D. XXXX XXXX
CONSULTING AGREEMENT
This Consulting Agreement dated as of October 5, 1995 is entered into by
and between Xxxxxxxxxxx Enterra, Inc., a Delaware corporation (the "Company"),
and D. Xxxx Xxxx ("Consultant").
W I T N E S S E T H:
WHEREAS, Consultant possesses valuable knowledge and experience in the oil
and gas industry, particularly the pipeline business; and
WHEREAS, the Company desires to engage Consultant to perform certain
services, as hereinafter specified; and
WHEREAS, Consultant is willing to enter into this Agreement with respect to
such services upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements hereinafter set forth, the parties hereto agree as follows:
1. Duties.
a. During the term of this Agreement, Consultant will perform certain
services at the Company's request, including without limitation the
following (the "Services"):
(i) Assistance in connection with the Company's pipeline business,
including without limitation customer contacts, industry
knowledge and sales efforts with respect to participation in the
pipeline repair work projected for the CIS and other areas;
(ii) Assistance with respect to personnel and management issues
related to the merger of Enterra Corporation into the Company;
and
(iii) Such other special projects as the Company and Consultant may
from time to time agree.
b. Consultant will report to Xxxxxx Xxxxxxxxxx, Chairman, President and
Chief Executive Officer of the Company during the term of this
Agreement.
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2. Term and Termination.
a. This Agreement will commence on October 5, 1995 and will continue
through October 4, 2000. Thereafter, this Agreement may continue on
terms agreed by the parties.
b. This Agreement shall terminate on the first to occur of the following
events:
(i) death of Consultant;
(ii) mutual written agreement of Consultant and a duly authorized
officer of the Company;
(iii) 30 days' notice by Consultant to the Company; or
(iv) breach by Consultant of any material term or condition of this
Agreement and failure by Consultant to cure such breach within
30 days after Consultant has received written notice thereof
from the Company.
3. Compensation.
a. As compensation for the Services rendered hereunder, the Company will
pay Consultant a fee of $50,000 per year, payable in monthly
installments of $4,166.67 on the first day of each month for the
current month.
b. In addition, the Company will grant Consultant an option to purchase
up to 84,500 shares (after giving effect to a one-for-two reverse
stock split effected on even date herewith) of the Company's Common
Stock, $.10 par value, in accordance with the terms of a Stock Option
Agreement dated as of the date of this Agreement. The option price
will be the fair market value of the Company's Common Stock on the
date of grant. Such option shall vest and become exercisable in five
equal annual installments, beginning October 5, 1996. Such option
will expire, if not exercised, on October 4, 2005.
4. Office Space; Expenses.
a. In the event the Company decides not to use the 6th floor of the
building located at 00000 Xxxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxx (the
"Premises"), the premises currently occupied by Enterra Corporation,
for ongoing operations of the Company or a subsidiary and in the event
the Company or a subsidiary does not require the space for other
purposes, Consultant shall be allowed to use his current office at the
Premises up to and including December 31, 1995, at no cost to the
Consultant. Arrangements will be made by the parties with respect to
telephone and telefax usage, secretarial support, etc. to the extent
same are not related to the Services.
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b. Authorized expenses incurred by Consultant while performing the
Services for the Company, including expenses for entertainment,
travel, automobile mileage allowance and similar items, will be
reimbursed by the Company, provided such expenses are made in
accordance with the Company's policies at that time and approved by
the Company. The Company will reimburse Consultant on a monthly basis
or at the end of the term of this Agreement, as applicable, upon
presentment by Consultant of an itemized accounting of such
expenditures, including receipts, setting forth (in appropriate detail
with the date, place, amount, names, etc.) the individual items for
which reimbursement is sought. Major expense items, such as travel,
must be authorized prior to Consultant's incurring the expense.
5. Relationship Between the Parties.
a. Consultant is retained and engaged by the Company only for the
purposes and to the extent set forth in this Agreement, and his
relation to the Company and its subsidiary and affiliated companies
shall be that of an independent contractor. Consultant is solely
responsible for determining the manner in which the Services are to be
performed; however, Consultant will exercise professional judgment in
determining appropriate circumstances when Company management should
be involved.
b. Consultant will be expected to devote sufficient time as is reasonably
necessary to provide the Services in a manner satisfactory to the
Company; provided, however, in no event shall Consultant be required
to expend more than 200 hours per year providing such Services.
