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10.17
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement"), is entered into as of
April 24, 1997, by and between EAGLE GEOPHYSICAL, INC., a Delaware corporation
(the "Company"), and XXXXXXX X. XXXXXXX (the "Executive").
The Company desires to employ the Executive and the Executive desires
to accept employment with the Company, on the terms and conditions of this
Agreement.
Accordingly, the parties agree as follows:
1. Employment Duties and Acceptance.
1.1 Employment by the Company; Duties. The Company
hereby agrees to employ the Executive for a term commencing on April 24 1997,
and expiring at the end of the day on April 23, 1999 (such date, or later date
to which this Agreement is extended in accordance with the terms hereof, the
"Termination Date"), unless earlier terminated as provided in Section 4 or
unless extended as provided herein (the "Term"). The Term shall be
automatically extended commencing on the Termination Date and on each
Termination Date thereafter (each such date being a "Renewal Date"), so as to
terminate one (1) year from such Renewal Date, unless and until at least ninety
(90) days prior to a Renewal Date either party hereto gives written notice to
the other that the Term should not be further extended, in which event the
Termination Date shall be the Renewal Date following such notice. During the
Term, the Executive shall serve in the capacity of Vice President and Chief
Financial Officer of the Company and shall also serve in those offices and
directorships of subsidiary corporations or entities of the Company to which he
may from time to time be appointed or elected. During the Term, the Executive
shall devote all reasonable efforts and all of his business time and services
to the Company, subject to the direction of the Board of Directors of the
Company (the "Board"). The Executive shall not engage in any other business
activities except for passive investments in corporations or partnerships not
engaged in the Company Business (as hereinafter defined) pursuant to Section 3
hereof.
1.2 Acceptance of Employment by the Executive. The
Executive hereby accepts such employment and shall render the services and
perform the duties described above.
2. Compensation and Other Benefits.
2.1 Annual Salary. The Company shall pay to the Executive
an annual salary at a rate of not less than one hundred fifty thousand dollars
($150,000) per year (the "Annual Salary"), subject to increase at the sole
discretion of the Board. The
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Annual Salary shall be payable in accordance with the payroll policies of the
Company as from time to time in effect, but in no event less frequently than
once each month, less such deductions as shall be required to be withheld by
applicable law and regulations.
2.2 Bonuses. The Executive may receive, at the sole
discretion of the Board, an incentive bonus with respect to the fiscal years
ending during the Term (the "Incentive Bonus"), equal to one-third of the
Annual Salary for such fiscal year, unless otherwise increased by the Board.
Any Incentive Bonus payable hereunder shall be paid by the Company to the
Executive within ninety (90) days following the end of the applicable fiscal
year.
2.3 Grant of Option. The Company agrees to grant the
Executive, pursuant to the terms of the Company's Option Plan (the "Option
Plan") created in connection with the initial public offering (the "IPO") of
the Company's common stock, options to acquire twenty five thousand (25,000)
shares of the Company's common stock (the "Options"), at an exercise price
equal to the IPO issue price. The Options shall vest over a period of three
years, with Options to acquire 8,334 shares vesting one year from the date
hereof, Options to acquire 8,333 shares vesting two years from the date hereof,
and Options to acquire 8,333 shares vesting three years from the date hereof,
subject to the terms of the Option Plan. The Company agrees to use all
reasonable efforts, consistent with the foregoing, to ensure that the Options
meet all requirements for treatment as Incentive Stock Options under the
Internal Revenue Code of 1986, as amended, and that the grant of the Options
meets the requirements of Rule 16b-3, promulgated under Section 16 of the
Securities Exchange Act of 1934, as amended (the "Act").
2.4 Vacation Policy. The Executive shall be entitled to a
paid vacation of three weeks during each year of the Term, commencing six
months after the date hereof.
