive's employment. In such
event, the Executive's employment with the Company
shall terminate effective on the 30th day after
receipt of such notice by the Executive (the
"Disability Effective Date"), provided that,
within the 30 days after such receipt, the
Executive shall not have returned to full-time
performance of the Executive's duties. For
purposes of this Agreement, "Disability" shall
mean the absence of the Executive from the
Executive's duties with the Company on a full-time
basis for 180 consecutive business days as a
result of incapacity due to mental or physical
illness which is determined to be total and perma-
nent by a physician selected by the Company or its
insurers and acceptable to the Executive or the
Executive's legal representative.
(b) Cause. The Company may terminate
the Executive's employment during the Employment
Period for Cause. For purposes of this Agreement,
"Cause" shall mean:
(i) the willful and continued
failure of the Executive to perform
substantially the Executive's duties with the
Company or one of its affiliates (other than
any such failure resulting from incapacity due
to physical or mental illness), after a
written demand for substantial performance is
delivered to the Executive by the Board or the
Chief Executive Officer of the Company which
specifically identifies the manner in which
the Board or Chief Executive Officer believes
that the Executive has not substantially
performed the Executive's duties, or
(ii) the willful engaging by the
Executive in illegal conduct or gross
misconduct which in either case is materially
and demonstrably injurious to the Company.
For purposes of this provision, no act or failure
to act, on the part of the Executive, shall be
considered "willful" unless it is done, or omitted
to be done, by the Executive in bad faith or
without reasonable belief that the Executive's
action or omission was in the best interests of
the Company. Any act, or failure to act, based
upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of
the Chief Executive Officer or a senior officer of
the Company or based upon the advice of counsel
for the Company shall be conclusively presumed to
be done, or omitted to be done, by the Executive
in good faith and in the best interests of the
Company. The cessation of employment of the
Executive shall not be deemed to be for Cause
unless and until there shall have been delivered
to the Executive a copy of a resolution duly
adopted by the affirmative vote of not less than
three-quarters of the entire membership of the
Board at a meeting of the Board called and held
for such purpose (after reasonable notice is
provided to the Executive and the Executive is
given an opportunity, together with counsel, to be
heard before the Board), finding that, in the good
faith opinion of the Board, the Executive is
guilty of the conduct described in subparagraph
(i) or (ii) above, and specifying the particulars
thereof in detail.
(c) Good Reason. The Executive's
employment may be terminated by the Executive for
Good Reason. For purposes of this Agreement,
"Good Reason" shall mean:
(i) the assignment to the Executive
of any duties inconsistent in any respect with
the Executive's position (including status,
offices, titles and reporting requirements),
authority, duties or responsibilities as
contemplated by Section 4(a) of this
Agreement, or any other action by the Company
which results in a diminution in such posi-
tion, authority, duties or responsibilities,
excluding for this purpose an isolated,
insubstantial and inadvertent action not taken
in bad faith and which is remedied by the
Company promptly after receipt of notice
thereof given by the Executive;
(ii) any failure by the Company to
comply with any of the provisions of Section
4(b) of this Agreement, other than an
isolated, insubstantial and inadvertent
failure not occurring in bad faith and which
is remedied by the Company promptly after
receipt of notice thereof given by the
Executive;
(iii) the Company's requiring the
Executive to be based at any office or
location other than as provided in Section
4(a)(i)(B) hereof or the Company's requiring
the Executive to travel on Company business to
a substantially greater extent than required
immediately prior to the Effective Date;
(iv) any purported termination by
the Company of the Executive's employment
otherwise than as expressly permitted by this
Agreement; or
(v) any failure by the Company to
comply with and satisfy Section 11(c) of this
Agreement.
For purposes of this Section 5(c), any good faith
determination of "Good Reason" made by the
Executive shall be conclusive. Anything in this
Agreement to the contrary notwithstanding, a
termination by the Executive for any reason during
the 30-day period immediately following the first
anniversary of the Effective Date shall be deemed
to be a termination for Good Reason for all
purposes of this Agreement.
