RETENTION AGREEMENT
Exhibit 10.1
THIS RETENTION AGREEMENT (this “Agreement”) is made by and between Anadarko Petroleum
Corporation, a Delaware corporation (the “Company”), and Xxxxxxx X. Xxxxx (“Executive”), as of
August 2, 2010 (“Effective Date”).
WHEREAS, the Company values the contributions of the Executive and desires that the Executive
continue his employment at least for a two-year period ending on August 2, 2012 (“Retention
Period”).
NOW, THEREFORE, for and in consideration of the mutual promises, covenants and obligations
contained herein, the Company and the Executive agree as follows:
1. Retention Payment. The Company shall pay to Executive an amount in cash equal to
$5,000,000 (“Retention Payment”), less applicable taxes, within 15 days of the Effective Date,
subject to the terms and conditions set forth herein. The Retention Payment shall not be treated,
to the fullest extent permitted by law, as salary or other compensation for purposes of increasing
the amount of benefits under any employee benefit plan or arrangement of the Company or any of its
affiliates, including, without limitation, the calculation of severance pay, pension benefits,
savings benefits, disability benefits and life insurance benefits.
2. Resignation without Good Reason; Terminable for Cause. In the event Executive
resigns (including retirement) without Good Reason (as defined below) or is determined by the Board
of Directors (“Board”) to be terminable by the Company or any of its affiliates for Cause (as
defined below) at any time during the Retention Period, Executive shall return to the Company a
portion of the Retention Payment or otherwise pay to the Company an amount in cash as set forth in
the schedule below, with said amount (without any reduction for taxes paid by Executive on said
Retention Payment) to be due and payable to the Company within 30 days following such termination
of employment.
If Executive resigns without Good Reason or
is determined by the Board to be terminable
for Cause during the applicable period set
forth below:
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Executive shall return or otherwise pay to the Company an amount equal to: | |
Effective Date to December 31, 2010
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100% of the Retention Payment, or $5,000,000 | |
January 1, 2011 to June 30, 2011
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75% of the Retention Payment, or $3,750,000 | |
July 1, 2011 to December 31, 2011
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50% of the Retention Payment, or $2,500,000 | |
January 1, 2012 to last day of Retention
Period
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25% of the Retention Payment, or $1,250,000 |
a. For purposes of this Agreement, “Cause” shall have the same meaning as “Cause” under
Section 5(c) of the Key Employee Change of Control Contract (the form of which has been
filed with the Securities and Exchange Commission (“SEC”) on March 18, 1998, with the first
amendment filed with the SEC on November 13, 2000 and with the second amendment filed with
the SEC on August 11, 2003) (“COC Agreement”). In addition, “Cause” shall also mean
fraud or embezzlement relating to the Company or any of its affiliates, as determined by
the same process as provided in Section 5(c) of the COC Agreement.
b. For purposes of this Agreement, “Good Reason” shall be, in all circumstances of this
definition and only following a Change of Control (as defined in Section 2 of the COC
Agreement), the same meaning as “Good Reason” under Section 5(d) of the COC
Agreement.
3. Other Terminations of Employment. In the event Executive’s employment with the
Company and its affiliates terminates during the Retention Period by reason of Executive’s death,
permanent and total disability (as determined for purposes of eligibility for disability benefits
under the Company’s long-term disability plan applicable to Executive), or involuntary termination
by the Company without Cause, Executive shall not be required to return any portion of the
Retention Payment to the Company.
