RESIGNATION AGREEMENT
This Resignation Agreement (this "Agreement") by and between Nuevo
Energy Company, a Delaware corporation (the "Company"), and Xxxxxx X. Xxxx (the
"Executive"), is dated as of November 30, 2001 (the "Execution Date").
WHEREAS, the Executive has been employed by the Company as its Senior
Vice President and Chief Financial Officer; and
WHEREAS, the Company and the Executive have agreed that it is in the
best interest of the Company and the Executive for the Executive to resign, and
they wish to set forth their mutual agreement as to the terms and conditions of
such resignation;
NOW, THEREFORE, the Company and the Executive hereby agree as follows:
1. Resignation. Unless this Agreement is revoked pursuant to Section
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8, effective as of December 5, 2001 or such other date after the Execution Date
specified by the Company in writing to Executive, but in no event later than
December 31, 2001(the "Resignation Date"), the Executive shall be deemed to have
voluntarily resigned from his employment with the Company, and from all other
positions the Executive then held as an officer or employee of any of the
Company's subsidiaries or affiliates (the Company and all of its subsidiaries
and affiliates are hereinafter referred to as the "Affiliated Entities"). This
Agreement is expressly conditioned upon approval of the Company's Board of
Directors at its regularly scheduled meeting of December 5, 2001, ("Board
Effective Date").
2. Severance Payments and Benefits. (a) On the later of the Revocation
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Date (as defined in Section 8(b)), or January 3, 2002, the Company shall pay to
the Executive a lump sum in cash of the amounts forth on Exhibit A hereto.
(b) Until the second anniversary of the Resignation Date, the
Company shall continue to provide the Executive and his eligible dependents with
medical insurance benefits (but not life or disability insurance) on the same
terms and conditions as employees of the Company, as in effect from time to
time, as if he had remained employed during that period, subject to his payment
of such employee contributions, copayments and similar charges as apply to
employees generally; provided, that such continued benefits shall terminate to
the extent the Executive becomes eligible for the same type of benefits (i.e.,
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medical, dental and/or health insurance benefits) from another employer. The
period for the required continuation coverage under Section 601 et seq. of the
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Employee Retirement Income Security Act of 1974, as amended, and Section 4980B
of the Internal Revenue Code of 1986, as amended (the "Code") (known as "COBRA"
benefits), shall be considered to begin on the Resignation Date, and the Company
may provide the continued health insurance benefits in this Section 2(b) by
paying the employee's portion of the Executive's COBRA premiums.
(c) Within ninety days after the Revocation Date the Company
shall pay to the Executive a lump sum in cash as determined in accordance with
the Company's Deferred Compensation Plan of which the most current balance is
set forth on Exhibit A hereto, which, together with any amounts contributed to
the Plan from the date of the balance to the Executive's resignation, represents
(solely for explanation and not in limitation or expansion of
the obligation to pay such amount) the amount to which the Executive is entitled
under the Company's Deferred Compensation Plan, which payment shall be in
satisfaction of any of the Executive's rights under the Company's Deferred
Compensation Plan. The value of the non-cash investments shall be established as
of the Resignation Date. In addition, the Executive shall be entitled to receive
his vested benefits under the Company 401(k) Plan, in accordance with the terms
thereof.
(d) For 2001 bonus year, the Company will pay the Executive an
annual bonus at the time at which annual bonuses are paid to the corporate
officers of the Company, and the Executive will have the same bonus percentage
as such other corporate officers, other than Messrs. Gobe and Xxxxx.
(e) The Company shall reimburse the Executive for any
unreimbursed business expenses incurred by the Executive on or prior to the
Resignation Date pursuant to the Company's reimbursement policies, within thirty
days following the Executive's presentation of an invoice to the Company;
provided, that the Company shall not reimburse the Executive for any expenses
for which the invoice is received by the Company after February 28, 2002.
3. Equity and Performance Awards. Exhibit A hereto sets forth a
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complete list of all of the Executive's currently outstanding stock options (the
"Stock Options") under the 1990 Stock Option Plan, the 1993 Stock Incentive Plan
and the 1999 Stock Incentive Plan. Notwithstanding any provision contained in
the applicable agreement governing any Stock Option (an "Award Agreement") or in
the applicable plan, the Stock Options shall be treated as set forth in this
Section 3, and the applicable Award Agreements are hereby amended to the extent
necessary to implement this Section 3. All Stock Options set forth in Exhibit A
as being retained by the Executive shall be exercisable as of the Revocation
Date and shall remain exercisable through the thirty-sixth month anniversary of
the Resignation Date (or, if earlier, until the end of their scheduled term),
and shall then expire to the extent not previously exercised. All Stock Options
set forth in Exhibit A as being surrendered by the Executive shall be cancelled
as of the Revocation Date. And the Executive shall have no further right or
interest in such cancelled options.