(d) Notice of Termination. Any
termination by the Company for Cause, or by the
Executive for Good Reason, shall be communicated
by Notice of Termination to the other party hereto
given in accordance with Section 12(b) of this
Agreement. For purposes of this Agreement, a
"Notice of Termination" means a written notice
which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) to
the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to
provide a basis for termination of the Executive's
employment under the provision so indicated and
(iii) if the Date of Termination (as defined
below) is other than the date of receipt of such
notice, specifies the termination date (which date
shall be not more than thirty days after the
giving of such notice). The failure by the
Executive or the Company to set forth in the No-
xxxx of Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause
shall not waive any right of the Executive or the
Company, respectively, hereunder or preclude the
Executive or the Company, respectively, from
asserting such fact or circumstance in enforcing
the Executive's or the Company's rights hereunder.
(e) Date of Termination. "Date of
Termination" means (i) if the Executive's
employment is terminated by the Company for Cause,
or by the Executive for Good Reason, the date of
receipt of the Notice of Termination or any later
date specified therein, as the case may be, (ii)
if the Executive's employment is terminated by the
Company other than for Cause or Disability, the
date on which the Company notifies the Executive
of such termination and (iii) if the Executive's
employment is terminated by reason of death or
Disability, the date of death of the Executive or
the Disability Effective Date, as the case may be.
6. Obligations of the Company upon
Termination.
(a) Good Reason; Other Than for Cause, Death or
Disability.
If, during the Employment Period, the Company
shall terminate the Executive's employment other
than for Cause or Disability or the Executive
shall terminate employment for Good Reason:
(i) the Company shall pay to the
Executive in a lump sum in cash within 30 days
after the Date of Termination the aggregate of
the following amounts:
A. the sum of (1) the
Executive's Annual Base Salary through
the Date of Termination to the extent not
theretofore paid, (2) the product of (x)
the higher of (I) the Recent Annual Bonus
and (II) the Annual Bonus paid or
payable, including any bonus or portion
thereof which has been earned but
deferred (and annualized for any fiscal
year consisting of less than twelve full
months or during which the Executive was
employed for less than twelve full
months), for the most recently completed
fiscal year during the Employment Period,
if any (such higher amount being referred
to as the "Highest Annual Bonus") and (y)
a fraction, the numerator of which is the
number of days in the current fiscal year
through the Date of Termination, and the
denominator of which is 365 and (3) any
compensation previously deferred by the
Executive (together with any accrued
interest or earnings thereon) and any ac-
crued vacation pay, in each case to the
extent not theretofore paid (the sum of
the amounts described in clauses (1),
(2), and (3) shall be hereinafter
referred to as the "Accrued Obliga-
tions"); and
B. the amount equal to the
product of (1) three and (2) the sum of
(x) the Executive's Annual Base Salary
and (y) the Highest Annual Bonus; and
(ii) for three years after the
Executive's Date of Termination, or such
longer period as may be provided by the terms
of the appropriate plan, program, practice or
policy, the Company shall continue benefits to
the Executive and/or the Executive's family at
least equal to those which would have been
provided to them in accordance with the plans,
programs, practices and policies described in
Section 4(b)(iv) of this Agreement if the
Executive's employment had not been terminated
or, if more favorable to the Executive, as in
effect generally at any time thereafter with
respect to other peer executives of the
Company and its affiliated companies and their
families, provided, however, that if the
Executive becomes reemployed with another
employer and is eligible to receive medical or
other welfare benefits under another employer-
provided plan, the medical and other welfare
benefits described herein shall be secondary
to those provided under such other plan during
such applicable period of eligibility, and for
purposes of determining eligibility (but not
the time of commencement of benefits) of the
Executive for retiree benefits pursuant to
such plans, practices, programs and policies,
the Executive shall be considered to have
remained employed until three years after the
Date of Termination and to have retired on the
last day of such period;
(iii) for purposes of the Executive
Welfare Benefit Agreement between the Company
and the Executive dated March 31, 1986 (the
"Individual Welfare Benefit Agreement"), the
Executive shall be treated as having been
terminated without cause as of the Date of
Termination and the insurance policies
provided for thereunder shall be immediately
transferred to the Executive, but as of
immediately before the Date of Termination,
the Executive shall be credited with three
additional years of service for purposes of
the vesting of such policies and the Company
shall continue to pay the premiums on such
policies for three years after the Executive's
Date of Termination;
(iv) the Company shall, at its sole
expense as incurred, provide the Executive
with outplacement services, the scope and
provider of which shall be selected by the
Executive in the Executive's sole discretion,
but the cost of which shall not exceed
$50,000; and
(v) to the extent not theretofore
paid or provided, the Company shall timely pay
or provide to the Executive any other amounts
or benefits required to be paid or provided or
which the Executive is eligible to receive
under any plan, program, policy or practice or
contract or agreement of the Company and its
affiliated companies (such other amounts and
benefits shall be hereinafter referred to as
the "Other Benefits").
