EXECUTIVE EMPLOYMENT AGREEMENT
EXHIBIT
10-36
This Executive Employment Agreement
("Agreement") is entered into by and between Halliburton Energy Services,
Inc. ("Employer") and Xxxxx Xxxxx Xxxxx
("Employee"), as of May 1, 2004 (the "Effective Date").
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I T N E S S E T H:
WHEREAS, Employee is currently
employed by Employer; and
WHEREAS, Employer is desirous
of continuing the employment of Employee after the Effective Date pursuant to
the terms and conditions and for the consideration set forth in this Agreement,
and Employee is desirous of continuing in the employ of Employer pursuant to
such terms and conditions and for such consideration.
NOW, THEREFORE, for and in
consideration of the mutual promises, covenants, and obligations contained
herein, Employer and Employee agree as follows:
ARTICLE
1: EMPLOYMENT AND DUTIES:
1.1. Employer
agrees to employ Employee, and Employee agrees to be employed by Employer,
beginning as of the Effective Date and continuing until the date of termination
of Employee's employment pursuant to the provisions of Article 3 (the "Term"),
subject to the terms and conditions of this Agreement.
1.2. Beginning
as of the Effective Date, Employee shall be employed as Vice President—United States Region,
Energy Services Group of Employer. Employee agrees to serve in the
assigned position or in such other executive capacities as may be requested from
time to time by Employer and to perform diligently and to the best of Employee's
abilities the duties and services appertaining to such positions as reasonably
determined by Employer, as well as such additional or different duties and
services appropriate to such positions which Employee from time to time may be
reasonably directed to perform by Employer.
1.3. Employee
shall at all times comply with and be subject to such policies and procedures as
Halliburton Company (“Halliburton”) or Employer may establish from time to time,
including, without limitation, the Halliburton Company Code of Business Conduct
(the "Code of Business Conduct").
1.4. Employee
shall, during the period of Employee's employment by Employer, devote Employee's
full business time, energy, and best efforts to the business and affairs of
Employer. Employee may not engage, directly or indirectly, in any other
business, investment, or activity that interferes with Employee's performance of
Employee's duties hereunder, is contrary to the interest of Halliburton or any
of its affiliated subsidiaries and divisions, including Employer (collectively,
the “Halliburton Entities” or, individually, a “Halliburton Entity”), or
requires any significant portion of Employee's business time. The
foregoing notwithstanding, the parties recognize and agree that Employee may
engage in passive personal investments and other business activities which do
not conflict with the business and affairs of the Halliburton Entities or
interfere with Employee's performance of his duties hereunder. Employee may not
serve on the board of directors of any entity other than a Halliburton Entity
during the Term without the approval thereof in accordance with Halliburton’s
policies and procedures regarding such service. Employee may retain compensation
received for approved service on any unaffiliated corporation’s board of
directors to the extent permitted under applicable Halliburton policies and
procedures.
1.5. Employee
acknowledges and agrees that Employee owes a fiduciary duty of loyalty, fidelity
and allegiance to act at all times in the best interests of the Employer and the
other Halliburton Entities and to do no act which would, directly or indirectly,
injure any such entity's business, interests, or reputation. It is agreed that
any direct or indirect interest in, connection with, or benefit from any outside
activities, particularly commercial activities, which interest might in any way
adversely affect Employer, or any Halliburton Entity, involves a possible
conflict of interest. In keeping with Employee's fiduciary duties to Employer,
Employee agrees that Employee shall not knowingly become involved in a conflict
of interest with Employer or the Halliburton Entities, or upon discovery
thereof, allow such a conflict to continue. Moreover, Employee shall not engage
in any activity which might involve a possible conflict of interest without
first obtaining approval in accordance with Halliburton's policies and
procedures.
