EXHIBIT 10.16
EMPLOYMENT AGREEMENT
BETWEEN
XXXX X. XXXXXXXXXX
AND
THE COASTAL CORPORATION
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of January 17, 2000 (the "Agreement") between The
Coastal Corporation, a Delaware corporation ("Company"), and Xxxx X. Xxxxxxxxxx
("Executive").
WHEREAS, the Company desires to employ Executive upon the terms and subject to
the conditions set forth herein; and
WHEREAS, the Company and Executive intend that the Agreement be void ab initio
and of no force and effect if neither the transaction contemplated by the
Agreement and Plan of Merger, dated as of January 17, 2000 by and among El Paso
Energy Corporation, a Delaware corporation, El Paso Merger Company, a Delaware
corporation and a wholly owned subsidiary of El Paso Energy Corporation, and The
Coastal Corporation, a Delaware corporation (the "Merger Agreement"), nor any
Change of Control resulting from the Company's pursuit of the Transaction
(either such transaction, the "Transaction"), is consummated;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, the Company and Executive hereby agree as follows:
ARTICLE 1
DEFINITIONS
The terms set forth below have the following meanings (such meanings to be
applicable to both the singular and plural forms, except where otherwise
expressly indicated):
1.1 "Accrued Annual Bonus" means the amount of any Annual Bonus earned but
not yet paid with respect to the Year ended prior to the Date of
Termination.
1.2 "Accrued Base Salary" means the amount of Executive's Base Salary which
is accrued but not yet paid as of the Date of Termination.
1.3 "Affiliate" means any Person directly or indirectly controlling,
controlled by, or under direct or indirect common control with, the
Company. For the purposes of this definition, the term "control" when
used with respect to any Person means the power to direct or cause the
direction of management or policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by
contract or otherwise.
1.4 "Agreement" - see the recitals to this Agreement.
1.5 "Agreement Date" means the date that is specified in the recitals to
this Agreement.
1.6 "Annual Bonus" - see Section 4.2(a).
1.7 "Annualized Total Compensation" means, as of any date, the sum of
Executive's (i) Base Salary as of such date and (ii) Target Annual
Bonus (in no event shall such Target Annual Bonus be less than the most
recently awarded Annual Bonus) applicable to the Year that includes
such date.
1.8 "Base Salary" - see Section 4.1.
1.9 "Beneficiary" - see Section 10.3.
1.10 "Board" means the Board of Directors of the Company.
1.11 (a) "Cause" means any of the following:
(i) Executive's conviction of a felony or of a
misdemeanor involving fraud, dishonesty or moral
turpitude, or
(ii) Executive's willful or intentional material breach of
this Agreement that results in financial detriment
that is material to the Company and its Affiliates
taken as a whole.
For purposes of clause (ii) of the preceding sentence, Cause shall not include
any one or more of the following:
(A) bad judgment,
(B) negligence,
(C) any act or omission that Executive believed in good
faith to have been in or not opposed to the interest
of the Company (without intent of Executive to gain
therefrom, directly or indirectly, a profit to which
he was not legally entitled), or
(D) any act or omission of which any member of the Board
who is not a party to such act or omission has had
actual knowledge for at least 12 months.
(b) With respect to a termination of employment occurring prior to
a Change of Control, "Cause" also means:
(i) the willful failure by Executive to substantially
perform Executive's duties with the Company (other
than any such failure resulting from Executive's
incapacity due to physical or mental illness) or
(ii) the willful engaging by Executive in conduct which is
demonstrably and materially injurious to the Company
or its subsidiaries, monetarily or otherwise.
1.12 "Change of Control" means any of the following events:
(a) any person or group (as such terms are used in Rule 13d-5
under the Exchange Act and defined in Sections 3(a)(9) and
13(d)(3) of the Exchange Act), other than a Subsidiary or any
employee benefit plan (or any related trust) of the Company or
a Subsidiary, becomes the beneficial owner of 15% or more of
the Common Stock or of securities of the Company that are
entitled to vote generally in the election of directors of the
Company ("Voting Securities") representing 15% or more of the
combined voting power of all Voting Securities of the Company.