(b) Death. If the Executive's
employment is terminated by reason of the
Executive's death during the Employment Period,
this Agreement shall terminate without further
obligations to the Executive's legal
representatives under this Agreement, other than
for payment of Accrued Obligations and the timely
payment or provision of Other Benefits. Accrued
Obligations shall be paid to the Executive's
estate or beneficiary, as applicable, in a lump
sum in cash within 30 days of the Date of
Termination. With respect to the provision of
Other Benefits, the term Other Benefits as
utilized in this Section 6(b) shall include,
without limitation, and the Executive's estate
and/or beneficiaries shall be entitled to receive,
benefits at least equal to the most favorable
benefits provided by the Company and affiliated
companies to the estates and beneficiaries of peer
executives of the Company and such affiliated
companies under such plans, programs, practices
and policies relating to death benefits, if any,
as in effect with respect to other peer executives
and their beneficiaries at any time during the
120-day period immediately preceding the Effective
Date or, if more favorable to the Executive's
estate and/or the Executive's beneficiaries, as in
effect on the date of the Executive's death with
respect to other peer executives of the Company
and its affiliated companies and their benefi-
ciaries.
(c) Disability. If the Executive's
employment is terminated by reason of the
Executive's Disability during the Employment
Period, this Agreement shall terminate without
further obligations to the Executive, other than
for payment of Accrued Obligations and the timely
payment or provision of Other Benefits. Accrued
Obligations shall be paid to the Executive in a
lump sum in cash within 30 days of the Date of
Termination. With respect to the provision of
Other Benefits, the term Other Benefits as
utilized in this Section 6(c) shall include, and
the Executive shall be entitled after the
Disability Effective Date to receive, disability
and other benefits at least equal to the most
favorable of those generally provided by the
Company and its affiliated companies to disabled
executives and/or their families in accordance
with such plans, programs, practices and policies
relating to disability, if any, as in effect
generally with respect to other peer executives
and their families at any time during the 120-day
period immediately preceding the Effective Date
or, if more favorable to the Executive and/or the
Executive's family, as in effect at any time
thereafter generally with respect to other peer
executives of the Company and its affiliated
companies and their families.
(d) Cause; Other than for Good Reason.
If the Executive's employment shall be terminated
for Cause during the Employment Period, this
Agreement shall terminate without further
obligations to the Executive other than the
obligation to pay to the Executive (x) the Annual
Base Salary through the Date of Termination, (y)
the amount of any compensation previously deferred
by the Executive, and (z) Other Benefits, in each
case to the extent theretofore unpaid. If the
Executive voluntarily terminates employment during
the Employment Period, excluding a termination for
Good Reason, this Agreement shall terminate
without further obligations to the Executive,
other than for Accrued Obligations and the timely
payment or provision of Other Benefits. In such
case, all Accrued Obligations shall be paid to the
Executive in a lump sum in cash within 30 days of
the Date of Termination.
