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EXHIBIT 2.2
XXXXXXXXX DRILLING COMPANY
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT is made and entered into this 23rd day
of October, 1996 (this "Agreement"), by and between XXXXXXXXX DRILLING COMPANY,
a Delaware corporation ("PDC"), and XXXXX X. XXXXXX, an individual residing in
Midland, Texas (the "Consultant").
RECITALS:
A. Simultaneously with the execution of this Agreement, PDC
has entered into that certain Stock Purchase Agreement (the "Stock Purchase
Agreement"), among PDC and H. Xxxx Xxxxxx, Xxxxx X. Xxxxxx, Xxxxx X. Xxxxxx and
Xxxxxxx X. Xxxxxx, providing for, among other things, the purchase by PDC of
all of the outstanding shares of capital stock of Xxxxxx Cattle Company, Inc.
(d/b/a Xxxx Xxxxxx Drilling Corporation), a Texas corporation.
B. PDC desires to retain the services of the Consultant as an
independent contractor.
C. The execution and delivery of this Agreement is a
condition to the consummation of the Stock Purchase contemplated by the Stock
Purchase Agreement, and the parties are entering into this Agreement in order
to fulfill such condition.
NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties, intending to be legally bound, hereby agree as follows:
1. Engagement of Consultant.
PDC hereby engages Consultant as an independent contractor to
perform the services hereinafter provided.
2. Period of Agreement.
The period of this Agreement shall commence on the date hereof
and remain in effect through October 1, 2001, unless sooner terminated as the
result of the death of the Consultant (the "Consulting Period").
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3. Services of Consultant.
(a) Consulting Services. During the Consulting Period, but
subject to the last sentence of this Section 3(a), the Consultant agrees to
make himself available at all reasonable times to consult with, and advise,
PDC, and the directors, officers, and other representatives of PDC, or any of
its affiliates, regarding such contract drilling matters of PDC, or its
affiliates, as may from time to time be referred to the Consultant by PDC (the
"Consulting Services"). In no event shall the Consultant be required to devote
(a) more than 100 hours of Consulting Services during the first month following
the date of this Agreement; (b) more than 50 hours of Consulting Services
during each of the second through the sixth month following the date of this
Agreement; or (c) more than 25 hours of Consulting Services during any month
following the sixth month and prior to expiration of the Consulting Period.
(b) Time for Performing Consulting Services. Subject to the
provisions of Section 3(a) above, the Consultant hereby agrees to perform the
Consulting Services at such time or times reasonably requested by PDC and to
make himself reasonably available to perform the Consulting Services requested
by PDC hereunder upon reasonable notice to the Consultant.
4. Consultant's Compensation.
(a) Compensation. Simultaneously with the execution of this
Agreement, PDC has paid the Consultant, by wire transfer, the amount of
$400,000 as compensation for entering into this Agreement and performing the
Consulting Services hereunder.
(b) Reimbursement of Expenses. PDC shall reimburse the
Consultant for all reasonable expenses he incurs with the prior written consent
of PDC in connection with the performance of the Consulting Services hereunder.
The reasonable expenses shall be reimbursed at cost. The Consultant shall
follow PDC's policy, as established from time to time, on reimbursement of
expenses, shall obtain receipts for all expenses in excess of $25.00, and shall
submit such receipts to PDC. PDC shall reimburse Consultant for reimbursable
expenses not more than once each month and only after receipt of an invoice
therefor and supporting receipts.
(c) Benefits. As an independent contractor to PDC, the
Consultant shall not be entitled or eligible for participation in any pension,
profit sharing, stock option, employee stock ownership, insurance, medical, or
other employee benefit plan which may be in effect from time to time, and the
Consultant shall not be entitled to be paid or otherwise provided any severance
or similar payment or any vacation, holiday, or other benefits, whether
provided for in PDC's employee handbook (if any), by custom or practice, or
otherwise.
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5. Relationship of Parties.
The Consultant is, and shall at all times during the term of this
Agreement be, an independent contractor of PDC. This Agreement does not
represent a continuing working relationship between the parties hereto. The
Consultant shall be solely responsible for payment of all federal, state, and
local taxes or contributions required under unemployment insurance, social
security, and income tax laws with respect to the Consultant. Unless requested
by PDC, the Consultant shall not work at any of PDC's business locations nor
shall the Consultant use the tools and materials of PDC. The Consultant shall
not represent or hold himself out as an agent, joint venturer, partner, or
employee of PDC. The Consultant may provide services to more than one company
at a time (subject to the terms of Section 8 hereof and the terms of the Non-
Competition Agreement among PDC and the Consultant dated of even date
herewith), and Consultant holds himself out for hire by other companies.
Except as specifically authorized in this Agreement or in writing by PDC, the
Consultant shall not enter into, or in any way be authorized or have the
authority to enter into, any contract, agreement, warranty, or representation
on behalf of PDC and shall not act as an agent of PDC. Nothing in this
Agreement is intended or shall be construed as a partnership between the
Consultant and PDC for any purpose.
