Mark B. Duncan AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit 10.2
Xxxx X. Xxxxxx
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (this “Agreement”) by and between Xxxxxxx Group
Inc., a Delaware corporation f/k/a Offshore Logistics, Inc. (the “Company”) and Xxxx X. Xxxxxx, an
individual (the “Executive”), is entered into this 6th day of June, 2006, but effective
as of the 24th day of January, 2005 (“Effective Date”). Except as otherwise provided
herein, capitalized terms used herein shall have the meaning specified in Section 10.
WHEREAS, the Company and the Executive entered into an Employment Agreement and a Change of
Control Employment Agreement (the “Original Agreements”) both dated as of the Effective Date,
providing for the Executive’s employment as the Company’s Vice President – Global Business
Development, and setting forth the terms and conditions for such employment; and
(i) The Company hereby agrees to employ the Executive for a term commencing on the
Effective Date and expiring at the end of the day on the second anniversary of the Effective
Date (the “Initial Employment Period”).
(ii) The Initial Employment Period shall be automatically further extended at the end
of the Initial Employment Period and on each anniversary thereafter (each such date being a
“Renewal Date”), so as to terminate one (1) year from such Renewal Date, unless at least
ninety (90) days prior to a Renewal Date either Party gives a written notice (a “Notice of
Non-Renewal”) to the other Party that the Employment Period should not be further extended
after the next Renewal Date, in which event the end of the term of the Executive’s
employment by the Company shall be the Renewal Date next following such Notice of
Non-Renewal. As used in this Agreement, the “Employment Period” shall mean the period
beginning on the Effective Date and ending on the expiration of the term of the Executive’s
employment with the Company pursuant to this Section 1(a), subject to earlier termination of
the Executive’s employment with the Company pursuant to Section 3 hereof.
(iii) Notwithstanding the foregoing provisions of this Section 1(a), if a Change of
Control Effective Date (as defined in Section 10(i) hereof) occurs during the Employment
Period, then the Employment Period shall extend to include and shall terminate at the end of
the Change of Control Period, subject to earlier termination pursuant to Section 3 hereof,
and the Employment Period shall no longer be subject to extension on the Renewal Date.
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Change of Control Period, the Annual Base Salary shall be at least equal to 12 times the
highest monthly base salary paid or payable, including any base salary which has been earned but
deferred, to the Executive by the Company and the Affiliated Group in respect of the 12-month
period immediately preceding the month in which the Change of Control Effective Date occurs.
During any Change of Control Period, (x) Annual Base Salary shall not be reduced, and (y) the term
“Annual Base Salary” as utilized in this Agreement shall refer to Annual Base Salary as determined
pursuant to the foregoing subpart (x).
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total shareholder returns during such vesting period reach certain thresholds provided in the
award agreement evidencing the grant of the Restricted Shares (which thresholds shall be consistent
with those provided in awards to other senior executives of the Company) and under the
circumstances described in Section 3(e). Except as specifically provided herein, the terms and
conditions of the Restricted Shares shall be subject to the terms of the Incentive Plan and the
award agreement evidencing the grant.
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reasonably practicable after execution and delivery of this Agreement by the Company and the
Executive, subject to the Executive becoming eligible for coverage under the Company health and
medical plan, the Company shall provide to the Executive and continue during the Employment Period
a Company-paid portable, term life insurance policy covering the Executive’s life in the amount of
$500,000 with death benefits payable to the Executive’s designated beneficiaries. The Executive
shall cooperate with the Company in applying for such coverage, including submitting to a physical
exam and providing all relevant health and personal data. During any Change of Control Period, in
no event shall the benefits described in this Section 2(f) provide the Executive with benefits that
are less favorable, in the aggregate, than the most favorable of such benefits in effect for the
Executive at any time during the 120-day period immediately preceding the Change of Control
Effective Date or, if more favorable to the Executive, those provided generally at any time after
the Change of Control Effective Date to other peer executives of the Company and the Affiliated
Group.
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Date”), provided that, within the 30-day period after such receipt, the Executive shall not
have returned to full time performance of the Executive’s duties.
(i) Upon the Executive’s termination of employment by reason of the Executive’s death
or Disability, any Stock Options held by the Executive that were exercisable immediately
before the Date of Termination may be exercised at any time until the earlier of (A) the
second anniversary of the Date of Termination and (B) the expiration date of the Stock
Options.
(ii) Upon the Executive’s termination of employment by the Company for Cause, any Stock
Options and Restricted Shares held by the Executive shall be forfeited, effective as of the
Date of Termination.
(iii) Upon termination of the Executive’s employment for any reason other than the
Executive’s death or Disability or termination by the Company for Cause, any
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Stock Options held by the Executive that were exercisable immediately before the Date
of Termination may be exercised at any time until the earlier of (A) the 90th day
following the Date of Termination and (B) the expiration date of such Stock Options.