7. Non-exclusivity of Rights. Nothing
in this Agreement shall prevent or limit the
Executive's continuing or future participation in
any plan, program, policy or practice provided by
the Company or any of its affiliated companies and
for which the Executive may qualify, nor, subject
to Section 12(f), shall anything herein limit or
otherwise affect such rights as the Executive may
have under any contract or agreement with the
Company or any of its affiliated companies.
Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under
any plan, policy, practice or program of or any
contract or agreement with the Company or any of
its affiliated companies at or subsequent to the
Date of Termination shall be payable in accordance
with such plan, policy, practice or program or
contract or agreement except as explicitly
modified by this Agreement.
8. Full Settlement; Legal Fees. The
Company's obligation to make the payments provided
for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or
other claim, right or action which the Company may
have against the Executive or others. In no event
shall the Executive be obligated to seek other
employment or take any other action by way of
mitigation of the amounts payable to the Executive
under any of the provisions of this Agreement and
except as specifically provided in Section
6(a)(ii), such amounts shall not be reduced
whether or not the Executive obtains other
employment. The Company agrees to pay as in-
curred, to the full extent permitted by law, all
legal fees and expenses which the Executive may
reasonably incur as a result of any contest
(regardless of the outcome thereof) by the
Company, the Executive or others of the validity
or enforceability of, or liability under, any
provision of this Agreement or any guarantee of
performance thereof (whether such contest is
between the Company and the Executive or between
either of them and any third party, and including
as a result of any contest by the Executive about
the amount of any payment pursuant to this Agree-
ment), plus in each case interest on any delayed
payment at the applicable Federal rate provided
for in Section 7872(f)(2)(A) of the Internal
Revenue Code of 1986, as amended (the "Code").
9. Certain Additional Payments by the
Company.
(a) Anything in this Agreement to the
contrary notwithstanding, in the event it shall be
determined that any payment or distribution by the
Company to or for the benefit of the Executive
(whether paid or payable or distributed or
distributable pursuant to the terms of this
Agreement or otherwise, but determined without
regard to any additional payments required under
this Section 9) (a "Payment") would be subject to
the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Executive with respect to such excise tax (such
excise tax, together with any such interest and
penalties, are hereinafter collectively referred
to as the "Excise Tax"), then the Executive shall
be entitled to receive an additional payment (a
"Gross-Up Payment") in an amount such that after
payment by the Executive of all taxes (including
any interest or penalties imposed with respect to
such taxes), including, without limitation, any
income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax
imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to
the Excise Tax imposed upon the Payments.
(b) Subject to the provisions of
Section 9(c), all determinations required to be
made under this Section 9, including whether and
when a Gross-Up Payment is required and the amount
of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determination, shall
be made by Xxxxxx Xxxxxxxx LLP or such other
certified public accounting firm as may be
designated by the Executive (the "Accounting
Firm"), which shall provide detailed supporting
calculations both to the Company and the Executive
within 15 business days of the receipt of notice
from the Executive that there has been a Payment,
or such earlier time as is requested by the
Company. In the event that the Accounting Firm is
serving as accountant or auditor for the
individual, entity or group effecting the Change
of Control, the Executive shall appoint another
nationally recognized accounting firm to make the
determinations required hereunder (which
accounting firm shall then be referred to as the
Accounting Firm hereunder). All fees and expenses
of the Accounting Firm shall be borne solely by
the Company. Any Gross-Up Payment, as determined
pursuant to this Section 9, shall be paid by the
Company to the Executive within five days of the
receipt of the Accounting Firm's determination.
Any determination by the Accounting Firm shall be
binding upon the Company and the Executive. As a
result of the uncertainty in the application of
Section 4999 of the Code at the time of the
initial determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments
which will not have been made by the Company
should have been made ("Underpayment"), consistent
with the calculations required to be made
hereunder. In the event that the Company exhausts
its remedies pursuant to Section 9(c) and the
Executive thereafter is required to make a payment
of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be
promptly paid by the Company to or for the benefit
of the Executive.
