AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit 10.9
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Agreement is made this 15th day of February, 1999, between Cal Dive International,
Inc., a Minnesota corporation (the “Company”), and Xxxxx X. Xxxxxxxx (Employee), an individual
residing at 0000 Xxxx Xxxx Xxxxx, Xxxxxxx, Xxxxx 00000.
WHEREAS, Employee has extensive executive management skills and experience in the oil service
industry, including valuable marketing, financial, technical and other experience, knowledge and
ability and has been acting as Vice President-Core Group for the Company; and
WHEREAS, the Company wishes to continue to employ Employee as Vice President-Core Group of the
Company and Employee is willing to accept such continued employment upon the terms and conditions
set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements set forth
herein, the parties hereto agree as follows:
Section 1. Term of Employment and Employment Duties.
(a) Employee agrees to be employed by the Company on the terms and conditions contained
herein, for a period commencing on the date hereof until February 28, 2001 and thereafter
terminating one year after delivery to Employee of a written notice of termination by the Company
(the “Employment Term”); provided, however, that the occurrence of any event
described in Sections 7(a), 7(b) or 7(c) prior to the end of the Employment Term shall result in
the immediate termination of Employee’s employment and the Employment Term, subject to the terms of
such applicable Section. Employee shall devote his time, energy and skill to the affairs of the
Company and any of its affiliated business entities and to the promotion of their interests. Any
provision of this Agreement to the contrary notwithstanding, Employee shall immediately resign from
any offices held with the Company or its Affiliates upon written request by the Company. Any
resignation made pursuant to a written request by the Company under this Section shall not affect
Employee’s rights under this Agreement for any compensation, benefits or payments.
(b) Employee’s duties shall include all the normal duties associated with acting as Vice
President-Core Group of the Company and all other responsibilities assigned to that office from
time to time by the Chairman, President and the Board of Directors.
(c) During the Employment Term, (i) Employee services shall be rendered on a full time basis,
(ii) Employee shall have no other employment and no substantial outside business activities and
(iii) the headquarters for the performance of Employee’s services shall be the principal executive
or operating offices of the Company, subject to travel for such reasonable lengths of time as the
performance of his duties in the business of the Company may require.
Section 2. Compensation.
(a) Salary. During the Employment Term, as compensation for his services and
covenants and agreements hereunder and subject to such changes therein as the Board may make from
time to time, the Company agrees to pay Employee an initial salary for the period from the date
hereof to April 30, 2001 at the rate of Ninety Thousand Four Hundred Two Dollars ($90,402), payable
in equal semi-monthly installments in accordance with the Company’s regular payroll practices for
its principal executives, prorated for any partial employment and subject to normal increases as
approved by the Board.
(b) Incentive Bonus. During the Employment Term, in addition to the to the annual
salary payable to Employee pursuant to paragraph (a) above, Employee shall be entitled to an annual
incentive bonus (the “Incentive
Bonus”), payable not later than three months after the close of each fiscal year of the
Company, commencing with the fiscal year ending December 31,1999, as established annually or from
time to time by the Board.
(c) Reimbursement of Expenses. During the Employment Term, Employee will be
reimbursed by the Company for his reasonable business expenses incurred in connection with the
performance of his duties hereunder, including, without limitation, a home fax line, car mileage,
cell phone and business calls and other expenses consistent with Company policy from time to time.
Section 3. Benefits.
During the Employment Term, Employee shall be entitled to participate in any medical/dental,
life insurance, accidental death, long term disability insurance plan and 401(k) or other insurance
and retirement plans which has been or which may be adopted by the Company (as long as such plan is
not discontinued) for the general and overall benefit of executive employees of the Company,
according to the participation or eligibility requirements of each such plan. During the Employment
Term, Employee shall enjoy such vacation, holiday and similar rights and privileges as are enjoyed
generally by the Company’s principal executives.
Section 4. Nondisclosure and Nonuse of Confidential Information.
(a) During the period commencing with the date of this Agreement and ending on (i) the fifth
anniversary of the date of the termination of Employee’s employment with the Company if such
termination arises as a result of voluntary termination or retirement by Employee or termination by
the Company for “Cause” (as defined in Section 7 (a) hereof) and (ii) the date which is 18 months
following the date of termination of Employee’s employment with the Company if such termination
arises for any reason other than as provided in subparagraph 4 (a) (i) above, Employee covenants
and agrees with the Company that Employee shall not disclose or use any Confidential Information
(as defined below) of which Employee is or becomes aware, whether or not such information is
developed by him, except to the extent that such disclosure or use is directly related to and
required by Employee’s performance of duties assigned to Employee by the Company. Employee shall
take all appropriate steps to safeguard Confidential Information and to protect it against
disclosure, misuse, espionage, loss and theft.