2.5 Participation in Employee Benefit Plans. The Company
agrees to permit the Executive during the Term, if and to the extent eligible,
to participate in any group life, hospitalization or disability insurance plan,
health program, pension plan, similar benefit plan or other so-called "fringe
benefits" of the Company (collectively, "Benefits") which may be available to
other senior executives of the Company on terms no less favorable to the
Executive than the terms offered to such other executives. The Company agrees
to use its best efforts to obtain immediate coverage for the Executive upon the
commencement of the Term under its existing or newly adopted medical expense
and hospitalization plan for employees without premium surcharge and without
exclusions for disclosed preexisting conditions. The Executive shall cooperate
with the Company in applying for such coverage, including submitting to a
physical exam and providing all relevant health and personal data.
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2.6 General Business Expenses. The Company shall pay or
reimburse the Executive for all expenses reasonably and necessarily incurred by
the Executive during the Term in the performance of the Executive's services
under this Agreement. Such payment shall be made upon presentation of such
documentation as the Company customarily requires of its senior executive
employees prior to making such payments or reimbursements.
2.7 Company Car and Cellular Telephone. The Company shall
pay the Executive a car allowance of six hundred and no/100 dollars ($600.00)
per month, which the Executive may apply, in his discretion, to the cost
associated with purchasing or leasing, insuring, operating and maintaining an
automobile of the Executive's choice. The Executive may use the automobile for
personal as well as business purposes. The Company shall also furnish the
Executive with a cellular telephone of his choice and the Company shall pay all
charges in connection with the use thereof, other than charges for calls not
related to the Executive's duties hereunder.
3. Non-Competition, Confidentiality and Company Property.
3.1 Covenants Against Competition. The Executive
acknowledges that (i) the Company is currently engaged in the business of
owning, managing and operating seismic data acquisition equipment and hiring
and managing crews to operate such equipment, which equipment and crews are
contracted or hired for the purpose of performing geological surveys and
acquiring seismic data onshore and offshore (the "Company Business"); (ii) his
work for the Company will give him access to trade secrets of and confidential
information concerning the Company; and (iii) the agreements and covenants
contained in this Agreement are essential to protect the business and goodwill
of the Company. Accordingly, the Executive covenants and agrees as follows:
3.1.1 Non-Compete. As an independent covenant, and
in order to enforce the provisions of Sections 3.1.3 and 3.1.5 hereof and the
other provisions of this Agreement, the Executive agrees that he shall not
during the Restricted Period (as hereinafter defined) within a fifty (50) mile
radius of the Company's principal office, directly or indirectly (except in the
Executive's capacity as an officer of the Company), (i) engage or participate
in the Company Business; (ii) enter the employ of, or render any other services
to, any person engaged in the Company Business except as permitted hereunder;
or (iii) become interested in any such person in any capacity, including,
without limitation, as an individual, partner, shareholder, lender, officer,
director, principal, agent or trustee except as permitted hereunder; provided,
however, that the Executive may own, directly or indirectly, solely as an
investment, securities of any person traded on any national securities exchange
or listed on the National Association of Securities Dealers Automated Quotation
System if the Executive is not a controlling person of, or a member of a group
which controls, such person and the Executive does not,
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directly or indirectly, own 5% or more of any class of equity securities, or
securities convertible into or exercisable or exchangeable for 5% or more of
any class of equity securities, of such person. As used herein, the
"Restricted Period" shall mean a period commencing on the date hereof and
terminating upon the first to occur of (a) the date on which the Company
terminates or is deemed to terminate the Executive's employment without Cause
(as hereinafter defined), (b) the date the Executive terminates or is deemed to
terminate his employment pursuant to Section 4.6 hereof or (c) the date of
termination of this Agreement; provided, however, that if the Company shall
have terminated the Executive's employment for Cause and such Cause in fact
exists or if the Executive shall have terminated his employment with the
Company in breach of the terms of this Agreement, the Restricted Period shall
end one (1) year following the termination of the Executive's employment
hereunder.
