AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the
"Amendment"), dated as of AUGUST 31, 1995, is between Enterra
Corporation, a Delaware corporation ("Enterra"), and M. XXXXXXX
XXXXX (the "Employee").
WHEREAS, on FEBRUARY 20, 1992 , Enterra and the
Employee entered into a Severance Agreement, dated as of
FEBRUARY 20, 1992 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain
provisions of the Agreement regarding the severance compensation
upon termination of employment in connection with a Change of
Control;
WHEREAS, the parties hereto desire to condition the
effectiveness of this Amendment upon the consummation of the
merger between Enterra and Xxxxxxxxxxx International Incorporated
("Weatherford") pursuant to the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not
defined herein shall have the meanings ascribed thereto in the
Agreement;
NOW, THEREFORE, effective as of the Effective Time, as
that term is defined in the Merger Agreement, the parties hereto,
intending to be legally bound, agree as follows:
1. Section 1(p)(ii) of the Agreement is hereby
amended by adding thereto a new last paragraph, to read as
follows:
"Notwithstanding anything to the contrary under this
Section 1(p)(ii), any resignation by the Employee at
any time from the Effective Time, as that term is
defined in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and the Company (the "Merger
Agreement"), through August 12, 1996 shall constitute a
'Termination upon Change of Control' under this
Agreement."
2. Section 1 of the Agreement is hereby amended by
adding thereto a new sentence at the end thereof, to read as
follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Merger Agreement, any reference in
this Agreement to the 'Company' or the
'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock,
par value $.10 per share, of Weatherford."
3. Section 4 of the Agreement is hereby amended by
deleting therefrom the introductory provision and subsection (a)
thereof and substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
4. Section 10 of the Agreement is deleted and the
following is
-2-
substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or for the benefit of
the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement,
the Merger Agreement or otherwise, but determined
without regard to any additional payments required
under this Section 10) (a "Payment") would be subject
to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
-3-
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim
-4-
in any permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
5. The remainder of the Agreement shall remain in
full force and effect as written.
6. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
-5-
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief
Financial Officer
/s/ M. Xxxxxxx Xxxxx
-------------------------------
M. Xxxxxxx Xxxxx
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the
"Amendment"), dated as of AUGUST 31, 1995, is between Enterra
Corporation, a Delaware corporation ("Enterra"), and C. XXXX
XXXXX (the "Employee").
WHEREAS, on February 20, 1992, Enterra and the
Employee entered into a Severance Agreement, dated as of
February 20, 1992 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain
provisions of the Agreement regarding the severance compensation
upon termination of employment in connection with a Change of
Control;
WHEREAS, the parties hereto desire to condition the
effectiveness of this Amendment upon the consummation of the
merger between Enterra and Xxxxxxxxxxx International Incorporated
("Weatherford") pursuant to the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not
defined herein shall have the meanings ascribed thereto in the
Agreement;
NOW, THEREFORE, effective as of the Effective Time, as
that term is defined in the Merger Agreement, the parties hereto,
intending to be legally bound, agree as follows:
1. Section 1 of the Agreement is hereby amended by
adding thereto a new sentence at the end thereof, to read as
follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28,
1995, between Xxxxxxxxxxx International
Incorporated ("Weatherford") and the Company,
any reference in this Agreement to the
'Company' or the 'Common Stock' shall be
deemed to be a reference to Xxxxxxxxxxx or
the common
stock, par value $.10 per share, of Weatherford."
2. Section 4 of the Agreement is hereby amended by
deleting therefrom the introductory provision and subsection (a)
thereof and substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
3. Section 10 of the Agreement is deleted and the
following is substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or
-2-
for the benefit of the Employee (whether paid or payable
or distributed or distributable pursuant to the terms
of this Agreement, the Merger Agreement or otherwise,
but determined without regard to any additional payments
required under this Section 10) (a "Payment") would be
subject to the excise tax imposed by Section 4999 of the
Code or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
-3-
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim in any
permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance or
-4-
with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
4. The remainder of the Agreement shall remain in
full force and effect as written.
5. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
/s/ C. Xxxx Xxxxx
--------------------------------
C. Xxxx Xxxxx
-5-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the "Amendment"),
dated as of AUGUST 31, 1995, is between Pipeline Induction Heat Limited
("PIH") and XXXXX XXXXXXX XXXX (the "Employee").
WHEREAS, Enterra Corporation, a Delaware Corporation ("Enterra"),
is the ultimate parent company of PIH;
WHEREAS, on Xxxxx 0, 0000, XXX and the Employee entered into a
Severance Agreement, dated as of April 1, 1993 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain provisions of
the Agreement regarding the severance compensation upon termination of
employment in connection with a Change of Control;
WHEREAS, the parties hereto desire to condition the effectiveness
of this Amendment upon the consummation of the merger between Enterra and
Xxxxxxxxxxx International Incorporated ("Weatherford") pursuant to the
Agreement and Plan of Merger, dated as of June 23, 1995, as amended as of
August 28, 1995, between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not defined herein
shall have the meanings ascribed thereto in the Agreement;
NOW, THEREFORE, effective as of the Effective Time, as that term is
defined in the Merger Agreement, the parties hereto, intending to be legally
bound, agree as follows:
1. Section 1 of the Agreement is hereby amended by adding thereto
a new sentence at the end thereof, to read as follows:
"With respect to all periods from and after the Effective Time,
as that term is defined in the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and Enterra, any reference in this Agreement
to 'Enterra' or the 'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock, par value $.10
per share, of Weatherford."
2. Section 4 of the Agreement is hereby amended by deleting
therefrom the introductory provision and subsection (a) thereof and
substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of Enterra's Common Stock the total fair market
value of which will be equal to the excess, if any, of
the aggregate fair market value of the shares of
Enterra's Common Stock subject to all stock options and
stock appreciation rights outstanding and unexercised
immediately prior to the Termination Date, whether
vested or unvested, granted to the Employee under the
Stock Plan, over the aggregate exercise price of all
such stock options. For purposes of this paragraph,
fair market value shall mean the highest of (x) the
closing price of Enterra's Common Stock on the business
day immediately preceding the Termination Date, if such
Common Stock is publicly traded at such date, (y) if
such Common Stock is not publicly traded at the
Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of Enterra's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of Enterra has given rise to a Change of
Control. Enterra shall take all corporate action
necessary (i) to reserve for issuance a sufficient
number of shares of the Common Stock for delivery
pursuant to this section and (ii) to ensure that all
shares of the Common Stock issued pursuant to this
section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
3. The remainder of the Agreement shall remain in full force and
effect as written.
4. This Amendment shall be conditioned upon the consummation of
the merger between Enterra and Weatherford pursuant to the Merger Agreement,
and in the event such merger is not so consummated, the Agreement shall
remain in full force and effect without regard to the changes contemplated by
this Amendment.
-2-
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as of the day and year first above written.
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
PIPELINE INDUCTION HEAT LIMITED
By: /s/ C. Xxxx Xxxxx
---------------------------
C. Xxxx Xxxxx
Director
/s/ Xxxxx Xxxxxxx Xxxx
---------------------------
Xxxxx Xxxxxxx Xxxx
-3-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the
"Amendment"), dated as of AUGUST 31, 1995, is between Enterra
Corporation, a Delaware corporation ("Enterra"), and XXXXXX X.
XXXXX (the "Employee").