(iv) Notwithstanding the foregoing provisions of this Section 3(e), if the Executive
dies after the Executive’s employment by the Company is terminated but while any of the
Stock Options remain exercisable as set forth above, such Stock Options may be exercised at
any time until the later of (A) the earlier of (1) the first anniversary of the date of such
death and (2) the expiration date of such Stock Options and (B) the last date on which such
Stock Options would have been exercisable, absent this Section 3(e)(iv).
(v) Notwithstanding the foregoing provisions of this Section 3(e), upon the termination
of the Executive’s employment with the Company for any reason, other than termination for
Cause by the Company, during the 24-month period following any Change of Control Effective
Date, any Stock Options held by the Executive as of the Change of Control Effective Date
that remain outstanding as of the Date of Termination may thereafter be exercised, until the
later of (A) the last date on which such Stock Options would be exercisable in the absence
of this Section 3(e)(v) and (B) the earlier of (1) the third anniversary of the Change of
Control Effective Date and (2) the expiration date of such Stock Options.
Notwithstanding anything in this Agreement to the contrary, express or implied, except as provided
in Section 4(a)(iii), the provisions of this Agreement are in addition to and not in limitation of
the Executive’s rights under the Incentive Plan and any other plan, program, policy or practice
provided by the Company or any of the Affiliated Group and for which the Executive may qualify.
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(4) the Executive’s employment terminates voluntarily or involuntarily upon expiration of the
term of this Agreement at the end of a Change of Control Period unless the Company provides the
Executive with a Comparable Offer at least ninety (90) days prior to the end of the Change of
Control Period:
(i) The Company shall pay to the Executive in a lump sum in cash within 30 days after
the Date of Termination the aggregate of the following amounts:
| A. | the Accrued Amounts (as defined in Section 10(a) hereof); and | ||
| B. | an amount equal to: |
| (1) | in the event such termination occurs at any time other than a Change of Control Period, the product of (x) one and one-half (11/2) and (y) the sum of (i) the Executive’s Annual Base Salary at the Date of Termination and (ii) the Target Bonus; or | ||
| (2) | in the event such termination occurs during or at the end of a Change of Control Period, the product of (x) two and one-half (21/2) and (y) the sum of (i) the Executive’s Annual Base Salary and (ii) the Highest Annual Bonus. |
| C. | all reasonable costs of either of the following, at the election of the Executive: (i) moving the Executive and his immediate family members and their household possessions from Houston, Texas to Aberdeen, Scotland or such other location in the United Kingdom as the Company and the Executive may agree or (ii) assistance and cooperation by the Company in transferring sponsorship of the Executive’s H-1B Visa from the Company to the Executive’s new employer. |
(ii) Notwithstanding any other provision of this Agreement to the contrary, the Company
must provide the Executive with six months advance notice prior to terminating the
Executive’s employment for any reason (including, but not limited to, termination by reason
of the Company providing to the Executive a Notice of Non-Renewal) other than Cause, death
or Disability and shall pay the Executive, in addition to the amounts payable to the
Executive under Section 4(a)(i) above, Annual Base Salary and Other Benefits and shall
cooperate with the Executive to permit him to maintain his H-1B Visa during such six month
period.
(iii) To the extent not theretofore paid or provided, the Company shall timely pay or
provide to the Executive any other amounts or benefits required to be paid or provided or
which the Executive is eligible to receive under any plan, program, policy or practice or
contract or agreement (other than, in the event the Executive’s termination occurs outside
of a Change of Control Period, any severance plan, program, policy or practice or contract
or agreement) of the Company and its Affiliated Group (such amounts and benefits, the “Other
Benefits”) in accordance with the terms and normal procedures of each such plan, program,
policy or practice, based on accrued benefits through the Date of Termination.
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(iv) Until the earlier to occur of (A) the expiration of eighteen months after the Date
of Termination, (B) the date on which the Executive attains the age of 65, (C) the date the
Executive first becomes eligible to receive health benefits under another employer-provided
plan, from and after the Executive’s Date of Termination, or (D) the death of the Executive,
the Company shall, via proper COBRA election by Executive, continue medical and dental
benefits to the Executive (and, if applicable, to the spouse and dependents of the Executive
who received such benefits under the Executive’s coverage immediately prior to the Date of
Termination) at least equal to those that would have been provided to the Executive (and to
any such dependent) in accordance with the plans, programs, practices and policies of the
Company had the Executive remained actively employed, provided that Executive makes all
required COBRA payments to the Company, and the Company shall immediately reimburse
Executive for each such COBRA payment.