(b) As used in this Agreement, the term “Confidential Information” means information that is
not generally known to the public and that is or has been used, developed or obtained, either prior
to or following the date of this Agreement, by the Company in connection with its businesses,
including but not limited to (i) products or services, (ii) fees, costs and pricing structures,
(iii) designs, (iv) analysis, (v) drawings, photographs and reports, (vi) computer software,
including operating systems, applications and program listings, (vii) flow charts, manuals and
documentation, (viii) data bases, (ix) accounting and business methods, (x) inventions, devices,
new developments, methods and processes, whether patentable or unpatentable and whether or not
reduced to practice, (xi) customers and clients and customer or client lists, (xii) other
copyrightable works, (xiii) all technology and trade secrets, and (xiv) all similar and related
information in whatever form. Confidential Information shall not include any information that has
been published in a form generally available to the public prior to the date Employee proposes to
disclose or use such information other than as a result of disclosure by Employee in violation of
this Agreement. Information shall not be deemed to have been published merely because individual
portions of the information have been separately published, but only if all material features
comprising such information have been published in combination.
Section 5. Non-Competition and Non-Solicitation.
(a) Employee acknowledges and agrees with the Company that his services to the Company are
unique in nature and that the Company would be irreparably damaged if Employee were to provide
similar services to any person or entity competing with the Company or engaged in a similar
business. Employee accordingly covenants and agrees with the Company that during the period
commencing with the date of this Agreement and ending on the later to occur of:
(i) April 30, 2002 and (ii) (A) the second anniversary of the date of the termination
of Employee’s employment with the Company if such termination arises as a result of
voluntary termination or
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retirement by Employee or termination by the Company for “Cause”, or (B) the first
anniversary of the date of termination of Employee’s employment with the Company if such
termination arises for any reason other than as provided in the preceding subparagraph 5(a)
(ii) (A).
Employee shall not, directly or indirectly, either for himself or for any other individual,
corporation, partnership, joint venture of other entity, participate in any business (including
without limitation any division, group or franchise of a larger organization) which engages or
which proposes to engage in the business of providing diving services in the Gulf of Mexico or any
other business actively engaged in by the Company on the date of termination of Employee’s
employment in the area or areas where the Company is conducting such business; provided
that until such time as the Company waives in writing any rights it may have to enforce the terms
of this Section 5 (the “Waiver), during the period commencing on the date of the termination of
Employee’s employment with the Company and ending on the date on which either the noncompetition
provisions contained in this Section 5 terminate or the Waiver is delivered to Employee, whichever
is earlier, the Company will pay to Employee either the amounts due under Section 7(d), if
appropriate, or an amount equal to Employee’s base salary as of the date his employment was
terminated (which will be paid over time in accordance with the salary payment schedule in effect
from time to time for senior executives of the Company) and during such time period Employee shall
be entitled to all insurance benefits received by other senior executives of the Company. For
purposes of this Agreement, the term ''participate in” shall include without limitation having any
direct or indirect interest in any corporation, partnership, joint venture or other entity, whether
as a sole proprietor, owner, stockholder, partner, joint venturer, creditor or otherwise, or
rendering any direct or indirect service or assistance to any individual, corporation, partnership,
joint venture and other business entity (whether as a director, officer, manager, supervisor,
employee, agent, consultant or otherwise) but not ownership of 2% or less of the capital stock of a
public company.
(b) Employee covenants and agrees with the Company that during the period commencing with the
date of this Agreement and ending on the later to occur of (i) April 30, 2003 and (ii) (A) the
second anniversary of the date of termination of Employee’s employment with the Company if such
termination arises as a result of voluntary termination by the Company or for “Cause”, or (B) the
date which is 18 months following the termination of Employee’s employment with the Company if such
termination arises for any reason other than as provided in the preceding subparagraph 5(b) (ii)
(A) above, Employee shall not, directly or indirectly, for himself or for any other individual,
corporation, partnership, joint venture or other entity, (x) make any offer of employment, solicit
or hire any supervisor, employee of the Company or its affiliates or induce or attempt to induce
any employee of the Company or its affiliates to leave their employ or in any way interfere with
the relationship between the Company or its affiliates and any of their employees or (y) induce or
attempt to induce any supplier, licensee, licensor, franchisee, or other business relation of the
Company or its affiliates to cease doing business with them or in any way interfere with the
relationship between the Company or its affiliates and any customer or business relation.