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(b) individuals who, as of the Agreement Date, constitute the
Board (the "Incumbent Directors") cease for any reason to
constitute a majority of the members of the Board; provided
that any individual who becomes a director after the Agreement
Date whose election or nomination for election by the
Company's shareholders was approved by a majority of the
members of the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office
is in connection with an actual or threatened "election
contest" relating to the election of the directors of the
Company (as such terms are used in Rule 14a-1 1 under the
Exchange Act), "tender offer" (as such term is used in Section
14(d) of the Exchange Act) or a proposed Merger (as defined
below)) shall be deemed to be members of the Incumbent Board;
or
(c) approval by the stockholders of the Company of either of the
following:
(i) a merger, reorganization, consolidation or similar
transaction (any of the foregoing, a "Merger") as a
result of which the Persons who were the respective
beneficial owners of the outstanding Common Stock and
Voting Securities of the Company immediately before
such Merger are not expected to beneficially own,
immediately after such Merger, directly or
indirectly, more than 60% of, respectively, the
common stock and the combined voting power of the
Voting Securities of the corporation resulting from
such Merger in substantially the same proportions as
immediately before such Merger, or
(ii) a plan of liquidation of the Company or a plan or
agreement for the sale or other disposition of all or
substantially all of the assets of the Company.
Notwithstanding the foregoing, there shall not be a Change of Control if, in
advance of such event, Executive agrees in writing that such event shall not
constitute a Change of Control.
1.13 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
1.14 "Committee" means the Compensation and Executive Development Committee
of the Board.
1.15 "Common Stock" means the common stock and Class A common stock of the
Company
1.16 "Company" - see the recitals to this Agreement.
1.17 "Date of Termination" means the effective date of a Termination of
Employment for any reason, including death or Disability, whether by
either of the Company or by Executive.
1.18 "Disability" means a mental or physical condition which, in the opinion
of the Board, renders Executive unable or incompetent to carry out the
material job responsibilities which such Executive held or the material
duties to which Executive was assigned at the time the disability was
incurred; which has existed for at least three months, and which in the
opinion of a physician mutually agreed upon by the Company and
Executive
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(provided that neither party shall unreasonably withhold this
agreement) is expected to be permanent or to last for an indefinite
duration or a duration in excess of six months.
1.19 "Employment Period" see Section 3.1.
1.20 "Exchange Act" means the Securities Exchange Act of 1934.
1.21 "Executive"- see the recitals to this Agreement.
1.22 Intentionally omitted.
1.23 "Good Reason" means the occurrence of any one or more of the following
events unless Executive specifically agrees in writing that such event
shall not be Good Reason:
(a) any material breach of this Agreement by the Company,
including:
(i) the failure of the Company to comply with the
provisions of Articles II, III, IV, V, VI or VII of
this Agreement;
(ii) any material adverse change in the status,
responsibilities or perquisites of Executive;
(iii) any material adverse change in Executive's title; or
(iv) assignment of duties materially inconsistent with his
position and duties described in this Agreement,
(b) the failure of the Company to assign this Agreement to a
successor to the Company or failure of a successor to the
Company to explicitly assume and agree to be bound by this
Agreement,
(c) requiring Executive to be principally based at any office or
location more than 25 miles from the current offices of the
Company in Houston, Texas, or
(d) the delivery to Executive of a Notice of Consideration
pursuant to Section 8.1 (b) if, within a period of 90 days
thereafter, the Board fails for any reason to terminate
Executive for Cause in compliance with all of the substantive
and procedural requirements of Section 8.1.
Any reasonable determination by Executive that any of the foregoing events has
occurred and constitutes Good Reason shall be conclusive and binding for all
purposes.
1.24 "Including" means including without limitation.
1.25 "Notice of Consideration" - see Section 8.1 (b).
1.26 Intentionally omitted.
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1.27 "Person" means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation,
institution, public benefit corporation, entity or government
instrumentality, division, agency, body or department.