(v) As a condition to the Executive’s receipt of payments and benefits described under
Sections 4(a)(i), 4(a)(ii), 4(a)(iii) and 4(a)(iv) in the event the Executive’s termination
occurs outside of a Change of Control Period, the Executive must execute and deliver to the
Company a full release of all claims that the Executive may have (and such release must
become irrevocable) against the Company, its Affiliated Group, and all of their officers,
employees, directors, and agents, in a form mutually and reasonably agreeable to the Parties
hereunder; provided, however, that the Executive shall retain the Executive’s
indemnification and related rights as a former officer and director under the Certificate of
Incorporation and Bylaws of the Company and the Executive’s rights under the Directors and
Officers Insurance Policy(ies) maintained by the Company from time to time.
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other peer executives and their beneficiaries at any time during the 120-day period
immediately preceding the Change of Control Effective Date or, if more favorable to the Executive’s
estate and/or the Executive’s beneficiaries, as in effect on the date of the Executive’s death with
respect to other peer executives of the Company and the Affiliated Group and their beneficiaries.
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Executive’s employment with the Company and the Affiliated Group, and arising from or relating
to such employment or the business of the Company or of other member of the Affiliated Group
(whether during business hours or otherwise, and whether on the premises of using the facilities or
materials of the Company or of other members of the Affiliated Group or otherwise). The Executive
shall promptly and fully disclose to the Company and to no one else all Developments, and hereby
assigns to the Company without further compensation all right, title and interest the Executive has
or may have in any Developments, and all patents, copyrights, or other intellectual property rights
relating thereto, and agrees that the Executive has not acquired and shall not acquire any rights
during the course of the Executive’s employment with the Affiliated Group or thereafter with
respect to any Developments.
(i) Areas Other Than Louisiana. Except with respect to competition in the
State of Louisiana, or with respect to competition in or above the waters off the State of
Louisiana in the areas specified in subparagraph (B) of Section 5(d)(ii) of this Agreement,
during the Restricted Period, the Executive shall not, either directly or indirectly,
compete with the business of the Company anywhere in the world where the Company or any
member of the Affiliated Group conducts business by (1) becoming an officer, agent,
employee, partner or director of any other corporation, partnership or other entity, or
otherwise render services to or assist or hold an interest (except as a less than 2-percent
shareholder of a publicly traded corporation or as a less than 5-percent shareholder of a
corporation that is not publicly traded) in any Competitive Business, or (2) soliciting,
servicing, or accepting the business of (A) any active customer of the Company or any member
of the Affiliated Group, or (B) any person or entity who is or was at any time during the
previous twelve months a customer of the Company or any member of the Affiliated Group,
provided that such business is competitive with any significant business of the Company or
any member of the Affiliated Group.
(ii) Louisiana. With respect to competition in the State of Louisiana, or with
respect to competition in or above the waters specified in subparagraph (B) of this Section
5(d)(ii).
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| A. | Executive, during the Restricted Period, agrees to refrain from carrying on or engaging in a business similar to the business of the Company or any member of the Affiliated Group, or from soliciting customers of the business of the Company or any member of the Affiliated Group, within the Parishes of Lafayette, Vermillion, Cameron, Iberia, St. Xxxx, Plaquemines, Terrebonne, Lafourche, St. Xxxxxxx, Orleans, Calcasieu and Jefferson in the State of Louisiana, so long as the Company or any member of the Affiliated Group carries on a like business therein during the Restricted Period, and | ||
| B. | Executive, during the Restricted Period, agrees to refrain from carrying on or engaging in a business similar to the business of the Company or any member of the Affiliated Group or from soliciting customers of the business of the Company or any member of the Affiliated Group in or above the waters of the Gulf of Mexico adjacent to the Parishes of Lafayette, Vermillion, Cameron, Iberia, St. Xxxx, Plaquemines, Terrebonne, Lafourche, St. Xxxxxxx, Orleans, Calcasieu and Jefferson in the State of Louisiana, so long as the Company or any member of the Affiliated Group carries on a like business therein during the Restricted Period. | ||
| C. | All non-capitalized terms in subparagraphs (A) and (B) of this Section 5(d)(ii) are intended to and shall have the same meanings that those terms (to the extent they appear therein) have in La. R.S. 23:921.C. Subject to and only to the extent not inconsistent with the foregoing sentence, the Parties understand the following phases to have the following meanings: |
| (1) | The phrase “carrying on or engaging in a business similar to the business of the Company or any member of the Affiliated Group” includes engaging, as principal, agent, trustee, or through the agency of any corporation, partnership, association or agent or agency, in any business that conducts an offshore oil and gas helicopter service business in competition with the Company or any member of the Affiliated Group or being the owner (except as a less than 2-percent shareholder of a publicly traded corporation or as a less than 5-percent shareholder of a corporation that is not publicly traded) of any interest in any corporation or other entity, or an officer, director, or employee of any corporation or other entity (other than the Company or any member of the Affiliated Group), or a member or employee or any partnership, or an owner or employee of any other business that conducts an offshore oil and gas helicopter service business in competition with the Company or any member of the Affiliated Group. Moreover, the term also includes (i) directly or indirectly inducing any current customers of the Company or any member of the Affiliated Group to patronize any offshore oil and gas helicopter service business in competition with the Company or any member of the Affiliated |