WHEREAS, on FEBRUARY 8, 1990, Enterra and the
Employee entered into a Severance Agreement, dated as of
FEBRUARY 8, 1990 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain
provisions of the Agreement regarding the severance compensation
upon termination of employment in connection with a Change of
Control;
WHEREAS, the parties hereto desire to condition the
effectiveness of this Amendment upon the consummation of the
merger between Enterra and Xxxxxxxxxxx International Incorporated
("Weatherford") pursuant to the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not
defined herein shall have the meanings ascribed thereto in the
Agreement;
NOW, THEREFORE, effective as of the Effective Time, as
that term is defined in the Merger Agreement, the parties hereto,
intending to be legally bound, agree as follows:
1. Section 1(p)(ii) of the Agreement is hereby
amended by adding thereto a new last paragraph, to read as
follows:
"Notwithstanding anything to the contrary under this
Section 1(p)(ii), any resignation by the Employee at
any time from the Effective Time, as that term is
defined in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and the Company (the "Merger
Agreement"), through August 12, 1996 shall constitute a
'Termination upon Change of Control' under this
Agreement."
2. Section 1 of the Agreement is hereby amended by
adding thereto a new sentence at the end thereof, to read as
follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Merger Agreement, any reference in
this Agreement to the 'Company' or the
'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock,
par value $.10 per share, of Weatherford."
3. Section 4 of the Agreement is hereby amended by
deleting therefrom the introductory provision and subsection (a)
thereof and substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
4. Section 10 of the Agreement is deleted and the
following is
-2-
substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or for the benefit of
the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement,
the Merger Agreement or otherwise, but determined
without regard to any additional payments required
under this Section 10) (a "Payment") would be subject
to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
-3-
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim
-4-
in any permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
5. The remainder of the Agreement shall remain in
full force and effect as written.
6. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
-5-
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
/s/ Xxxxxx X. Xxxxx
-------------------------------
Xxxxxx X. Xxxxx
-6-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the "Amendment"),
dated as of AUGUST 31, 1995, is between Enterra Corporation, a Delaware
corporation ("Enterra"), and XXXXXX X. XXXXXX (the "Employee").
WHEREAS, on FEBRUARY 8, 1990, Enterra and the Employee entered
into a Severance Agreement, dated as of FEBRUARY 8, 1990 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain provisions of
the Agreement regarding the severance compensation upon termination of
employment in connection with a Change of Control;
WHEREAS, the parties hereto desire to condition the effectiveness
of this Amendment upon the consummation of the merger between Enterra and
Xxxxxxxxxxx International Incorporated ("Weatherford") pursuant to the
Agreement and Plan of Merger, dated as of June 23, 1995, as amended as of
August 28, 1995, between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not defined herein
shall have the meanings ascribed thereto in the Agreement;
NOW, THEREFORE, effective as of the Effective Time, as that term is
defined in the Merger Agreement, the parties hereto, intending to be legally
bound, agree as follows:
1. Section 1(p)(ii) of the Agreement is hereby amended by adding
thereto a new last paragraph, to read as follows:
"Notwithstanding anything to the contrary under this
Section 1(p)(ii), any resignation by the Employee at
any time from the Effective Time, as that term is
defined in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and the Company (the "Merger
Agreement"), through August 12, 1996 shall constitute a
'Termination upon Change of Control' under this
Agreement."
2. Section 1 of the Agreement is hereby amended by adding thereto
a new sentence at the end thereof, to read as follows:
"With respect to all periods from and after the Effective Time,
as that term is defined in the Merger Agreement, any reference in
this Agreement to the 'Company' or the 'Common Stock' shall be
deemed to be a reference to Xxxxxxxxxxx or the common stock,
par value $.10 per share, of Weatherford."
3. Section 4 of the Agreement is hereby amended by deleting
therefrom the introductory provision and subsection (a) thereof and
substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
4. Section 10 of the Agreement is deleted and the following is
-2-
substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or for the benefit of
the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement,
the Merger Agreement or otherwise, but determined
without regard to any additional payments required
under this Section 10) (a "Payment") would be subject
to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
-3-
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim
-4-
in any permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
5. The remainder of the Agreement shall remain in full force and
effect as written.