(c) The Executive shall notify the
Company in writing of any claim by the Internal
Revenue Service that, if successful, would require
the payment by the Company of the Gross-Up
Payment. Such notification shall be given as soon
as practicable but no later than ten business days
after the Executive is informed in writing of such
claim and shall apprise the Company of the nature
of such claim and the date on which such claim is
requested to be paid. The Executive shall not pay
such claim prior to the expiration of the 30-day
period following the date on which the Executive
gives such notice to the Company (or such shorter
period ending on the date that any payment of
taxes with respect to such claim is due). If the
Company notifies the Executive in writing prior to
the expiration of such period that it desires to
contest such claim, the Executive shall:
(i) give the Company any
information reasonably requested by the
Company relating to such claim,
(ii) take such action in connection
with contesting such claim as the Company
shall reasonably request in writing from
time to time, including, without
limitation, accepting legal representa-
tion with respect to such claim by an
attorney reasonably selected by the
Company,
(iii) cooperate with the Company in
good faith in order effectively to
contest such claim, and
(iv) permit the Company to
participate in any proceedings relating
to such claim;
provided, however, that the Company shall bear and
pay directly all costs and expenses (including
additional interest and penalties) incurred in
connection with such contest and shall indemnify
and hold the Executive harmless, on an after-tax
basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto)
imposed as a result of such representation and
payment of costs and expenses. Without limitation
on the foregoing provisions of this Section 9(c),
the Company shall control all proceedings taken in
connection with such contest and, at its sole op-
tion, may pursue or forgo any and all administra-
tive appeals, proceedings, hearings and
conferences with the taxing authority in respect
of such claim and may, at its sole option, either
direct the Executive to pay the tax claimed and
xxx for a refund or contest the claim in any
permissible manner, and the Executive agrees to
prosecute such contest to a determination before
any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts,
as the Company shall determine; provided, however,
that if the Company directs the Executive to pay
such claim and xxx for a refund, the Company shall
advance the amount of such payment to the
Executive, on an interest-free basis and shall
indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect
thereto) imposed with respect to such advance or
with respect to any imputed income with respect to
such advance; and further provided that any exten-
sion of the statute of limitations relating to
payment of taxes for the taxable year of the
Executive with respect to which such contested
amount is claimed to be due is limited solely to
such contested amount. Furthermore, the Company's
control of the contest shall be limited to issues
with respect to which a Gross-Up Payment would be
payable hereunder and the Executive shall be enti-
tled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service
or any other taxing authority.
(d) If, after the receipt by the
Executive of an amount advanced by the Company
pursuant to Section 9(c), the Executive becomes
entitled to receive any refund with respect to
such claim, the Executive shall (subject to the
Company's complying with the requirements of
Section 9(c)) promptly pay to the Company the
amount of such refund (together with any interest
paid or credited thereon after taxes applicable
thereto). If, after the receipt by the Executive
of an amount advanced by the Company pursuant to
Section 9(c), a determination is made that the
Executive shall not be entitled to any refund with
respect to such claim and the Company does not
notify the Executive in writing of its intent to
contest such denial of refund prior to the expira-
tion of 30 days after such determination, then
such advance shall be forgiven and shall not be
required to be repaid and the amount of such
advance shall offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid.
10. Confidential Information. The
Executive shall hold in a fiduciary capacity for
the benefit of the Company all secret or
confidential information, knowledge or data
relating to the Company or any of its affiliated
companies, and their respective businesses, which
shall have been obtained by the Executive during
the Executive's employment by the Company or any
of its affiliated companies and which shall not be
or become public knowledge (other than by acts by
the Executive or representatives of the Executive
in violation of this Agreement). After
termination of the Executive's employment with the
Company, the Executive shall not, without the
prior written consent of the Company or as may
otherwise be required by law or legal process,
communicate or divulge any such information,
knowledge or data to anyone other than the Company
and those designated by it. In no event shall an
asserted violation of the provisions of this
Section 10 constitute a basis for deferring or
withholding any amounts otherwise payable to the
Executive under this Agreement.