Except as provided in Section 8 below, Consultant shall be free to
dispose of such portion of his entire time, energy and skill during
regular business hours, as he is not obligated to devote hereunder to
the Company and its subsidiary and affiliated companies, to other
pursuits, persons, firms or corporations.
c. Consultant shall not be considered under the provisions of this
Agreement or otherwise as having an employee status and shall not be
entitled to participate in any plans, arrangements or distributions by
the Company or its subsidiary or affiliated companies pertaining to or
in connection with any pension, stock, bonus, insurance, profit
sharing or similar benefits for the Company's regular employees.
6. Taxes. Consultant will be liable for all taxes imposed on him or his
business by any government. Accordingly, the Company will not withhold
from Consultant's compensation any monies for payment of taxes, including
income taxes, social security taxes, etc. Consultant agrees to defend,
hold harmless and indemnify the Company from and against the payment of any
taxes on account of Consultant's performance hereunder.
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7. Restrictive Covenants. Consultant further agrees and binds himself as
follows:
a. Inventions and Developments.
(i) Consultant agrees to hold in complete trust for the benefit of
the Company, and to disclose promptly and fully to the Company
in writing and to assign, and Consultant hereby assigns to the
Company, any and all inventions, copyrightable works,
discoveries, innovations or other developments made, discovered,
conceived or developed by Consultant, solely or jointly with
others, including the Company, as the result of, in connection
with or related to the Services (the "Intellectual Property
Rights"). Any and all such Intellectual Property Rights,
including without limitation rights in inventions and
copyrightable works, shall be the sole and exclusive property of
the Company, whether patentable or not, and Consultant agrees
that Consultant will assist and fully cooperate in every proper
way, at the Company's expense, in securing and enforcing, for
the Company's sole benefit, patents and/or copyrights for such
Intellectual Property Rights in any and all countries.
(ii) Consultant agrees at the request of the Company (but without
additional compensation from the Company) to execute any and all
papers and perform all lawful acts that the Company deems
necessary for the preparation, filing, prosecution and
maintenance of applications for U.S. Letters Patent and foreign
letters patent and applications for U.S. copyright registration
and foreign copyrights on such Intellectual Property Rights and
to execute such instruments as are necessary to assign to the
Company, its successors, assigns or nominees, all of
Consultant's right, title and interest in such Intellectual
Property Rights and the like, so as to establish or perfect in
the Company, its successors, assigns or nominees, the entire
right, title and interest in and to such Intellectual Property
Rights, and also to execute any instruments necessary or that
the Company may deem desirable in connection with any
continuation, renewal or reissue thereof. All expenses incurred
by Consultant by reason of the performance of any of the
obligations set forth herein shall be borne by the Company.
b. Work Product. All work product and generally all materials of any
form (such as drawings, reports, calculations, analyses, etc.) that
recite or are based on secret, proprietary or confidential information
of the Company or corporations affiliated with the Company that are
received or prepared by Consultant while performing the Services are
"work for hire" and are the sole property of the Company. Upon
completion of the Services or earlier termination of this Agreement
for whatever reason, Consultant shall forthwith deliver to the Company
all such materials. No copies of the same or any part shall be
retained by Consultant.
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c. Trade Secrets and Confidential Information. Consultant recognizes,
understands and acknowledges that Consultant may have access to
certain trade secrets, financial information, strategic plans and
other confidential information of the Company and its subsidiary and
affiliated companies and that such information constitutes valuable,
special and unique property of the Company and such other companies.
Consultant shall use his best efforts and exercise utmost diligence to
protect and guard such information and shall keep such information
strictly confidential and will not, during the term of this Agreement,
and for a period of two years after the termination hereof, directly
or indirectly, disclose any of such trade secrets or confidential
information to any person, firm, corporation or other entity for any
reason or purpose whatsoever except to authorized representatives of
the Company. In the event of a breach or threatened breach by
Consultant of the provisions of this Agreement, the Company shall be
entitled to an injunction restraining Consultant from disclosing, in
whole or in part, such trade secrets and confidential information.