1.28 "Prorata Annual Bonus" means (a) the product of the amount of the
Target Annual Bonus to which Executive would have been entitled if he
had been employed by the Company on the last day of the Year that
includes the Date of Termination and if Executive had achieved his
Target Annual Goals for such Year, multiplied by (b) a fraction of
which the numerator is the numbers of days which have elapsed in such
Year through the Date of Termination and the denominator is 365.
1.29 "Replacement Pension Plan" - see Section 7.1.
1.30 "Severance Payment" means the payment of a multiple of Executive's
Annualized Total Compensation pursuant to Section 8.3(b) or Section
8.4, as applicable.
1.31 "Severance Period" means 2.99 years.
1.32 "Subsidiary" means, with respect to any Person, (a) any corporation of
which more than 50% of the outstanding capital stock having ordinary
voting power to elect a majority of the board of directors of such
corporation (irrespective of whether, at the time, stock of any other
class or classes of such corporation shall have or might have voting
power by reason of the happening of any contingency) is at the time,
directly or indirectly, owned by such Person, and (b) any partnership
in which such Person has a direct or indirect interest (whether in the
form of voting or participation in profits or capital contribution) of
more than 50%.
1.33 "Target Annual Bonus" - see Section 4.2.
1.34 "Target Annual Goal" - see Section 4.2.
1.35 "Termination For Good Reason" means a Termination of Employment by
Executive for a Good Reason.
1.36 "Termination of Employment" means a termination by the Company or by
Executive of Executive's employment by the Company.
1.37 "Termination Without Cause" means a Termination of Employment by the
Company for any reason other than Cause or Executive's death or
Disability.
1.38 "Year" means a calendar year period ending on December 31.
ARTICLE 2
DUTIES
2.1 Duties. The Company shall employ Executive during the Employment Period
in the position(s) which Executive holds on the Agreement Date. During
the Employment Period, Executive shall perform the duties properly
assigned to him hereunder, shall
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devote substantially all of his business time, attention and effort to
the affairs of the Company and shall use his reasonable best efforts to
promote the interests of the Company. During the Employment Period, and
excluding any periods of disability, vacation, or sick leave to which
Executive is entitled, Executive agrees to devote his full attention
and time to the business and affairs of the Company.
2.2 Other Activities. Executive may serve on corporate, civic or charitable
boards or committees, deliver lectures, fulfill speaking engagements,
teach at educational institutions, or manage personal investments;
provided that such activities do not individually or in the aggregate
significantly interfere with the performance of his duties under this
Agreement.
ARTICLE 3
EMPLOYMENT PERIOD
3.1 Employment Period. Subject to the termination provisions hereinafter
provided, the term of Executive's employment under this Agreement (the
"Employment Period") shall begin on the Agreement Date and end on the
third anniversary of the date of consummation of the Transaction. The
employment of Executive by the Company shall not be terminated other
than in accordance with Article VIII. Notwithstanding the foregoing,
the Agreement shall be void ab initio and of no force and effect if the
Merger Agreement is terminated in accordance with its terms and if any
Transaction other than the Transaction contemplated by the Merger
Agreement is not consummated within six months of the termination of
the Merger Agreement in accordance with its terms.
ARTICLE 4
COMPENSATION
4.1 Salary. The Company shall pay Executive in accordance with its normal
payroll practices (but not less frequently than monthly) an annual
salary at a rate no less favorable than the rate in effect on the
Agreement Date ("Base Salary"). During the Employment Period, the Base
Salary shall be reviewed at least annually by the Committee after
consultation with Executive and may from time to time be increased as
determined by the Committee. Effective as of the date of any such
increase the Base Salary as so increased shall be considered the new
Base Salary for all purposes of this Agreement and may not thereafter
be reduced. Any increase in Base Salary shall not limit or reduce any
other obligation of the Company to Executive under this Agreement.
4.2 Annual Bonus.
(a) The Company shall pay to Executive an annual cash bonus
("Annual Bonus") in accordance with the terms hereof for each
Year which begins during the Employment Period. Executive
shall be eligible for an Annual Bonus pursuant to the
Executive Bonus Program of the Company administered by the
Committee.
