Form of Severance Benefits Agreement SEVERANCE BENEFITS AGREEMENT
Exhibit
10.1
The
following form of Severance Benefits Agreement was entered into by each of
the
officers named in this filing on February 21, 2007 without modification other
than the name of the officer. Individual agreements have not been filed since
there is no material difference in content.
Form
of Severance Benefits Agreement
This
Severance Benefits Agreement (this “Agreement”) is entered into by and between
Xxxxxxx
Group Inc.,
a
Delaware corporation (the “Company”), and ________,
an
individual (the “Employee”), effective as of the 21st day of February, 2007
(“Effective Date”). Except as otherwise provided herein, capitalized terms used
herein shall have the meaning specified in Section 9.
WHEREAS,
the
Employee is a senior management employee of the Company or of a member of the
Affiliated Group on an at-will basis; and
WHEREAS,
the
Company values the continuing service of the Employee and desires to provide
certain severance rights to the Employee in the event the Employee is terminated
without cause or in connection with a change of control of the Company, as
described herein;
NOW,
THEREFORE,
in
consideration of the premises and mutual covenants contained herein and for
other good and valuable consideration, the receipt of which is mutually
acknowledged, the Company and the Employee agree as follows:
1. Severance
Benefits.
(a) Good
Reason; Other Than for Cause.
If
during the Employment Period (1) the Company shall terminate the Employee’s
employment other than for Cause, death or Disability, or (2) the Employee shall
terminate the Employee’s employment for Good Reason:
(i) The
Company shall pay to the Employee in a lump sum in cash within 30 days after
the
Date of Termination the aggregate of the following amounts:
| A. |
the
Accrued Amounts; and
|
| B. |
an
amount equal to:
|
| (1) |
in
the event such termination occurs at any time other than a Change
of
Control Period, the sum of (i) the Employee’s Annual Base Salary at the
Date of Termination and (ii) the Target Bonus; or
|
| (2) |
in
the event such termination occurs during or at the end of a Change
of
Control Period, the product of (x) two and (y) the sum of
(i) the Employee’s Annual Base Salary and (ii) the Highest
Annual Bonus.
|
(ii) To
the
extent not theretofore paid or provided, the Company shall timely pay or provide
to the Employee any other amounts or benefits required to be paid or provided
or
which the Employee is eligible to receive under any plan, program, policy or
practice or contract or agreement (other than, in the event the Employee’s
termination occurs outside of a Change of Control Period, any severance plan,
program, policy or practice or contract or agreement) of the Company and its
Affiliated Group (such amounts and benefits, the “Other Benefits”) in accordance
with the terms and normal procedures of each such plan, program, policy or
practice, based on accrued benefits through the Date of
Termination.
(iii) Until
the
earlier to occur of (A) the expiration of eighteen months after the Date of
Termination, (B) the date on which the Employee attains the age of 65, (C)
the
date the Employee first becomes eligible to receive health benefits under
another employer-provided plan, from and after the Employee’s Date of
Termination, or (D) the death of the Employee, the Company shall, via proper
COBRA election by Employee, continue medical and dental benefits to the Employee
(and, if applicable, to the spouse and dependents of the Employee who received
such benefits under the Employee’s coverage immediately prior to the Date of
Termination) at least equal to those that would have been provided to the
Employee (and to any such dependent) in accordance with the plans, programs,
practices and policies of the Company had the Employee remained actively
employed, provided that Employee makes all required COBRA payments to the
Company, and the Company shall immediately reimburse Employee for each such
COBRA payment.
(iv) As
a
condition to the Employee’s receipt of payments and benefits described under
Sections 1(a)(i), 1(a)(ii) and 1(a)(iii) in the event the Employee’s termination
occurs outside of a Change of Control Period, the Employee must execute and
deliver to the Company a full release of all claims that the Employee may have
(and such release must become irrevocable) against the Company, its Affiliated
Group, and all of their officers, employees, directors, and agents, in a form
mutually and reasonably agreeable to the Parties hereunder; provided, however,
that the Employee shall retain the Employee’s indemnification and related rights
as a former officer and director under the Certificate of Incorporation and
Bylaws of the Company and any rights of the Employee under the Directors and
Officers Insurance Policy(ies) maintained by the Company from time to
time.
(b) Cause;
Without Good Reason.
If the
Employee’s employment shall be terminated for Cause during the Employment
Period, or if the Employee shall resign without Good Reason during the
Employment Period, this Agreement shall terminate without further obligations
to
the Employee, other than the Company’s obligation to pay or provide to the
Employee an amount equal to the Accrued Amounts and the Other Benefits. For
purposes of this Section 1(b) only, the Accrued Amounts shall not include the
amount described in Section 9(a)(i)(2).
(c) Death
or Disability.