11. Successors. (a) This Agreement is
personal to the Executive and without the prior
written consent of the Company shall not be
assignable by the Executive otherwise than by will
or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be
enforceable by the Executive's legal
representatives.
(b) This Agreement shall inure to the
benefit of and be binding upon the Company and its
successors and assigns.
(c) The Company will require any
successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to
all or substantially all of the business and/or
assets of the Company to assume expressly and
agree to perform this Agreement in the same manner
and to the same extent that the Company would be
required to perform it if no such succession had
taken place. As used in this Agreement, "Company"
shall mean the Company as hereinbefore defined and
any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this
Agreement by operation of law, or otherwise.
12. Miscellaneous. (a) This Agreement
shall be governed by and construed in accordance
with the laws of the State of Delaware, without
reference to principles of conflict of laws. The
captions of this Agreement are not part of the
provisions hereof and shall have no force or
effect. This Agreement may not be amended or
modified otherwise than by a written agreement
executed by the parties hereto or their respective
successors and legal representatives.
(b) All notices and other communications
hereunder shall be in writing and shall be given
by hand delivery to the other party or by
registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:
If to the Executive:
Xxxxxx X. Small
000 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
If to the Company:
Offshore Logistics, Inc.
000 Xxx xx Xxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Chief Executive Officer
or to such other address as either party shall
have furnished to the other in writing in
accordance herewith. Notice and communications
shall be effective when actually received by the
addressee.
(c) The invalidity or unenforceability
of any provision of this Agreement shall not
affect the validity or enforceability of any other
provision of this Agreement.
(d) The Company may withhold from any
amounts payable under this Agreement such Federal,
state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or
regulation.
(e) The Executive's or the Company's
failure to insist upon strict compliance with any
provision hereof or any other provision of this
Agreement or the failure to assert any right the
Executive or the Company may have hereunder,
including, without limitation, the right of the
Executive to terminate employment for Good Reason
pursuant to Section 5(c)(i)-(v) of this Agreement,
shall not be deemed to be a waiver of such
provision or right or any other provision or right
of this Agreement.
(f) The Executive and the Company
acknowledge that, except as may otherwise be
provided under any other written agreement
between the Executive and the Company, the employ-
ment of the Executive by the Company is "at will"
and, prior to the Effective Date, the Executive's
employment may be terminated by either the
Executive or the Company at any time prior to the
Effective Date, in which case the Executive shall
have no further rights under this Agreement. From
and after the date of this Agreement, this
Agreement supersedes the Executive Severance
Agreement dated February 9, 1989 between the
Executive and the Company. From and after the Ef-
fective Date, this Agreement shall supersede any
other agreement between the parties with respect
to the subject matter hereof; provided, that this
Agreement shall not supersede the Individual Wel-
fare Benefit Agreement nor any agreement providing
for indemnification of the Executive in his
capacity as a director or officer of the Company
or any of its affiliated companies, including
without limitation the Indemnity Agreement dated
as of May 10, 1995 between the Company and the
Executive.
(g) Notwithstanding the provisions of
Section 7.10 of the Company's 1994 Long-Term
Management Incentive Plan, no Award granted to the
Executive pursuant to such plan at any time
before, on or after the date of this Agreement or
the Effective Date, nor any other amounts payable
or distributable to the Executive pursuant to
another plan, program or arrangement maintained
by the Company, shall be reduced pursuant to said
Section 7.10 or otherwise as a result of being
potentially nondeductible under Section 280G of
the Code.
IN WITNESS WHEREOF, the Executive has
hereunto set the Executive's hand and, pursuant to
the authorization from its Board of Directors, the
Company has caused this Agreement to be executed
in its name on its behalf, all as of the day and
year first above written.
/s/ Xxxxxx X. Small
-----------------------------
Xxxxxx X. Small
OFFSHORE LOGISTICS, INC.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------