(b) The Company performance goals are determined annually by the
Company. These performance goals are expressed as target
performance ("Target Annual Goal"). The level of bonus awarded
to the Executive pursuant to the Executive
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Bonus Program shall be deter mined by the Committee and will
vary based upon the level of Company performance with the
target bonus award for attainment of Target Annual Goals (the
"Target Annual Bonus").
(c) In the event that it is necessary to determine the bonus due
the Executive for less than a full year, then if the bonus due
pursuant to terns of this Agreement is the Target Annual
Bonus, the Executive shall be entitled to a bonus equal to the
Target Annual Bonus amount pursuant to the Executive Bonus
Program of the Company for the preceding Year had the Target
Annual Goal been met, regardless of whether such Target Annual
Goal was met. In no event shall such Target Annual Bonus be
less than the most recently awarded Annual Bonus. The bonus
calculated pursuant to this Section 4.2(c) shall be prorated
for the portion of the year for which such bonus is due. The
Commit tee may increase this amount in its discretion.
(d) The Company shall pay the entire Annual Bonus that is payable
with respect to a Year in a lump-sum cash payment as soon as
practicable after the Committee can determine whether and the
degree to which Target Annual Goal has been achieved following
the close of such Year. Any such Annual Bonus shall in any
event be paid within 120 days after the end of the Year.
ARTICLE 5
STOCK OPTIONS AND GRANTS
5.1 Participation. The Executive shall be eligible to participate in stock
option plans and similar programs offered by the Company to its key
employees.
5.2 Terms and Conditions of Options. The terms and conditions of the
programs discussed in Section 5.1 shall be established by the
provisions of such programs.
ARTICLE 6
OTHER BENEFITS
6.1 Incentive, Savings and Retirement Plans. In addition to Base Salary and
an Annual Bonus, Executive shall be entitled to participate during the
Employment Period in all incentive, savings and (except as otherwise
provided in Section 7.3) retirement plans, practices, policies and
programs that are from time to time applicable to other senior
executives of the Company.
6.2 Welfare Benefits. During the Employment Period, Executive and/or his
family, as the case may be, shall be eligible for participation in and
shall receive all benefits under welfare benefit plans, practices,
policies and programs provided by the Company (including medical,
prescription, dental, disability, salary continuance, employee life,
group life, dependent life, accidental death and travel accident
insurance plans and programs) applicable to other senior executives of
the Company. After Termination of Employment by reason of a Termination
Without Cause or a Termination for Good Reason, the Executive and/or
his family, as the case may be, shall be eligible for participation in
and shall receive all benefits under welfare benefit plans, practices
and
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programs provided by the Company (including medical, prescription and
life insurance plans and programs) applicable to other former employees
including former senior executives of the Company who retire from the
Company at the time of Termination of Employment of the Executive (or
if earlier, at the time of a Change of Control) provided that the
requirements for the retiree medical program (medical and prescription
coverage) and participant contributions for such coverage shall be
modified as follows: (a) the requirement to immediately receive monthly
retirement income from a pension plan maintained by the Company shall
be met if the Executive begins immediately to receive such payments
from The Coastal Corporation Replacement Pension Plan and (b) the
contribution rate for the Executive and/or his family, as the case may
be, for coverage shall be calculated based upon years of service
credited for purposes of determining the benefit due from The Coastal
Corporation Replacement Pension Plan.
6.3 Fringe Benefits. During the Employment Period, Executive shall be
entitled to all fringe benefits that are from time to time available to
other senior executives of the Company.
6.4 Vacation. During the Employment Period, Executive shall be entitled to
paid vacation time in accordance with the plans, practices, policies,
and programs applicable to other senior executives of the Company.
6.5 Expenses. During the Employment Period, Executive shall be entitled to
receive prompt reimbursement for all reasonable employment-related
expenses incurred by Executive upon the receipt by the Company of
accounting in accordance with practices, policies and procedures
applicable to other senior executives of the Company.
6.6 Office; Support Staff. During the Employment Period, Executive shall be
entitled to an office or offices of a size and with furnishings and
other appointments, and to personal secretarial and other assistance,
appropriate to his position and duties under this Agreement.
