EMPLOYMENT AGREEMENT
EXHIBIT
10-37
This Employment Agreement
("Agreement"), is entered into by and between Halliburton Energy Services, a division of
Halliburton Energy Services, Inc. ("Employer") and Xxxxx Xxxxxxx Xxxx
("Employee"), to be effective on October 1, 1999 (the "Effective
Date").
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I T N E S S E T H:
WHEREAS, Employee is currently
employed by Employer; and
WHEREAS, Employer is desirous
of continuing the employment of Employee after the Effective Date pursuant to
the terms and conditions and for the consideration set forth in this Agreement,
and Employee is desirous of continuing in the employ of Employer pursuant to
such terms and conditions and for such consideration.
NOW, THEREFORE, for and in
consideration of the mutual promises, covenants, and obligations contained
herein, Employer and Employee agree as follows:
ARTICLE
1: EMPLOYMENT AND DUTIES:
1.1. Employer
agrees to employ Employee, and Employee agrees to be employed by Employer,
beginning as of the Effective Date and continuing until the date of termination
of Employee’s employment pursuant to the provisions of Article 3 (the “Term”),
subject to the terms and conditions of this Agreement.
1.2. Beginning
as of the Effective Date, Employee shall be employed as Division Vice President
– Operations, Completion Product Services, Production
Enhancement. Employee agrees to serve in the assigned position or in
such other managerial capacities as may be requested from time to time by
Employer and to perform diligently and to the best of Employee’s abilities the
duties and services appertaining to such positions as reasonably determined by
Employer, as well as such additional or different duties and services
appropriate to such positions which Employee from time to time may be reasonably
directed to perform by Employer.
1.3. Employee
shall at all times comply with and be subject to such policies and procedures as
Halliburton Company (“Halliburton”) or Employer may establish from time to time,
including, without limitation, the Halliburton Company Code of Business Conduct
(the “Code of Business Conduct”).
1.4. Employee
shall, during the period of Employee’s employment by Employer, devote Employee’s
full business time, energy, and best efforts to the business and affairs of
Employer. Employee may not engage, directly or indirectly, in any
other business, investment, or activity that interferes with Employee’s
performance of Employee’s duties hereunder, is contrary to the interest of
Halliburton or any of its affiliated subsidiaries and divisions, including
Employer (collectively, the “Halliburton Entities” or, individually, a
“Halliburton Entity”), or requires any significant portion of Employee’s
business time. The foregoing notwithstanding, the parties recognize
and agree that Employee may engage in passive personal investments and other
business activities which do not conflict with the business and affairs of the
Halliburton Entities or interfere with Employee’s performance of his or her
duties hereunder. Employee may not serve on the board of directors of
any entity other than a Halliburton Entity during the Term without the approval
thereof in accordance with Halliburton’s policies and procedures regarding such
service. Employee shall be permitted to retain any compensation
received for approved service on any unaffiliated corporation’s board of
directors.
1.5. Employee
acknowledges and agrees that Employee owes a fiduciary duty of loyalty, fidelity
and allegiance to act at all times in the best interests of the Employer and the
other Halliburton Entities and to do no act which would, directly or indirectly,
injure any such entity’s business, interests, or reputation. It is
agreed that any direct or indirect interest in, connection with, or benefit from
any outside activities, particularly commercial activities, which interest might
in any way adversely affect Employer, or any Halliburton Entity, involves a
possible conflict of interest. In keeping with Employee’s fiduciary
duties to Employer, Employee agrees that Employee shall not knowingly become
involved in an conflict of interest with Employer or the Halliburton Entities,
or upon discovery thereof, allow such a conflict to
continue. Moreover, Employee shall not engage in any activity which
might involve a possible conflict of interest without first obtaining approval
in accordance with Halliburton’s policies and procedures.
1.6. Nothing
contained herein shall be construed to preclude the transfer of Employee’s
employment to another Halliburton Entity (“Subsequent Employer”) as of, or at
any time after, the Effective Date and no such transfer shall be deemed to be a
termination of employment for purposes of Article 3 hereof; provided, however,
that, effective with such transfer, all of Employer’s obligations hereunder
shall be assumed by and be binding upon, and all of Employer’s rights hereunder
shall be assigned to, such Subsequent Employer and the defined term “Employer”
as used herein shall thereafter be deemed amended to mean such Subsequent
Employer. Except as otherwise provided above, all of the terms and
conditions of this Agreement, including without limitation, Employee’s rights
and obligations, shall remaining in full force and effect following such
transfer of employment.