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| Group; (ii) canvassing, soliciting, or accepting any offshore oil and gas helicopter service business of the type conducted by the Company or any member of the Affiliated Group; (iii) directly or indirectly requesting or advising any current customers of the Company or any member of the Affiliated Group to withdraw, curtail or cancel such customer’s offshore oil and gas helicopter service business with the Company or any member of the Affiliated Group; or (iv) directly or indirectly disclosing to any other person, firm, corporation or entity, the names and addresses of any of the current customers of the Company or any member of the Affiliated Group. In addition, the term includes, directly or indirectly, through any person, firm, association, corporation or other entity with which Executive is now or may hereafter become associated, causing or inducing any present employee of the Company or any of its subsidiaries to leave the employ of the Company or any of its subsidiaries to accept employment with the Executive or with such person, firm association, corporation, or other entity. |
| (2) | The phrase “a similar business to the business of the Company or any member of the Affiliated Group” means an offshore oil and gas helicopter service business. | ||
| (3) | The phrase “carries on a like business” includes, without limitation, actions taken by or through a wholly-owned subsidiary or other affiliated corporation or entity. |
| D. | Notwithstanding any other provision of this Agreement, Section 5(d)(ii) of this Agreement shall not apply with respect to any geographic area outside of the geographic territory expressly set forth in this Section 5(d)(ii). |
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time to time. The Company agrees to reimburse the Executive for all of the Executive’s
reasonable out-of-pocket expenses associated with such assistance, including travel expenses and
any attorneys’ fees, and shall pay a reasonable per diem fee for the Executive’s service. In
addition, the Executive agrees to provide such services as are reasonably requested by the Company
to assist any successor to the Executive in the transition of duties and responsibilities to such
successor. Any services or assistance contemplated in this Section 5(e) shall be at mutually
agreed to and convenient times.
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(a) Governing Law; Captions; Amendments. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without reference to principles of
conflict of laws. The Parties hereto irrevocably agree to submit to the jurisdiction and venue of
the courts of the State of Delaware in any Delaware Proceeding. In the event of a Delaware
Proceeding, the Company shall pay all of the Executive’s reasonable travel expenses incurred by him
for the Executive’s travel between the Executive’s principal residence and/or principal place of
business at such time and Delaware in connection with such Delaware Proceeding. The captions of
this Agreement are not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified otherwise than by a written agreement executed by the
Parties hereto or their respective successors and legal representatives.
If to the Executive:
At the address most recently on file for the Executive at the Company at the time of such notice.
If to the Company:
Xxxxxxx Group Inc.
0000 X. Xxx Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: President and Chief Executive Officer
0000 X. Xxx Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: President and Chief Executive Officer
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With a Copy to:
Gardere Xxxxx Xxxxxx LLP
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attention: X. X. Xxxxxxx III
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attention: X. X. Xxxxxxx III
or to such other address as either Party shall have furnished to the other Party in writing in
accordance herewith. Notice and communications shall be effective when actually received by the
addressee.
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(i) In the event that all or any portion of the benefits provided under this Agreement,
either alone or together with other payments and benefits that the Executive receives or is
then entitled to receive from the Company or any member of the Affiliated Group, would
constitute a “parachute payment” within the meaning of Section 280G of the Code, the Company
shall reduce such payments and benefits provided to the Executive under this Agreement to
the extent necessary so that no portion thereof shall be subject to the excise tax imposed
by Section 4999 of the Code; but only if, by reason of such reduction, the net after-tax
benefit to the Executive shall exceed the net after-tax benefit if such reduction were not
made. “Net after-tax benefit” for these purposes shall mean (A) the total amount payable to
the Executive under this Agreement (and all other payments and benefits which the Executive
receives or is then entitled to receive from the Company or any member of the Affiliated
Group) that would constitute a “parachute payment” within the meaning of Section 280G of the
Code, less (B) the amount of federal income taxes payable with respect to the foregoing
calculated at the Executive’s applicable marginal income tax rate for each year in which the
foregoing shall be paid to the Executive (based upon the rate in effect for such year as set
forth in the Code at the time of the payment under this Agreement), less (C) the amount of
excise taxes imposed with respect to the payments and benefits described in (A) above by
Section 4999 of the Code. The amount of any reduction made under this Section 9(k) in the
payment to which the Executive is entitled under this Agreement is hereinafter referred to
as the “Relinquished Amount.”
(ii) All determinations required to be made under this Section 9(k), including whether
and when a Relinquished Amount shall be imposed and the amount of such Relinquished Amount,
shall be made by the Company’s independent auditing firm used immediately prior to the
Change of Control (the “Accounting Firm”), which shall provide detailed supporting
calculations both to the Company and the Executive. The Company shall provide any and all
information, records and documents relating to Executive’s compensation and benefits paid or
payable by the Company as may be reasonably requested by the Accounting Firm in connection
with its determination of the Relinquished Amount. In the event that the Accounting Firm is
serving as accountant or auditor for the individual, entity or group effecting the Change of
Control, the Executive shall appoint another nationally recognized accounting firm to make
the determinations required hereunder (which accounting firm shall then be referred to as
the Accounting
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Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by
the Company.