3.1.2 Customers. As an independent covenant, the
Executive also agrees to refrain during his employment by the Company, and in
the event of the termination of his employment for any reason, for one year
thereafter, without written permission from the Company, from diverting,
taking, soliciting and/or accepting on his own behalf or on the behalf of
another person, firm, or company, the business of any past or present customer
of the Company, its divisions, subsidiaries and/or other affiliated entities,
or any identified prospective or potential customer of the Company, its
divisions, subsidiaries and/or affiliated entities, whose identity became known
to the Executive through his employment by the Company.
3.1.3 Confidential Information.
3.1.3.1 The Executive acknowledges that the
Company has a legitimate and continuing proprietary interest in the protection
of its confidential information and that it has invested substantial sums and
will continue to invest substantial sums to develop, maintain and protect
confidential information. The Company agrees to provide the Executive access
to confidential information in conjunction with the Executive's duties,
including, without limitation, information of a technical and business nature
regarding the Company's past, current or anticipated business that may
encompass financial information, financial figures, trade secrets, customer
lists, details of client or consultant contracts, pricing policies, operational
methods, marketing plans or strategies, product development techniques or
plans, business acquisition plans, Company employee information, organizational
charts, new personnel acquisition plans, technical processes, designs and
design projects, inventions and research projects, ideas, discoveries,
inventions, improvements, trade secrets, design specifications, writings and
other works of authorship. In exchange, as an independent covenant, the
Executive agrees not to make any unauthorized use, publication, or disclosure,
during or subsequent to his employment by the Company, of any Intellectual
Property of a confidential or trade secret nature, generated or
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acquired by him during the course of his employment, except to the extent that
the disclosure of Intellectual Property Information is necessary to fulfill his
responsibilities as an employee of the Company. The Executive understands that
confidential matters and trade secrets include information not generally known
by or available to the public about or belonging to the Company, its divisions,
subsidiaries, and related affiliates, or belonging to other companies to whom
the Company, its divisions, subsidiaries, and related affiliates, may have an
obligation to maintain information in confidence, and that authorization for
public disclosure may only be obtained through the Company's written consent.
3.1.3.2 The Executive further agrees not to
disclose to the Company, or induce any personnel of the Company to use, any
confidential information, trade secret, or confidential material belonging to
others.
3.1.3.3 The Executive agrees that the
covenants set forth in Sections 3.1.3.1 and 3.1.3.2 are independent covenants
and indefinite obligations binding upon the Executive both during and after the
termination of the Executive's relationship with the Company.
3.1.4 Property of the Company. All memoranda,
notes, lists, records, engineering drawings, technical specifications and
related documents and other documents or papers (and all copies thereof)
relating to the Company, including such items stored in computer memories,
microfiche or by any other means, made or compiled by or on behalf of the
Executive after the date hereof, or made available to the Executive after the
date hereof relating to the Company, its affiliates or any entity which may
hereafter become an affiliate thereof, shall be the property of the Company,
and shall be delivered to the Company promptly upon the termination of the
Executive's employment with the Company or at any other time upon request;
provided, however, that the Executive's address books, diaries, chronological
correspondence files and rolodex files shall be deemed to be property of the
Executive.
3.1.5 Original Material. The Executive agrees that
any inventions, discoveries, improvements, ideas, concepts or original works of
authorship relating directly to the Company Business, including without
limitation information of a technical or business nature such as ideas,
discoveries, designs, inventions, improvements, trade secrets, know-how,
manufacturing processes, product formulae, design specifications, writings and
other works of authorship, computer programs, financial figures, marketing
plans, customer lists and data, business plans or methods and the like, which
relate in any manner to the actual or anticipated business or the actual or
anticipated areas of research and development of the Company and its divisions,
subsidiaries, affiliates, or related entities, whether or not protectable by
patent or copyright, that have been originated, developed or
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reduced to practice by the Executive alone or jointly with others during the
Executive's employment with the Company shall be the property of and belong
exclusively to the Company. The Executive shall promptly and fully disclose to
the Company the origination or development by the Executive of any such
material and shall provide the Company with any information that it may
reasonably request about such material. Either during the subsequent to the
Executive's employment, upon the request and at the expense of the Company or
its nominee, and for no remuneration in addition to that due the Executive
pursuant to his employment by the Company, but at no expense to him, the
Executive agrees to execute, acknowledge, and deliver to the Company or its
attorneys any and all instruments which, in the judgment of the Company or its
attorneys, may be necessary or desirable to secure or maintain for the benefit
of the Company adequate patent, copyright, and other property rights in the
United States and foreign countries with respect to any such inventions,
improvements, ideas, concepts, or original works of authorship embraced within
this Agreement.