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ARTICLE
2: COMPENSATION AND BENEFITS:
2.1. Employee’s
base salary during the Term shall be not less than $145,000 per annum which
shall be paid in accordance with the Employer’s standard payroll practice for
its executives. Employee’s base salary may be increased from time to
time with the approval of the Compensation Committee of Halliburton’s Board of
Directors (the “Compensation Committee”) or its delegate, as
applicable. Such increased base salary shall become the minimum base
salary under this Agreement and may not be decreased thereafter without the
written consent of Employee.
2.2. During
the Term, Employee shall participate in the Halliburton Annual Performance Pay
Plan, or any successor annual incentive plan approved by the Compensation
Committee; provided, however, that all determinations relating to Employee’s
participation, including, without limitation, those relating to the performance
goals applicable to Employee and Employee’s level of participation and payout
opportunity, shall be made in the sole discretion of the person or committee to
whom such authority has been granted pursuant to such plan’s terms.
2.3. During
the Term, Employer shall pay or reimburse Employee for all actual, reasonable
and customary expenses incurred by Employee in the course of his or her
employment; including, but not limited to, travel, entertainment, subscriptions
and dues associated with Employee’s membership in professional, business and
civic organizations; provided that such expenses are incurred and accounted for
in accordance with Employer’s applicable policies and procedures.
2.4. While
employed by Employer, Employee shall be allowed to participate, on the same
basis generally as other similarly situated employees of Employer, in all
general employee benefit plans and programs, including improvements or
modifications of the same, which on the Effective Date or thereafter are made
available by Employer or Halliburton to all or substantially all of Employer’s
similarly situated employees. Such benefits, plans, and programs may
include, without limitation, medical, health, and dental care, life insurance,
disability protection, and qualified and non-qualified retirement
plans. Except as specifically provided herein, nothing in this
Agreement is to be construed or interpreted to increase or alter in any way the
rights, participation, coverage, or benefits under such benefit plans or
programs than provided to similarly situated employees pursuant to the terms and
conditions of such benefit plans and programs. While employed by
Employer, employee shall be eligible to receive awards under the Halliburton
Company 1993 Stock and Long-Term Incentive Plan (the “1993 Plan”) or any
successor stock-related plan adopted by Halliburton’s Board of Directors;
provided, however, that the foregoing shall not be construed as a guarantee with
respect to the type, amount or frequency of such awards, if any, such decisions
being solely within the discretion of the Compensation Committee or its
delegate, as applicable.
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2.5. Neither
Halliburton nor Employer shall by reason of this Article 2 be
obligated to institute, maintain, or refrain from changing, amending or
discontinuing, any incentive compensation, employee benefit or stock or stock
option program or plan, so long as such actions are similarly applicable to
covered employees generally.
2.6. Employer
may withhold from any compensation, benefits, or amounts payable under this
Agreement all federal, state, city, or other taxes as may be required pursuant
to any law or governmental regulation or ruling.
ARTICLE
3: TERMINATION OF EMPLOYMENT AND EFFECTS OF SUCH
TERMINATION:
3.1. Employee’s
employment with Employer shall be terminated (i) upon the death of Employee,
(ii) upon Employee’s Retirement (as defined below), (iii) upon Employee’s
Permanent Disability (as defined below), or (iv) at any time by Employer upon
notice to Employee, or by Employee upon thirty (30) days’ notice to Employer,
for any or no reason.
3.2. If
Employee’s employment is terminated by reason of any of the following
circumstances, Employee shall not be entitled to receive the benefits set forth
in Section 3.3 hereof:
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(i)
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Death.
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(ii)
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Retirement. “Retirement”
shall mean either (a) Employee’s retirement at or after normal retirement
age (either voluntarily or pursuant to Halliburton’s retirement policy) or
(b) the voluntary termination of Employee’s employment by Employee in
accordance with Employer’s early retirement policy for other than Good
Reason (as defined below).
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(iii)
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Permanent
Disability. “Permanent Disability” shall mean Employee’s
physical or mental incapacity to perform his or her usual duties with such
condition likely to remain continuously and permanently as determined by a
qualified physician selected by
Employer.
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(iv)
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Voluntary
Termination. “Voluntary Termination” shall mean a
termination of employment in the sole discretion and at the election of
Employee for other than Good Reason. “Good Reason” shall mean
(a) a termination of employment by Employee because of a material breach
by Employer of any material provision of this Agreement which remains
uncorrected for thirty (30) days following notice of such breach by
Employee to Employer, provided such termination occurs within sixty (60)
days after the expiration of the notice period or (b) a termination of
employment by Employee within six (6) months after a material diminution
in the nature or scope of Employee’s job functions, duties or
responsibilities.