Section 6. Company’s Ownership of Intellectual Property.
(a) In the event that Employee as part of his activities on behalf of the Company generates,
authors or contributes to any invention, design, new development, device, product, method or
process (whether or not patentable or reduced to practice or comprising Confidential Information),
any copyrightable work (whether or not comprising Confidential Information) or any other form of
Confidential Information relating directly or indirectly to the Company’s business as prior hereto,
now or hereinafter conducted (collectively, “Intellectual Property”), Employee acknowledges that
such Intellectual Property is the exclusive property of the Company and hereby assigns all right,
title and interest in and to such Intellectual Property to the Company. Any copyrightable work
prepared in whole or in part by Employee shall be deemed “a work made for hire” under Section
201(b) of the 1976 Copyright Act, and the Company shall own all of the rights comprised in the
copyright therein. Employee shall promptly and fully disclose all Intellectual Property to the
Company and shall cooperate with the Company to protect the Company’s interest in and rights to
such Intellectual Property, including without limitation providing reasonable assistance in
securing patent protection and copyright registrations and executing all documents as reasonably
requested by the Company, whether such requests occur prior to or after termination of Employee’s
employment with the Company.
(b) As requested by the Company from time to time and upon the termination of Employee’s
employment with the Company for any reason, Employee shall promptly deliver to the Company all
copies and embodiments, in whatever form, of all Confidential Information or Intellectual Property
in Employee’s possession or within his control (including, but not limited to, written records,
notes, photographs, manuals, notebooks,
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documentation, program listings, flow charts, magnetic media, disks, diskettes, tapes and all
other materials containing any Confidential Information or Intellectual Property) irrespective of
the location or form of such material and, if requested by the Company, shall provide the Company
with written confirmation that all such materials have been delivered to the Company.
Section 7. Termination of Agreement.
(a) Termination for “Cause”. This Agreement may be terminated by the Company at any
time during the Employment Term for “Cause”, in which event Employee shall have no further rights
under this Agreement (but the Company’s rights shall survive as herein otherwise provided
including, without limitation, under Sections 4, 5 and 6 hereof). For purposes of the preceding
sentence, “Cause” shall mean: (i) any breach or threatened breach by Employee of any of his
agreements contained in Section 4, 5 or 6 hereof; (ii) repeated or willful neglect by Employee in
performing any duty or carrying out any responsibility assigned or delegated to him pursuant to
Section l(b) hereof, which neglect shall not have permanently ceased within ten (10) business days
after written notice to Employee thereof; or (iii) the commission by Employee of any criminal act
involving moral turpitude or a felony which results in an arrest or indictment, or the commission
by Employee, based on reasonable proof, of any act of fraud or embezzlement involving the Company
or its customers or suppliers. In the event that the Company elects to terminate this Agreement for
Cause, it will give Employee written notice of such termination, and, at the Company’s discretion,
Employee’s employment will terminate sixty (60) days thereafter.
(b) Termination Upon Death. This Agreement shall terminate automatically upon the
death of Employee during the Employment Term. In such event, the Company shall be obligated to pay
to Employee’s estate, or to such person or persons as he may designate in writing to the Company,
(i) through the last day of the fiscal year in which Employee’s death shall have occurred, the
salary (payable in the same manner as described in Section 2(a) hereof) to which Employee would
have been entitled under Section 2(a) hereof had such death not occurred, and (ii) as soon as
reasonably practicable after Employee’s death, any accrued but, as of the date of such death,
unpaid Incentive Bonus (or, if such death shall have occurred after the first three (3) months of
the Company’s fiscal year, any prorated portion thereof).