4. Offset Against Severance Pay. In the event Executive is entitled during the
Retention Period to receive severance pay under any plan (including any amounts that may be payable
under Section 6 (a)(i)(A) and (B) of the COC Agreement), agreement or established practice
of the Company or any of its affiliates, the amount of Retention Payment that Executive received
and did not return to the Company pursuant to Paragraphs 2 and 3 above shall be applied as an
offset against the amount of severance pay owed by the Company or any of its affiliates and shall
thereby reduce the amount of any such severance payment. In the event the remaining Retention
Payment amount is greater than the severance payment, then any and all remaining repayment
obligation under Paragraph 2 shall terminate. Further, in the event the Executive is terminated
whereby he would otherwise be entitled to receive severance benefits but for the fact of the offset
described in this Paragraph, then Executive shall be required to comply with the terms and
conditions of such applicable severance arrangement, including the execution of the applicable
release (with the consideration under this Agreement being due consideration for such release).
Except for the Company’s right to offset severance pay as set forth above, the Company shall not
otherwise be entitled to offset the amount of Retention Payment retained by Executive against any
other amounts owed by the Company or any of its affiliates to Executive, including, without
limitation, any amounts owed under the Anadarko Petroleum Corporation Deferred Compensation Plan,
Anadarko Petroleum Corporation Savings Restoration Plan, Anadarko Retirement
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Restoration Plan, Xxxx-XxXxx Corporation Benefits Restoration Plan, and/or any similar
deferred compensation or non-qualified retirement benefit plan or agreement.
5. Confidential Information. 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
Company or any of its affiliates, and their respective businesses, which shall have been obtained
by Executive during Executive’s employment by the Company, its predecessors, or any of its
affiliates and which shall not be or become public knowledge (other than by acts by Executive or
representatives of Executive in violation of this Agreement) (referred to herein as “Confidential
Information”). Following the termination of Executive’s employment with the Company for any
reason, Executive shall not, without the prior written consent of the Company or as may otherwise
be required by law or legal process, communicate or divulge any such Confidential Information to
anyone other than the Company and those designated by it. Also, within five (5) days after the
termination of Executive’s employment for any reason, Executive shall return to Company all
documents and other tangible items containing Company information which are in Executive’s
possession, custody or control.
6. Nonsolicitation. As part of the consideration for the Retention Payment to be paid
to Executive hereunder; to protect the Confidential Information that has been and will in the
future be disclosed or entrusted to Executive, the business good will of the Company and its
affiliates that has been and will in the future be developed in Executive, or the business
opportunities that have been and will in the future be disclosed or entrusted to Executive by the
Company and its affiliates; and as an additional incentive for the Company to enter into this
Agreement, the Company and Executive agree to the nonsolicitation obligations herein. Executive
shall not, directly or indirectly for Executive or for others, in any geographic area or market
where the Company or any of its affiliates are conducting any business or have during the previous
twelve months conducted such business, induce any employee of the Company or any of its affiliates
to terminate his or her employment with the Company or such affiliates, or hire or assist in the
hiring of any such employee by any person, association, or entity not affiliated with the Company,
unless such employee has terminated employment with the Company and its affiliates before such
solicitation. These nonsolicitation obligations shall apply during the period that Executive is
employed by the Company and during the one-year period commencing on the date of Executive’s
termination of employment for any reason. Notwithstanding the foregoing, the provisions of this
Paragraph 6 shall not restrict the ability of the Company to take actions with respect to the
employment or the termination of employment of any of its employees, or for Executive to
participate in any such actions in his capacity as an officer of the Company.
7. Enforcement and Remedies. Executive acknowledges that money damages would not be
sufficient remedy for any breach of this Agreement by Executive, and the Company shall be entitled
to specific performance and injunctive relief as remedies for such breach or any threatened breach.
Such remedies shall not be deemed the exclusive remedies for a breach of this Agreement, but shall
be in addition to all remedies available at law or in equity to the Company, including the recovery
of damages
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from Executive and his agents involved in such breach and remedies available to the Company
pursuant to this and other agreements with Executive.