(iii) Notwithstanding anything herein to the contrary, expressed or implied, the
Company’s obligations to the Executive pursuant to this Section 9(k) shall be limited to
providing to the Executive payments and benefits in accordance with the determinations of
the Accounting Firm. The Company shall not be liable for any inaccuracies in the
determination of the Relinquished Amount by such Accounting Firm.
(a) “Accrued Amounts” shall mean:
(i) in the event termination of the Executive’s employment occurs at any time other
than during a Change of Control Period, the sum of (1) the Executive’s Annual Base Salary
through the Date of Termination, to the extent not theretofore paid, (2) the product of (x)
the Target Bonus and (y) a fraction (which, for purposes of clarity, shall equal less than
1), the numerator of which is the number of days in the then-current fiscal year through the
Date of Termination, and the denominator of which is 365, (3) the Executive’s business
expenses that are reimbursable pursuant to this Agreement but have not been reimbursed by
the Company as of the Date of Termination, (4) any compensation previously deferred by the
Executive (together with any accrued interest or earnings thereon) and any accrued but
unused vacation allowances for the year in which the Date of Termination occurs, and (5) any
Annual Bonus earned prior to the Termination Date but unpaid; or
(ii) in the event termination of the Executive’s employment occurs during a Change of
Control Period, the sum of (1) the Executive’s Annual Base Salary through the Date of
Termination to the extent not theretofore paid, (2) the product of (x) the higher of (I) the
Recent Annual Bonus and (II) the Annual Bonus paid or payable, including any bonus or
portion thereof which has been earned but deferred (and annualized for any fiscal year
consisting of less than twelve full months or during which the Executive was employed for
less than twelve full months or during which the Executive was employed for less than twelve
full months), for the most recently completed fiscal year during the Employment Period, if
any (such higher amount being referred to as the “Highest Annual
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Bonus”) and (y) a fraction, the numerator of which is the number of days in the current
fiscal year through the Date of Termination, and the denominator of which is 365, (3) the
Executive’s business expenses that are reimbursable pursuant to this Agreement but have not
been reimbursed by the Company as of the Date of Termination, (4) any compensation
previously deferred by the Executive (together with any accrued interest or earnings
thereon) and any accrued vacation pay, in each case to the extent not therefore paid, and
(5) any Annual Bonus earned prior to the Termination Date but unpaid.
(b) “Affiliated Group” shall mean any entity controlled by, controlling or under common
control with the Company.
(c) “Agreement” is defined in the Preamble to this Agreement.
(d) “Annual Base Salary” is defined in Section 2(a).
(e) “Annual Bonus” is defined in Section 2(b).
(f) “Board” shall mean the Board of Directors of the Company.
(g) “Cause” shall mean:
(i) the Executive’s willful failure to substantially perform the Executive’s duties
under this Agreement, or the Executive’s willful failure to perform specific directives of
the President and Chief Executive Officer of the Company, which directives are consistent
with the scope and nature of the Executive’s duties as set forth in Section 1(d) hereof,
other than any such failure resulting from incapacity due to physical or mental illness,
which failure has continued for a period of at least 30 days following delivery to the
Executive of a written demand for substantial performance specifying the manner in which the
Executive has failed hereunder; or
(ii) the Executive’s commission of malfeasance, fraud, or dishonesty, or the
Executive’s willful and material violation of Company policies; or
(iii) the Executive’s indictment or formal charge for, and subsequent conviction of, or
plea of guilty or nolo contendere to, a felony, or a misdemeanor involving moral turpitude;
or
(iv) the Executive’s material breach of Section 5 of this Agreement.
A termination of employment of the Executive shall not be deemed to be for “Cause” unless
and until there shall have been delivered to the Executive a copy of a resolution duly
adopted by the affirmative vote of not less than a majority of the entire membership of the
Board at a meeting of the Board called and held for such purpose, finding that, in the good
faith opinion of the Board, the Executive is guilty of the conduct described in one or more
of the clauses in Section 10(g) above, and specifying the particulars thereof.