1.6 Nothing
contained herein shall be construed to preclude the transfer of Employee's
employment to another Halliburton Entity ("Subsequent Employer") as of, or at
any time after, the Effective Date and no such transfer shall be deemed to be a
termination of employment for purposes of Article 3 hereof; provided, however,
that, effective with such transfer, all of Employer's obligations hereunder
shall be assumed by and be binding upon, and all of Employer's rights hereunder
shall be assigned to, such Subsequent Employer and the defined term "Employer"
as used herein shall thereafter be deemed amended to mean such Subsequent
Employer. Except as otherwise provided above, all of the terms and conditions of
this Agreement, including without limitation, Employee's rights and obligations,
shall remain in full force and effect following such transfer of
employment.
ARTICLE
2: COMPENSATION AND BENEFITS:
2.1. Employee's
base salary during the Term shall be not less than $234,600 per annum which
shall be paid in accordance with the Employer's standard payroll practice for
its executives. Employee's base salary may be increased from time to time in
accordance with Employer’s salary policy. Such increased base salary shall
become the minimum base salary under this Agreement and may not be decreased
thereafter without the written consent of Employee.
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2.2. During
the Term, Employee shall participate in the Halliburton Annual Performance Pay
Plan, or any successor annual incentive plan approved by the Compensation
Committee of Halliburton’s Board of Directors (the “Compensation Committee”);
provided, however, that all determinations relating to Employee's participation,
including, without limitation, those relating to the performance goals
applicable to Employee and Employee's level of participation and payout
opportunity, shall be made in the sole discretion of the person or committee to
whom such authority has been granted pursuant to such plan's terms.
2.3. Each
year during the Term beginning with the 2004 performance cycle, Employee shall
be nominated to participate in the Halliburton Performance Unit
Program, or any similar successor long-term incentive program approved by the
Compensation Committee; provided, however, that all determinations relating to
Employee’s participation, including, without limitation, those relating to the
performance goals applicable to Employee and Employee’s level of participation
and incentive opportunity shall be made in accordance with applicable guidelines
in place at the time of nomination, and Employee’s participation shall further
be subject to such other terms and conditions as set forth in the Performance
Unit Program Terms and Conditions and other underlying
documentation.
2.4. During
the Term, Employer shall pay or reimburse Employee for all actual, reasonable
and customary expenses incurred by Employee in the course of his employment;
including, but not limited to, travel, entertainment, subscriptions and dues
associated with Employee's membership in professional, business and civic
organizations; provided that such expenses are incurred and accounted for in
accordance with Employer's applicable policies and procedures.
2.5. While
employed by Employer, Employee shall be allowed to participate, on the same
basis generally as other executive employees of Employer, in all general
employee benefit plans and programs, including improvements or modifications of
the same, which on the Effective Date or thereafter are made available by
Employer or Halliburton to all or substantially all of Employer's similarly
situated executive employees. Such benefits, plans, and programs may include,
without limitation, medical, health, and dental care, life insurance, disability
protection, and qualified and non-qualified retirement plans. Except as
specifically provided herein, nothing in this Agreement is to be construed or
interpreted to increase or alter in any way the rights, participation, coverage,
or benefits under such benefit plans or programs than provided to similarly
situated executive employees pursuant to the terms and conditions of such
benefit plans and programs. While employed by Employer, Employee
shall be eligible to receive awards under the Halliburton Company 1993 Stock and
Incentive Plan (the "1993 Plan") or any successor stock-related plan adopted by
Halliburton's Board of Directors; provided, however, that the foregoing shall
not be construed as a guarantee with respect to the type, amount or frequency of
such awards, if any, such decisions being solely within the discretion of the
Compensation Committee or its delegate, as applicable.
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2.6. The
foregoing notwithstanding, neither Halliburton nor Employer shall by reason of
this Article 2 be obligated to institute, maintain, or refrain from changing,
amending or discontinuing, any incentive compensation, employee benefit or stock
or stock option program or plan, so long as such actions are similarly
applicable to covered employees generally.