If the
Employee’s employment is terminated by reason of the Employee’s death or
Disability during the Employment Period, this Agreement shall terminate without
further obligations to the Employee’s legal representatives under this
Agreement, other than the Company’s obligation to pay or provide to Employee’s
estate, heirs or beneficiaries or to Employee, as the case may be: (i) the
Accrued Amounts; and (ii) the Other Benefits. With respect to the provision
of
Other Benefits, in the event the Employee’s termination occurs during a Change
of Control Period, the term “Other Benefits” as utilized in this Section 1(c)
shall include, without limitation, and the Employee’s estate and/or
beneficiaries shall be entitled to receive, benefits at least equal to the
most
favorable benefits provided by the Company and the Affiliated Group to the
estates and beneficiaries of peer executives of the Company and the Affiliated
Group 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
Change of Control Effective Date or, if more favorable to the Employee’s estate
and/or the Employee’s beneficiaries, as in effect on the date of the Employee’s
death with respect to other peer executives of the Company and the Affiliated
Group and their beneficiaries.
(d) Special
Vesting Terms for Stock Option and Awards.
All
unvested Stock Options and other Awards (as defined in the Incentive Plan),
including, without limitation, the Restricted Shares, granted pursuant to the
Incentive Plan will become fully vested and unrestricted (i) in the event of
the
Company’s termination of the Employee’s employment without Cause, (ii) in the
event of the Employee’s resignation from employment by the Company for Good
Reason, (iii) upon termination of the Employee’s employment by the Company due
to the Employee’s death or Disability, or
(iv)
upon the occurrence of a Change of Control. Upon termination of the Employee’s
employment by the Company, the period of exercise for the Employee’s vested
Stock Options shall be as follows:
(i) Upon
the
Employee’s termination of employment by reason of the Employee’s death or
Disability, any Stock Options held by the Employee that were exercisable
immediately before the Date of Termination may be exercised at any time until
the earlier of (A) the second anniversary of the Date of Termination and (B)
the
expiration date of the Stock Options.
(ii) Upon
the
Employee’s termination of employment by the Company for Cause, any Stock Options
and Restricted Shares held by the Employee shall be forfeited, effective as
of
the Date of Termination.
(iii) Upon
termination of the Employee’s employment for any reason other than the
Employee’s death or Disability or termination by the Company for Cause, any
Stock Options held by the Employee that were exercisable immediately before
the
Date of Termination may be exercised at any time until the earlier of (A) the
90th
day
following the Date of Termination and (B) the expiration date of such Stock
Options.
(iv) Notwithstanding
the foregoing provisions of this Section 1(d), if the Employee dies after the
Employee’s employment by the Company is terminated but while any of the Stock
Options remain exercisable as set forth above, such Stock Options may be
exercised at any time until the later of (A) the earlier of (1) the first
anniversary of the date of such death and (2) the expiration date of such Stock
Options and (B) the last date on which such Stock Options would have been
exercisable, absent this Section 1(d)(iv).
(v) Notwithstanding
the foregoing provisions of this Section 1(d), upon the termination of the
Employee’s employment with the Company for any reason, other than termination
for Cause by the Company, during the 24-month period following any Change of
Control Effective Date, any Stock Options held by the Employee as of the Change
of Control Effective Date that remain outstanding as of the Date of Termination
may thereafter be exercised, until the later of (A) the last date on which
such
Stock Options would be exercisable in the absence of this Section 1(d)(v) and
(B) the earlier of (1) the third anniversary of the Change of Control Effective
Date and (2) the expiration date of such Stock Options.
Notwithstanding
anything in this Agreement to the contrary, express or implied, except as
provided in Section 1(a)(ii), the provisions of this Agreement are in addition
to and not in limitation of the Employee’s rights under the Incentive Plan and
any other plan, program, policy or practice provided by the Company or any
of
the Affiliated Group and for which the Employee may qualify.
2. Compensation
and Benefits During Change of Control Period.
During
any Change of Control Period, (i) the Annual Base Salary of the Employee shall
be at least equal to the highest Annual Base Salary received by the Employee
in
the twelve (12) months preceding the Change of Control Effective Date, (ii)
the
Employee shall be awarded, for each fiscal year ending during the Change of
Control Period, an Annual Bonus in cash at least equal to the Recent Annual
Bonus, and (iii) the Employee shall be eligible for participation in Other
Benefits that are at least as favorable, in the aggregate, to the most favorable
of such Other Benefits in effect for the Employee at any time during the 120-day
period immediately preceding the Change of Control Effective Date.
3. Covenants.
The
Employee recognizes that the Company’s willingness to enter into this Agreement
is based in material part on the Employee’s agreement to the provisions of this
Section 3, and that the Employee’s breach of the provisions of this Section 3
could materially damage the Company.
(a) Confidential
Information.
The
Company will provide its confidential and trade secret information to the
Employee, and the Employee agrees to hold in a fiduciary capacity for the
benefit of the Company and the Affiliated Group, all Confidential Information.