(c) Termination Upon Disability. This Agreement may be terminated by the Company at
any time during the Employment Term in the event that Employee shall have been unable, because of
“Disability” (as hereinafter defined), to perform his principal duties for the Company for a
cumulative period of six (6) months within any eighteen (18) month period. Prior to Employee’s
termination for Disability as provided herein, he shall remain eligible to receive the compensation
and benefits set forth in Section 2 and Section 3 hereof. Upon such termination, Employee shall be
entitled to receive as soon as reasonably practicable thereafter, any accrued, but as of the date
of such termination, unpaid Incentive Bonus (or, if such termination shall have occurred after the
first three (3) months of the Company’s fiscal year, any prorated portion thereof). For purposes of
this Section 7(c), “Disability” shall mean any physical or mental condition of Employee which shall
substantially impair his ability to perform his principal duties hereunder. In the event that the
Company elects to terminate this Agreement by reason of Disability under this Section 7(c), it will
give written notice of such termination, and, at the Company’s discretion, Employee’s employment
will terminate sixty (60) days thereafter.
(d) “Termination by the Company Without Cause Prior to Change in Control.” If the
Company terminates this Agreement for any reason other than pursuant to the terms of Sections 7(a),
7(b), or 7(c), and such termination occurs more than sixty (60) days prior to the occurrence of a
Change in Control, then the Company shall: (1) pay to Employee an amount equal to the greater of
(a) six (6) months salary (at the salary rate then in effect) or; (b) the total of four (4) weeks
salary plus two weeks salary for every twelve months of salaried employment by the Company and; (2)
continue Employee’s participation in the Company’s medical, dental, accidental death, and life
insurance plans, as provided in Section 3 of this Agreement, for six months, subject to COBRA
required benefits thereafter. The Company shall make cash payments due in one lump sum within 10
days of the effective date of termination.
(e) “Termination by the Company Without Cause After Change in Control.” If the
Company terminates this Agreement for any reason other than pursuant to the terms of Sections 7(a),
7(b), or 7(c), and such termination occurs within two years of the occurrence of a Change in
Control and a Material Change in Senior Management (as defined in (e) 1 below), then, in addition
to any amounts otherwise due under this Agreement, the Company shall: (1) pay to Employee an amount
equal to 2 times the salary plus bonus paid to Employee for his last complete year of
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employment, (2) continue Employee’s participation in the Company’s medical, dental, accidental
death, and life insurance plans, as provided in Section 3 of this Agreement, for two years, subject
to COBRA required benefits thereafter, and (3) cause Employee to be fully vested in any stock
options or stock grants held by Employee. The Company shall make the payment due in one lump sum
within 10 days of the effective date of termination.
A “Change in Control” shall be deemed to have occurred at any time after the date of this
Agreement that any person (including those persons who own more than 10% of the combined voting
power of the Company’s outstanding voting securities on the date hereof) becomes the beneficial
owner, directly or indirectly, of 45% or more of the combined voting power of the Company’s then
outstanding voting securities.
(e) “Termination by Employee With Good Cause After Change in Control”. If Employee
terminates this Agreement for Good Cause (defined below) and such termination occurs within two
years of the occurrence of a Change in Control, then, in addition to any amounts otherwise due
under this Agreement, the Company shall: (1) pay to Employee an amount equal to 2 times the salary
plus bonus paid to Employee for his last complete year of employment, (2) continue Employee’s
participation in the Company’s medical, dental, accidental death, and life insurance plans, as
provided in Section 3 of this Agreement, for two years, subject to COBRA required benefits
thereafter, and (3) cause Employee to be fully vested in any stock options or stock grants held by
Employee. The Company shall make the payment due in one lump sum within 10 days of the effective
date of termination.