2.7. Employer
may withhold from any compensation, benefits, or amounts payable under this
Agreement all federal, state, city, or other taxes as may be required pursuant
to any law or governmental regulation or ruling.
ARTICLE
3: TERMINATION OF EMPLOYMENT AND EFFECTS OF SUCH TERMINATION:
3.1. Employee's
employment with Employer shall be terminated (i) upon the death of Employee,
(ii) upon Employee's Retirement (as defined below), (iii) upon Employee's
Permanent Disability (as defined below), or (iv) at any time by Employer upon
notice to Employee, or by Employee upon thirty (30) days' notice to Employer,
for any or no reason.
3.2. If
Employee's employment is terminated by reason of any of the following
circumstances, Employee shall not be entitled to receive the benefits set forth
in Section 3.3 hereof:
(i)
Death.
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(ii)
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Retirement. "Retirement"
shall mean either (a) Employee's retirement at or after normal retirement
age (either voluntarily or pursuant to Halliburton's retirement policy) or
(b) the voluntary termination of Employee's employment by Employee in
accordance with Employer's early retirement policy for other than Good
Reason (as defined below).
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(iii)
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Permanent
Disability. "Permanent Disability" shall mean Employee's
physical or mental incapacity to perform his usual duties with such
condition likely to remain continuously and permanently as determined by a
qualified physician selected by
Employer.
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(iv)
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Voluntary
Termination. "Voluntary Termination" shall mean a
termination of employment in the sole discretion and at the election of
Employee for other than Good Reason. "Good Reason" shall mean
(a) a termination of employment by Employee because of a material breach
by Employer of any material provision of this Agreement which remains
uncorrected for thirty (30) days following notice of such breach by
Employee to Employer as provided in Section 5.2 hereof, provided such
termination occurs within sixty (60) days after the expiration of the
notice period or (b) a termination of employment by Employee within six
(6) months after a material reduction in Employee's rank or responsibility
with Employer.
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(v)
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Termination for
Cause. Termination of Employee's employment by Employer for Cause.
"Cause" shall mean any of the following: (a) Employee's gross negligence
or willful misconduct in the performance of the duties and services
required of Employee pursuant to this Agreement, (b) Employee's final
conviction of a felony, (c) a material violation of the Code of Business
Conduct or (d) Employee's material breach of any material provision of
this Agreement which remains uncorrected for thirty (30) days following
notice of such breach to Employee by Employer as provided in Section 5.2
hereof. Determination as to whether or not Cause exists for termination of
Employee's employment will be reasonably made by the Compensation
Committee, or its delegate, in good
faith.
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In the event Employee's employment is
terminated under any of the foregoing circumstances, all future compensation to
which Employee is otherwise entitled and all future benefits for which Employee
is eligible shall cease and terminate as of the date of termination, except as
specifically provided in this Section 3.2. Employee, or his estate in the case
of Employee's death, shall be entitled to pro rata base salary through the date
of such termination and shall be entitled to any individual annual incentive
compensation not yet paid but earned and payable under Employer's or
Halliburton's annual incentive plans for the year prior to the year of
Employee's termination of employment, but shall not be entitled to any annual
incentive compensation for the year in which he terminates employment or any
other payments or benefits by or on behalf of Employer except for those which
may be payable pursuant to the terms of Employer's or Halliburton’s employee
benefit plans (as defined in Section 3.4), stock, stock option or incentive
plans, or the applicable agreements underlying such plans.
3.3 If
Employee's employment is terminated by Employee for Good Reason or by Employer
for any reason other than as set forth in Section 3.2 above, Employee shall be
entitled to each of the following, subject to the provisions of Section
3.4:
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(i)
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To
the extent not otherwise specifically provided in any underlying
restricted stock agreements, Halliburton, at its option and in its sole
discretion, shall either (a) cause all shares of Halliburton common stock
previously granted to Employee under the 1993 Plan, and any similar plan
adopted by Halliburton in the future, which at the date of termination of
employment are subject to restrictions (the "Restricted Shares") to be
forfeited, in which case, Employer will pay Employee a lump sum cash
payment equal to the value of the Restricted Shares (based on the closing
price of Halliburton common stock on the New York Stock Exchange on the
date of termination of employment); or (b) cause the forfeiture
restrictions with respect to the Restricted Shares to lapse and such
shares shall be retained by
Employee.