(h) “Change of Control” shall mean:
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(i) the acquisition by an individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of either (x) the
then outstanding shares of common stock of the Company (the “Outstanding Company Common
Stock”) or (y) the combined voting power of the then outstanding voting securities of the
Company entitled to vote generally in the election of directors (the “Outstanding Company
Voting Securities”); provided, however, that for purposes of this subsection (i), the
following acquisitions shall not constitute a Change of Control: (A) any acquisition
directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company or (D) any acquisition by any corporation pursuant to
a transaction which complies with clauses (A), (B) and (C) of subsection (iii) of this
Section 10(h)(i); or
(ii) individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company’s stockholders, was approved by a vote
of at least a majority of the directors then comprising the Incumbent Board, but excluding,
for this purpose, any such individual whose initial assumption of office occurs as a result
of an actual or threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by or on behalf
of a Person other than the Board; or
(iii) consummation by the Company of a reorganization, merger or consolidation or sale
or other disposition of all or substantially all of the assets of the Company or the
acquisition of assets of another corporation (a “Business Combination”), in each case,
unless, following such Business Combination, (A) all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50.1% of, respectively, the
then outstanding shares of common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of directors, as
the case may be, of the corporation resulting from such Business Combination (including,
without limitation, a corporation which as a result of such transaction owns the Company or
all or substantially all of the Company’s assets either directly or through one or more
subsidiaries ) in substantially the same proportions as their ownership, immediately prior
to such Business Combination of the Outstanding Company Common Stock and Outstanding Company
Voting Securities, as the case may be, (B) no Person (excluding any employee benefit plan
(or related trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly 35% or more of, respectively, the
then outstanding shares of common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the Business
Combination, and (C) at least a majority of the members of the board of directors of the
corporation resulting from such Business Combination were members of the Incumbent Board at
the
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time of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or
(iv) approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.
(i) “Change of Control Effective Date” shall mean the first date during the Employment Period
on which a Change of Control occurs. Anything in this Agreement to the contrary notwithstanding,
if a Change of Control occurs and if the Executive’s employment with the Company is terminated
prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by
the Executive that such termination of employment (1) was at the request of a third party who has
taken steps reasonably calculated to effect a Change of Control or (2) otherwise arose in
connection with or anticipation of a Change of Control, then for all purposes of this Agreement the
“Change of Control Effective Date” shall mean the date immediately prior to the date of such
termination of employment.
(j) “Change of Control Period” shall mean the greater of (i) the period commencing on the
Change of Control Effective Date and ending on the Termination Date in effect on the Change of
Control Effective Date, and (ii) the period commencing on the Change of Control Effective Date and
ending on the second anniversary of the Change of Control Effective Date.
(k) “Code” shall mean the Internal Revenue Code of 1986, as amended.
(l) “Committee” shall mean the Compensation Committee of the Company.
(m) “Company” shall mean Xxxxxxx Group Inc., a Delaware corporation, and any successor to its
business and/or assets that assumes and agrees to perform this Agreement by operation of law, or
otherwise.
(n) “Comparable Offer” shall mean a binding offer of employment by the Company to the
Executive on terms substantially the same as the terms of this Agreement, or on terms more
beneficial to the Executive, including, without limitation, terms and provisions regarding (i) the
Executive’s position, title, duties, authority, and responsibilities, (ii) base salary, annual
bonus, options, restricted shares, severance payments and other compensation provided to the
Executive, and (iii) health and medical, welfare, retirement, deferred compensation, perquisite,
fringe benefit and other benefit plans in which the Executive will be eligible for participation.
(o) “Competitive Business” shall mean any person or entity (including any joint venture,
partnership, firm, corporation, or limited liability company) that engages in any principal or
significant business of the Company or any member of the Affiliated Group as of the Date of
Termination (or any material or significant business being actively pursued as of the Date of
Termination that the Company or any member of the Affiliated Group enters into during the
Restricted Period).
(p) “Confidential Information” shall mean any and all secret or confidential information,
knowledge or data relating to the Company and the Affiliated Group and their businesses (including,
without limitation, any proprietary and not publicly available information concerning any
processes, methods, trade secrets, research or secret data, costs, names of users
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or purchasers of their respective products or services, business methods, operating procedures
or programs or methods of promotion and sale) that the Executive obtains during the Executive’s
employment by the Company and the Affiliated Group that is not public knowledge.
(q) “Date of Termination” means (i) if the Executive’s employment is terminated by the Company
for Cause or by the Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein within 30 days of such notice, as the case may be; (ii) if the
Executive’s employment is terminated by the Company, other than for Cause or Disability, the date
on which the Company notifies the Executive of such termination; (iii) if the Executive voluntarily
resigns without Good Reason, the date on which the Executive notifies the Company of such
termination; (iv) if the Executive’s employment is terminated by reason of death, the date of death
of the Executive; (v) if the Executive’s employment is terminated by the Company due to Disability,
the Disability Effective Date; or (vi) if the Executive’s employment is terminated by the Executive
or the Company as a result of a Notice of Non-Renewal, the end of the applicable Employment Period.
(r) “Delaware Proceeding” shall mean any action or proceeding brought under, with respect to
or in connection with this Agreement in the courts of Delaware.