ARTICLE 7
SUPPLEMENTAL RETIREMENT BENEFIT
7.1 Supplemental Retirement Benefit. Executive shall be entitled to a
nonqualified supplemental retirement benefit pursuant to The Coastal
Corporation Replacement Pension Plan (the "Replacement Pension Plan")
provided, however, that the method used to calculate the benefit due
the Executive shall be modified as stated in Section 7.2 of this
Agreement for determining benefits under the Replacement Pension Plan
in the event of a Termination of Employment by reason of his death or
Disability, a Termination Without Cause, or a Termination for Good
Reason.
7.2 Replacement Pension Plan Benefit Modification. For purposes of Section
7.1 of this Agreement, the benefit calculation method and the age at
which benefit payments may begin under the Replacement Pension Plan
shall be modified as follows: (a) the Basic Compensation (as defined in
the Replacement Pension Plan) used to determine the five year average
for purposes of determining Final Average Earnings (as defined in the
Replacement Pension Plan) shall be (i) Base Salary (as defined in this
Agreement) in
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effect on the Date of Termination (reduced, if necessary, to comply
with the Replacement Pension Plan limitation of $500,000 as indexed)
for 3 of the 5 years, and (ii) Base Salary (as defined in this
Agreement) in effect for the two calendar years preceding the Date of
Termination (reduced, if necessary, to comply with the Replacement
Pension Plan limitation of $500,000 as indexed); provided, however,
that if one of such two years is 1998, then Basic Compensation (as
defined in the Replacement Pension Plan) shall be used in lieu of Base
Salary for such year; and provided, further, that if one of such 2
years is 1997, then Basic Compensation (as defined in the Replacement
Pension Plan and modified to insert $500,000 in lieu of $160,000) shall
be used in lieu of Base Salary for such year; (b) Years of Service (as
defined in the Replacement Pension Plan) shall be increased to include
the Severance Period (as defined in this Agreement); and (c) the age of
the Executive shall be equal to the sum of his actual age and the
Severance Period (as defined in this Agreement).
7.3 Other Supplemental Retirement Benefits. Executive shall not participate
in, or be entitled to benefits under, any other supplemental defined
benefit retirement plans of the Company which are not qualified under
Section 401(a) of the Code, except as otherwise provided in writing by
the Company.
ARTICLE 8
TERMINATION BENEFITS
8.1 Termination for Cause or Other Than for Good Reason etc.
(a) If the Company terminates Executive's employment for Cause or
Executive terminates his employment other than for Good
Reason, death or Disability, the Company shall pay to
Executive immediately after the Date of Termination an amount
equal to the sum of Executive's Accrued Base Salary and
Accrued Annual Bonus, and Executive shall not be entitled to
receive any Severance Payment.
(b) Upon and following the occurrence of a Change of Control, the
Company may not terminate Executive's employment for Cause
unless:
(i) no fewer than 60 days prior to the Date of
Termination, the Company provides Executive with
written notice (the "Notice of Consideration") of its
intent to consider termination of Executive's
employment for Cause, including a detailed
description of the specific reasons which form the
basis for such consideration;
(ii) for a period of not less than 30 days after the date
Notice of Consideration is provided, Executive shall
have the opportunity to appear before the Board, with
or without legal representation, at Executive's
election, to present arguments and evidence on his
own behalf; and
(iii) following the presentation to the Board as provided
in (ii) above or Executive's failure to appear before
the Board and date and time specified in the Notice
of Consideration (which date shall not be less than
30 days
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after the date the Notice of Consideration is
provided), Executive may be terminated for Cause only
if (x) the Board, by the affirmative vote of all of
its members (excluding Executive if he is a member of
the Board, and any other member of the Board
reasonably believed by the Board to be involved in
the events leading the Board to terminate Executive
for Cause), determines that the actions or inactions
of Executive specified in the Notice of Termination
occurred, that such actions or inactions constitute
Cause, and that Executive's employment should
accordingly be terminated for Cause; and (y) the
Board provides Executive with a written determination
(a "Notice of Termination for Cause") setting forth
in specific detail the basis of such Termination of
Employment, which Notice of Termination for Cause
shall be consistent with the reasons set forth in the
Notice of Consideration.