The Employee shall not communicate, divulge or disseminate Confidential
Information at any time during or after the Employee’s employment with the
Company and the Affiliated Group, except with the prior written consent of
the
Company, or as otherwise required by law or legal process or governmental
inquiry or as such disclosure or use may be required in the course of the
Employee performing the Employee’s duties and responsibilities hereunder.
Notwithstanding the foregoing provisions, if the Employee is required to
disclose any such confidential or proprietary information pursuant to applicable
law or governmental inquiry or a subpoena or court order, the Employee shall
promptly notify the Company in writing of any such requirement so that the
Company or the appropriate member of the Company and the Affiliated Group may
seek an appropriate protective order or other appropriate remedy. The Employee
shall reasonably cooperate with the Company and the Affiliated Group to obtain
such a protective order or other remedy. If such order or other remedy is not
obtained prior to the time the Employee is required to make the disclosure,
then
unless the Company waives compliance with the provisions hereof, the Employee
shall disclose only that portion of the confidential or proprietary information
which the Employee is advised by counsel in writing (either the Employee’s or
the Company’s) that the Employee is legally required to so disclose. Upon the
Employee’s termination of employment with the Company and the Affiliated Group
for any reason, the Employee shall promptly return to the Company all records,
files, memoranda, correspondence, notebooks, notes, reports, customer lists,
drawings, plans, documents, and other documents and the like relating to the
business of the Company and the Affiliated Group or containing any trade secrets
relating to the Company and the Affiliated Group or that the Employee uses,
prepares or comes into contact with during the course of the Employee’s
employment with the Company and the Affiliated Group, and all keys, credit
cards
and passes, and such materials shall remain the sole property of the Company
and/or the Affiliated Group, as applicable. The Employee agrees to execute
any
standard form confidentiality agreements with the Company that the Company
generally enters into or may enter into in the future with its senior
executives. The Employee agrees to represent in writing to the Company upon
termination of employment that the Employee has complied with the foregoing
provisions of this Section 3(a).
(b) Work
Product and Inventions.
The
Company and/or its nominees or assigns shall own all right, title and interest
in and to the Developments, whether or not patentable, reduced to practice
or
registrable under patent, copyright, trademark or other intellectual property
law anywhere in the world, made, authored, discovered, reduced to practice,
conceived, created, developed or otherwise obtained by the Employee (alone
or
jointly with others) during the Employee’s employment with the Company and the
Affiliated Group, and arising from or relating to such employment or the
business of the Company or of other member of the Affiliated Group (whether
during business hours or otherwise, and whether on the premises of using
the
facilities or materials of the Company or of other members of the Affiliated
Group or otherwise). The Employee shall promptly and fully disclose to the
Company and to no one else all Developments, and hereby assigns to the Company
without further compensation all right, title and interest the Employee has
or
may have in any Developments, and all patents, copyrights, or other intellectual
property rights relating thereto, and agrees that the Employee has not acquired
and shall not acquire any rights during the course of the Employee’s employment
with the Affiliated Group or thereafter with respect to any
Developments.
(c) Non-Solicitation
of Affiliated Group Employees.
The
Employee shall not, at any time during the Restricted Period, other than in
the
ordinary exercise of the Employee’s duties while serving as an employee of the
Company or a member of the Affiliated Group, without the prior written consent
of the Company, directly or indirectly, solicit, recruit, or employ (whether
as
an employee, officer, agent, consultant or independent contractor) any person
who is or was at any time during the previous 12 months, an employee,
representative, officer or director of the Company or any member of the
Affiliated Group. Further, during the Restricted Period, the Employee shall
not
take any action that could reasonably be expected to have the effect of directly
encouraging or inducing any person to cease their relationship with the Company
or any member of the Affiliated Group for any reason. A general employment
advertisement by an entity of which the Employee is a part will not constitute
solicitation or recruitment.
(d) Non-Competition.
In
consideration of the Company’s promise to provide the Employee with the
confidential and trade secret information of the Company, the Employee agrees
as
follows:
(i) Areas
Other Than Louisiana.
Except
with respect to competition in the State of Louisiana, or with respect to
competition in or above the waters off the State of Louisiana in the areas
specified in subparagraph (B) of Section 3(d)(ii) of this Agreement, during
the
Restricted Period, the Employee shall not, either directly or indirectly,
compete with the business of the Company anywhere in the world where the Company
or any member of the Affiliated Group conducts business by (1) becoming an
officer, agent, employee, partner or director of any other corporation,
partnership or other entity, or otherwise render services to or assist or hold
an interest (except as a less than 2-percent shareholder of a publicly traded
corporation or as a less than 5-percent shareholder of a corporation that is
not
publicly traded) in any Competitive Business, or (2) soliciting, servicing,
or accepting the business of (A) any active customer of the Company or any
member of the Affiliated Group, or (B) any person or entity who is or was at
any
time during the previous twelve months a customer of the Company or any member
of the Affiliated Group, provided that such business is competitive with any
significant business of the Company or any member of the Affiliated Group.