4. Mutual Nondisparagement. (a) The Executive shall not make,
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participate in the making of, or encourage or facilitate any other person to
make, any statements, written or oral, which criticize, disparage, or defame the
goodwill or reputation of, or which are intended to embarrass or adversely
affect the morale of, any of the Affiliated Entities or any of their respective
present, former or future directors, officers, executives, employees and/or
shareholders. The Executive further agrees not to make any negative statements,
written or oral, relating to his employment, the termination of his employment,
or any aspect of the business of the Affiliated Entities.
(b) The Company shall use reasonable best efforts to cause its
executive officers and directors and shall cause its Chief Executive Officer and
Chief Financial Officer not to make, participate in the making of, or encourage
or facilitate any employees or any other person to make, any statements, written
or oral, which criticize, disparage, or defame the reputation of, or which are
intended to embarrass, the Executive. In addition, the Company shall advise its
executive officers and directors not to make any negative statements, written or
oral, relating to the Executive's employment or the termination of his
employment.
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(c) Notwithstanding the foregoing, nothing in this Section 4
shall prohibit any person from making truthful statements when required by order
of a court or other body having jurisdiction, or as otherwise may be required by
law or legal process.
5. Mutual Confidentiality. The existence of and terms and conditions
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of this Agreement shall be held confidential by the parties hereto, except for
disclosure (a) by the Company as may be required by applicable securities laws,
as determined by the Company upon the advice of outside counsel, (b) by the
Executive to his legal and financial advisors and his spouse, each of whom shall
be instructed by the Executive to maintain the terms of this Agreement in strict
confidence in accordance with the terms hereof, (c) by either party if required
by order of a court or other body having jurisdiction over such matter, and (d)
by either party with the written consent of the other. With respect to
disclosures under (a) or (c) the disclosing party shall give the other prior
notice where reasonably practical and shall provide an opportunity to comment on
the disclosure. In addition, the Executive shall hold in a fiduciary capacity
for the benefit of the Company all secret or confidential information, knowledge
or data relating to the Affiliated Entities and their respective businesses that
he has obtained that is not or does not become public knowledge (other than as a
result of the Executive's violation of this Section 5) ("Confidential
Information"). The Executive shall not communicate, divulge or disseminate
Confidential Information at any time, except with the prior written consent of
the Company or as otherwise required by law or legal process.
6. Other Covenants and Remedies (a) Transition Cooperation. The
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Executive shall make himself reasonably available and assist the Company and its
Affiliated Entities for a period of up to 90 days following the Resignation Date
for such amount of time that is necessary, but in no event less than twenty
hours a week in the preparation of the Company's 2001 financial statements and
to assist in the transition to a new Chief Financial Officer. The Executive
shall report to and coordinate all activities with respect to the 2001 financial
statements with the Vice President of Finance and Administration and shall
otherwise assist the Vice President and the Company's Chief Financial Officer
when such position is filled. The Executive shall be compensated for such
services at a daily rate of $400 being one half of the Executive's base salary,
prior to the Resignation Date prorated to a daily payment. The activities of the
Executive under this Section 6(a) may be terminated at any time by the Company
by providing written notice to the Executive and, upon such termination, no
further obligations will exist between the parties except payment by the Company
for services rendered prior to termination.
(b) Cooperation after Transition. The Executive shall make
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himself reasonably available to the Company following the Resignation Date to
assist the Affiliated Entities, as may be requested by the Company at mutually
convenient times and places, with respect to pending and future litigations,
arbitrations, governmental investigations or other dispute resolutions relating
to or in connection with matters that arose during the Executive's employment
with the Company. The Company will compensate the Executive for providing
assistance under this Section 6(a) or (b) at the rate of $175 per hour and will
reimburse the Executive for all reasonable expenses and costs he may incur as a
result of providing such assistance, upon receipt of proper documentation
thereof.
