Key Energy Group, Inc.
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxxx Xxxxxxxxx, Xxx Xxxxxx
November 13, 1998
Xxxxx X. Xxxxxxxxxx
000 Xxxxx
Xxx Xxxxxxx, Xxxxx 00000
EMPLOYMENT AGREEMENT
(this "Agreement")
Dear Xxx:
Key Energy Group, Inc., a Maryland corporation (the "Company"), with its
principal offices at the address set forth above, and you, an individual with
your home address set forth above, agree as follows:
1. Employment; Term. The Company agrees to employ you, and you agree to devote
your full time and best efforts to serve as the Company as Executive Vice
President of Permian Basin Operations. Your employment will commence effective
as of the date hereof and continue until this Agreement is terminated in
accordance with Section 3 hereof.
2. Salary; Expenses; Benefits. From the date hereof until this Agreement is
terminated in accordance with Section 3 hereof, the Company will pay a salary to
you at the annual rate of $170,000 per year (the "Base Salary"), payable in
substantially equal installments in accordance with the Company's existing
payroll practices, but no less frequently than monthly. You will be reimbursed
by the Company for reasonable travel, lodging, meal and other expenses incurred
by you in connection with performing your services hereunder in accordance with
the Company's policies from time to time in effect. From the date hereof until
this Agreement is terminated in accordance with Section 3 hereof, you will be
entitled to such benefits, including, without limitation, group medical and
dental , accident and disability insurance, retirement plans and supplemental
and excess retirement benefits as the Company may provide from time to time for
its similarly situated management personnel.
3. Termination.
(a) Termination by Company for Cause. The Company shall have the right to
terminate your employment under this Agreement for Cause (as defined below)
at any time without obligation to make any further payments to you
hereunder other than any salary or expense reimbursement payments owed to
you under Section 2 hereof through the date of termination. As used in this
Agreement, the term "Cause" shall mean the willful and continued failure by
you to substantially perform your duties hereunder (other than any such
wilful or continued failure resulting from your incapacity due to physical
or mental illness or physical injury), or the willful engaging by you in
misconduct which is materially injurious to the Company, monetarily or
otherwise, or your conviction of a felony by a court of competent
jurisdiction.
(b) Termination by Company upon Disability or Death. If you die or become
totally and permanently disabled so that you are unable to perform your
obligations hereunder by reasons involving physical or mental illness or
physical injury, then the Company shall have the right to terminate your
employment under this Agreement, effective on the date of such disability
or death, without obligation to make any further payments to you hereunder
other than any salary or expense reimbursement payments owed to you under
Section 2 hereof through the date of termination.
(c) Termination by Employee. You shall have the right to terminate your
employment under this Agreement for any reason by giving at least thirty
(30) days' written notice to the Company, with the Company having no
obligation to make any further payments to you hereunder other than any
salary or expense reimbursement payments owed to you under Section 2 hereof
through the date of termination.
(d) Termination by Company other than for Cause, Disability or Death. The
Company shall have the right, upon at least ten (10) days' written notice,
to terminate your employment under this Agreement for any reason other than
for Cause, disability or death at any time without obligation to make any
further payments to you hereunder other than (i) any salary or expense
reimbursement payments owed to you under Section 2 hereof through the date
of termination and (ii) the payments provided for in Section 3(e) hereof.
(e) Severance Compensation. In the event your employment hereunder is
terminated by the Company other than for Cause, death or disability within
six (6) months following a Change of Control (as defined below), you will
be entitled to severance compensation in the amount of $170,000 payable in
twelve (12) equal monthly installments on the last day of each calendar
month commencing on the last day of the calendar month on which the
termination date occurs. In the event your employment hereunder is
otherwise terminated by the Company other than for Cause, death or
disability, you will be entitled to severance compensation in the amount of
$85,000 payable in six (6) equal monthly installments on the last day of
each calendar month commencing on the last day of the calendar month on
which the termination date occurs. As used in this Agreement, the term
"Change of Control" shall mean any one or more of the following
occurrences: (i) an event or series of events by which any person or group
of persons shall, as a result of a tender or exchange offer, open market
purchase, privately negotiated purchase, merger, consolidation or
otherwise, have become the beneficial owner (within the meaning of Rule
13d-3 under the Securities Exchange Act, as amended) of 50% or more of the
combined voting power of the then outstanding capital stock of the Company
entitled to vote for the election of directors ("Voting Stock"), (ii) the
Company is merged with or into another corporation with the effect that
immediately after such transaction the stockholders of the Company hold
less than a majority of the combined voting power of the then outstanding
Voting Stock of the person surviving such transaction, or (iii) the direct
or indirect, sale, lease, exchange or other transfer to any person or group
of persons of all or substantially all of the assets of the Company.
4. Limitation on Competition. From the date hereof until the later to occur of
(i) the date this Agreement is terminated in accordance with Section 3 hereof
and (ii) the date of the last severance payment made to you under Section 3(e)
hereof, you shall not, directly or indirectly, without the prior written consent
of the Company, participate or engage in, whether as a director, officer,
employee, advisor, consultant, stockholder, partner, joint venturer, owner or in
any other capacity, any business engaged in the business of furnishing oilfield
services (a "Competing Enterprise") anywhere in the continental United States,
Argentina or any other geographic region in which the Company (including its
subsidiaries and affiliates) conducts its business from time to time; provided,
however, that you shall not be deemed to be participating or engaging in any
such business solely by virtue of your ownership of not more than five percent
of any class of stock or other securities which is publicly traded on a national
securities exchange or in a recognized over-the-counter market; and, for that
same period of time, you shall not, directly or indirectly, solicit, raid,
entice or otherwise induce any employee of the Company or any of its
subsidiaries to be employed by a Competing Enterprise.
If this Agreement correctly sets forth your understanding of the agreement
between the Company and you, please indicate your agreement hereto by signing
this Agreement in the space for that purpose below.
KEY ENERGY GROUP, INC.
By:
Name:
Title:
ACCEPTED AND AGREED
as of the date first written above:
Xxxxx X. Xxxxxxxxxx