6. This Amendment shall be conditioned upon the consummation of
the merger between Enterra and Weatherford pursuant to the Merger Agreement,
and in the event such merger is not so consummated, the Agreement shall
remain in full force and effect without regard to the changes contemplated by
this Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
-5-
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
/s/ Xxxxxx X. Xxxxxx
------------------------------
Xxxxxx X. Xxxxxx
-6-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the "Amendment"),
dated as of AUGUST 31, 1995, is between Enterra Corporation, a Delaware
corporation ("Enterra"), and XXXXXX X. XXXXXXX (the "Employee").
WHEREAS, on FEBRUARY 8, 1990, Enterra and the Employee entered
into a Severance Agreement, dated as of FEBRUARY 8, 1990 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain provisions of
the Agreement regarding the severance compensation upon termination of
employment in connection with a Change of Control;
WHEREAS, the parties hereto desire to condition the effectiveness
of this Amendment upon the consummation of the merger between Enterra and
Xxxxxxxxxxx International Incorporated ("Weatherford") pursuant to the
Agreement and Plan of Merger, dated as of June 23, 1995, as amended as of
August 28, 1995, between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not defined herein
shall have the meanings ascribed thereto in the Agreement;
NOW, THEREFORE, effective as of the Effective Time, as that term is
defined in the Merger Agreement, the parties hereto, intending to be legally
bound, agree as follows:
1. Section 1(p)(ii) of the Agreement is hereby amended by adding
thereto a new last paragraph, to read as follows:
"Notwithstanding anything to the contrary under this
Section 1(p)(ii), any resignation by the Employee at
any time from the Effective Time, as that term is
defined in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and the Company (the "Merger
Agreement"), through August 12, 1996 shall constitute a
'Termination upon Change of Control' under this
Agreement."
2. Section 1 of the Agreement is hereby amended by adding thereto
a new sentence at the end thereof, to read as follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Merger Agreement, any reference in
this Agreement to the 'Company' or the
'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock,
par value $.10 per share, of Weatherford."
3. Section 4 of the Agreement is hereby amended by deleting
therefrom the introductory provision and subsection (a) thereof and
substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's Termination
upon a Change of Control, the Company shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
4. Section 10 of the Agreement is deleted and the following is
-2-
substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or for the benefit of
the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement,
the Merger Agreement or otherwise, but determined
without regard to any additional payments required
under this Section 10) (a "Payment") would be subject
to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
-3-
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim
-4-
in any permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
5. The remainder of the Agreement shall remain in full force and
effect as written.
6. This Amendment shall be conditioned upon the consummation of
the merger between Enterra and Weatherford pursuant to the Merger Agreement,
and in the event such merger is not so consummated, the Agreement shall
remain in full force and effect without regard to the changes contemplated by
this Amendment.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as of the day and year first above written.
-5-
ENTERRA CORPORATION
By: /s/ M. Gay Xxxxxx
-------------------------------
M. Gay Xxxxxx
Secretary
/s/ Xxxxxx X. Xxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxx
-6-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the
"Amendment"), dated as of AUGUST 31, 1995, is between Enterra
Corporation, a Delaware corporation ("Enterra"), and XXXXXXX X.
XXXXXX, XX. (the "Employee").
WHEREAS, on NOVEMBER 10, 1993, Enterra and the
Employee entered into a Severance Agreement, dated as of
NOVEMBER 10, 1993 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain
provisions of the Agreement regarding the severance compensation
upon termination of employment in connection with a Change of
Control;
WHEREAS, the parties hereto desire to condition the
effectiveness of this Amendment upon the consummation of the
merger between Enterra and Xxxxxxxxxxx International Incorporated
("Weatherford") pursuant to the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not
defined herein shall have the meanings ascribed thereto in the
Agreement;
NOW, THEREFORE, effective as of the Effective Time, as
that term is defined in the Merger Agreement, the parties hereto,
intending to be legally bound, agree as follows:
1. Section 1 of the Agreement is hereby amended by
adding thereto a new sentence at the end thereof, to read as
follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28,
1995, between Xxxxxxxxxxx International
Incorporated ("Weatherford") and the Company,
any reference in this Agreement to the
'Company' or the 'Common Stock' shall be
deemed to be a reference to Xxxxxxxxxxx or
the common
stock, par value $.10 per share, of Weatherford."