(ii) Louisiana.
With
respect to competition in the State of Louisiana, or with respect to competition
in or above the waters specified in subparagraph (B) of this Section
3(d)(ii).
| A. |
Employee,
during the Restricted Period, agrees to refrain from carrying on
or
engaging in a business similar to the business of the Company or
any
member of the Affiliated Group, or from soliciting customers of the
business of the Company or any member of the Affiliated Group, within
the
Parishes of Lafayette, Vermillion, Cameron, Iberia, St. Xxxx, Plaquemines,
Terrebonne, Lafourche, St. Xxxxxxx, Orleans, Calcasieu and Jefferson
in
the State of Louisiana, so long as the Company or any member of the
Affiliated Group carries on a like business therein during the Restricted
Period, and
|
| B. |
Employee,
during the Restricted Period, agrees to refrain from carrying on
or
engaging in a business similar to the business of the Company or
any
member of the Affiliated Group or from soliciting customers of the
business of the Company or any member of the Affiliated Group in
or above
the waters of the Gulf of Mexico adjacent to the Parishes of Lafayette,
Vermillion, Cameron, Iberia, St. Xxxx, Plaquemines, Terrebonne, Lafourche,
St. Xxxxxxx, Orleans, Calcasieu and Jefferson in the State of Louisiana,
so long as the Company or any member of the Affiliated Group carries
on a
like business therein during the Restricted Period.
|
| C. |
All
non-capitalized terms in subparagraphs (A) and (B) of this Section
3(d)(ii) are intended to and shall have the same meanings that those
terms
(to the extent they appear therein) have in La. R.S. 23:921.C. Subject
to
and only to the extent not inconsistent with the foregoing sentence,
the
Parties understand the following phases to have the following meanings:
|
| (1) |
The
phrase “carrying on or engaging in a business similar to the business of
the Company or any member of the Affiliated Group” includes engaging, as
principal, agent, trustee, or through the agency of any corporation,
partnership, association or agent or agency, in any business that
conducts
an offshore oil and gas helicopter service business in competition
with
the Company or any member of the Affiliated Group or being the owner
(except as a less than 2-percent shareholder of a publicly traded
corporation or as a less than 5-percent shareholder of a corporation
that
is not publicly traded) of any interest in any corporation or other
entity, or an officer, director, or employee of any corporation or
other
entity (other than the Company or any member of the Affiliated Group),
or
a member or employee or any partnership, or an owner or employee
of any
other business that conducts an offshore oil and gas helicopter service
business in competition with the Company or any member of the Affiliated
Group. Moreover, the term also includes (i) directly or indirectly
inducing any current customers of the Company or any member of the
Affiliated Group to patronize any offshore oil and gas helicopter
service
business in competition with the Company or any member of the Affiliated
Group; (ii) canvassing, soliciting, or accepting any offshore oil
and gas
helicopter service business of the type conducted by the Company
or any
member of the Affiliated Group; (iii) directly or indirectly requesting
or
advising any current customers of the Company or any member of the
Affiliated Group to withdraw, curtail or cancel such customer’s offshore
oil and gas helicopter service business with the Company or any member
of
the Affiliated Group; or (iv) directly or indirectly disclosing to
any
other person, firm, corporation or entity, the names and addresses
of any
of the current customers of the Company or any member of the Affiliated
Group. In addition, the term includes, directly or indirectly, through
any
person, firm, association, corporation or other entity with which
Employee
is now or may hereafter become associated, causing or inducing any
present
employee of the Company or any of its subsidiaries to leave the employ
of
the Company or any of its subsidiaries to accept employment with
the
Employee or with such person, firm association, corporation, or other
entity.
|
| (2) |
The
phrase “a similar business to the business of the Company or any member of
the Affiliated Group” means an offshore oil and gas helicopter service
business.
|
| (3) |
The
phrase “carries on a like business” includes, without limitation, actions
taken by or through a wholly-owned subsidiary or other affiliated
corporation or entity.
|
| D. |
Notwithstanding
any other provision of this Agreement, Section 3(d)(ii) of this Agreement
shall not apply with respect to any geographic area outside of the
geographic territory expressly set forth in this Section 3(d)(ii).
|
(e) Assistance.