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(v)
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Termination for
Cause. Termination of Employee’s employment by Employer
for Cause. “Cause” shall mean any of the
following: (a) Employee’s gross negligence or willful
misconduct in the performance of the duties and services required of
Employee pursuant to this Agreement, (b) Employee’s final conviction of a
felony, (c) a material violation of the Code of Business Conduct or (d)
Employee’s material breach of any material provision of this Agreement
which remains uncorrected for thirty (30) days following notice of such
breach to Employee by Employer. Determination as to whether or
not Cause exists for termination of Employee’s employment will be made by
the Compensation Committee.
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In the event Employee’s employment is
terminated under any of the foregoing circumstances, all future compensation to
which Employee is otherwise entitled and all future benefits for which Employee
is eligible shall cease and terminate as of the date of termination, except as
specifically provided in this Section 3.2. Employee, or his or her estate in the
case of Employee’s death, shall be entitled to pro rata base salary through the
date of such termination and shall be entitled to any individual bonuses or
individual incentive compensation not yet paid but payable under Employer’s or
Halliburton’s plans for years prior to the year of Employee’s termination of
employment, but shall not be entitled to any bonus or incentive compensation for
the year in which he or she terminates employment or any other payments or
benefits by or on behalf of Employer except for those which may be payable
pursuant to the terms of Employer’s or Halliburton’s employee benefit plans (as
defined in Section 3.4), stock, stock option or incentive plans, or the
applicable agreements underlying such plans.
3.3. If
Employee’s employment is terminated by Employer or Employee for any reason other
than as set forth in Section 3.2 above Employee shall be entitled to each of the
following:
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(i)
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To
the extent not otherwise specifically provided in any underlying
restricted stock agreements, all shares of Halliburton common stock
previously granted to Employee under the 1993 Plan, and any similar plan
adopted by Halliburton in the future, which at the date of termination of
employment are subject to restrictions (the “Restricted Shares”) will be
treated in a manner consistent with Halliburton’s past practices for
treatment of Restricted Shares held by employees whose employment was
involuntarily terminated by a Halliburton Entity for reasons other than
Cause, which, in most instances, have been to forfeit the Restricted
Shares and pay to such employee a lump sum cash payment equal to the value
of the Restricted Shares (based on the closing price of Halliburton common
stock on the New York Stock Exchange on the date of termination of
employment); although in some cases, Halliburton has, in lieu of, or in
combination with, the foregoing and in its discretion, caused the
forfeiture restrictions with respect to all or a portion of the Restricted
Shares to lapse and provided for the retention of such shares by such
employee.
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(ii)
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Subject
to the provisions of Section 3.4, Employer shall pay to Employee a
severance benefit consisting of a single lump sum cash payment equal to
two years’ of Employee’s base salary as in effect at the date of
Employee’s termination of employment. Such severance benefit
shall be paid no later than sixty (60) days following Employee’s
termination of employment.
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(iii)
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Employee
shall be entitled to any individual bonuses or individual incentive
compensation not yet paid but payable under Employer’s or Halliburton’s
plans for years prior to the year of Employee’s termination of
employment. Such amounts shall be paid to Employee in a single
lump sum cash payment no later than sixty (60) days following Employee’s
termination of employment.
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(iv)
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Employee
shall be entitled to any individual bonuses or individual incentive
compensation under Employer’s or Halliburton’s plans for the year of
Employee’s termination of employment determined as if Employee had
remained employed by the Employer for the entire year. Such
amounts shall be paid to Employee at the time that such amounts are paid
to similarly situated employees except that no portion of such amounts
shall be deferred to future
years.