2. Section 4 of the Agreement is hereby amended by
deleting therefrom the introductory provision and subsection (a)
thereof and substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
3. Section 10 of the Agreement is deleted and the
following is substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or
-2-
for the benefit of the Employee (whether paid or
payable or distributed or distributable pursuant to
the terms of this Agreement, the Merger Agreement
or otherwise, but determined without regard to any
additional payments required under this Section 10)
(a "Payment") would be subject to the excise tax
imposed by Section 4999 of the Code or any interest
or penalties are incurred by the Employee with
respect to such excise tax (such excise tax,
together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
-3-
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim in any
permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance or
-4-
with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
4. The remainder of the Agreement shall remain in
full force and effect as written.
5. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
/s/ Xxxxxxx X. Xxxxxx, Xx.
-------------------------------
Xxxxxxx X. Xxxxxx, Xx.
-5-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the "Amendment"),
dated as of AUGUST 31, 1995, is between Enterra Corporation, a Delaware
corporation ("Enterra"), and J. XXXXXX XXXXXX (the "Employee").
WHEREAS, on FEBRUARY 21, 1991, Enterra and the Employee entered
into a Severance Agreement, dated as of FEBRUARY 21, 1991 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain provisions of
the Agreement regarding the severance compensation upon termination of
employment in connection with a Change of Control;
WHEREAS, the parties hereto desire to condition the effectiveness
of this Amendment upon the consummation of the merger between Enterra and
Xxxxxxxxxxx International Incorporated ("Weatherford") pursuant to the
Agreement and Plan of Merger, dated as of June 23, 1995, as amended as of
August 28, 1995, between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not defined herein
shall have the meanings ascribed thereto in the Agreement;
NOW, THEREFORE, effective as of the Effective Time, as that term is
defined in the Merger Agreement, the parties hereto, intending to be legally
bound, agree as follows:
1. Section 1(p)(ii) of the Agreement is hereby amended by adding
thereto a new last paragraph, to read as follows:
"Notwithstanding anything to the contrary under this Section 1(p)(ii),
any resignation by the Employee at any time from the Effective Time,
as that term is defined in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28, 1995, between
Xxxxxxxxxxx International Incorporated ("Weatherford") and the
Company (the "Merger Agreement"), through August 12, 1996 shall
constitute a 'Termination upon Change of Control' under this
Agreement."
2. Section 1 of the Agreement is hereby amended by
adding thereto a new sentence at the end thereof, to read as
follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Merger Agreement, any reference in
this Agreement to the 'Company' or the
'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock,
par value $.10 per share, of Weatherford."
3. Section 4 of the Agreement is hereby amended by
deleting therefrom the introductory provision and subsection (a)
thereof and substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
4. Section 10 of the Agreement is deleted and the
following is
-2-
substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or for the benefit of
the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement,
the Merger Agreement or otherwise, but determined
without regard to any additional payments required
under this Section 10) (a "Payment") would be subject
to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
-3-
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim
-4-
in any permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
5. The remainder of the Agreement shall remain in
full force and effect as written.
6. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
-5-
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
/s/ J. Xxxxxx Xxxxxx
---------------------------------
J. Xxxxxx Xxxxxx
-6-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the "Amendment"),
dated as of AUGUST 31, 1995, is between Pipeline Induction Heat Limited
("PIH") and XXXXXXX XXXXX XXXXX (the "Employee").