The
Employee agrees that during and after the Employee’s employment by the Company,
upon request by the Company, the Employee will assist the Company and the
Affiliated Group in the defense of any claims, or potential claims that may
be
made or threatened to be made against the Company and/or any member of the
Affiliated Group in any Proceeding, and will assist the Company and the
Affiliated Group in the prosecution of any claims that may be made by the
Company and/or any member of the Affiliated Group in any Proceeding, to the
extent that such claims may relate to the Employee’s employment or the period of
the Employee’s employment by the Company. The Employee agrees, unless precluded
by law, to promptly inform the Company if the Employee is asked to participate
(or otherwise become involved) in any Proceeding involving such claims or
potential claims. The Employee also agrees, unless precluded by law, to promptly
inform the Company if the Employee is asked to assist in any investigation
(whether governmental or otherwise) of the Company and/or any member of the
Affiliated Group (or their actions), regardless of whether a lawsuit has then
been filed against the Company and/or any member of the Affiliated Group with
respect to such investigation. The Employee agrees to fully and completely
cooperate with any investigations conducted by or on behalf of the Company
and
for any member of the Affiliated Group from time to time. The Company agrees
to
reimburse the Employee for all of the Employee’s reasonable out-of-pocket
expenses associated with such assistance, including travel expenses and any
attorneys’ fees, and shall pay a reasonable per diem fee for the Employee’s
service. In addition, the Employee agrees to provide such services as are
reasonably requested by the Company to assist any successor to the Employee
in
the transition of duties and responsibilities to such successor. Any services
or
assistance contemplated in this Section 3(e) shall be at mutually agreed to
and
convenient times.
(f) Remedies.
The
Employee acknowledges and agrees that the terms of this Section 3: (i) are
reasonable in geographic and temporal scope, (ii) are necessary to protect
legitimate proprietary and business interests of the Company in, inter alia,
near permanent customer relationships and confidential information. The Employee
further acknowledges and agrees that (x) the Employee’s breach of the provisions
of this Section 3 will cause the Company irreparable harm, which cannot be
adequately compensated by money damages, and (y) if the Company elects to
prevent the Employee from breaching such provisions by obtaining an injunction
against the Employee, there is a reasonable probability of the Company’s
eventual success on the merits. The Employee consents and agrees that if the
Employee commits any such breach or threatens to commit any breach, the Company
shall be entitled to temporary and permanent injunctive relief from a court
of
competent jurisdiction, in addition to, and not in lieu of, such other remedies
as may be available to the Company for such breach, including the recovery
of
money damages. If any of the provisions of this Section 3 are determined to
be
wholly or partially unenforceable, the Employee hereby agrees that this
Agreement or any provision hereof may be reformed so that it is enforceable
to
the maximum extent permitted by law. If any of the provisions of this Section
3
are determined to be wholly or partially unenforceable in any jurisdiction,
such
determination shall not be a bar to or in any way diminish the Company’s right
to enforce any such covenant in any other jurisdiction.
4. Non-Exclusivity
of Rights.
Except
as provided in Section 1(a)(ii), nothing in this Agreement shall prevent or
limit the Employee’s continuing or future participation in any plan, program,
policy or practice provided by the Company or any of the Affiliated Group and
for which the Employee may qualify, nor shall anything herein limit or otherwise
affect such rights as the Employee may have under any contract or agreement
with
the Company or any of the Affiliated Group. Amounts which are vested benefits
or
which the Employee is otherwise entitled to receive under any plan, policy,
practice or program of or any contract or agreement with the Company or any
of
the Affiliated Group 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.
5. No
Duty to Mitigate.
In no
event shall the Employee be obligated to seek other employment or take any
other
action by way of mitigation of the amounts payable to the Employee under any
of
the provisions of this Agreement and except as specifically provided in
Section 1(a)(iii), such amounts shall not be reduced whether or not the
Employee obtains other employment.
6. At-Will
Employee.
The
obligation of the Company to pay amounts hereunder shall not alter the at-will
employment status of the Employee or diminish the right of the Company to
terminate the Employee's employment with or without Cause.
7. Assignment;
Successors.
(a) No
Assignment.
This
Agreement is personal to the Employee and without the prior written consent
of
the Company shall not be assignable by the Employee other than by will or the
laws of descent and distribution. This Agreement shall inure to the benefit
of
and be enforceable by the Employee’s legal representatives. This Agreement shall
inure to the benefit of and be binding upon the Company and its successors
and
assigns.
(b) Successors.
The
Company shall cause any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all or a substantial
portion of its business and/or assets to assume expressly and agree to perform
this Agreement immediately upon such succession 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.
8. Miscellaneous.
(a) Governing
Law; Captions; Amendments.
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
Parties hereto irrevocably agree to submit to the jurisdiction and venue of
the
courts of the State of Delaware in any Delaware Proceeding. In the event of
a
Delaware Proceeding, the Company shall pay all of the Employee’s reasonable
travel expenses incurred by him for the Employee’s travel between the Employee’s
principal residence and/or principal place of business at such time and Delaware
in connection with such Delaware Proceeding. 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) Notices.
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 Employee:
At
the
address most recently on file for the Employee at the Company at the time of
such notice.
If
to
the Company:
Xxxxxxx
Group Inc.
0000
X.
Xxx Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxx 00000
Attention:
General Counsel
or
to
such other address as either Party shall have furnished to the other Party
in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) Severability.