3.1.6 Employees of the Company and its Affiliates.
As an independent covenant, the Executive agrees to refrain during his
employment by the Company, and in the event of the termination of his
employment for any reason for a period of one year thereafter, from inducing or
attempting to influence any employee of the Company, its divisions,
subsidiaries and/or affiliated entities to terminate his employment.
3.1.7 Company's Interest. The Executive further
agrees that these covenants are made to protect the legitimate business
interests of the Company, including interests in the Company's property
described in and pursuant to Section 3.1.4 and Section 3.1.5, and not to
restrict his mobility or to prevent him from utilizing his general technical
skills. The Executive understands as a part of these covenants that the
Company intends to exercise whatever legal recourse against him for any breach
of this Agreement and, in particular, for any breach of these covenants.
3.2 Rights and Remedies Upon Breach. If the Executive
breaches, or threatens to commit a breach of, any of the provisions contained
in Section 3.1 of this Agreement (the "Restrictive Covenants"), the Company
shall have the following rights and remedies, each of which rights and remedies
shall be independent of the others and severally enforceable, and each of which
is in addition to, and not in lieu of, any other rights and remedies available
to the Company under law or in equity:
3.2.1 Specific Performance. The right and remedy
to have the Restrictive Covenants specifically enforced by any court of
competent jurisdiction, it being agreed that any breach or threatened breach of
the Restrictive Covenants would cause irreparable injury to the Company and
that money damages would not provide an adequate remedy to the Company.
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3.2.2 Accounting. The right and remedy to
require the Executive to account for and pay over to the Company all
compensation, profits, monies, accruals, increments or other benefits derived
or received by the Executive as the result of any action constituting a breach
of the Restrictive Covenants.
3.3 Severability of Covenants. The Executive
acknowledges and agrees that the Restrictive Covenants are reasonable and valid
in duration and geographical scope and in all other respects. If any court
determines that any of the Restrictive Covenants, or any part thereof, is
invalid or unenforceable, the remainder of the Restrictive Covenants shall not
thereby be affected and shall be given full effect without regard to the
invalid portions.
3.4 Court Review. If any court determines that any of
the Restrictive Covenants, or any part thereof, is unenforceable because of the
duration or geographical scope of, or scope of activities restrained by, such
provision, such court shall have the power to reduce the duration or scope of
such provision, as the case may be, and, in its reduced form, such provision
shall then be enforceable.
3.5 Enforceability in Jurisdictions. The Company and the
Executive intend to and hereby confer jurisdiction to enforce the Restrictive
Covenants upon the courts of any jurisdiction within the geographical scope of
such Restrictive Covenants. If the courts of any one or more of such
jurisdictions hold the Restrictive Covenants unenforceable by reason of the
breadth of such scope or otherwise, it is the intention of the Company that
such determination not bar or in any way affect the right of the Company to the
relief provided above in the courts of any other jurisdiction within the
geographical scope of such Restrictive Covenants, as to breaches of such
Restrictive Covenants in such other respective jurisdictions, such Restrictive
Covenants as they relate to each jurisdiction being, for this purpose,
severable into diverse and independent covenants.