“Good Cause” shall mean the occurrence of both of the following events:
| 1. | a “Material Change in Senior Management” (which shall mean either one or both of the CEO and COO cease their employment with the Company); and | ||
| 2. | in addition, any of the following events occur: |
(i) the assignment by the Company to Employee of duties that are materially
inconsistent with Employee’s office with the Company at the time of such assignment, or the
removal by the Company from Employee of a material portion of those duties usually
appertaining to Employee’s office with the Company at the time of such removal;
(ii) a material change by the Company, without Employee’s prior written consent, in
Employee’s responsibilities to the Company, as such responsibilities are ordinarily and
customarily required from time to time of a senior officer of a corporation engaged in the
Company’s business;
(iii) any removal of Employee from, or any failure to reelect or to reappoint Employee
to, the office stated in Section l(b);
(iv) The Company’s direction that Employee discontinue service (or not seek reelection
or reappointment) as a director, officer or member of any corporation or association of
which Employee is a director, officer, or member at the date of this Agreement;
(v) a reduction by the Company in the amount of Employee’s salary in effect at the time
of the occurrence of a Change in Control or the failure of the Company to pay such salary to
Employee at the time and in the manner specified in this Agreement;
(vi) the discontinuance (without comparable replacement) or material reduction by the
Company of Employee’s participation in any bonus or other employee benefit arrangement
(including, without limitation, any profit-sharing, thrift, life insurance, medical, dental,
hospitalization, stock option or retirement plan or arrangement) in which Employee is a
participant under the terms of this Agreement, as in effect on the date hereof or as may be
improved from time to time hereafter;
(vii) the moving by the Company of Employee’s principal office space, related
facilities, or support personnel, from the Company’s principal operating offices, or the
Company’s requiring Employee
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to perform a majority of his duties outside the Company’s principal operating offices
for a period of more than 30 consecutive days;
(viii) the relocation, without Employee’s prior written consent, of the Company’s
principal Employee offices to a location outside the county in which such offices are
located at the time of the signing of this Agreement;
(ix) in the event the Company requires Employee to reside at a location more than 25
miles from the Company’s principal Employee offices, except for occasional travel in
connection with the Company business to an extent and in a manner which is substantially
consistent with Employee’s current business travel obligations;
(x) in the event Employee consents to a relocation of the Company’s principal Employee
offices the failure of the Company to (A) pay or reimburse Employee on an after-tax basis
for all reasonable moving expenses incurred by Employee in connection with such relocation
or (B) indemnify Employee on an after-tax basis against any loss realized by Employee on the
sale his principal residence in connection with such relocation;
(xi) the failure of the Company to continue to provide Employee with office space,
related facilities and support personnel (including, without limitation, administrative and
secretarial assistance) that are commensurate with Employee’s responsibilities to and
position with the Company, and no less than those prior to this Agreement;
(xii) any significant change in Employee’s reporting relationships or changes in senior
management of the Company
(xiii) the failure by the Company to promptly reimburse Employee for the reasonable
business expenses incurred by Employee in the performance of his duties for the Company, in
accordance with this Agreement.
(f) Gross-Up Payments — Certain Additional Payments by the Company.
(i) Anything in this Agreement to the contrary notwithstanding, in the event it shall
be determined that any payment or distribution by the Company or any of its affiliates (as
that term is defined in the regulations promulgated under the Securities Exchange Act of
1934, as amended) under this Agreement to or for the benefit of Employee (any such payments
or distributions being individually referred to herein as a “Payment,” and any two or more
of such payments or distributions being referred to herein as “Payments”), would be subject
to the excise tax imposed by Section 4999 of the Code (such excise tax, together with any
interest thereon, any penalties, additions to tax, or additional amounts with respect to
such excise tax, and any interest in respect of such penalties, additions to tax or
additional amounts, being collectively referred herein to as the “Excise Tax”), then
Employee shall be entitled to receive an additional payment or payments (individually
referred to herein as a “Gross-Up Payment” and any two or more of such additional payments
being referred to herein as “Gross-Up Payments”) in an amount such that after payment by
Employee of all taxes (as defined in Section 7(f)(xi) imposed upon the Gross-Up Payment.
Employee retains an amount of such Gross-Up Payment equal to the Excise Tax imposed upon the
Payments.
(ii) Subject to the provisions of Section 7(f)(iii) through 7(f)(ix), any determination
(individually, a “Determination”) required to be made under this Section 7(f)(ii), including
whether a Gross-Up Payment is required and the amount of such Gross-Up Payment, shall
initially be made, at the Company’s expense, by nationally recognized tax counsel mutually
acceptable to the Company and Employee (“Tax Counsel”). Tax Counsel shall provide detailed
supporting legal authorities, calculations, and documentation both to the Company and
Employee within 15 business days of the termination of Employee’s employment, if applicable,
or such other time or times as is reasonably requested by the Company or Employee. If Tax
Counsel makes the initial Determination that no Excise Tax is payable by Employee with
respect to a Payment or Payments, it shall furnish Employee with an opinion reasonably
acceptable to
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Employee that no Excise Tax will be imposed with respect to any such Payment or
Payments. Employee shall have the right to dispute any Determination (a “Dispute”) within 15
business days after delivery of Tax Counsel’s opinion with respect to such Determination.