8. Reformation and Severability. It is expressly understood and agreed that the
Company and Executive consider the restrictions contained in Paragraphs 5, 6 and 7 to be reasonable
and necessary to protect the proprietary information of the Company. Nevertheless, if any of the
aforesaid restrictions are found by a court having jurisdiction to be unreasonable, or overly broad
as to geographic area or time, or otherwise unenforceable, the parties intend for the restrictions
herein set forth to be modified by such court so as to be reasonable and enforceable and, as so
modified by the court, to be fully enforced. Further, if a court of competent jurisdiction
determines that any other provision of this Agreement is invalid or unenforceable, then the
invalidity or unenforceability of that provision shall not affect the validity or enforceability of
any other provision of this Agreement, and all other provisions shall remain in full force and
effect.
9. No Right To Employment. Nothing in this Agreement provides or shall be construed
as proving Executive with any right to employment with the Company, and Company may terminate the
employment of Executive at any time.
10. Notices. For purposes of this Agreement, notices and all other communications
provided for herein shall be in writing and shall be deemed to have been duly given when personally
delivered, when delivered by facsimile with printed confirmation, via email with acknowledgement,
or when mailed by United States registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Company:
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Anadarko Petroleum Corporation 0000 Xxxx Xxxxxxx Xxxxx Xxx Xxxxxxxxx, Xxxxx 00000 |
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Attention: Senior Vice President, General Counsel and Chief Administrative Officer | ||
If to the Executive:
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Xxxxxxx X. Xxxxx [ ] [ ] |
or to such other address as either party may furnish to the other in writing in accordance
herewith, except that notices or changes of address shall be effective only upon receipt.
11. Applicable Law. This Agreement is entered into under, and shall be governed for
all purposes by, the laws of the State of Texas, without reference to principles of conflict of
laws.
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12. No Waiver. No failure by either party hereto at any time to give notice of any
breach by the other party of, or to require compliance with, any condition or provision of this
Agreement shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or
at any prior or subsequent time.
13. Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, but all of which together will constitute one and the same
Agreement.
14. Withholding of Taxes and Other Employee Deductions. The Company may withhold from
any benefits and payments made pursuant to this Agreement all federal, state, city and other taxes
as may be required pursuant to any law or governmental regulation or ruling and all other normal
employee deductions made with respect to the Company’s employees generally.
15. Headings. The paragraph headings have been inserted for purposes of convenience
and shall not be used for interpretive purposes.
16. Gender and Plurals. Wherever the context so requires, the masculine gender
includes the feminine or neuter, and the singular number includes the plural and conversely.
17. Affiliate. As used in this Agreement, the term “affiliate” shall mean any entity
which owns or controls, is owned or controlled by, or is under common ownership or control with,
the Company.
18. Assignment. This Agreement shall be binding upon and inure to the benefit of the
Company and any successor of the Company, by merger or otherwise. Except as provided in the
preceding sentence, this Agreement, and the rights and obligations of the parties hereunder, are
personal and neither this Agreement, nor any right, benefit, or obligation of either party hereto,
shall be subject to voluntary or involuntary assignment, alienation or transfer, whether by
operation of law or otherwise, without the prior written consent of the other party.
19. Term. This Agreement has a term co-extensive with the Retention Period.
Termination of this Agreement shall not affect any right or obligation of any party which is
accrued or vested prior to such termination. Without limiting the scope of the preceding sentence,
the provisions of Paragraphs 4, 5, 6 and 7 shall survive any termination of the employment
relationship and/or of this Agreement.
20. Entire Agreement. This Agreement constitutes the entire agreement of the parties
with regard to the subject matter hereof. Without limiting the scope of the preceding sentence,
all prior understandings and agreements among the parties hereto relating to the subject matter
hereof are hereby null and void and of no further force and effect.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the year and date
first above written, to be effective as of the Effective Date.
ANADARKO PETROLEUM CORPORATION |
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By: | /s/ X. X. Xxxxxx | |||
Name: | X. X. Xxxxxx | |||
Title: | President & Chief Operating Officer | |||
/s/ Xxxxxxx X. Xxxxx | ||||
Xxxxxxx X. Xxxxx | ||||
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