Nothing herein shall be construed as prohibiting the Company from
pursuing any other remedies available to it for such breach or
threatened breach, including the recovery of damages from Consultant.
The restrictions on disclosures set forth herein shall not apply to
any portion of such trade secrets or confidential information that (i)
through no fault of Consultant is generally available to the public at
the time of such disclosure to Consultant or thereafter becomes
generally available to the public, but only when and to the extent
such information becomes public, (ii) is disclosed to Consultant by a
third party having the right to disclose such information or (iii) was
known to Consultant, as shown by suitable evidence, before such
information was received from the Company or its predecessors in
interest. It is understood, for the purpose of this paragraph, that
specific confidential information disclosed by the Company shall not
be deemed to be available to the public or in the possession of
Consultant merely because such information is embraced by more general
information available to the public or in the possession of
Consultant.
d. In the course of providing Services to the Company, Consultant, with
respect to discussing the acquisition of other business entities,
shall not disclose the identity of any such entity or any information,
whether confidential or not, relating to the Company, without the
prior written consent of an executive officer of the Company, and then
only to extent specifically outlined by the Company.
8. Conflict of Interest. Consultant agrees that he will not, during the term
of this Agreement, without the prior written consent of the Company,
directly or indirectly, enter into competition with the Company in respect
of any business as conducted by either the Company or Enterra Corporation,
or by any of their respective subsidiaries or affiliates, prior to the date
hereof.
9. No Power to Act on Behalf of the Company. Consultant shall have no right,
power or authority to create any obligation, express or implied, or make
any representation on behalf of the Company except as Consultant may be
expressly authorized from time to time by the Company in writing and then
only to the extent of such authorization.
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10. Consultant's Covenants. Consultant covenants to the Company as follows:
a. In performing hereunder, Consultant will comply at all times with all
applicable laws and regulations of the United States and any other
jurisdiction in which Consultant may perform Services hereunder.
b. In performing hereunder, Consultant will comply at all times with all
applicable Company policies and procedures and will perform the
Services in a manner consistent with applicable industry standards.
c. Consultant covenants that his execution of this Agreement does not
conflict with any obligations he has under any other oral or written
agreement.
11. Notices. Any notice required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been given when hand
delivered, deposited in the U.S. mail in a registered, postage prepaid
envelope, or telefaxed, with confirmation, if to Consultant, to D. Xxxx
Xxxx, _________________________________________________________________
______________________________, telefax number ________________, and if to
the Company, to Xxxxxxxxxxx Enterra, Inc., 0000 Xxxx Xxx Xxxxxxxxx,
Xxxxxxx, Xxxxx 00000, Attn.: Xxxxxxx Xxxxxx, telefax number 713/622-0913,
or to such other address or telefax number as either party shall designate
by written notice to the other.
12. Assignment. Neither party may assign his or its rights or obligations
hereunder without obtaining the prior written consent of the other party.
The rights and obligations of the Company hereunder shall inure to the
benefit of and shall be binding upon the successors and assigns of the
Company and permitted assigns of Consultant.
13. Miscellaneous.
a. This Agreement shall be subject to and governed by the laws of the
State of Texas.
b. Failure to insist upon strict compliance with any provision hereof
shall not be deemed a waiver of such provision or any other provision
hereof.
c. This Agreement may not be modified except by an agreement in writing
executed by the parties hereto.
d. The invalidity or unenforceability of any provision hereof shall not
affect the validity or enforceability of any other provision.
e. This Agreement may be executed in duplicate any of which and all of
which will constitute one and the same document.
14. Entire Agreement. This Agreement and the Stock Option Agreement contain
the entire agreement of the parties hereto with respect to the engagement
of Consultant by the
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Company, and all previous written and oral discussions and negotiations
have been merged into this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
XXXXXXXXXXX ENTERRA, INC.
By:
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Name: Xxxxxx Xxxxxxxxxx
Title: Chairman, President and
Chief Executive Officer
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D. Xxxx Xxxx
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