4. Termination.
4.1 Termination Upon Death. If the Executive dies during
the Term, this Agreement shall terminate; provided, however, that in any such
event, the Company shall pay to the Executive's estate any portion of the
Annual Salary that shall have been earned by the Executive prior to the
termination but not yet paid, any accrued Incentive Bonus and any Benefits that
have vested in the Executive at the time of such termination as a result of his
participation in any of the Company's benefit plans shall be paid to the
Executive, or to his estate or designated beneficiary, in accordance with the
provisions of such plan; and the Company shall reimburse the Executive, or his
estate, for any expenses with respect to which the Executive is entitled to
reimbursement pursuant to Section 2.6 of this Agreement, and the Executive's
right to indemnification, payment or reimbursement pursuant to Section 6 of
this Agreement
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shall not be affected by such termination and shall continue in full force and
effect, both with respect to proceedings that are threatened, pending or
completed at the date of such termination and with respect to proceedings that
are threatened, pending or completed after that date.
4.2 Termination With Cause. The Company has the right, at
any time during the Term, subject to all of the provisions hereof, exercisable
by serving notice, effective on or after the date of service of such notice as
specified therein, to terminate the Executive's employment under this Agreement
and discharge the Executive with Cause. If such right is exercised, the
Company's obligation to the Executive shall be limited solely to the payment of
unpaid Annual Salary accrued, together with any earned but unpaid Incentive
Bonus and Benefits vested up to the effective date specified in the Company's
notice of termination. As used in this Agreement, the term "Cause" shall mean
and include (i) chronic alcoholism or controlled substance abuse as determined
by a doctor mutually acceptable to the Company and the Executive, (ii) an act
of proven fraud or dishonesty on the part of the Executive with respect to the
Company or its subsidiaries; (iii) knowing and material failure by the
Executive to comply with material applicable laws and regulations relating to
the business of the Company or its subsidiaries; (iv) the Executive's
continuing failure to satisfactorily perform his duties hereunder or a material
breach by the Executive of this Agreement except, in each case, where such
failure or breach is caused by the illness or other similar incapacity or
disability of the Executive; or (v) conviction of a crime involving moral
turpitude or a felony. Prior to the effectiveness of termination for Cause
under subclause (i), (ii), (iii) or (iv) above, the Executive shall be given 30
days' prior notice from the Board specifically identifying the reasons which
are alleged to constitute Cause for any termination hereunder and an
opportunity to be heard by the Board in the event the Executive disputes such
allegations.
4.3 Termination Without Cause. The Company has the right,
at any time during the Term, subject to all of the provisions hereof,
exercisable by serving notice, effective on or after the date of service of
such notice as specified therein, to terminate the Executive's employment under
this Agreement and discharge the Executive without Cause. If the Executive is
terminated during the Term without Cause (including any termination which is
deemed to be a constructive termination without Cause under Section 4.6
hereof), the Company's obligation to the Executive shall be limited solely to
(a) the payment, at the times and upon the terms provided for herein, of the
greater of (i) the Executive's Annual Salary and Incentive Bonus for the number
of full months remaining in the Term of this Agreement had the Executive not
been so terminated and (ii) the Executive's Annual Salary for a period of
twelve months, in each case based on the Annual Salary of the Executive in
effect on the date of termination (or, if the Company has reduced the
Executive's Annual Salary in breach of this Agreement, the Executive's Annual
Salary before such
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reduction), together with all unpaid Incentive Bonus and Benefits awarded or
accrued up to the date of termination, and (b) the provision at the Company's
expense of continued medical and dental insurance for the Executive, with the
same or substantially similar coverage as provided by the Company to Executive
immediately prior to the date of termination, for the greater of twelve (12)
months or the number of full months remaining in the Term of this Agreement had
the Executive not been so terminated. If the Executive is terminated after he
has received one Incentive Bonus, the Incentive Bonus in clause (i) shall be
based on the amount of that one Incentive Bonus; if he has not yet received an
Incentive Bonus, it shall be based on the minimum Incentive Bonus (i.e., one
third of the Annual Salary). In the event of a termination by the Company
without Cause within 180 days after a Change of Control (as hereinafter
defined), including a constructive termination without Cause pursuant to
Section 4.6, the amounts due to the Executive pursuant to this Section 4.3
shall be due and payable in one lump-sum payment within 60 days after such
termination. In all other cases, any amounts due to the Executive pursuant to
this Section 4.3 shall be due and payable as and when they would have become
due and payable over the remaining Term of this Agreement had the Executive not
been so terminated.