7. Remedies. The Executive acknowledges and agrees that because of the
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nature of the business in which the Company and the other Affiliated Entities
are engaged and because of the nature of the Confidential Information to which
the Executive has had access
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during his employment, it would be impractical and excessively difficult to
determine the actual damages of the Company and the other Affiliated Entities in
the event the Executive breached any of the covenants of Sections 4 or 5, and
remedies at law (such as monetary damages) for any breach of the Executive's
covenants under Sections 4 or 5 would be inadequate. The Company acknowledges
and agrees that it would be impractical and excessively difficult to determine
the actual damages of the Executive in the event the Company breached any of the
covenants of Sections 4 and 5, and remedies at law (such as monetary damages)
for any breach of the Company's covenants under Sections 4 and 5 would be
inadequate. The parties therefore agree and consent that if either of them
commits any such breach or threatens to commit any such breach, the other party
shall have the right (in addition to, and not in lieu of, any other right or
remedy that may be available to it) to temporary and permanent injunctive relief
from a court of competent jurisdiction, without posting any bond or other
security and without the necessity of proof of actual damage. With respect to
any provision of Sections 4 or 5 that is finally determined to be unenforceable,
the Executive and the Company hereby agree that this Agreement or any provision
hereof may be reformed so that it is enforceable to the maximum extent permitted
by law. If any of the covenants of Sections 4 or 5 is determined to be wholly or
partially unenforceable in any jurisdiction, such determination shall not be a
bar to or in any way diminish the Company's right to enforce any such covenant
in any other jurisdiction.
8. Release. (a) In consideration of the payments and benefits set
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forth in this Agreement, except for the rights expressly provided herein, the
Executive for himself, his heirs, administrators, representatives, executors,
successors and assigns (collectively "Releasors") does hereby irrevocably and
unconditionally release, acquit and forever discharge the Company and its
subsidiaries, shareholders, affiliates, divisions, trustees, officers,
directors, partners, agents, and former and current employees, including without
limitation all persons acting by, through, under or in concert with any of them
(collectively, "Releasees"), and each of them from any and all charges,
complaints, claims, liabilities, obligations, promises, agreements, including
the Severance Protection Agreement entered into between the parties on March 25,
2001, which is hereby cancelled and terminated for all purposes, controversies,
damages, remedies, actions, causes of action, suits, rights, demands, costs,
losses, debts and expenses (including attorneys' fees and costs) of any nature
whatsoever, known or unknown, whether in law or equity and whether arising under
federal, state or local law and in particular including any claim for
discrimination based upon race, color, ethnicity, sex, age (including the Age
Discrimination in Employment Act), national origin, religion, disability, or any
other unlawful criterion or circumstance, which the Executive and Releasors had,
now have, or may have in the future against each or any of the Releasees from
the beginning of the world until the Execution Date relating to the Executive's
employment with the Company and its subsidiaries and affiliates. In
consideration of the payments and benefits set forth in this Agreement, except
for the rights expressly provided herein, the Company, on behalf of itself and
the Releasees, hereby irrevocably and unconditionally releases, acquits and
forever discharges the Executive from any and all charges, complaints, claims,
liabilities, obligations, promises, agreements controversies, damages, remedies,
actions, causes of action, suits, rights, demands, costs, losses, debts and
expenses (including attorneys' fees and costs) of any nature whatsoever, known
or unknown, whether in law or equity and whether arising under federal, state or
local law which the Company had, now has, or may have in the future against
Executive from the beginning of the world until the Execution Date relating to
the Executive's employment with the Company and its subsidiaries and affiliates
but excluding only those acts which are unknown to the Company as
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of the date hereof that would constitute a basis for termination for cause as
defined under the Executive's Employment Agreement.
(b) The Executive acknowledges that: (i) this entire Agreement is
written in a manner calculated to be understood by him; (ii) he has been advised
to consult with an attorney before executing this Agreement; (iii) he was given
a period of twenty-one days within which to consider this Agreement; and (iv) to
the extent he executes this Agreement before the expiration of the
twenty-one-day period, he does so knowingly and voluntarily and only after
consulting his attorney. The Executive shall have the right to cancel and revoke
this Agreement during a period of seven days following the Board Effective Date,
and this Agreement shall not become effective, and no money shall be paid
hereunder, until the day after the expiration of such seven-day period (the
"Revocation Date"). The seven-day period of revocation shall commence upon the
Board Effective Date. In order to revoke this Agreement, the Executive shall
deliver to the Company, prior to the expiration of said seven-day period, a
written notice of revocation. Upon such revocation, this Agreement shall be null
and void and of no further force or effect.