The Gross-Up Payment, if any, as determined pursuant to such Determination shall, at the
Company’s expense, be paid by the Company to Employee within five business days of
Employee’s receipt of such Determination. The existence of a Dispute shall not in any way
affect Employee’s right to receive the Gross-Up Payment in accordance with such
Determination. If there is no Dispute, such Determination shall be binding, final and
conclusive upon the Company and Employee, subject in all respects, however, to the
provisions of Section 7(f)(iii) through 7(f)(ix) below. As a result of the uncertainty in
the application of Sections 4999 and 280G of the Code, it is possible that Gross-Up Payments
(or portions thereof) which will not have been made by the Company should have been made
(“Underpayment”), and if upon any reasonable written request from Employee or the Company to
Tax Counsel, or upon Tax Counsel’s own initiative, Tax Counsel, at the Company’s expense,
thereafter determines that Employee is required to make a payment of any Excise Tax or any
additional Excise Tax, as the case may be, Tax Counsel shall, at the Company’s expense,
determine the amount of the Underpayment that has occurred and any such Underpayment shall
be promptly paid by the Company to Employee.
(iii) the Company shall defend, hold harmless, and indemnify Employee on a fully
grossed-up after tax basis from and against any and all claims, losses, liabilities,
obligations, damages, impositions, assessments, demands, judgments, settlements, costs and
expenses (including reasonable attorneys’, accountants’, and experts’ fees and expenses)
with respect to any tax liability of Employee resulting from any Final Determination (as
defined in Section 7(f)(x) that any Payment is subject to the Excise Tax.
(iv) If a party hereto receives any written or oral communication with respect to any
question, adjustment, assessment or pending or threatened audit, examination, investigation
or administrative, court or other proceeding which, if pursued successfully, could result in
or give rise to a claim by Employee against the Company under this Section 7(f) (“Claim”),
including, but not limited to, a claim for indemnification of Employee by the Company under
Section 7(f)(iii), then such party shall promptly notify the other party hereto in writing
of such Claim (“Tax Claim Notice”).
(v) If a Claim is asserted against Employee (“Employee Claim”), Employee shall take or
cause to be taken such action in connection with contesting such Employee Claim as the
Company shall reasonably request in writing from time to time, including the retention of
counsel and experts as are reasonably designated by the Company (it being understood and
agreed by the parties hereto that the terms of any such retention shall expressly provide
that the Company shall be solely responsible for the payment of any and all fees and
disbursements of such counsel and any experts) and the execution of powers of attorney,
provided that:
| (1) | within 30 calendar days after the Company receives or delivers, as the case may be, the Tax Claim Notice relating to such Employee Claim (or such earlier date that any payment of the taxes claimed is due from Employee, but in no event sooner than five calendar days after the Company receives or delivers such Tax Claim Notice), the Company shall have notified Employee in writing (“Election Notice”) that the Company does not dispute its obligations (including, but not limited to, its indemnity obligations) under this Agreement and that the Company elects to contest, and to control the defense or prosecution of, such Employee Claim at the Company’s sole risk and sole cost and expense; and | ||
| (2) | the Company shall have advanced to Employee on an interest-free basis, the total amount of the tax claimed in order for Employee, at the Company’s request, to pay or cause to be paid the tax claimed, file a claim for refund of such tax and, subject to the provisions of the last sentence of Section 7(f)(vii), xxx for a refund of such tax if such claim for refund is disallowed by the appropriate taxing authority (it being understood and agreed by the parties hereto that the Company shall only be entitled to xxx for a refund and the Company shall not be entitled to initiate any proceeding in, for example, United States Tax Court) and shall indemnify and hold Employee harmless, on a fully grossed-up |
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| after tax basis, from any tax imposed with respect to such advance or with respect to any imputed income with respect to such advance; and | |||
| (3) | the Company shall reimburse Employee for any and all costs and expenses resulting from any such request by the Company and shall indemnify and hold Employee harmless, on fully grossed-up after-tax basis, from any tax imposed as a result of such reimbursement. |
(vi) Subject to the provisions of Section 7(f)(v) hereof, the Company shall have the
right to defend or prosecute, at the sole cost, expense and risk of the Company, such
Employee Claim by all appropriate proceedings, which proceedings shall be defended or
prosecuted diligently by the Company to a Final Determination; provided,
however, that (i) the Company shall not, without Employee’s prior written consent,
enter into any compromise or settlement of such Employee Claim that would adversely affect
Employee, (ii) any request from the Company to Employee regarding any extension of the
statute of limitations relating to assessment, payment, or collection of taxes for the
taxable year of Employee with respect to which the contested issues involved in, and amount
of, Employee Claim relate is limited solely to such contested issues and amount, and (iii)
the Company’s control of any contest or proceeding shall be limited to issues with respect
to Employee Claim and Employee shall be entitled to settle or contest, in his sole and
absolute discretion, any other issue raised by the Internal Revenue Service or any other
taxing authority. So long as the Company is diligently defending or prosecuting such
Employee Claim, Employee shall provide or cause to be provided to the Company any
information reasonably requested by the Company that relates to such Employee Claim, and
shall otherwise cooperate with the Company and its representatives in good faith in order to
contest effectively such Employee Claim, the Company shall keep Employee informed of all
developments and events relating to any such Employee Claim (including, without limitation,
providing to Employee copies of all written materials pertaining to any such Employee
Claim), and Employee or his authorized representatives shall be entitled, at Employee’s
expense, to participate in all conferences, meetings and proceedings relating to any such
Employee Claim.