Unless the Company establishes both (i) its full compliance with the substantive
and procedural requirements of this Section 8.1 prior to a Termination of
Employment for Cause, and (ii) that Executive's action or inaction specified in
the Notice of Termination for Cause did occur and constituted Cause, any
Termination of Employment shall be deemed a Termination Without Cause for all
purposes of this Agreement.
(c) With respect to a termination of employment upon or following
a Change of Control, after providing a Notice of Consideration
pursuant to the provisions of Section 8.1 (b), the Board may,
by the affirmative vote of all of its members (excluding for
this purpose Executive if he is a member of the Board, and any
other member of the Board reason ably believed by the Board to
be involved in the events issuing the Notice of
Consideration), suspend Executive with pay until a final
determination pursuant to such Section 8.1(b) has been made.
8.2 Termination for Death or Disability. If Executive's employment
terminates during the Employment Period due to his death or Disability,
the Company shall pay to Executive or his Beneficiaries, as the case
may be, immediately after the Date of Termination an amount which is
equal to the sum of Executive's Accrued Base Salary, Accrued Annual
Bonus and Prorata Annual Bonus.
8.3 Termination Without Cause or for Good Reason. In the event of a
Termination Without Cause or a Termination for Good Reason, Executive
shall receive the following:
(a) immediately after the Date of Termination, a lump-sum amount
in immediately available funds equal to the sum of Executive's
Accrued Base Salary, Accrued Annual Bonus and Prorata Annual
Bonus;
(b) immediately after the Date of Termination, a lump-sum amount
in immediately available funds equal to the product of 2.99
multiplied by Executive's Annualized Total Compensation;
(c) immediately after the Date of Termination, a lump-sum amount
in immediately available funds equal to the total amount (if
any) of Executive's unvested benefits
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(excluding equity and equity-based benefits) under any plan or
program sponsored by the Company which is forfeited on account
of Executive's employment being terminated; and
(d) the continuation of the benefits (or, if such benefits are not
available, the after-tax economic equivalent thereof)
specified in Sections 6.1, 6.2 and 6.3, at the level provided
to other senior executives of the Company, for the entire
duration of the Severance Period or, at the election of
Executive, an immediate lump-sum cash payment equal to the
value of such benefits; provided that with respect to any
benefit to be provided on an insured basis, such value shall
be the present value of the premiums expected to be paid for
such coverage, and with respect to other benefits, such value
shall be the present value of the expected net cost to the
Company of providing such benefits.
8.4 Other Termination Benefits. In addition to any amounts or benefits
payable upon a Termination of Employment hereunder, Executive shall,
except as otherwise specifically provided herein, be entitled to any
payments or benefits provided hereunder or under the terms of any plan,
policy or program of the Company or as otherwise required by applicable
law.
ARTICLE 9
RESTRICTIVE COVENANTS
9.1 Non-Solicitation of Employees: Confidentiality. Non-Competition.
(a) Executive covenants and agrees that, at no time during the
period employed pursuant to this Agreement nor during the
one-year period immediately following a Termination of
Employment by the Company for Cause or by Executive other than
for Good Reason, death or Disability, will Executive:
(i) directly or indirectly employ or seek to employ any
person employed at that time by the Company or any of
its Subsidiaries or otherwise encourage or entice any
such person to leave such employment;
(ii) become employed by, enter into a consulting
arrangement with or otherwise agree to perform
personal services for a Competitor (as defined in
Section 9.1(b));
(iii) acquire an ownership interest in a Competitor, or
(iv) solicit any customers or vendors of the Company on
behalf of or for the benefit of a Competitor.
(b) For purposes of this Section, "Competitor" means any Person
which sells goods or services which are directly competitive
with those sold by a business that (i) is being conducted by
the Company or any Subsidiary at the time in question and (ii)
was being conducted at the Date of Termination and, for the
Company's most recently-completed fiscal year, contributed
more than 10% of the Company's
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consolidated revenues. Notwithstanding anything to the
contrary in this Section, goods or services shall not be
deemed to be competitive with those of the Company (A) solely
as a result of Executive being employed by or otherwise
associated with a business of which a unit is in competition
with the Company or any Subsidiary but as to which unit
Executive does not have direct or indirect responsibilities
for the products or services involved or (B) if the activity
contributes less than 10% of the consolidated revenues for the
most recently-completed fiscal year of the business by which
Executive is employed or with which he is otherwise
associated.