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(ii)
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Employer
shall pay to Employee a severance benefit consisting of a single lump sum
cash payment equal to two years' of Employee's base salary as in effect at
the date of Employee's termination of employment. Such
severance benefit shall be paid no later than sixty (60) days following
Employee's termination of
employment.
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(iii)
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Employee
shall be entitled to any individual incentive compensation earned under
the Halliburton Annual Performance Pay Plan, or any successor annual
incentive plan approved by the Compensation Committee, for the year of
Employee's termination of employment determined as if Employee had
remained employed by the Employer for the entire year. Such
amounts shall be paid to Employee at the time that such amounts are paid
to similarly situated employees.
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3.4. The
severance benefits paid to Employee pursuant to Section 3.3 shall be in
consideration of Employee's continuing obligations hereunder after such
termination, including, without limitation, Employee's obligations under Article
4. Further, as a condition to the receipt of such severance benefits, Employer
shall require Employee to first execute a release, in the form established by
Employer, releasing Employer and all other Halliburton Entities, and their
officers, directors, employees, and agents, from any and all claims and from any
and all causes of action of any kind or character, including, but not limited
to, all claims and causes of action arising out of Employee's employment with
Employer and any other Halliburton Entities or the termination of such
employment. The performance of Employer's obligations under Section 3.3 and the
receipt of the severance benefits provided thereunder by Employee shall
constitute full settlement of all such claims and causes of
action. Employee shall not be under any duty or obligation to seek or
accept other employment following a termination of employment pursuant to which
severance benefits under Section 3.3 are owing and the amounts due Employee
pursuant to Section 3.3 shall not be reduced or suspended if Employee accepts
subsequent employment or earns any amounts as a self-employed individual.
Employee's rights under Section 3.3 are Employee's sole and exclusive rights
against the Employer or its affiliates and the Employer's sole and exclusive
liability to Employee under this Agreement, in contract, tort or otherwise, for
the termination of his employment relationship with Employer. Employee agrees
that all disputes relating to Employee’s termination of employment, including,
without limitation, any dispute as to “Cause” or “Voluntary Termination” and any
claims or demands against Employer or Halliburton based upon Employee’s
employment for any monies other than those specified in Section 3.3, shall be
resolved through the Halliburton Dispute Resolution Plan as provided in Section
5.6 hereof; provided, however, that decisions as to whether "Cause" exists for
termination of the employment relationship with Employee and whether and as of
what date Employee has become permanently disabled are delegated to the
Compensation Committee, or its delegate, for determination and any dispute of
Employee with any such decision shall be limited to whether the Compensation
Committee, or its delegate, reached such decision in good
faith. Nothing contained in this Article 3 shall be construed to be a
waiver by Employee of any benefits accrued for or due Employee under any
employee benefit plan (as such term is defined in the Employees' Retirement
Income Security Act of 1974, as amended) maintained by Employer or Halliburton
except that Employee shall not be entitled to any severance benefits pursuant to
any severance plan or program of the Employer or Halliburton.
3.5. Termination
of the employment relationship does not terminate those obligations imposed by
this Agreement which are continuing obligations, including, without limitation,
Employee's obligations under Article 4.