6. Right of Supervision.
PDC is interested only in the accurate and timely completion of
the Consulting Services. Therefore, the Consulting Services shall be subject
to PDC's general right of inspection and supervision to secure its satisfactory
completion. However, PDC shall have no right to control Consultant's hours of
work or to supervise the Consultant in the details of the Consultant's work.
The Consultant shall comply with all federal, state, and municipal laws, rules,
and regulations that are now or may in the future become applicable to the
Consultant or the Consulting Services.
7. Allocation of Risk.
The Consulting Services shall be performed entirely at the risk
of the Consultant.
This Section 7 shall survive the termination or other expiration
or cancellation of this Agreement.
8. Confidentiality.
(a) Confidential Information Defined. It is contemplated that
PDC may disclose to the Consultant information concerning PDC's confidential
know-how, data, and trade secrets to further the performance of this Agreement.
For purposes of this Agreement, "Confidential Information" means technical and
business information relating
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to PDC's inventions or products, research and development, production,
manufacturing, engineering, and other processes, software produced by or for
PDC, source code, computer programs, costs, profit or margin information,
finances, financial information and practices, customers and customer lists,
records, marketing, production, existing, contemplated, and future business
plans, products, and services, presentation binders, sales literature, pricing,
techniques, trade secrets (as defined under applicable law), all related
information and documentation, and any other information which is marked
"Confidential" or otherwise identified by PDC to be confidential. All material
and information disclosed by PDC to the Consultant will be presumed to be
Confidential Information and will be so regarded by the Consultant.
(b) Confidentiality Agreement. The Consultant agrees that the
Consultant will hold the Confidential Information in strict confidence and will
only use the Confidential Information in connection with the providing of
Consulting Services to PDC under this Agreement and will not disclose or use
any of the Confidential Information in any manner which would constitute a
"misappropriation" under applicable law governing trade secrets and will
otherwise comply with applicable law governing trade secrets. The Consultant
further agrees that the Consultant will not make any disclosure of the
Confidential Information (including methods or concepts utilized in the
Confidential Information) to anyone without the express written consent of PDC.
The Consultant will take all reasonable steps to ensure the confidentiality of
all Confidential Information. The Consultant agrees not to copy any
Confidential Information and not to use any Confidential Information for the
Consultant's benefit or for the benefit of any third party.
(c) Exceptions. Notwithstanding the other provisions of this
Agreement, nothing received by the Consultant will be considered to be
Confidential Information of PDC if: (i) it has been published or its otherwise
readily available to the public other than by a breach of this Agreement; (ii)
it has been rightfully received by the Consultant from a third party other than
PDC without confidentiality limitations; (iii) it has been independently
developed for the Consultant by personnel or agents having no access to the
Confidential Information; or (iv) it is required to be disclosed by order of
court or other governmental authority.
(d) Survival of Obligations. This Section 8 will survive any
termination or other expiration or cancellation of this Agreement.
9. Specific Performance.
Without intending to limit the remedies available to PDC, the
Consultant acknowledges that PDC will have no adequate remedies at law if the
Consultant violates the terms of Sections 7 or 8, hereof. In such event, the
Consultant agrees that PDC shall have the right, in addition to any other
rights it may have, to obtain in any court of competent jurisdiction specific
performance of such Sections of this Agreement or injunctive relief to
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restrain any breach or threatened breach thereof. Nothing herein shall be
construed as prohibiting PDC from pursuing any other remedies available to PDC
(whether at law or in equity) for such breach or threatened breach, including,
without limitation, the recovery of monetary damages from the Consultant.
The provisions of this Section 9 shall survive the termination or
cancellation of this Agreement.
10. Survival of Obligations.
The restrictions and obligations of this Agreement shall survive
any expiration, termination, or cancellation of this Agreement, and shall
continue to bind the Consultant and the Consultant's successors, personal
representatives, heirs and assigns.
11. Negation of Licenses.
No rights or licenses, express or implied, are hereby granted to
the Consultant as a result of or related to this Agreement.
12. Return of Information Upon Termination.
As requested by PDC from time to time and upon the expiration or
termination of this Agreement, the Consultant will deliver to PDC, within five
(5) days of such request or termination, all copies and embodiments, in
whatever form, of all Confidential Information in the Consultant's possession
or within the Consultant's control (including, but not limited to, written
records, notes, photographs, manuals, notebooks, documentation, program
listings, flow charts, magnetic media, disks, diskettes, tapes, and all other
materials containing any Confidential Information or Intellectual Property)
irrespective of the location or form of such material and, if requested by PDC,
will provide PDC with written confirmation that all such materials have been
delivered to PDC.
13. Attorneys Fees and Costs.
If an action at law or in equity is necessary to enforce or
interpret the terms of this Agreement, the prevailing party shall be entitled
to reasonable attorneys fees, costs and necessary expenses in addition to any
other relief to which that party may be entitled. This provision is applicable
to this entire Agreement.