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3.4. The
severance benefit paid to Employee pursuant to Section 3.3 shall be in
consideration of Employee’s continuing obligations hereunder after such
termination, including, without limitation, Employee’s obligations under Article
4. Further, as a condition to the receipt of such severance benefit,
Employer, in its sole discretion, may require Employee to first execute a
release, in the form established by Employer, releasing Employer and all other
Halliburton Entities, and their officers, directors, employees, and agents, from
any and all claims and from any and all causes of action of any kind or
character, including, but not limited to, all claims and causes of action
arising out of Employee’s employment with Employer and any other Halliburton
Entities or the termination of such employment. The performance of
Employer’s obligations under Section 3.3 and the receipt of the severance
benefit provided thereunder by Employee shall constitute full settlement of all
such claims and causes of action. Employee shall not be under any
duty or obligation to seek or accept other employment following a termination of
employment pursuant to which a severance benefit payment under Section 3.3 is
owing and the amounts due Employee pursuant to Section 3.3 shall not be reduced
or suspended if Employee accepts subsequent employment or earns any amounts as a
self-employed individual. Employee’s rights under Section 3.3 are
Employee’s sole and exclusive rights against the Employer or its affiliates and
the Employer’s sole and exclusive liability to Employee under this Agreement, in
contract, tort or otherwise, for the termination of his or her employment
relationship with Employer. Employee agrees that all disputes
relating to Employee’s termination of employment, including, without limitation,
any dispute as to “Cause” or “Voluntary Termination” and any claims or demands
against Employer or Halliburton based upon Employee’s employment for any monies
other than those specified in Section 3.3, shall be resolved through the
Halliburton Dispute Resolution Plan as provided in Section 5.6
hereof. Nothing contained in this Article 3 shall be construed to be
a waiver by Employee of any benefits accrued for or due Employee under any
employee benefit plan (as such term is defined in the Employees’ Retirement
Income Security Act of 1974, as amended) maintained by Employer or Halliburton
except that Employee shall not be entitled to any severance benefits pursuant to
any severance plan or program of the Employer or Halliburton.
3.5. Termination
of the employment relationship does not terminate those obligations imposed by
this Agreement which are continuing obligations, including, without limitation,
Employee’s obligations under Article 4.
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ARTICLE
4: OWNERSHIP AND PROTECTION OF INTELLECTUAL
PROPERTY
AND CONDIFENTIAL INFORMATION:
4.1. All
information, ideas, concepts, improvements, discoveries, and inventions, whether
patentable or not, which are conceived, made, developed or acquired by Employee,
individually or in conjunction with others, during Employee’s employment by
Employer or any of its affiliates (whether during business hours or otherwise
and whether on Employer’s premises or otherwise) which relate to the business,
products or services of Employer or its affiliates (including, without
limitation, all such information relating to corporate opportunities, research,
financial and sales data, pricing and trading terms, evaluations, opinions,
interpretations, acquisition prospects, the identity of customers or their
requirements, the identity of key contacts within the customer’s organizations
or within the organization of acquisition prospects, or marketing and
merchandising techniques, prospective names, and marks), and all writings or
materials of any type embodying any of such items, shall be the sole and
exclusive property of Employer or its affiliates, as the case may
be.
4.2. Employee
acknowledges that the businesses of Employer and its affiliates are highly
competitive and that their strategies, methods, books, records, and documents,
their technical information concerning their products, equipment, services, and
processes, procurement procedures and pricing techniques, the names of and other
information (such as credit and financial data) concerning their customers and
business affiliates, all comprise confidential business information and trade
secrets which are valuable, special, and unique assets which Employer or its
affiliates use in their business to obtain a competitive advantage over their
competitors. Employee further acknowledges that protection of such
confidential business information and trade secrets against unauthorized
disclosure and use is of critical importance to Employer and its affiliates in
maintaining their competitive position. Employee hereby agrees that
Employee will not, at any time during or after his or her employment by
Employer, make any unauthorized disclosure of any confidential business
information or trade secrets of Employer or its affiliates, or make any use
thereof, except in the carrying out of his or her employment responsibilities
hereunder. Confidential business information shall not include
information in the public domain (but only if the same becomes part of the
public domain through a means other than a disclosure prohibited
hereunder). The above notwithstanding, a disclosure shall not be
unauthorized if (i) it is required by law or by a court of competent
jurisdiction or (ii) it is in connection with any judicial, arbitration, dispute
resolution or other legal proceeding in which Employee’s legal rights and
obligations as an employee or under this Agreement are at issue; provided,
however, that Employee shall, to the extent practicable and lawful in any such
events, give prior notice to Employer of his or her intent to disclose any such
confidential business information in such context so as to allow Employer or its
affiliates an opportunity (which Employee will not oppose) to obtain such
protective orders or similar relief with respect thereto as may be deemed
appropriate.
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4.3. All
written materials, records, and other documents made by, or coming into the
possession of, Employee during the period of Employee’s employment by Employer
which contain or disclose confidential business information or trade secrets of
Employer or its affiliates shall be and remain the property of Employer, or its
affiliates, as the case may be. Upon termination of Employee’s
employment by Employer, for any reason, Employee promptly shall deliver the
same, and all copies thereof, to Employer.
4.4. For
purposes of this Article 4, “affiliates” shall mean entities in which Employer
or Halliburton has a 20% or more direct or indirect equity
interest.