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ARTICLE
4: OWNERSHIP AND PROTECTION OF INTELLECTUAL PROPERTY AND
CONFIDENTIAL INFORMATION:
4.1. All
information, ideas, concepts, improvements, discoveries, and inventions, whether
patentable or not, which are conceived, made, developed or acquired by Employee,
individually or in conjunction with others, during Employee's employment by
Employer or any of its affiliates (whether during business hours or otherwise
and whether on Employer's premises or otherwise) which relate to the business,
products or services of Employer or its affiliates (including, without
limitation, all such information relating to corporate opportunities, research,
financial and sales data, pricing and trading terms, evaluations, opinions,
interpretations, acquisition prospects, the identity of customers or their
requirements, the identity of key contacts within the customer's organizations
or within the organization of acquisition prospects, or marketing and
merchandising techniques, prospective names, and marks), and all correspondence,
memoranda, notes, records, data or information, analyses, or other documents
(including, without limitation, any computer-generated, computer-stored or
electronically-stored materials) of any type embodying any of such items, shall
be the sole and exclusive property of Employer or its affiliates, as the case
may be.
4.2. Employee
acknowledges that the businesses of the various Halliburton Entities are highly
competitive and that they have developed and own valuable information which is
confidential, unique and specific to the Halliburton Entities (“Proprietary and
Confidential Information”) and which includes, without limitation, financial
information; marketing plans; business and implementation plans; engineering
plans; prospect lists; technical information concerning products, equipment,
services and processes; procurement procedures and pricing techniques; names and
other information (such as credit and financial data) concerning customers and
business affiliates; and other trade secrets, concepts, ideas, plans,
strategies, analyses, surveys and proprietary information related to the past,
present or anticipated business of various of the Halliburton
Entities. Employee further acknowledges that protection of such
Proprietary and Confidential Information against unauthorized disclosure and use
is of critical importance to Employer and the other Halliburton Entities in
maintaining their competitive position. Employee hereby agrees that Employee
will not, at any time during or after his employment by Employer, disclose to
others, permit to be disclosed, use, permit to be used, copy or permit to be
copied, any such Proprietary and Confidential Information (whether or not
developed by Employee and whether or not received as an employee) without the
prior written consent of the Chief Executive Officer of Employer. Employee
further agrees to maintain in confidence any proprietary and confidential
information of third parties received or of which he has knowledge as a result
of his employment. The prohibitions of this Section 4.2 shall not apply,
however, to information in the public domain (but only if the same becomes part
of the public domain through means other than a disclosure prohibited
hereunder). The above notwithstanding, a disclosure shall not be
unauthorized if (i) it is required by law or by a court of competent
jurisdiction or (ii) it is in connection with any judicial, arbitration, dispute
resolution or other legal proceeding in which Employee's legal rights and
obligations as an employee or under this Agreement are at issue; provided,
however, that Employee shall, to the extent practicable and lawful in any such
events, give prior notice to Employer of his intent to disclose any such
Proprietary and Confidential Information in such context so as to allow Employer
or its affiliates an opportunity (which Employee will not oppose) to obtain such
protective orders or similar relief with respect thereto as may be deemed
appropriate.
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4.3. All
written materials, records, data and information, analyses, and other documents
(including, without limitation, any computer-generated, computer-stored or
electronically-stored data and other materials), and all copies thereof, made,
composed or received by Employee, solely or jointly with others, and which are
in Employee’s possession, custody or control and which are related in any manner
to the past, present or anticipated business of any of the Halliburton Entities
(collectively, the “Company Documents”) shall be and remain the property of
Employer, or its affiliates, as the case may be. Upon termination of Employee's
employment with Employer, for any reason, Employee promptly shall deliver the
Company Documents, and all copies thereof, to Employer.
4.4 For
purposes of this Article 4, "affiliates" shall mean Halliburton and entities in
which Employer or Halliburton has a 20% or more direct or indirect equity
interest.
ARTICLE
5: MISCELLANEOUS:
5.1. Except
as otherwise provided in Section 4.4 hereof, for purposes of this Agreement, the
terms "affiliate" or "affiliated" means Halliburton and any other entity who
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with Halliburton or in which
Halliburton has a 50% or more equity interest.