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) Withholding.
Notwithstanding any other provision of this Agreement, the Company may withhold
from any amounts payable or benefits provided under this Agreement any Federal,
state, local and foreign taxes as shall be required to be withheld pursuant
to
any applicable law or regulation.
(e) No
Waiver.
The
Employee’s or the Company’s failure to insist upon strict compliance with any
provision of this Agreement or the failure to assert any right the Employee
or
the Company may have hereunder, shall not be deemed to be a waiver of such
provision or right or any other provision or right of this
Agreement.
(f) Entire
Agreement; Conflicts.
This
Agreement and the other agreements referred to herein, constitute the entire
agreement between the Parties hereto with respect to the subject matter hereof
and supersedes all prior agreements and understanding, both written and oral.
In
the event of direct conflict between the provisions of this Agreement and any
Company policies or practices, the provisions of this Agreement shall
control.
(g) Counterparts.
This
Agreement may be executed by facsimile and in multiple counterparts, each of
which shall constitute an original and all of which shall constitute one and
the
same document.
(h) Section
280G Limitation on Payments.
(i) In
the
event that all or any portion of the benefits provided under this Agreement,
either alone or together with other payments and benefits that the Employee
receives or is then entitled to receive from the Company or any member of the
Affiliated Group, would constitute a "parachute payment" within the meaning
of
Section 280G of the Code, the Company shall reduce such payments and benefits
provided to the Employee under this Agreement to the extent necessary so that
no
portion thereof shall be subject to the excise tax imposed by Section 4999
of
the Code; but only if, by reason of such reduction, the net after-tax benefit
to
the Employee shall exceed the net after-tax benefit if such reduction were
not
made. "Net after-tax benefit" for these purposes shall mean (A) the total
amount payable to the Employee under this Agreement (and all other payments
and
benefits which the Employee receives or is then entitled to receive from the
Company or any member of the Affiliated Group) that would constitute a
"parachute payment" within the meaning of Section 280G of the Code, less (B)
the
amount of federal income taxes payable with respect to the foregoing calculated
at the Employee's applicable marginal income tax rate for each year in which
the
foregoing shall be paid to the Employee (based upon the rate in effect for
such
year as set forth in the Code at the time of the payment under this Agreement),
less (C) the amount of excise taxes imposed with respect to the payments and
benefits described in (A) above by Section 4999 of the Code. The amount of
any reduction made under this Section 8(h) in the payment to which the Employee
is entitled under this Agreement is hereinafter referred to as the "Relinquished
Amount."
(ii) All
determinations required to be made under this Section 8(h), including whether
and when a Relinquished Amount shall be imposed and the amount of such
Relinquished Amount, shall be made by the Company's independent auditing firm
used immediately prior to the Change of Control (the "Accounting Firm"), which
shall provide detailed supporting calculations both to the Company and the
Employee. The Company shall provide any and all information, records and
documents relating to Employee’s compensation and benefits paid or payable by
the Company as may be reasonably requested by the Accounting Firm in connection
with its determination of the Relinquished Amount. 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 Employee 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.
(iii) Notwithstanding
anything herein to the contrary, expressed or implied, the Company’s obligations
to the Employee pursuant to this Section 8(h) shall be limited to providing
to
the Employee payments and benefits in accordance with the determinations of
the
Accounting Firm. The Company shall not be liable for any inaccuracies in the
determination of the Relinquished Amount by such Accounting Firm.
(i) Section
409A Compliance.
If any
compensation or benefits provided by this Agreement may result in the
application of Section 409A of the Code, the Company shall, in consultation
with
the Employee, modify the Agreement in the least restrictive manner necessary
in
an effort to exclude such compensation from the definition of “deferred
compensation” within the meaning of such Section 409A or in an effort to comply
with the provisions of Section 409A, other applicable provision(s) of the Code
and/or any rules, regulations or other regulatory guidance issued under such
statutory provisions, without any diminution in the value of the payments or
benefits to the Employee and, in the case of health and medical benefits,
without any lapse in coverage. Notwithstanding the foregoing, the Company shall
not be required to assume any increased economic burden.