(s) “Developments” shall mean any and all inventions, ideas, trade secrets, technology,
devices, discoveries, improvements, processes, developments, designs, know how, show-how, data,
computer programs, algorithms, formulae, works of authorship, works modifications, trademarks,
trade names, documentation, techniques, designs, methods, trade secrets, technical specifications,
technical data, concepts, expressions, patents, patent rights, copyrights, moral rights, and all
other intellectual property rights or other developments whatsoever.
(t) “Disability” shall mean the inability of the Executive to perform the Executive’s duties
with the Company on a full-time basis for 150 consecutive days during the Employment Period as a
result of incapacity due to mental or physical illness, which is determined to be total and
permanent by a licensed physician selected by the Company or its insurers and reasonably acceptable
to the Executive or the Executive’s legal representative. If the Parties cannot agree on a
licensed physician, each Party shall select a licensed physician and the two physicians shall
select a third who shall be the approved licensed physician for these purposes.
(u) “Disability Effective Date” is defined in Section 3(a).
(v) “Effective Date” is defined in the Preamble to this Agreement.
(w) “Employment Period” is defined in Section 1(a)(ii).
(x) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
(y) “Executive” is defined in the Preamble to this Agreement.
(z) “Extended Employment Period” is defined in Section 1(a)(ii).
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(aa) “Good Reason” shall mean, in the absence of the Executive’s consent, (i) a material
failure by the Company to comply with any of the material provisions regarding the Executive’s
position and duties set forth in Section 1 hereof or the Executive’s compensation and benefits set
forth in Section 2 hereof, other than an isolated, insubstantial or inadvertent failure not
occurring in bad faith and which is remedied by the Company promptly after receipt of notice
thereof given by the Executive, (ii) the relocation of the Executive’s job to a location more than
fifty (50) miles from the location shown on Exhibit A that creates an unreasonable and material
burden on the Executive or the Executive’s spouse and children (if any), or (iii) any action or
inaction by any member of the Board, the Chief Executive Officer or the President, in connection
with the business of the Company, which (A) causes the Executive to be named as a party in a
Proceeding for which the Company does not provide Director’s and Officer’s Insurance coverage for
the Executive pursuant to Section 9(g) or indemnification of the Executive pursuant to the
Certificate of Incorporation and Bylaws of the Company, or (B) requires or could reasonably be
expected to require the Executive to commit in connection with the discharge of the Executive’s
duties to the Company (1) malfeasance, fraud, or dishonesty, or (2) a willful and material
violation of Company policies or U.S. laws and regulations (including SEC rules and regulations) or
accounting and auditing rules and regulations generally known as U.S. generally accepted accounting
principles and U.S. generally accepted auditing standards, or (3) any conduct that could reasonably
be expected to result in an indictment or formal charge under the laws of the United States or any
political subdivision thereof for a felony or a misdemeanor involving moral turpitude.
(bb) “Highest Annual Bonus” is defined in Section 10(a)(ii).
(cc) “Incentive Plan” shall mean the Company’s 2004 Stock Incentive Plan and any successor
plan, as each may be amended.
(dd) “Initial Employment Period” is defined in Section 1(a)(i).
(ee) “Notice of Non-Renewal” is defined in Section 1(a)(ii).
(ff) “Notice of Termination” shall mean a written notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for termination of the
Executive’s employment under the provision so indicated, and (iii) if the Date of Termination is
other than the date of receipt of such notice, specifies the termination date (which date shall be
not more than thirty days after the giving of such notice).
(gg) “Other Benefits” is defined in Section 4(a)(iii) and Section 4(c).
(hh) “Party” shall mean the Company and the Executive, individually, and “Parties” shall mean
the Company and the Executive collectively.
(ii) “Proceeding” shall mean any action, suit or proceeding, whether civil, criminal,
administrative, investigative or otherwise.
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(jj) “Recent Annual Bonus” shall mean the Executive’s highest Annual Bonus for the last three
fiscal years prior to the Change of Control Effective Date (annualized in the event that the
Executive is not employed by the Company for the whole of such fiscal year).
(kk) “Renewal Date” is defined in Section 1(a)(ii).
(ll) “Restricted Period” shall mean the period from the Effective Date through the date
eighteen (18) months following the Date of Termination; provided, however, that there shall be no
Restricted Period in the event that the termination of the Executive’s employment occurs during a
Change of Control Period.
(mm) “Restricted Shares” is defined in Section 2(d).
(nn) “Stock Options” is defined in Section 2(c).
(oo) “Target Bonus” is defined in Section 2(b).
