EXHIBIT 10.9
AMENDED AND RESTATED SEVERANCE
BENEFITS AGREEMENT OF SENIOR OFFICERS
THIS AMENDED AND RESTATED SEVERANCE BENEFITS AGREEMENT OF SENIOR
OFFICERS (this "Agreement") is entered into and effective this 1st day of July,
2002, by and between XXXXXX OFFSHORE INC., a Delaware corporation, (the
"Company"), and XXXXXXX XXXXXXX, XXXXXXX X. XXXXXXX, XXXXXX XXXXX XXXXXXX, XXXXX
XXXXXXX, and XXXX XXXX (each, a "Senior Officer", and collectively, the "Senior
Officers").
RECITALS
The Senior Officers are senior management employees of the Company.
The Senior Officers entered into a Severance Benefits Agreement (the
"Original Agreement") with either the Company or Xxxxxx Offshore LLC, the
predecessor-in-interest to the Company, dated June 12, 2000 (except in the case
of Xxxxx Xxxxxxx, whose Original Agreement is dated April 30, 2002, and Xxxx
Xxxx, whose original Agreement is dated May 14, 2002), setting out the terms and
conditions for the severance benefits of the Senior Officers.
ENSCO International Incorporated, a Delaware company ("ENSCO"), and the
Company have entered into that certain Merger Agreement dated May 14, 2002 (the
"Merger Agreement") by and among ENSCO, Chore Acquisition, Inc. (the "Merger
Sub"), a wholly-owned subsidiary of ENSCO, and the Company.
If the merger of the Company with and into Merger Sub pursuant to the
Merger Agreement becomes effective (the "Merger"), the Company and the Senior
Officers desire to amend and restate the Original Agreement and provide for the
severance and certain other benefits of the Senior Officers, on the terms and
conditions of this Agreement, and from and after the effective date of the
Merger (the "Effective Date") all references in this Agreement to "the Company"
shall mean ENSCO.
AGREEMENT
Accordingly, the parties agree as follows:
1. Performance Bonus. On the effective date of the Merger (the
"Effective Date"), the Company shall pay to each Senior Officer a performance
bonus in the amount listed for such Senior Officer on the attached Exhibit A
(the "Performance Bonus").
2. Stay Bonus. If a Senior Officer is offered employment with the
Company effective on the Effective Date and such Senior Officer accepts such
employment with the Company, the Company shall pay to the Senior Officer a stay
bonus in the amount listed for such Senior Officer on the attached Exhibit A
(the "Stay Bonus"). One-half of a Senior Officer's Stay Bonus shall be payable
by the Company to the Senior Officer on the first anniversary of the Effective
Date, and the remaining one-half of the Stay Bonus shall be payable by the
Company
to the Senior Officer on the second anniversary of the Effective Date, subject
in each case to such Senior Officer being employed by the Company on such
anniversary. If employment is not offered to any Senior Officer beginning on the
Effective Date, or a position that does not have comparable pay and benefits
(irrespective of title or location of employment) is offered but not accepted,
thirty percent (30%) of the Stay Bonus applicable to such Senior Officer shall
be payable by the Company to such Senior Officer on the Effective Date (together
with the Performance Bonus and the severance payment described in Section 5
hereof). If a Senior Officer is offered and accepts employment with the Company,
the entire balance of any unpaid Stay Bonus (whether vested or unvested) shall
be payable by the Company to such Senior Officer if such Senior Officer is
terminated by the Company without Cause (as hereinafter defined) within 2 years
after such Senior Officer's commencement of employment with the Company. As used
in this Agreement, the term "Cause" shall mean and include (i) chronic
alcoholism or controlled substance abuse as determined by a doctor of medicine
selected by the Company that is authorized to practice medicine by the State of
Texas and whose practice is located in Houston, Texas (or such other location as
reasonably agreed by the Company and the applicable Senior Officer), (ii) an act
of proven fraud or dishonesty on the part of the Senior Officer, (iii) knowing
and material failure by the Senior Officer to comply with material applicable
laws and regulations relating to the business of the Company or its
subsidiaries, (iv) the Senior Officer's material and continuing failure to
perform (as opposed to unsatisfactory performance) his or her duties as
reasonably directed by the Company, except for such failures caused by the
illness or other similar capacity or disability of the Senior Officer, or (iv)
conviction of a crime involving moral turpitude or a felony.