WHEREAS, Enterra Corporation, a Delaware corporation ("Enterra"),
is the ultimate parent company of PIH;
WHEREAS, on XXXXX 0, 0000, XXX and the Employee entered into a
Severance Agreement, dated as of APRIL 1, 1993 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain provisions of
the Agreement regarding the severance compensation upon termination of
employment in connection with a Change of Control;
WHEREAS, the parties hereto desire to condition the effectiveness
of this Amendment upon the consummation of the merger between Enterra and
Xxxxxxxxxxx International Incorporated ("Weatherford") pursuant to the
Agreement and Plan of Merger, dated as of June 23, 1995, as amended as of
August 28, 1995, between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not defined herein
shall have the meanings ascribed thereto in the Agreement;
NOW, THEREFORE, effective as of the Effective Time, as that term is
defined in the Merger Agreement, the parties hereto, intending to be legally
bound, agree as follows:
1. Section 1 of the Agreement is hereby amended by adding thereto
a new sentence at the end thereof, to read as follows:
"With respect to all periods from and after the Effective Time,
as that term is defined in the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and Enterra, any reference in this Agreement
to 'Enterra' or the 'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock, par value $.10
per share, of Weatherford."
2. Section 4 of the Agreement is hereby amended by deleting
therefrom the introductory provision and subsection (a) thereof and
substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of Enterra's Common Stock the total fair market
value of which will be equal to the excess, if any, of
the aggregate fair market value of the shares of
Enterra's Common Stock subject to all stock options and
stock appreciation rights outstanding and unexercised
immediately prior to the Termination Date, whether
vested or unvested, granted to the Employee under the
Stock Plan, over the aggregate exercise price of all
such stock options. For purposes of this paragraph,
fair market value shall mean the highest of (x) the
closing price of Enterra's Common Stock on the business
day immediately preceding the Termination Date, if such
Common Stock is publicly traded at such date, (y) if
such Common Stock is not publicly traded at the
Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of Enterra's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of Enterra has given rise to a Change of
Control. Enterra shall take all corporate action
necessary (i) to reserve for issuance a sufficient
number of shares of the Common Stock for delivery
pursuant to this section and (ii) to ensure that all
shares of the Common Stock issued pursuant to this
section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
3. The remainder of the Agreement shall remain in full force
and effect as written.
4. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
-2-
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as of the day and year first above written.
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
PIPELINE INDUCTION HEAT LIMITED
By: /s/ C. Xxxx Xxxxx
---------------------------
C. Xxxx Xxxxx
Director
/s/ Xxxxxxx Xxxxx Xxxxx
-------------------------------
Xxxxxxx Xxxxx Xxxxx
-3-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the
"Amendment"), dated as of AUGUST 31, 1995, is between Enterra
Corporation, a Delaware corporation ("Enterra"), and XXXXXXX X.
XXXXXXXXXX (the "Employee").
WHEREAS, on FEBRUARY 21, 1991, Enterra and the
Employee entered into a Severance Agreement, dated as of
FEBRUARY 21, 1991 (the "Agreement");
WHEREAS, the parties hereto desire to amend certain
provisions of the Agreement regarding the severance compensation
upon termination of employment in connection with a Change of
Control;
WHEREAS, the parties hereto desire to condition the
effectiveness of this Amendment upon the consummation of the
merger between Enterra and Xxxxxxxxxxx International Incorporated
("Weatherford") pursuant to the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not
defined herein shall have the meanings ascribed thereto in the
Agreement;
NOW, THEREFORE, effective as of the Effective Time, as
that term is defined in the Merger Agreement, the parties hereto,
intending to be legally bound, agree as follows:
1. Section 1(p)(ii) of the Agreement is hereby
amended by adding thereto a new last paragraph, to read as
follows:
"Notwithstanding anything to the contrary under this
Section 1(p)(ii), any resignation by the Employee at
any time from the Effective Time, as that term is
defined in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and the Company (the "Merger
Agreement"), through August 12, 1996 shall constitute a
'Termination upon Change of Control' under this
Agreement."
2. Section 1 of the Agreement is hereby amended by
adding thereto a new sentence at the end thereof, to read as
follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Merger Agreement, any reference in
this Agreement to the 'Company' or the
'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock,
par value $.10 per share, of Weatherford."