(pp) “Termination Date” shall mean the second anniversary of the Effective Date, or such later
date to which the Employment Period of this Agreement is extended in accordance with the terms of
Section 1(a).
| “EXECUTIVE” | ||||
| /s/ Xxxx X. Xxxxxx | ||||
| “COMPANY” | ||||
| XXXXXXX GROUP INC. | ||||
| By: /s/ Xxxxx X. Xxxxxx | ||||
| Title: Executive Vice President and Chief Financial Officer | ||||
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EXHIBIT A
TERM SHEET
XXXX X. XXXXXX
Position: Senior Vice President – Global Business Development
Position: Senior Vice President – Global Business Development
Compensation Package
Employer and Location:
|
Xxxxxxx Group Inc. located at 0000 Xxxx Xxx Xxxxxxx Xxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000 (the “Company”). | |
| From and after January 24, 2005, you will receive an Annual Base Salary at the rate of $200,000, subject to increase at the discretion of the Company. From and after April 1, 2006, and during the remainder of the Employment Period, you will receive an Annual Base Salary at the rate of $260,000, subject to increase at the discretion of the Company. Annual Base Salary will be payable semi-monthly or such other payroll period pursuant to the Company’s normal payroll practices for its senior executives. | ||
Effective Date and Term:
|
From January 24, 2005 to the second anniversary of such date, automatically renewing for consecutive one year terms unless you or the Company give written notice, at least 90 days prior to the anniversary of your employment, that employment will not be renewed. | |
| From and after January 24, 2005, you will participate in the Incentive Compensation Plan including cash bonuses and stock options and grants in accordance with Executive Salary Grade 11. From and after January 1, 2006, you will participate in the Incentive Compensation Plan including cash bonuses and stock options and grants in accordance with Executive Salary Grade 12. Current annual incentive compensation at Salary Grade 12 is a target bonus of 50% of Annual Base Salary with a maximum of 100% of Annual Base Salary. | ||
Equity Grants:
|
Initial grant of 12,000 Stock Options and no Restricted Shares as an incoming member of senior management, and continuing participation in the Company’s annual stock option plans for the Company’s senior management. The granted Stock Options will vest periodically in accordance with Company polices. Participation in annual stock option and |
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| restricted share grants is subject to approval of the Compensation Committee of the Board of Directors. | ||
| Standard 3% match + an additional 3% of Annual Base Salary at the end of each calendar year based on continued employment. | ||
| From and after January 24, 2005, this plan will “top up” all 401K contributions made to 10%. From and after January 1, 2006, this plan will “top up” all 401K contributions made to 15%. Additionally you can elect to defer a portion of his Annual Base Salary or Annual Bonus by contribution into this plan. All investments are self directed by the employee via Vanguard Investment Group. | ||
Health & Benefit Plans:
|
Standard health & benefits packages for health insurance, STD, LTD, life and options to “buy up” coverage relative to LTD and life. Additionally you will participate in the Xxxxxxx Group Inc. management life insurance plan that will provide an additional $500,000 of term life coverage; paid for by the Company (this insurance will be portable). Four (4) weeks of annual vacation is allowed. | |
Company Vehicle Allowance:
|
From and after January 24, 2005, you shall receive a car allowance of $1,250 per month, which will be reassessed periodically. From and after January 1, 2006, you shall receive a car allowance of $1,500 per month, which shall be reassessed periodically. | |
| The Company shall reimburse you for all dues and assessments up to $300 per month (which amount shall be reviewed in March of each year during the Employment Period) for one country club or athletic club of your choosing. | ||
| This Term Sheet is Exhibit A to and a part of the Amended and Restated Employment Agreement between the Company and you. |
You agree that during the Employment Period, you will serve as the Senior Vice President – Global
Business Development of the Company, under the direction of and reporting to the President and
Chief Executive Officer of the Company, and will be responsible for the following:
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| • | Providing market analysis and planning including forecasting market requirements, competitive analysis and client satisfaction analysis; | |
| • | Ensuring that the Company has the knowledge, exposure and opportunity to capitalize on strategic growth opportunities worldwide; | |
| • | Conceiving marketing and business development strategies to increase penetration in existing accounts and acquire new accounts promoting long term relationships; | |
| • | Implementing short and long-range plans, including analysis and recommendations of business development opportunities including acquisitions, joint ventures and alliances; | |
| • | Functioning as the Company focal point in the areas of macroeconomics and competitive surveillance emphasizing trends and events affecting Company objectives and performance; | |
| • | Developing and maintaining contacts with other oil companies, governments, banks, consultants, the investment community, etc. in seeking to develop and enhance growth opportunities; | |
| • | Delegating authorities and responsibilities, as appropriate, and continually working toward developing the professional staff; | |
| • | Working closely with the other major Company functions such as operating, finance, human resources, and legal departments in carrying out specific duties; | |
| • | Keeping the President and Chief Executive Officer, and other key management personnel, informed of conditions, activities and trends in the Company’s markets around the world; | |
| • | Coordinating global business development and marketing and sales teams in the Company’s strategic business units; | |
| • | Participating in bid/no bid and final bid approval decisions on all major and strategy proposals in accordance with the Company authority matrix; | |
| • | Controlling budget for corporate business development group; and | |
| • | Such other business development duties as the President and Chief Executive Officer may assign to you from time to time during the Employment Period. |
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