14. Representations and Warranties of PDC and the Consultant.
(a) Representations and Warranties of PDC. PDC hereby
represents and warrants to the Consultant that: (i) it has all requisite power
to enter into and perform its obligations under this Agreement; (ii) this
Agreement has been duly and validly authorized
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by all necessary corporate action on the part of PDC; (iii) the execution of
this Agreement by PDC and performance of PDC's obligations hereunder do not
require the consent or approval of any other party; and (iv) this Agreement is
a valid and binding obligation of PDC.
(b) Representations and Warranties of the Consultant. The
Consultant hereby represents and warrants to PDC that: (i) the Consultant has
the capacity and power to enter into and perform the Consultant's obligations
under this Agreement; (ii) the Consultant has duly and validly executed this
Agreement; (iii) the execution of this Agreement and performance of the
Consultant's obligations hereunder do not require the consent or approval of
any other party; and (iv) this Agreement constitutes a valid and binding
obligation of the Consultant.
15. General Provisions.
(a) Compliance with Laws. The parties agree that they will
comply with all applicable laws and regulations of government bodies or
agencies in their respective performance of their obligations under this
Agreement.
(b) No Undisclosed Agency. Each party represents that it is
acting on its own behalf and is not acting as an agent for or on behalf of any
third party.
(c) Governing Law and Construction. This Agreement will be
governed by and construed in accordance with the laws of the State of Texas
without reference to its conflict-of-laws principles. This Agreement's final
form resulted from review and negotiations among the parties and their
attorneys, and no part of this Agreement should be construed against any party
on the basis of authorship.
(d) Forum for Dispute Resolution. If any dispute arises among
the parties concerning the interpretation or performance of any portion of this
Agreement which the parties are unable to resolve themselves, and any party
brings an action against any other party seeking a declaratory order, specific
performance, damages, or any other legal or equitable relief based on this
Agreement, the parties agree that the forum for any such action shall be an
appropriate federal or state court in Texas having jurisdiction, agree that
venue will be proper in such courts, and waive any objections based on
inconvenience of the forum, and further agree that the prevailing party in any
such action, as determined by the court, shall be awarded its reasonable
attorneys' fees and costs in addition to any relief or judgment the court
awards.
(e) Entire Agreement; Amendment. This Agreement constitutes
the entire agreement between the parties with respect to the subject matter
contained herein and supersedes any previous oral or written communications,
representations, understandings or
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agreements with respect thereto. The terms of this Agreement may be modified
only in a writing, signed by authorized representatives of both parties.
(f) Assignability. This Agreement will be binding upon the
parties' respective successors and permitted assigns. Neither party may assign
this Agreement and/or any of its rights and/or obligations hereunder without
the prior written consent of the other party, and any such attempted assignment
will be void; provided, however, that PDC may assign this Agreement to a
subsidiary or affiliate without the prior written consent of the Consultant,
and provided further that a transfer by PDC as a result of a merger or sale of
all or substantially all of the assets with or to a third party that assumes
PDC's obligations hereunder shall not constitute a prohibited assignment under
this Section 15(f).
(g) Waiver. A waiver of a breach or default under this
Agreement will not constitute a waiver of any other breach or default. Failure
or delay by either party to enforce compliance with any term or condition of
this Agreement will not constitute a waiver of such term or condition.
(h) Severability. If any provision of this Agreement is
declared to be invalid, the parties agree that such invalidity will not affect
the validity of the remaining provisions of this Agreement, and further agree,
to the extent possible, to substitute for the invalid provision a valid
provision that approximates the intent and economic effect of the invalid
provision as closely as possible.
(i) Headings. The titles of the Sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
(j) Notice. Any notice, request, consent, demand or other
communication required to be given under this Agreement will be in writing and
will be given personally, by facsimile or by mailing the same, first-class,
postage prepaid to the appropriate address and facsimile number set forth below
or to such other person or at such other address as may hereafter be designated
by like notice. Notices by mail will be considered delivered and become
effective three days after the mailing thereof. All notices by facsimile will
be considered delivered and become effective immediately upon the confirmed (by
answer back or other tangible printed verification or successful receipt)
sending thereof.
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To PDC:
Xxxxxxxxx Drilling Company
0000 Xxxxxx Xxxxxxx
X.X. Xxxxxx 0000
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx
Chairman and Chief Executive Officer
To the Consultant:
Xxxxx X. Xxxxxx
0000 Xxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
with copies to:
Xxxxxx Xxx Xxxxxxx
Meadows, Owens, Collier, Reed,
Cousins & Blau, L.L.P.
0000 XxxxxxxXxxx Xxxxx
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
(k) Counterparts. This Agreement may be executed in
counterparts and by the parties hereto in separate counterparts, each of which
will be deemed an original, but all of which together will constitute one and
the same instrument.
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to
be executed by their respective representatives as of the day and year first
above written.
XXXXXXXXX DRILLING COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Chief Executive Officer
/s/ Xxxxx X. Xxxxxx
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XXXXX X. XXXXXX
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