3. Deferred Bonuses. All deferred bonuses and interest thereon payable
by Xxxxxx Offshore to a Senior Officer, which are set forth on the attached
Schedule 3 ("Deferred Bonuses"), shall vest immediately and shall be paid by the
Company as applicable to the Senior Officers on the Effective Date.
4. Stock Options and Restricted Stock.
4.1 Upon the Effective Date, all stock options of the Senior
Officers granted under the Company Stock Option Plan (as defined in the Merger
Agreement) (the "Xxxxxx Options") shall vest immediately and shall be treated in
the manner provided in Section 1.8 of the Merger Agreement, except as provided
in this Article 4. Any restricted stock of the Company awarded to a Senior
Officer shall automatically become unrestricted on the Effective Date.
4.2 The remaining term of the Senior Officers' Xxxxxx Options shall
remain unchanged as a result of the Merger. If any Senior Officer does not
accept employment with the Company for any reason, such Senior Officer shall
have one year from the Effective Date to exercise such Senior Officer's Xxxxxx
Options. If any Senior Officer that accepts employment with the Company is
subsequently terminated without Cause, such Senior Officer will have one year
from the date of such termination within which to exercise such Senior Officer's
Xxxxxx Options, such period not to exceed the remaining term of the Xxxxxx
Options. If any Senior Officer that accepts employment with the Company is
subsequently terminated with Cause or voluntarily terminates such Senior
Officer's employment, such Senior Officer shall have a period
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of one year from the Effective Date if such termination occurs within nine (9)
months after the Effective Date, and a period of three (3) months after such
termination if such termination occurs more than nine (9) months after the
Effective Date, in which to exercise such Senior Officer's Xxxxxx Options. If a
Senior Officer's employment terminates due to the death or disability of such
Senior Officer, the execution period for such Senior Officer's Xxxxxx Options
shall be the applicable period specified in the Company Stock Option Plan.
5. Severance Payments. Any Senior Officer that is not offered or does
not accept employment with the Company for any reason shall be paid severance in
the amount equal to one (1) year of such Senior Officer's current annual salary
as listed on the attached Exhibit A. Any such severance payments shall be made
by the Company to such Senior Officer on the Effective Date. Any Senior Officer
who accepts employment with the Company shall not receive any severance
payments, including any severance payment pursuant to the Original Agreement.
6. Relocation Expenses. Any Senior Officer that accepts employment with
the Company shall be entitled to relocation expenses, temporary housing and
other reimbursements consistent with the policies of the Company if such Senior
Officer relocates in connection with such employment with the Company.
7. At-Will Employment. The obligation of the Company to pay amounts
hereunder shall not alter the at-will employment status of any Senior Officer or
diminish the right of the Company to terminate a Senior Officer's employment
without Cause.
8. Death or Disability of Senior Officer. If a Senior Officer dies or
becomes disabled prior to or during the first two years after the Effective
Date, such Senior Officer's employment with the Company shall terminate and,
subject to the Merger becoming effective, the Company shall pay to such Senior
Officer (or such Senior Officer's estate in the case of such Senior Officer's
death) within thirty (30) days after such termination (i) the Performance Bonus
(if not already paid to such Senior Officer), all Deferred Bonuses (if not
already paid to such Senior Officer), any portion of such Senior Officer's
annual salary, any bonuses or other compensation that shall have been earned by
such Senior Officer prior to the termination in respect of the period prior to
the Effective Date but not yet paid, and thirty percent (30%) of the entire Stay
Bonus listed for such Senior Officer on the attached Exhibit A (less any amount
of the Stay Bonus previously paid to the Senior Officer), (ii) any Company
benefits that have vested in such Senior Officer at the time of such termination
in respect of the period prior to the Effective Date as a result of the Senior
Officer's participation in any of the Company's benefit plans (which shall be
paid in accordance with the provisions of such plan), and (iii) reimbursement
for any expenses with respect to which such Senior Officer is entitled to
reimbursement pursuant to the terms of the Company's reimbursement policies. For
purposes of this Agreement, a Senior Officer shall be deemed to be disabled if a
competent physician licensed to practice medicine in the State of Texas who is
mutually acceptable to the Company and such Senior Officer, or such Senior
Officer's closest relative if such Senior Officer is not able to make such
choice, determines in writing that such Senior Officer is physically or mentally
disabled, whether totally or partially, such that such Senior Officer is not
able to perform such Senior Officer's services to the Company for (i) a period
of two consecutive months, or (ii) for shorter periods aggregating 60 days
during any 12-month period.