4.4 Termination by the Executive. Any termination of this
Agreement by the Executive during the Term, except such termination as is
deemed to be a constructive termination without Cause by the Company under
Section 4.6 of this Agreement, shall be deemed to be a breach of the terms of
this Agreement for the purposes of Section 3.1.1 hereof and shall entitle the
Company to discontinue payment of all Annual Salary, Incentive Bonuses and
Benefits not earned and payable prior to the date of such termination.
4.5 Termination upon Disability. If during the Term the
Executive becomes physically or mentally disabled, whether totally or
partially, as evidenced by the written statement of a competent physician
licensed to practice medicine in the United States who is mutually acceptable
to the Company and the Executive or his closest relative if he is not then able
to make such a choice, so that the Executive is unable substantially to perform
his services hereunder for (i) a period of four consecutive months, or (ii) for
shorter periods aggregating six months during any twelve-month period, the
Company may at any time after the last day of the four consecutive months of
disability or the day on which the shorter periods of disability equal an
aggregate of six months, by written notice to the Executive, terminate the
Executive's employment hereunder and discontinue payments of the Annual Salary,
Incentive Bonuses and Benefits accruing from and after the date of such
termination. The Executive shall be entitled to the full compensation payable
to him hereunder for periods of disability shorter than the periods specified
in clauses (i) and (ii) of the previous sentence.
4.6 Constructive Termination Without Cause.
Notwithstanding any other provision of this Agreement, the
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Executive's employment under this Agreement may be terminated during the Term
by the Executive, which shall be deemed to be constructive termination by the
Company without Cause, if one of the following events shall occur without the
consent of the Executive: (i) a failure to elect or reelect or to appoint or
reappoint the Executive to the office of Vice President and Chief Financial
Officer of the Company; (ii) the assignment or reassignment by the Company of
the Executive to a location not within 35 miles of the Company's current
location; (iii) the liquidation, dissolution, consolidation or merger of the
Company, or transfer of all or substantially all of its assets, other than a
transaction in which a successor corporation with a net worth at least equal to
that of the Company assumes this Agreement and all obligations and undertakings
of the Company hereunder; (iv) a reduction in the Executive's fixed salary; (v)
the failure of the Company to continue to provide the Executive with office
space, related facilities and secretarial assistance that are commensurate with
the Executive's responsibilities to and position with the Company; (vi) the
notification by the Company of the Company's intention not to observe or
perform one or more of the obligations of the Company under this Agreement;
(vii) the failure by the Company to indemnify, pay or reimburse the Executive
at the time and under the circumstances required by Section 6 of this
Agreement; or (viii) the occurrence of any other material breach of this
Agreement by the Company or any of its subsidiaries. Any such termination
shall be made by written notice to the President of the Company, specifying the
event relied upon for such termination and given within 60 days after such
event. Any constructive termination shall be effective 60 days after the date
the President of the Company has been given such written notice setting forth
the grounds for such termination with specificity; provided, however, that the
Executive shall not be entitled to terminate this Agreement in respect of any
of the grounds set forth above if within 60 days after such notice the action
constituting such ground for termination is no longer continuing. A
constructive termination by the Company without Cause shall terminate the
Restrictive Period hereunder.
4.7 For the purposes hereof, a "Change of Control of the
Company" shall be deemed to have occurred if after the effective date and the
IPO (i) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Act), directly or indirectly, of securities of the Company representing 50% or
more of the combined voting power of the Company's then outstanding securities
without the prior approval of at least a majority of the members of the Board
in office immediately prior to such person attaining such percentage interest;
(ii) there occurs a proxy contest or a consent solicitation, or the Company is
a party to a merger, consolidation, sale of assets, plan of liquidation or
other reorganization not approved by at least a majority of the members of the
Board in office, as a consequence of which members of the Board in office
immediately prior to such transaction or event constitute less than a majority
of the Board thereafter; or (iii) during any period of
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two consecutive years, other than as a result of an event described in clause
(ii) of this Section 4.7, individuals who at the beginning of such period
constituted the Board (including for this purpose any new director 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 still in office who were
directors at the beginning of such period) cease for any reason to constitute
at least a majority of the Board.
