AMENDMENT TO EMPLOYMENT AGREEMENT
AMENDMENT
TO EMPLOYMENT AGREEMENT
This Amendment (the “Amendment”) to Employment
Agreement, effective as of July 1, 2010, is entered into by and between A-G
GEOPHYSICAL PRODUCTS, INC., a Texas corporation (the “Company”), and Xxxxxxx X.
Xxxxxx (“Xxxxxx”).
WITNESSETH:
WHEREAS, the Company and
Xxxxxx entered into an Employment Agreement effective as of July 1, 2004, as
amended by an amendment effective as of
November 20, 2007 (the “Employment Agreement”), in
connection with the employment by the Company of Xxxxxx;
WHEREAS, in March 2010, Xxxxxx
was appointed Executive Vice President of Bolt Technology Corporation, the
parent corporation of the Company; and
WHEREAS, the Company and
Xxxxxx desire to amend the Employment Agreement as set forth
herein.
NOW, THEREFORE, in
consideration of the mutual covenants and premises contained herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Company and Xxxxxx agree as follows:
1. Paragraph
2 of the Employment Agreement is hereby amended and restated in its entirety as
follows:
2.
Compensation.
(a) Base
Salary. Company shall pay to Xxxxxx, on the same
periodic basis as Company pays its other employees (but in no event less
frequently than monthly), during the Term, as the same may be extended, a base
salary in substantially equal payments as follows:
(i)
During the twelve (12) months of
the Term beginning July 1, 2010 and ending June 30, 2011, a base salary of
$400,000.00; and
(ii) During each subsequent twelve (12) month
period during the Term, a base salary equal to the greater
of
(a) one hundred five percent (105%) of the
prior twelve (12) month’s base salary, or
(b) the product obtained by multiplying the
prior twelve (12) month’s base salary times a fraction, the numerator of which
shall be the Price Index (hereinafter defined) for April of the immediately
preceding twelve (12) month period and the denominator of which shall be the
Price Index for April of the twelve (12) month period immediately preceding the
twelve (12) month period used in determining the numerator. The
“Price Index” shall mean the Consumer Price Index for All Urban Consumers, New
York-No.N.J.-Long Island, NY-NJ-CT, All terms (1982-84=100) issued and published
by the Bureau of Labor Statistics of the United States Department of
Labor. If, at any time, said Consumer Price Index is no longer issued
or available, then the term “Price Index” shall mean a successor or comparable
index selected by Company and Xxxxxx.
It is understood that Company may, in
the discretion of its Board of Directors, increase such base salary above an
amount provided for pursuant to the foregoing without affecting any of the other
terms of this Agreement.
(b) Performance
Bonus. Company shall pay to Xxxxxx, with respect to each
of Company’s fiscal years during the Term, such performance bonus, if any, as
the Board of Directors of Company may, in its discretion, determine; provided,
however, that with respect to each of fiscal years 2011, 2012 and 2013 (i.e.,
July 1, 2010 – June 30, 2011, July 1, 2011 – June 30, 2012 and July 1, 2012 –
June 30, 2013), the sum of (i) Xxxxxx’x base salary for such fiscal year and
(ii) the performance bonus paid to Xxxxxx for such fiscal year, shall not be
less than the sum of (y) Seventy-Five Thousand Dollars (($75,000.00) plus (z)
the amount equal to three and one-half percent (3.5%) of all Company sales for
such fiscal year. Notwithstanding the foregoing, but subject to the
proviso in the foregoing sentence, Company agrees that all such performance
bonuses shall be based upon the performance of Company and
Xxxxxx. All such bonuses shall be paid within sixty (60) days of the
end of the fiscal year of Company to which the same relate.
2. Paragraph
4 of the Employment Agreement is hereby amended and restated in its entirety as
follows:
4. Health Insurance and Life
Insurance.
(a) Health
Insurance. The Company shall provide Xxxxxx such
hospitalization and major medical insurance coverage for Xxxxxx as provided to
other key or executive employees of the Company.
(b) Life
Insurance. Bolt Technology Corporation, the parent corporation
of the Company (“Bolt”), currently maintains a whole life insurance policy
covering the life of Xxxxxx in the face amount of $1,000,000.00. Bolt agrees to
maintain, at all times during the Term, at Bolt’s expense, said insurance policy
and/or one or more insurance policies for comparable insurance, with an insurer
or insurers reasonably acceptable to Xxxxxx, on the life of Xxxxxx payable to a
beneficiary or beneficiaries chosen by Xxxxxx in an aggregate amount of at least
$1,000,000.00 (the “Life Insurance”). Bolt shall pay all premiums
that become due on the Life Insurance at least 15 days before the end of the
applicable grace period and upon demand exhibit from time to time to Xxxxxx due
proof of such payment. If any premium shall remain unpaid 15 days
before the end of the grace period, Xxxxxx may pay or cause the premium to be
paid, and thereupon Xxxxxx shall be entitled to reimbursement from
Bolt. Bolt shall do everything necessary to maintain the Life
Insurance in full force and effect and shall not borrow on the cash surrender
value of any Life Insurance and/or pledge any Life Insurance as collateral for
any corporate obligation. Upon the termination of Xxxxxx’x employment under this
Agreement for any reason, Bolt shall, within 30 days after such termination or,
if applicable, the time specified in Paragraph 18(j), transfer, free and clear
of liens and security interests, the ownership of the Life Insurance (including,
without limitation, the full cash surrender value thereof) to Xxxxxx or his
designee.