5.2. 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
received by or tendered to Employee, Halliburton or Employer, as applicable, by
pre-paid courier or by United States registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
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If
to Employer or Halliburton, to Halliburton Company at 5 Houston Center,
0000 XxXxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, to the attention of the
General Counsel, or to such other address as Employee shall receive notice
thereof.
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If
to Employee, to his last known personal
residence.
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5.3. This
Agreement shall be governed by and construed and enforced, in all respects in
accordance with the law of the State of Texas, without regard to principles of
conflicts of law, unless preempted by federal law, in which case federal law
shall govern; provided, however, that the Halliburton Dispute Resolution Plan
and the Federal Arbitration Act shall govern in all respects with regard to the
resolution of disputes hereunder.
5.4. 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.
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5.5. It
is the desire and intent of the parties that the terms, provisions, covenants,
and remedies contained in this Agreement shall be enforceable to the fullest
extent permitted by law. If any such term, provision, covenant, or remedy of
this Agreement or the application thereof to any person, association, or entity
or circumstances shall, to any extent, be construed to be invalid or
unenforceable in whole or in part, then such term, provision, covenant, or
remedy shall be construed in a manner so as to permit its enforceability under
the applicable law to the fullest extent permitted by law. In any case, the
remaining provisions of this Agreement or the application thereof to any person,
association, or entity or circumstances other than those to which they have been
held invalid or unenforceable, shall remain in full force and
effect.
5.6. It
is the mutual intention of the parties to have any dispute concerning this
Agreement resolved out of court. Accordingly, the parties agree that
any such dispute shall, as the sole and exclusive remedy, be submitted for
resolution through the Halliburton Dispute Resolution Plan; provided, however,
that the Employer, on its own behalf and on behalf of any of the Halliburton
Entities, shall be entitled to seek a restraining order or injunction in any
court of competent jurisdiction to prevent any breach or the continuation of any
breach of the provisions of Article 4 and Employee hereby consents that such
restraining order or injunction may be granted without the necessity of the
Employer posting any bond. The parties agree that the resolution of
any such dispute through such Plan shall be final and binding.
5.7. This
Agreement shall be binding upon and inure to the benefit of Employer, to the
extent herein provided, Halliburton and any other person, association, or entity
which may hereafter acquire or succeed to all or substantially all of the
business or assets of Employer or Halliburton by any means whether direct or
indirect, by purchase, merger, consolidation, or otherwise. Employee's rights
and obligations under this Agreement are personal and such rights, benefits, and
obligations of Employee shall not be voluntarily or involuntarily assigned,
alienated, or transferred, whether by operation of law or otherwise, without the
prior written consent of Employer, other than in the case of death or
incompetence of Employee.
5.8. This
Agreement replaces and merges any previous agreements and discussions, oral and
written, pertaining to the subject matter covered herein. This Agreement
constitutes the entire agreement of the parties with regard to the terms of
Employee's employment, termination of employment and severance benefits, and
contains all of the covenants, promises, representations, warranties, and
agreements between the parties with respect to such matters. Each
party to this Agreement acknowledges that no representation, inducement,
promise, or agreement, oral or written, has been made by either party with
respect to the foregoing matters which is not embodied herein, and that no
agreement, statement, or promise relating to the employment of Employee by
Employer that is not contained in this Agreement shall be valid or binding. Any
modification of this Agreement will be effective only if it is in writing and
signed by each party whose rights hereunder are affected thereby, provided that
any such modification must be authorized or approved in accordance with any
applicable policies and procedures of both Employer and
Halliburton.
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IN WITNESS WHEREOF, Employer
and Employee have duly executed this Agreement in multiple originals to be
effective on the Effective Date.
HALLIBURTON ENERGY SERVICES,
INC.
By: /s/ Xxxxx X.
Lesar_________________
Name: Xxxxx X.
Xxxxx
Title: Chairman
of the Board, President,
and Chief Executive Officer
EMPLOYEE
/s/ Xxxxx Xxxxx
Brown____________________
Xxxxx Xxxxx Xxxxx
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