9. Definitions.
As used
in this Agreement, the following terms shall have the respective meanings
assigned to them below:
(a) “Accrued
Amounts” shall mean:
(i) in
the
event termination of the Employee’s employment occurs at any time other than
during a Change of Control Period, the sum of (1) the Employee’s Annual
Base Salary through the Date of Termination, to the extent not theretofore
paid,
(2) the product of (x) the Target Bonus and (y) a fraction
(which, for purposes of clarity, shall equal less than 1), the numerator of
which is the number of days in the then-current fiscal year through the Date
of
Termination, and the denominator of which is 365, (3) the Employee’s
business expenses that are reimbursable pursuant to this Agreement but have
not
been reimbursed by the Company as of the Date of Termination, (4) any
compensation previously deferred by the Employee (together with any accrued
interest or earnings thereon) and any accrued but unused vacation
allowances for the year in which the Date of Termination occurs, and (5) any
Annual Bonus earned prior to the Termination Date but unpaid; or
(ii) in
the
event termination of the Employee’s employment occurs during a Change of Control
Period, the sum of (1) the Employee’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 Employee was employed for less than
twelve full months or during which the Employee 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, (3) the Employee’s business expenses that are
reimbursable pursuant to this Agreement but have not been reimbursed by the
Company as of the Date of Termination, (4) any compensation previously
deferred by the Employee (together with any accrued interest or earnings
thereon) and any accrued vacation pay, in each case to the extent not therefore
paid, and (5) any Annual Bonus earned prior to the Termination Date but
unpaid.
(b) “Affiliated
Group” shall mean any entity controlled by, controlling or under common control
with the Company.
(c) “Agreement”
is defined in the Preamble to this Agreement.
(d) “Annual
Base Salary” shall mean the annualized base salary of the Employee in effect
from time to time.
(e) “Annual
Bonus” shall mean the annual cash bonus, if any, to which the Employee is
eligible to receive for each fiscal year based upon performance targets that
are
established by the Compensation Committee of the Company.
(f) “Board”
shall mean the Board of Directors of the Company.
(g) “Cause”
shall mean:
(i) the
Employee’s willful failure to substantially perform the Employee’s duties
associated with the Employee’s position with the Company or the Affiliated
Group, or the Employee’s willful failure to perform specific directives of the
President and Chief Executive Officer of the Company, which directives are
consistent with the scope and nature of such position, other than any such
failure resulting from incapacity due to physical or mental illness, which
failure has continued for a period of at least 30 days following delivery to
the
Employee of a written demand for substantial performance specifying the manner
in which the Employee has failed hereunder; or
(ii) the
Employee’s commission of malfeasance, fraud, or dishonesty, or the Employee’s
willful and material violation of Company policies; or
(iii) the
Employee’s indictment or formal charge for, and subsequent conviction of, or
plea of guilty or nolo contendere to, a felony, or a misdemeanor involving
moral
turpitude; or
(iv) the
Employee’s material breach of Section 3 of this Agreement.
(h) “Change
of Control” shall mean:
(i) the
acquisition by an individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 35%
or
more of either (x) the then outstanding shares of common stock of the
Company (the “Outstanding Company Common Stock”) or (y) 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 (i), the
following acquisitions shall not constitute a Change of Control: (A) any
acquisition directly from the Company, (B) any acquisition by the Company,
(C)
any acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company or (D)
any acquisition by any corporation pursuant to a transaction which complies
with
clauses (A), (B) and (C) of subsection (iii) of this Section 9(h)(i);
or
(ii) 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, 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
(iii) 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, (A) 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 outstanding 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 proportions as
their ownership, immediately prior to such Business Combination of the
Outstanding Company Common Stock and Outstanding Company Voting Securities,
as
the case may be, (B) no Person (excluding any employee benefit plan (or related
trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly 35% 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 (C) 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
(iv) approval
by the stockholders of the Company of a complete liquidation or dissolution
of
the Company.
(i) “Change
of Control Effective Date” shall mean the first date during the Employment
Period on which a Change of Control occurs. Anything in this Agreement to the
contrary notwithstanding, if a Change of Control occurs and if the Employee’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 Employee that
such termination of employment (1) was at the request of a third party who
has taken steps reasonably calculated to effect a Change of Control or
(2) otherwise arose in connection with or anticipation of a Change of
Control, then for all purposes of this Agreement the “Change of Control
Effective Date” shall mean the date immediately prior to the date of such
termination of employment.
(j) “Change
of Control Period” shall mean the period commencing on the Change of Control
Effective Date and ending on the second anniversary of the Change of Control
Effective Date.
(k) “Code”
shall mean the Internal Revenue Code of 1986, as amended.
(l) “Company”
shall mean Xxxxxxx Group Inc., a Delaware corporation f/k/a Offshore Logistics,
Inc., and any successor to its business and/or assets that assumes and agrees
to
perform this Agreement by operation of law, or otherwise.
(m) “Competitive
Business” shall mean any person or entity (including any joint venture,
partnership, firm, corporation, or limited liability company) that engages
in
any principal or significant business of the Company or any member of the
Affiliated Group as of the Date of Termination (or any material or significant
business being actively pursued as of the Date of Termination that the Company
or any member of the Affiliated Group enters into during the Restricted
Period).
(n) “Confidential
Information” shall mean any and all secret or confidential information,
knowledge or data relating to the Company and the Affiliated Group and their
businesses (including, without limitation, any proprietary and not publicly
available information concerning any processes, methods, trade secrets, research
or secret data, costs, names of users or purchasers of their respective products
or services, business methods, operating procedures or programs or methods
of
promotion and sale) that the Employee obtains during the Employee’s employment
by the Company and the Affiliated Group that is not public knowledge.