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3. Paragraph
7 of the Employment Agreement is hereby amended and restated in its entirety as
follows:
7. Full Time to
be Devoted. Subject to the termination provisions of
paragraph 9, hereof the Company shall employ Xxxxxx; and Xxxxxx shall work
during the Employment Period as President of the Company and Executive Vice
President and Chief Operating Officer of Bolt. Xxxxxx shall devote
his full effort, skill, and attention to the affairs of the Company, Bolt and
its affiliated corporations, and as much time as is reasonably required to
faithfully perform his duties hereunder to promote the interests of the Company,
Bolt and its affiliates and observe and perform his agreements contained
herein.
4. The
first sentence of Paragraph 8 of the Employment Agreement is hereby amended to
delete the words “including Bolt Technology Corporation (“Bolt”)”.
5. Paragraph
9(B) of the Employment Agreement is hereby amended and restated in its entirety
as follows:
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(B)
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If
Company terminates this Agreement for other than Cause or Xxxxxx
terminates this Agreement for Good Reason, then Company shall be obligated
to:
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(i)
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pay
to Xxxxxx, within thirty (30) days after the date of such termination, all
accrued but unpaid amounts payable hereunder with respect to the period
prior to the date of termination (including, without limitation, accrued
bonus and unused vacation pay); and
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(ii)
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pay
to Xxxxxx any and all sums which would have become payable to Xxxxxx under
this Agreement during the three (3) year period following the date of such
termination (the “Severance Period”). Said sums are sometimes
hereinafter referred to as the “Severance Period Payments”. The
Severance Period Payments shall be paid in a lump sum within 30 days after
such termination or, if applicable, the time specified in Paragraph
18(j). Said lump sum amount shall be computed without any
discount for present value. The Severance Period Payments shall
be computed based upon (a) the then base salary and (b) annual performance
bonus based upon the average of such bonuses paid to Xxxxxx during the
three (3) fiscal years preceding the date of such termination; provided,
however, in the event that for any of the three fiscal years Xxxxxx was
paid commissions and not a performance bonus (i.e., any fiscal years
preceding fiscal year 2011), the amount to be used for purposes of the
calculation under clause (b) for any such fiscal year shall be equal to
the commissions paid to Xxxxxx in such fiscal year minus
$400,000.00. For purposes of clause (b) of the immediately
preceding sentence, the calculation of the annual performance bonus for
any given fiscal year shall be the sum of (i) the cash bonus paid to
Xxxxxx in respect of such fiscal year (regardless of whether such cash
bonus was paid prior to or after the end of such fiscal year), and (ii)
the Fair Market Value (as defined in the Bolt Technology Corporation
Amended and Restated 2006 Stock Option and Restricted Stock Plan) as of
the date of award of any shares of restricted stock awarded to Xxxxxx as
part of Xxxxxx’x annual performance bonus in respect of such fiscal year
(regardless of whether such award was made prior to or after the end of
such fiscal year and regardless of whether such stock is forfeited upon
Xxxxxx’x termination).
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6. Paragraph
9(C) of the Employment Agreement is hereby amended and restated in its entirety
as follows:
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(C)
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If
Company terminates this Agreement for Cause, or if Xxxxxx terminates this
Agreement for other than Good Reason, then Company shall pay to Xxxxxx,
within (30) days after the date of such termination, all accrued but
unpaid amounts payable hereunder with respect to the period ending on the
date of termination (including, without limitation, accrued bonus and
unused vacation pay).
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7. The
Employment Agreement is hereby amended by adding the following Paragraph 9(G)
after Paragraph 9(F):
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(G)
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Notwithstanding
anything to the contrary herein, in the event Xxxxxx terminates this
Agreement for Good Reason as defined in Paragraph 9(E)(ii) above, then the
amount of the benefits payable pursuant to Paragraph 9(B) above shall be
limited to the maximum amount which can be paid without having any amount
paid hereunder being treated as a “parachute payment” within the meaning
of Section 280G(b)(2) of the Internal Revenue Code of 1986, as the same
may be amended, after giving effect to all other payments of compensation
described in Section 280G(b)(2)(A)(i) and
(ii).
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8. Except
as amended by this Amendment, the Employment Agreement shall remain unaffected
and in full force and effect.
9. This
Amendment may be executed in one or more counterparts, each of which shall for
all purposes be deemed to be an original and all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the
parties have executed this Amendment as of the date and year first above
written.
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A-G
GEOPHYSICAL PRODUCTS, INC.
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By:
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/s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X.
Xxxx
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Title: Chairman
of the Board
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Date: November
5, 2010
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/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X.
Xxxxxx
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Solely
with respect to Paragraphs 2 and 3 of the Amendment
(amending
Paragraphs 4(b) and 7 of the Employment Agreement):
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BOLT
TECHNOLOGY CORPORATION
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By:
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/s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X.
Xxxx
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Title: President,
Chief Executive Officer
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and
Chairman of the Board
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GUARANTEE
BY BOLT
Bolt
Technology Corporation hereby confirms that its guarantee of the performance of
A-G Geophysical Products, Inc. attached to the Employment Agreement between
Xxxxxxx Xxxxxx and A-G Geophysical Products, Inc., effective as of July 1, 2004,
shall apply to said Employment Agreement as amended by the amendment effective
as of November 20, 2007 and the foregoing amendment.
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BOLT
TECHNOLOGY CORPORATION
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By:
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/s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X.
Xxxx
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Title: President,
Chief Executive Officer
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and
Chairman of the Board
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