(vii) If, after actual receipt by Employee of an amount of a tax claimed (pursuant to
an Employee Claim) that has been advanced by the Company pursuant to Section 7(f)(v)(2)
hereof, the extent of the liability of the Company hereunder with respect to such tax
claimed has been established by a Final Determination, Employee shall promptly pay or cause
to be paid to the Company any refund actually received by, or actually credited to, Employee
with respect to such tax (together with any interest paid or credited thereon by the taxing
authority and any recovery of legal fees from such taxing authority related thereto), except
to the extent that any amounts are then due and payable by the Company to Employee, whether
under the provisions of this Agreement or otherwise. If, after the receipt by Employee of an
amount advanced by the Company pursuant to Section 7(f)(v)(2), a determination is made by
the Internal Revenue Service or other appropriate taxing authority that Employee shall not
be entitled to any refund with respect to such tax claimed, and the Company does not notify
Employee in writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of any Gross-Up Payments and other payments required to be paid hereunder.
(viii) With respect to any Employee Claim, if the Company fails to deliver an Election
Notice to Employee within the period provided in Section 7(f)(v)(1) hereof or, after
delivery of such Election Notice, the Company fails to comply with the provisions of Section
7(f)(v)(2) and (3) and 7(f)(vi) hereof, then Employee shall at any time thereafter have the
right (but not the obligation), at his election and in his sole and absolute discretion, to
defend or prosecute, at the sole cost, expense and risk of the Company, such Employee Claim.
Employee shall have full control of such defense or prosecution and such proceedings,
including any settlement or compromise thereof. If requested by Employee, the Company shall
cooperate, and shall cause its Affiliates to cooperate, in good faith with Employee and his
authorized representatives in order to contest effectively such Employee Claim. The Company
may attend, but not participate in or control, any defense, prosecution, settlement or
compromise of any Employee Claim controlled by Employee pursuant to this Section 7(f)(viii)
and shall bear its own costs and expenses with respect thereto. In the case of any Employee
Claim that is defended or prosecuted by Employee, Employee shall, from time
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to time, be entitled to current payment, on a fully grossed-up after tax basis, from
the Company with respect to costs and expenses incurred by Employee in connection with such
defense or prosecution.
(ix) In the case of any Employee Claim that is defended or prosecuted to a Final
Determination pursuant to the terms of this Section 7(f)(ix), the Company shall pay, on a
fully grossed-up after tax basis, to Employee in immediately available funds the full amount
of any taxes arising or resulting from or incurred in connection with such Employee Claim
that have not theretofore been paid by the Company to Employee, together with the costs and
expenses, on a full grossed-up after tax basis, incurred in connection therewith that have
not theretofore been paid by the Company to Employee, within ten calendar days after such
Final Determination. In the case of any Employee Claim not covered by the preceding
sentence, the Company shall pay, on a fully grossed-up after tax basis, to Employee in
immediately available funds the full amount of any taxes arising or resulting from or
incurred in connection with such Employee Claim at least ten calendar days before the date
payment of such taxes is due from Employee, except where payment of such taxes is sooner
required under the provisions of this Section 7(f)(ix), in which case payment of such taxes
(and payment, on a fully grossed-up after tax basis, of any costs and expenses required to
be paid under this Section 7(f)(ix)) shall be made within the time and in the manner
otherwise provided in this Section 7(f)(ix).
(x) For purposes of this Agreement, the term “Final Determination” shall mean (A) a
decision, judgment, decree or other order by a court or other tribunal with appropriate
jurisdiction, which as become final and non-appealable; (B) a final and binding settlement
or compromise with an administrative agency with appropriate jurisdiction, including, but
not limited to, a closing agreement under Section 7121 of the Code; (C) any disallowance of
a claim for refund or credit in respect to an overpayment of tax unless a suit is filed on a
timely basis; or (D) any final disposition by reason of the expiration of all applicable
statutes of limitations.