3. Section 4 of the Agreement is hereby amended by
deleting therefrom the introductory provision and subsection (a)
thereof and substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
4. Section 10 of the Agreement is deleted and the
following is
-2-
substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or for the benefit of
the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement,
the Merger Agreement or otherwise, but determined
without regard to any additional payments required
under this Section 10) (a "Payment") would be subject
to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
-3-
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim
-4-
in any permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
5. The remainder of the Agreement shall remain in
full force and effect as written.
6. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
-5-
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
/s/ Xxxxxxx X. Xxxxxxxxxx
-------------------------------
Xxxxxxx X. Xxxxxxxxxx
-6-
AMENDMENT 1995-1 TO SEVERANCE AGREEMENT
This Amendment 1995-1 to Severance Agreement (the
"Amendment"), dated as of AUGUST 31, 1995, is between Enterra
Corporation, a Delaware corporation ("Enterra"), and D. XXXX
XXXX (the "Employee").
WHEREAS, on MARCH 5, 1991, Enterra and the Employee
entered into a Severance Agreement, dated as of MARCH 5, 1991
(the "Agreement");
WHEREAS, the parties hereto desire to amend certain
provisions of the Agreement regarding the severance compensation
upon termination of employment in connection with a Change of
Control;
WHEREAS, the parties hereto desire to condition the
effectiveness of this Amendment upon the consummation of the
merger between Enterra and Xxxxxxxxxxx International Incorporated
("Weatherford") pursuant to the Agreement and Plan of Merger,
dated as of June 23, 1995, as amended as of August 28, 1995,
between Weatherford and Enterra (the "Merger Agreement"); and
WHEREAS, capitalized terms used herein that are not
defined herein shall have the meanings ascribed thereto in the
Agreement;
NOW, THEREFORE, effective as of the Effective Time, as
that term is defined in the Merger Agreement, the parties hereto,
intending to be legally bound, agree as follows:
1. Section 1(p)(ii) of the Agreement is hereby
amended by adding thereto a new last paragraph, to read as
follows:
"Notwithstanding anything to the contrary under this
Section 1(p)(ii), any resignation by the Employee at
any time from the Effective Time, as that term is
defined in the Agreement and Plan of Merger, dated as
of June 23, 1995, as amended as of August 28, 1995,
between Xxxxxxxxxxx International Incorporated
("Weatherford") and the Company (the "Merger
Agreement"), through August 12, 1996 shall constitute a
'Termination upon Change of Control' under this
Agreement."
2. Section 1 of the Agreement is hereby amended by
adding thereto a new sentence at the end thereof, to read as
follows:
"With respect to all periods from and after
the Effective Time, as that term is defined
in the Merger Agreement, any reference in
this Agreement to the 'Company' or the
'Common Stock' shall be deemed to be a
reference to Xxxxxxxxxxx or the common stock,
par value $.10 per share, of Weatherford."