(c) Executive covenants and agrees that at no time during the
Employment Period nor at any time following any Termination of
Employment will Executive communicate, furnish, divulge or
disclose in any manner to any Person any Confidential
Information (as defined in Section 9.1 (d)) without the prior
express written consent of the Company. After a Termination of
Employment, Executive shall not, without the prior written
consent of the Company, or as may otherwise be required by law
or legal process, communicate or divulge such Confidential
Information to anyone other than the Company and its
designees.
(d) For purposes of this Section, "Confidential Information" shall
mean financial information about the Company, contract terms
with vendors and suppliers, customer and supplier lists and
data, trade secrets and such other competitively-sensitive
information to which Executive has access as a result of his
positions with the Company, except that Confidential
Information shall not include any information which was or
becomes generally available to the public (i) other than as a
result of a wrongful disclosure by Executive, (ii) as a result
of disclosure by Executive during the Employment Period which
he reasonably and in good faith believes is required by the
performance of his duties under this Agreement, or (iii) any
information compelled to be disclosed by applicable law or
administrative regulation; provided that Executive, to the
extent not prohibited from doing so by applicable law or
administrative regulation, shall give the Company written
notice of the information to be so disclosed pursuant to
clause (iii) of this sentence as far in advance of its
disclosure as is practicable.
9.2 Injunction. Executive acknowledges that monetary damages will not be an
adequate remedy for the Company in the event of a breach of this
Article IX, and that it would be impossible for the Company to measure
damages in the event of such a breach. Therefore, Executive agrees
that, in addition to other rights that the Company may have, the
Company is entitled to an injunction preventing Executive from any
breach of this Article IX.
ARTICLE 10
MISCELLANEOUS
10.1 Full Settlement. The Company's obligation to make the payments provided
for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including
set-off, counterclaim, recoupment, defense or other claim,
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right or action which the Company may have against Executive or others.
In no event shall Executive be obligated to seek other employment or
take any Other action to mitigate the amounts payable to Executive
under any of the provisions of this Agreement, nor shall the amount of
any payment hereunder be reduced by any compensation earned as result
of Executive's employment by another employer, except that any
continued welfare benefits provided for by Section 6.2 shall not
duplicate any benefits that are provided to Executive and his family by
such other employer and shall be secondary to any coverage provided by
such other employer.
10.2 Legal Fees: Late Payments.
(a) All reasonable costs and expenses (including fees and
disbursements of counsel) incurred by Executive in negotiating
the terms and conditions of this Agreement shall be promptly
paid on behalf of, or reimbursed to, Executive by the Company.
(b) If Executive incurs legal or other fees and expenses in an
effort to secure or preserve or establish entitlement to
compensation and benefits under this Agreement, the Company
shall, regardless of the outcome of such effort, reimburse
Executive for such fees and expenses. The Company shall
reimburse Executive for such fees and expenses on a monthly
basis within 10 days after his request for reimbursement
accompanied by evidence that the fees and expenses were
incurred. If Executive does not prevail (after exhaustion of
all available judicial remedies) in respect of a claim by
Executive or by the Company hereunder, and the Company
establishes before a court of competent jurisdiction, by clear
and convincing evidence, that Executive had no reasonable
basis for his claim hereunder, or for his response to the
Company's claim hereunder, and acted in bad faith, no further
reimbursement for legal fees and expenses shall be due to
Executive in respect of such claim and Executive shall refund
any amounts previously reimbursed hereunder with respect to
such claim.