(xi) For purposes of this Agreement, the terms “tax” and “taxes” mean any and all taxes
of any kind whatsoever (including, but not limited to, any and all Excise Taxes, income
taxes, and employment taxes), together with any interest thereon, any penalties, additions
to tax, or additional amounts with respect to such taxes and any interest in respect of such
penalties, additions to tax, or additional amounts.”
(g) Effect of Termination. In the event that the Employee is terminated pursuant to
any paragraph of this Section 7, Employee shall thereafter have not further rights under this
Agreement, except for those explicitly set forth in the particular paragraph of this Section 7
which served as the basis for such termination. Notwithstanding any such termination, the
covenants and agreements of Employee contained in Sections 4, 5(a) (so long as payments under
Section 5(a) are continued as therein described), 5(b) and 6 hereof shall survive and remain in
full force and effect.
Section 8. Notices.
All notices, requests, demands and other communications hereunder must be in writing and shall
be deemed to have been duly given if delivered by hand, sent to the recipient by reputable express
courier service (charge prepaid), or mailed by first class, registered mail, return receipt
requested, postage and registry fees prepaid and addressed as follows:
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If to Employee:
At the address set forth on page 1 hereof.
If to the Company :
Cal Dive International, Inc.
000 Xxxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxxxx, General Counsel
000 Xxxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxxxx, General Counsel
Addresses may be changed by notice in writing signed by the addressee.
Section 9. General Provisions.
(a) Company Subsidiaries. For purposes of this Agreement, the term “Company” shall
include all subsidiaries of the Company.
(b) Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall
not affect any other provisions of any other jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdictions if such invalid, illegal or unenforceable provision
had never been contained herein. The parties agree that a court of competent jurisdiction making
a determination of the invalidity or unenforceability of any term or provision of Sections 4, 5 and
6 of this Agreement shall have the power to reduce the scope, duration or area of any such term or
provision, to delete specific words or phrases or to replace any invalid or unenforceable term or
provision in Sections 4, 5, 6 with a term or provision that is valid and enforceable and that comes
closest to expressing the intention of the invalid or unenforceable term or provision, and this
Agreement shall be enforceable as so modified.
(c) Complete Agreement. This Agreement, embodies the complete agreement and
understanding among the parties and supersedes and preempts any prior understandings, agreements or
representations by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.
(d) Counterparts. This Agreement may be executed in separate counterparts, each of
which is deemed to be an original and all of which taken together constitute one and the same
agreement.
(e) Successors and Assigns. Except as otherwise provided herein, this Agreement shall
bind and inure to the benefit of and be enforceable by the Company and Employee and their
respective successors and assigns; provided that the rights and obligations of Employee under this
Agreement shall not be assignable without the prior written consent of the Company.
(f) Governing Law. All questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto shall be governed by the internal law, and
not the law of conflicts, of the State of Texas.
(g) Remedies. Each of the parties to this Agreement shall be entitled to enforce its
rights under this Agreement specifically, to recover damages and costs (including reasonable
attorneys fees) caused by any breach of any provision of this Agreement and to exercise all other
rights existing in its favor. The parties hereto agree and acknowledge that Employee’s breach of
any term or provision of this Agreement shall materially and irreparably harm the Company, that
money damages shall accordingly not be an adequate remedy for any breach of the provisions of this
Agreement and that any party in its sole discretion and in addition to any other remedies it may
have at law or in equity may apply to any court of law or equity of competent jurisdiction (without
posting any bond or deposit) for specific
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performance and/or other injunctive relief in order to enforce or prevent any violations of
the provisions of this Agreement.
(h) Amendment and Waiver. The provisions of this Agreement may be amended and waived
only with the prior written consent of the Company and Employee.
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IN WITNESS, WHEREOF, the parties hereto have duly executed this Agreement as of the date first
above written.
| CAL DIVE INTERNATIONAL, INC. | EMPLOYEE | |||||||||
By:
|
/s/ Xxxxxx X. Xxxxxx | By: | /s/ Xxxxx X. Xxxxxxxx | |||||||
| Name: Xxxxxx X. Xxxxxx | Xxxxx X. Xxxxxxxx | |||||||||
| Title: President and Chief Operating Officer | ||||||||||
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