5. Insurance. The Company may, from time to time, apply for and
take out, in its own name and at its own expense, naming itself or one or more
of its affiliates as the designated beneficiary (which it may change from time
to time), policies for life, health, accident, disability or other insurance
upon the Executive in any amount or amounts that it may deem necessary or
appropriate to protect its interest. The Executive agrees to aid the Company in
procuring such insurance by submitting to medical examinations and by filling
out, executing and delivering such applications and other instruments in
writing as may reasonably be required by an insurance company or companies to
which any application or applications for insurance may be made by or for the
Company.
6. Indemnification.
6.1 The Company shall, to the maximum extent not
prohibited by law, indemnify the Executive if he is made, or threatened to be
made, a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, including
an action by or in the right of the Company to procure a judgment in its favor
(collectively, a "Proceeding"), by reason of the fact that the Executive is or
was a director or officer of the Company, or is or was serving in any capacity
at the request of the Company for any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise, against judgments,
fines, penalties, excise taxes, amounts paid in settlement and costs, charges
and expenses (including attorneys' fees and disbursements) paid or incurred in
connection with any such Proceeding.
6.2 The Company shall, from time to time, reimburse or
advance to the Executive the funds necessary for payment of expenses, including
attorneys' fees and disbursements, incurred in connection with any Proceeding
in advance of the final disposition of such Proceeding; provided, however.
that, if required by the Texas Business Corporation Act, such expenses incurred
by or on behalf of the Executive may be paid in advance of the final
disposition of a Proceeding only upon receipt by the Company of an undertaking,
by or on behalf of the Executive, to repay any such amount so advanced if it
shall ultimately be determined by final judicial decision from which there is
no further right of appeal that the Executive is not entitled to be indemnified
for such expenses.
6.3 The right to indemnification and reimbursement or
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advancement of expenses provided by, or granted pursuant to, this Section 6
shall not be deemed exclusive of any other rights which the Executive may now
or hereafter have under any law, by-law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office.
6.4 The right to indemnification and reimbursement or
advancement of expenses provided by, or granted pursuant to, this Section 6
shall continue as to the Executive after he has ceased to be a director or
officer and shall inure to the benefit of the heirs, executors and
administrators of the Executive.
6.5 The Company shall purchase and maintain director and
officer liability insurance on such terms and providing such coverage as the
Board determines is appropriate, and the Executive shall be covered by such
insurance on the same basis as the other directors and executive officers of
the Company.
6.6 The right to indemnification and reimbursement or
advancement of expenses provided by, or granted pursuant to, this Section 6
shall be enforceable by the Executive in any court of competent jurisdiction.
The burden of proving that such indemnification or reimbursement or advancement
of expenses is not appropriate shall be on the Company. Neither the failure of
the Company (including its board of directors, independent legal counsel, or
its stockholders) to have made a determination prior to the commencement of
such action that such indemnification or reimbursement or advancement of
expenses is proper in the circumstances nor an actual determination by the
Company (including its board of directors, independent legal counsel, or its
stockholders) that the Executive is not entitled to such indemnification or
reimbursement or advancement of expenses shall constitute a defense to the
action or create a presumption that the Executive is not so entitled. The
Executive shall also be indemnified for any expenses incurred in connection
with successfully establishing his right to such indemnification or
reimbursement or advancement of expenses, in whole or in part, in any such
proceeding.
6.7 If the Executive serves (i) another corporation of
which a majority of the shares entitled to vote in the election of its
directors is held by the Company, or (ii) any employee benefit plan of the
Company or any corporation referred to in clause (i), in any capacity, then he
shall be deemed to be doing so at the request of the Company.