9. Confidential Data. Beginning upon the Resignation Date and for a
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period of ninety days thereafter, the Company shall provide the Executive with
reasonable access during regular business hours to Company personnel, records
and data related to the Company's offshore California assets for the purpose of
evaluating a possible transaction with the Company. All obligations, duties and
responsibilities of the parties with respect to access to and use of the data
shall be governed solely by a separate Confidentiality Agreement to be entered
into by the parties.
10. Return of Property. (a) Within 15 days after the Resignation Date,
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the Executive shall surrender to the Company all property of the Affiliated
Entities in the Executive's possession and all property made available to the
Executive in connection with his employment by the Company, including, without
limitation, any and all records, manuals, customer lists, notebooks, computers,
computer programs, cellular phones, and files, papers, electronically stored
information and documents kept or made by the Executive in connection with the
Executive's employment.
(b) For 45 days after the Resignation Date, the Company shall
provide the Executive with off-site voicemail services, and during such period,
the Executive's former secretary shall be permitted to forward voicemail and
electronic mail from the Company's voicemail and electronic mail systems to the
Executive's off-site voicemail and personal electronic mail account.
(c) The Executive shall be permitted to have and keep his laptop
computer after first purging from such computer any proprietary confidential
information belonging to the Company or relating to the Company's business for
which he has not received written permission to retain. The depreciated book
value of the computer shall de deducted from the final payment due to the
Executive.
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11. Entire Agreement; Other Benefits. This Agreement sets forth the
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entire agreement of the Company and the Executive with respect to the subject
matter hereof, and supersedes in its entirety the Employment Agreement, between
the Company and the Executive, dated as of September 1, 1998, as amended as of
September 1, 2000 and as of January 1, 2001, under which neither party shall
have any further obligation or liability to the other, and, as otherwise set
forth in this Agreement with respect to the option grants, deferred compensation
plan, and medical benefits or the Executive's rights to the vested component of
his 401(K) account, any severance plan, policy or arrangement of any of the
Affiliated Entities, including without limitation the Executive's Severance
Protection Agreement with the Company dated as of March 25, 2001. Without
limiting the generality of the foregoing, the Executive expressly acknowledges
and agrees that except as specifically set forth in this Agreement, he is not
entitled to receive any severance pay, severance benefits, compensation or
employee benefits of any kind whatsoever from any of the Affiliated Entities.
12. Successors. This Agreement is personal to the Executive and
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without the prior written consent of the Company shall not be assignable by the
Executive other than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives. This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and no assignment shall release the
Executive or the Company or its successors from any obligations herein.
13. Amendment. This Agreement may be amended, modified or changed only
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by a written instrument executed by the Executive and the Company.
14. Governing Law; Consent to Suit. (a) This Agreement shall be
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governed by and construed in accordance with the laws of the State of Texas,
without reference to principles of conflict of laws. The captions of this
Agreement are not part of the provisions hereof and shall have no force or
effect.
(b) The parties hereto irrevocably consent to jurisdiction in the
courts of the state of Texas for resolution of any claim or dispute arising
hereunder, and such shall be the exclusive forum for the resolution of such
claim or dispute.
15. Notices. All notices and other communications hereunder shall be
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in writing; shall be delivered by hand delivery to the other party or mailed by
registered or certified mail, return receipt requested, postage prepaid; shall
be deemed delivered upon actual receipt; and shall be addressed as follows:
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If to the Executive:
Xxxxxx X. Xxxx
00000 Xxxxxxx
Xxxxxxx, Xxxxx 00000
With a copy to:
Xxxxxx Xxxxx
Gardere, Wynne, Xxxxxx LLP
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
If to the Company:
Nuevo Energy Company
0000 Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
With a copy to:
Xxxxxxx X. Xxxxxx, Esq.
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
or to such other address as either party shall have furnished to the other in
writing in accordance herewith.
16. Tax Withholding. Notwithstanding any other provision of this
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Agreement, the Company may withhold from any amounts payable under this
Agreement, or any other benefits received pursuant hereto, such minimum Federal,
state and/or local taxes as shall be required to be withheld under any
applicable law or regulation.
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IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the date first set forth above.
/S/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
NUEVO ENERGY COMPANY
By: /S/ Xxxxx Xxxxx
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Xxxxx Xxxxx
Chief Executive Officer
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EXHIBIT A
Severance Compensation.