ARTICLE
5: MISCELLANEOUS:
5.1. Except
as otherwise provided in Section 4.4 hereof, for purposes of this Agreement, the
terms “affiliate” or “affiliated” means an entity who directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with Halliburton or in which Halliburton has a 50% or more equity
interest.
5.2. For
purposes of this Agreement, notices and all other communications provided for
herein shall be in writing and shall be deemed to have been duly given when
received by or tendered to Employee, Halliburton or Employer, as applicable, by
pre-paid courier or by United States registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
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If
to Employer or Halliburton, to Halliburton Company at 3600 Lincoln Plaza,
000 Xxxxx Xxxxx Xxxxxx, Xxxxxx, Xxxxx 00000-0000, to the attention of the
General Counsel.
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If
to Employee, to his or her last known personal
residence.
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5.3. This
Agreement shall be governed by and construed and enforced, in all respects in
accordance with the law of the State of Texas, without regard to principles of
conflicts of law, unless preempted by federal law, in which case federal law
shall govern; provided, however, that the Halliburton Dispute Resolution Plan
and the Federal Arbitration Act shall govern in all respects with regard to the
resolution of disputes hereunder.
5.4. No
failure by either party hereto at any time to give notice of any breach by the
other party of, or to require compliance with, any condition or provision of
this Agreement shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.
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5.5. It
is a desire and intent of the parties that the terms, provisions, covenants, and
remedies contained in this Agreement shall be enforceable to the fullest extent
permitted by law. If any such term, provision, covenant, or remedy of
this Agreement or the application thereof to any person, association, or entity
or circumstances shall, to any extent, be construed to be invalid or
unenforceable in whole or in part, then such term, provision, covenant, or
remedy shall be construed in a manner so as to permit its enforceability under
the applicable law to the fullest extent permitted by law. In any
case, the remaining provisions of this Agreement or the application thereof to
any person, association, or entity or circumstances other than those to which
they have been held invalid or unenforceable, shall remain in full force and
effect.
5.6. It
is the mutual intention of the parties to have any dispute concerning this
Agreement resolved out of court. Accordingly, the parties agree that
any such dispute shall, as the sole and exclusive remedy, be submitted for
resolution through the Halliburton Dispute Resolution Plan; provided, however,
that the Employer, on its own behalf and on behalf of any of the Halliburton
Entities, shall be entitled to seek a restraining order or injunction in any
court of competent jurisdiction to prevent any breach or the continuation of any
breach of the provisions of Article 4 and Employee hereby consents that such
restraining order or injunction may be granted without the necessity of the
Employer posting any bond. The parties agree that the resolution of
any such dispute through such Plan shall be final and binding.
5.7. This
Agreement shall be binding upon and inure to the benefit of Employer, to the
extent herein provided, Halliburton and any other person, association, or entity
which may hereafter acquire or succeed to all or substantially all of the
business or assets of Employer or Halliburton by any means whether direct or
indirect, by purchase, merger, consolidation, or
otherwise. Employee’s rights and obligations under this Agreement are
personal and such rights, benefits, and obligations of Employee shall not be
voluntarily or involuntarily assigned, alienated, or transferred, whether by
operation of law or otherwise, without the prior written consent of Employer,
other than in the case of death or incompetence of Employee.
5.8. This
Agreement replaces and merges any previous agreements and discussions pertaining
to the subject matter covered herein. This Agreement constitutes the
entire agreement of the parties with regard to the terms of Employee’s
employment, termination of employment and severance benefits, and contains all
of the covenants, promises, representations, warranties, and agreements between
the parties with respect to such matters. Each party to this
Agreement acknowledges that no representation, inducement, promise, or
agreement, oral or written, has been made by either party with respect to the
foregoing matters which is not embodied herein, and that no agreement,
statement, or promise relating to the employment of Employee by Employer that is
not contained in this Agreement shall be valid or binding. Any
modification of this Agreement will be effective only if it is in writing and
signed by each party whose rights hereunder are affected thereby, provided that
any such modification must be authorized or approved in accordance with any
applicable Halliburton policies and procedures.
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IN WITNESS WHEREOF, Employer
and Employee have duly executed this Agreement in multiple originals to be
effective on the Effective Date.
HALLIBURTON ENERGY
SERVICES, A DIVISION
OF HALLIBURTON ENERGY
SERVICES, INC.
By: /s/ Xxxxx
Xxxxx
Name:
Xxxxx Xxxxx
Title: President
EMPLOYEE
/s/ Xxxxx Xxxxxxx
Xxxx
Xxxxx Xxxxxxx
King
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