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9. Miscellaneous.
9.1 This Agreement shall be effective as to a Senior Officer upon
his or her execution of this Agreement and the execution of this Agreement by
the Company. Subject to the Merger becoming effective, this Agreement contains
the entire agreement between the parties with respect to the subject matter
hereof and supersedes all prior agreements, whether written or oral with respect
thereto, including, without limitation, the Original Agreement. Notwithstanding
the foregoing, the Senior Officers shall remain third party beneficiaries of the
applicable provisions of the Merger Agreement. In the event of a conflict
between the terms of this Agreement and the Merger Agreement, the terms of this
Agreement shall control. If the Merger does not become effective, the Original
Agreement shall remain in effect and this Agreement shall be of no force or
effect.
9.2 This Agreement may be amended, supersedes, or canceled, and the
terms and conditions hereof may be waived, only by written instrument signed by
the parties or, in the case of a waiver, by the party waiving compliance. No
delay on the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof.
9.3 This Agreement shall be governed by and construed in accordance
with the laws of the State of Texas, without giving effect to any choice of law
provisions or principles thereof. Enforcement of this Agreement or any action
taken or held with respect to this Agreement shall be taken exclusively in the
courts of appropriate jurisdiction in Houston, Texas.
9.4 This Agreement, and any rights and obligations hereunder, may
not be assigned by any Senior Officer and may be assigned by the Company only to
a successor by merger or purchaser of substantially all of the assets of the
Company.
9.5 This Agreement may be executed in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all of
which together shall constitute one in the same instrument.
9.6 Under no circumstances will the Company have any obligation or
liability to the Senior Officers for the reimbursement or gross-up of income,
excise or other taxes resulting from any payments, stock options or other
benefits under this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
SENIOR OFFICERS:
/s/ Xxxxxxx Xxxxxxx
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XXXXXXX XXXXXXX
/s/ Xxxxxxx X. Xxxxxxx
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XXXXXXX X. XXXXXXX
/s/ Xxxxxx Xxxxx Xxxxxxx
----------------------------------------
XXXXXX XXXXX XXXXXXX
/s/ Xxxxx Xxxxxxx
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XXXXX XXXXXXX
/s/ Xxxx Xxxx
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XXXX XXXX
XXXXXX OFFSHORE INC.
By: /s/ Xxxx Xxxxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxxxx
-----------------------------------
Title: Senior Vice President, Chief
Financial Officer and
Secretary
--------------------------------
ENSCO hereby adopts this Agreement for purposes of acknowledging and agreeing to
assume the obligations of the Company pursuant to the terms of this Agreement on
the Effective Date if the Merger becomes effective.
ENSCO INTERNATIONAL INCORPORATED
By: /s/ C. Xxxxxxxxxxx Xxxx
-------------------------------------
Name: C. Xxxxxxxxxxx Xxxx
-----------------------------------
Title: Senior Vice President
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SCHEDULE 3
DEFERRED BONUSES
Xxxxxxx Xxxxxxx
1. $9,500 plus interest at 10% from and after January 15, 2001.
2. $24,000 plus interest at 5.375% from and after February 15, 2002.
Xxxxxxx X. Xxxxxxx
1. $9,500 plus interest at 10% from and after January 15, 2001.
2. $24,000 plus interest at 5.375% from and after February 15, 2002.
Xxxxxx Xxxxx Xxxxxxx
1. $9,500 plus interest at 10% from and after January 15, 2001.
2. $26,000 plus interest at 5.375% from and after February 15, 2002.
Xxxxx Xxxxxxx
1. $20,000 plus interest at 5.375% from and after February 15, 2002.
Xxxx Xxxx
1. None.
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EXHIBIT A
SENIOR OFFICER COMPENSATION
Senior Officer Performance Bonus Stay Bonus Annual Salary
-------------- ----------------- ---------- -------------
Xxxxxx Xxxxx Xxxxxxx $150,000 $150,000 $136,500
Xxxxxxx X. Xxxxxxx $150,000 $150,000 $136,500
Xxxxxxx Xxxxxxx $150,000 $150,000 $136,500
Xxxxx Xxxxxxx $125,000 $125,000 $135,000
Xxxx Xxxx $ 50,000 $ 50,000 $115,000
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