3. Section 4 of the Agreement is hereby amended by
deleting therefrom the introductory provision and subsection (a)
thereof and substituting the following therefor:
"4. OTHER PAYMENTS. In the event of the Employee's
Termination upon a Change of Control, the Company
shall:
(a) deliver to the Employee within fifteen days
after the Termination Date, unless the Employee has
exercised such options and rights, such number of
shares of the Company's Common Stock the total fair
market value of which will be equal to the excess, if
any, of the aggregate fair market value of the shares
of the Company's Common Stock subject to all stock
options and stock appreciation rights outstanding and
unexercised immediately prior to the Termination Date,
whether vested or unvested, granted to the Employee
under the Stock Plan, over the aggregate exercise price
of all such stock options. For purposes of this
paragraph, fair market value shall mean the highest of
(x) the closing price of the Company's Common Stock on
the business day immediately preceding the Termination
Date, if such Common Stock is publicly traded at such
date, (y) if such Common Stock is not publicly traded
at the Termination Date, the value determined by an
independent appraiser, such appraiser to be selected by
the Employee and to be reasonably satisfactory to the
Company (the fees and expenses of such appraiser to be
borne by the Company), or (z) the highest per share
price of the Company's Common Stock paid (in connection
with the Change of Control or at any time thereafter)
by the Person or group whose acquisition of shares of
Common Stock of the Company has given rise to a Change
of Control. The Company shall take all corporate
action necessary (i) to reserve for issuance a
sufficient number of shares of the Common Stock for
delivery pursuant to this section and (ii) to ensure
that all shares of the Common Stock issued pursuant to
this section are registered under the Securities Act of
1933, as amended, listed on the New York Stock Exchange
and may be freely transferred by the holders thereof;"
4. Section 10 of the Agreement is deleted and the
following is
-2-
substituted therefor:
"10. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the
event it shall be determined that any payment or
distribution by the Company (whether by Enterra
Corporation or Xxxxxxxxxxx or by any affiliate of, or
plan maintained by, either) to or for the benefit of
the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement,
the Merger Agreement or otherwise, but determined
without regard to any additional payments required
under this Section 10) (a "Payment") would be subject
to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise
Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Employee of all
taxes (including any interest or penalties imposed with
respect to such taxes), including without limitation,
any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 10(c),
all determinations required to be made under this
Section 10, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving
at such determination shall be made by Xxxxxx Xxxxxxxx
LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee
(the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the
Employee within 15 business days after the receipt of
notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.
In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the 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. Any Gross-Up Payment, as determined pursuant
to this Section 10, shall be paid by the Company to the
Employee within five days after the receipt of the
Accounting Firm's determination. Any determination by
the Accounting Firm shall be binding upon the Company
and the Employee. As a result of the uncertainty in
the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm
-3-
hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 10(c)
and the Employee thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the
Employee.
(c) The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable, but no later
than ten business days after the Employee is informed
in writing of such claim, and shall apprise the Company
of the nature of such claim and the date on which such
claim is requested to be paid. The Employee shall not
pay such claim prior to the expiration of the 30-day
period following the date on which he gives such notice
to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such
claim is due). If the Company notifies the Employee in
writing prior to the expiration of such period that it
desires to contest such claim the Employee shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably
request in writing from time to time, including without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claims; provided, however,
that the Company shall bear and pay directly all costs
and expenses (including additional interest and
penalties) incurred in connection with such costs and
shall indemnify and hold the Employee harmless, on an
after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto)
imposed as a result of such representation and payment
of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), the Company
shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option,
either direct the Employee to pay the tax claimed and
xxx for a refund or contest the claim
-4-
in any permissible manner, and the Employee agrees to
prosecute such contest to determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
the Company shall determine; provided, however, that if
the Company directs the Employee to pay such claim and
xxx for a refund, the Company shall advance the amount
of such payment to the Employee, on an interest-free
basis and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with
respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to
such advance; and further provided that any extension
of the statute of limitations relating to payment of
taxes for the taxable year of the Employee with respect
to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited
to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Employee shall be
entitled to settle or contest, as the case may be, any
other issues raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by the Employee of an
amount advanced by the Company pursuant to Section
10(c), the Employee becomes entitled to receive any
refund with respect to such claim, the Employee shall
(subject to the Company's complying with the
requirements of Section 10(c)) promptly pay to the
Company the amount of such refund (together with any
interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant
to Section 10(c), a determination is made that the
Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify
the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
5. The remainder of the Agreement shall remain in
full force and effect as written.
6. This Amendment shall be conditioned upon the
consummation of the merger between Enterra and Weatherford
pursuant to the Merger Agreement, and in the event such merger is
not so consummated, the Agreement shall remain in full force and
effect without regard to the changes contemplated by this
Amendment.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year first above written.
-5-
ENTERRA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
/s/ D. Xxxx Xxxx
-------------------------------
D. Xxxx Xxxx
-6-