(c) If the Company fails to pay any amount provided under this
Agreement when due, the Company shall pay interest on such
amount at a rate equal to (i) the highest rate of interest
charged by the Company's principal lender plus 200 basis
points, or (ii) in the absence of such a lender, 300 basis
points over the prime commercial lending rate announced by
Chase Bank of Texas, N.A. on the date such amount is due or,
if no such rate shall be announced on such date, the
immediately prior date on which Chase Bank of Texas, N.A.
announced such a rate; provided, however, that if the interest
rate determined in accordance with this Section exceeds the
highest legally permissible interest rate, then the interest
rate shall the highest legally permissible interest rate.
10.3 Beneficiary. If Executive dies prior to receiving all of the amounts
payable to him in accordance with the terms of this Agreement, such
amounts shall be paid to one or more beneficiaries (each, a
"Beneficiary") designated by Executive in writing to the Company during
his lifetime, or if no such Beneficiary is designated, to Executive's
estate. Such payments shall be made in a lump sum to the extent so
payable and, to the extent not payable in a lump sum, in accordance
with the terms of this Agreement. Executive,
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without the consent of any prior Beneficiary, may change his
designation of Beneficiary or Beneficiaries at any time or from time to
time by a submitting to the Company a new designation in writing.
10.4 Assignment: Successors. The Company may not assign its rights and
obligations under this Agreement without the prior written consent of
Executive except to a successor of the Company's business which
expressly assumes the Company's obligations hereunder in writing. This
Agreement shall be binding upon and inure to the benefit of Executive,
his estate and Beneficiaries, the Company and the successors and
permitted assigns of the Company.
10.5 Nonalienation. Benefits payable under this Agreement shall not be
subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, charge, garnishment, execution or levy
of any kind, either voluntary or involuntary, prior to actually being
received by Executive or a Beneficiary, as applicable, and any such
attempt to dispose of any right to benefits payable hereunder shall be
void.
10.6 Severability. If one or more parts of this Agreement are declared by
any court or governmental authority to be unlawful or invalid, such
unlawfulness or invalidity shall not invalidate any part of this
Agreement not declared to be unlawful or invalid. Any part so declared
to be unlawful or invalid shall, if possible, be construed in a manner
which will give effect to the terms of such part to the fullest extent
possible while remaining lawful and valid.
10.7 Captions. The names of the Articles and Sections of this Agreement are
for convenience of reference only and do not constitute a part hereof.
10.8 Amendment: Waiver. This Agreement shall not be amended or modified
except by written instrument executed by the Company and Executive. A
waiver of any term, covenant or condition contained in this Agreement
shall not be deemed a waiver of any other term, covenant or condition,
and any waiver of any default in any such term, covenant or condition
shall not be deemed a waiver of any later default thereof.
10.9 Notices. All notices hereunder shall be in writing and delivered by
hand, by nationally-recognized delivery service that guarantees
overnight delivery, or by first-class, registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
If to the Company, to: The Coastal Corporation
0 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Corporate Secretary
and if to Executive, to the most recent address furnished by Executive to the
Company. Either party may from time to time designate a new address by notice
given in accordance with this Section. Notice shall be effective when actually
received by the addressee.
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10.10 Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
10.11 Entire Agreement. This Agreement forms the entire agreement between the
parties hereto with respect to the subject matter contained in this
Agreement and, except as otherwise provided herein, shall supersede all
prior agreements, promises and representations regarding employment,
compensation, severance or other payments contingent upon termination
of employment, whether in writing or otherwise.
10.12 Applicable Law. This Agreement shall be interpreted and construed in
accordance with the laws of the State of Texas, without regard to its
choice of law principles.
10.13 Survival of Executive's Rights. All of Executive's rights hereunder,
including his rights to compensation and benefits, and his obligations
under Section 9.1 hereof, shall survive the termination of Executive's
employment and/or the termination of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement on ____________,
2000.
ATTEST : THE COASTAL CORPORATION
(Seal)
/s/ Xxxxxx X. X'Xxxxx By: /s/ Xxxxx X. Xxxxxxx
----------------------------------- -------------------------------------
Austin. X. X'Xxxxx Xxxxx X. Xxxxxxx
Senior Vice President & Chairman of the Board, President and
Corporate Secretary Chief Executive Officer
/s/ Xxxx X. Xxxxxxxxxx
----------------------------------------
Xxxx X. Xxxxxxxxxx
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