6.8 The right to indemnification or reimbursement or
advancement of expenses shall be interpreted on the basis of the applicable law
in effect at the time of the occurrence of the event or events giving rise to
the applicable Proceeding.
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7. Other Provisions.
7.1 Certain Definitions. As used in this Agreement, the
following terms have the following meanings unless the context otherwise
requires:
(i) "affiliate" with respect to the Company means any
other person controlled by or under common control with the Company
but shall not include any stockholder or director of the Company, as
such.
(ii) "person" means any individual, corporation,
partnership, firm, joint Company, association, joint-stock company,
trust, unincorporated organization, governmental or regulatory body or
other entity.
(iii) "subsidiary" means any corporation 50% or more
of the voting securities of which are owned directly or indirectly by
the Company.
7.2 Notices. Any notice or other communication required
or permitted hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, sent by facsimile transmission or sent by certified,
registered or express mail, postage prepaid. Any such notice shall be deemed
given when so delivered personally, telegraphed, telexed or sent by facsimile
transmission or, if mailed, on the date of actual receipt thereof, as follows:
(i) if to the Company, to:
Eagle Geophysical, Inc.
00 Xxxxx Xxxxxx Xxxx
Xxxx Xxxxxxxx, 0xx Floor
Xxxxxxx, Xxxxx 00000
Attention: Xxx X. Xxxxxxxxx, President
with a copy to:
Gardere Xxxxx Xxxxxx & Xxxxx, L.L.P.
000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: X. X. Xxxxxxx III
(ii) if to the Executive, to:
Xxxxxxx X. XxXxxxx
0000 Xxxxxxx Xxxxx
Xxxxx Xxxx, Xxxxx 00000
Any party may change its address for notice hereunder by notice to the other
party hereto.
7.3 Entire Agreement. This Agreement contains the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements, written or oral, with respect thereto.
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7.4 Waivers and Amendments. This Agreement may be
amended, superseded, canceled, renewed or extended, and the terms and
conditions hereof may be waived, only by a written instrument signed by the
parties or, in the case of a waiver, by the party waiving compliance. No delay
on the part of any party in exercising any right, power or privilege hereunder
shall operate as a waiver thereof. Nor shall any waiver on the part of any
party of any such right, power or privilege hereunder, nor any single or
partial exercise of any right, power or privilege hereunder, preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege hereunder.
7.5 Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Texas (without giving
effect to the choice of law provisions thereof) where the employment of the
Executive shall be deemed, in part, to be performed and enforcement of this
Agreement or any action taken or held with respect to this Agreement shall be
taken in the courts of appropriate jurisdiction in Houston, Texas.
7.6 Assignment. This Agreement, and any rights and
obligations hereunder, may not be assigned by the Executive and may be assigned
by the Company (subject to Section 4.6 (iii) hereof) only to a successor by
merger or purchasers of substantially all of the assets of the Company.
7.7 Counterparts. This Agreement may be executed in
separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
7.8 Headings. The headings in this Agreement are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
7.9 No Presumption Against Interest. This Agreement has
been negotiated. drafted, edited and reviewed by the respective parties, and
therefore, no provision arising directly or indirectly herefrom shall be
construed against any party as being drafted by said party.
7.10 Validity Contest. The Company shall promptly pay any
and all legal fees and expenses incurred by the Executive from time to time as
a direct result of the Company's contesting the due execution, authorization,
validity or enforceability of this Agreement.
7.11 Binding Agreement. This Agreement shall inure to the
benefit of and bit binding upon the Company and its respective successors and
assigns and the Executive and his legal representatives.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
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EAGLE GEOPHYSICAL, INC.
By: /s/ Xxx X. Xxxxxxxxx
-------------------------------------
Xxx X. Xxxxxxxxx, President
EXECUTIVE
By: /s/ Xxxxxxx X. XxXxxxx
-------------------------------------
Xxxxxxx X. XxXxxxx