(o) “Date
of
Termination” means (i) if the Employee’s employment is terminated by the Company
for Cause or by the Employee for Good Reason, the date of receipt of the Notice
of Termination or any later date specified therein within 30 days of such
notice, as the case may be; (ii) if the Employee’s employment is terminated by
the Company, other than for Cause or Disability, the date on which the Company
notifies the Employee of such termination; (iii) if the Employee voluntarily
resigns without Good Reason, the date on which the Employee notifies the Company
of such termination; (iv) if the Employee’s employment is terminated by reason
of death, the date of death of the Employee; or (v) if the Employee’s employment
is terminated by the Company due to Disability, the Disability Effective
Date.
(p) “Delaware
Proceeding” shall mean any action or proceeding brought under, with respect to
or in connection with this Agreement in the courts of Delaware.
(q) “Developments”
shall mean any and all inventions, ideas, trade secrets, technology, devices,
discoveries, improvements, processes, developments, designs, know how, show-how,
data, computer programs, algorithms, formulae, works of authorship, works
modifications, trademarks, trade names, documentation, techniques, designs,
methods, trade secrets, technical specifications, technical data, concepts,
expressions, patents, patent rights, copyrights, moral rights, and all other
intellectual property rights or other developments whatsoever.
(r) “Disability”
shall mean the inability of the Employee to perform the Employee’s duties with
the Company on a full-time basis for 150 consecutive days during the Employment
Period as a result of incapacity due to mental or physical illness, which is
determined to be total and permanent by a licensed physician selected by the
Company or its insurers and reasonably acceptable to the Employee or the
Employee’s legal representative. If the Parties cannot agree on a licensed
physician, each Party shall select a licensed physician and the two physicians
shall select a third who shall be the approved licensed physician for these
purposes.
(s) “Disability
Effective Date” shall mean the 30th
day
after receipt of the Company’s written notice to the Employee notifying the
Employee of the Company’s intention to terminate the Employee’s employment based
on the Company’s good faith determination that the Disability of the Employee
has occurred.
(t) “Effective
Date” is defined in the Preamble to this Agreement.
(u) “Employment
Period” shall mean the period during which the Employee is employed as an
employee of the Company or as an employee of a member of the Affiliated
Group.
(v) “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.
(w) “Good
Reason” shall mean, during any Change of Control Period and in the absence of
the Employee’s consent, (i) any reduction in the position or duties of the
Employee, or (ii) any failure by the Company during the Change of Control
Period to comply with Section 2 hereof, other than in either case an isolated,
insubstantial or inadvertent reduction or failure not occurring in bad faith
and
which is remedied by the Company promptly (but in no event in less than 30
days)
after receipt of written notice thereof given by the Employee.
(x) “Highest
Annual Bonus” is defined in Section 9(a)(ii).
(y) “Incentive
Plan” shall mean the Company’s 2004 Stock Incentive Plan and any successor plan,
as each may be amended.
(z) “Notice
of Termination” shall mean a written notice which (i) indicates the specific
severance benefits 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 the payment of severance benefits under the provision
so
indicated, and (iii) if the Date of Termination 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).
(aa) “Other
Benefits” is defined in Section 1(a)(ii) and Section 1(c).
(bb) “Party”
shall mean the Company and the Employee, individually, and “Parties” shall mean
the Company and the Employee collectively.
(cc) “Proceeding”
shall mean any action, suit or proceeding, whether civil, criminal,
administrative, investigative or otherwise.
(dd) “Recent
Annual Bonus” shall mean the Employee’s highest Annual Bonus for the last three
fiscal years prior to the Change of Control Effective Date (annualized in the
event that the Employee is not employed by the Company for the whole of such
fiscal year).
(ee) “Restricted
Period” shall mean the period from the Effective Date through the date eighteen
(18) months following the Date of Termination; provided, however, that there
shall be no Restricted Period in the event that the termination of the
Employee’s employment occurs during a Change of Control Period.
(ff) “Restricted
Shares” shall mean Performance Accelerated Restricted Stock Units granted
pursuant to the Incentive Plan.
(gg) “Employee”
is defined in the Preamble to this Agreement.
(hh) “Stock
Options” shall mean stock options to acquire shares of the Company’s common
stock granted by the Company to the Executive pursuant to the Incentive
Plan.
(ii) “Target
Bonus” shall mean a bonus amount equal to fifty percent (50%) of the Employee’s
Annual Base Salary.
IN
WITNESS WHEREOF,
the
Employee has hereunto set the Employee’s hand and, the Company has caused this
Agreement to be executed in its name and on its behalf, as of the Effective
Date.
“EMPLOYEE”
“COMPANY”
XXXXXXX
GROUP INC.
Xxxxxxx X. Xxxxxx
President
and Chief Executive Officer
