EXHIBIT 10.18
SEVERANCE AND CONSULTING AGREEMENT
THIS AGREEMENT, executed on February 17, 1998, but effective as of
March 1, 1998 (the "Effective Date"), is between XXXXXXXXXXX ENTERRA, INC., a
Delaware corporation (the "Company"), and XXXXXX X. EAGLES (the "Consultant").
W I T N E S S E T H:
WHEREAS, the Consultant as of the Effective Date will have (i) resigned as
an employee of the Company, (ii) resigned each office that the Consultant held
with each subsidiary of the Company identified on EXHIBIT A (the "Subsidiaries")
hereto, (iii) resigned as a director of each of the Subsidiaries, and (iv)
resigned as a member of the Administrative Committee of each employee benefit
plan of the Company that is administered by such committee; and
WHEREAS, except as provided otherwise herein, the Company and the
Consultant wish to provide for the termination of all employment or other
arrangements between the Company and the Consultant and between the Consultant
and each of the Subsidiaries; and
WHEREAS, the Company wishes to retain the Consultant as an independent
contractor, and not as an employee of the Company, to provide the Company the
services hereinafter specified for a period of 36 months commencing on the
Effective Date;
NOW, THEREFORE, in consideration of the promises, the agreements herein
contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Consultant
agree as follows:
Section 1 CONSULTING SERVICES.
(a) During the period from the Effective Date through February 28,
2001 (the "Expiration Date"), unless sooner terminated as hereinafter provided
(the "Consulting Period"), the Consultant shall consult from time to time with
the officers, directors and other agents of the Company, the Subsidiaries and
other subsidiaries and affiliates of the Company (the Subsidiaries and other
subsidiaries and affiliates collectively, the "Xxxxxxxxxxx Group Entities") with
respect to (i) the operations, practices, history, employees, properties and
existing and future financial arrangements of the Company and the Xxxxxxxxxxx
Group Entities and (ii) any other affairs of the Company and the Xxxxxxxxxxx
Group Entities for which the Consultant had sole or shared responsibility, in
whatever capacity.
(b) The Consultant shall not, and shall not be required to, provide
such consulting services unless specifically requested to do so by the President
and Chief Executive Officer of the Company. In providing such consulting
services, the Consultant shall be an independent contractor of the Company, and
no employment relationship shall exist between
the Company and the Consultant on or after the Effective Date. In no event shall
the Consultant be required to expend more than 500 hours per year, 42 hours per
month, or 10 hours per week, in providing such consulting services. The
Consultant shall not be required, without his consent, to perform such
consulting services at any place other than the City of Houston metropolitan
area.
Section 2 CASH COMPENSATION.
(a) The Company will pay the Consultant such compensation as is owed
to the Consultant, and extend such other benefits to which the Consultant is
entitled, as an employee of the Company up to the Effective Date. In addition,
the Company will pay the Consultant such bonus for 1997 fiscal year as is owed
to the Consultant in accordance with the 1997 Management Incentive Bonus Plan.
All such amounts shall be less any amounts that the Company shall determine it
is required by law or regulation to withhold, including income taxes and social
security.
(b) As soon as practicable after the Effective Date, the Company will
pay the Consultant all earned but unused vacation as of the Effective Date, less
any amounts that the Company shall determine it is required by law or regulation
to withhold, including income taxes and social security.
(c) Except as provided otherwise herein, in consideration for the
agreements of the Consultant herein contained (including without limitation the
Release of All Claims provision included in Section 1 of this Agreement) and as
compensation for the services provided to the Company by the Consultant pursuant
to Section 12 of this Agreement, the Consultant shall be entitled to receive
from the Company $12,500 per month, on a monthly basis (or such other basis as
agreed to by the Company), beginning approximately March 31, 1998, and ending
approximately February 28, 2001, provided that the Company shall be entitled to
withhold from such payments any amounts that the Company shall determine it is
required by law or regulation to so withhold, including income taxes and social
security taxes. The Company will reimburse the Consultant for all reasonable
expenses that the Employee may incur in the performance of the consulting
services which are requested to be performed by him, including travel, lodging
and similar items.
(d) All amounts owed to the Consultant shall be paid to the
Consultant by check drawn on an account of the Company, payable to the
Consultant (or, in the event of the death of the Consultant at any time during
the Consulting Period, to his widow, or if he is not survived by his widow, to
his legal representatives), and mailed not later than the date provided for
payment herein to the address for notices to the Consultant determined pursuant
to Section 19 of this Agreement.
(e) The obligation of the Company to make payments to the Consultant
pursuant to this Section 2 shall not be affected by the death or disability of
the Consultant.
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(f) If the Company shall continue to fail to make any payment
required under this Section 2 after 30 days written notice of such failure from
the Consultant (except as provided in Section 16(b) hereof), the Consultant
shall have the right to demand and receive immediately from the Company all
amounts payable to the Consultant under this Section 2.
(g) If the Consultant accepts employment with another employer on a
full-time basis or agrees to furnish consulting services to another individual
or entity on a full-time basis, the Company, at its sole discretion, may reduce
or terminate, on an equitable basis, the payments owed pursuant to Subsection
(c) of this Section 2. In no event shall this provision serve to waive the
Consultant's obligation to comply with Section 15 hereof or the Company's right
to enforce that section. The Consultant's full-time employment or full-time
engagement as a consultant by another entity shall not affect the Options (as
defined in Section 3(a) hereof) unless as a result of such employment or
engagement as a consultant the Consultant engages in a Competitive Business (as
defined in Section 15(a)(i) hereof), as provided in Section 15(a)(i) hereof,
renders advice or services to, or otherwise assists, any Competitive Business,
as provided in Section 15(a)(ii) hereof, or breaches the other provisions of
Section 15 hereof. The term "full-time basis," as used herein, shall mean the
performance by Consultant of employment or consulting services for a third party
pursuant to an agreement which obligates or requires the Consultant to work
regularly more than twenty (20) hours per week for a term of twelve (12) or more
consecutive weeks.
(h) The Company will provide to the Consultant stenographic help and
other facilities and services that are suitable and appropriate for the
performance of the consulting services which are requested to be performed by
him pursuant to this Agreement.
Section 3 STOCK OPTIONS.
(a) Immediately prior to the Effective Date, the Consultant held
fully vested options granted under various of the Company's Stock Option Plans
(the "Option Plans") to purchase (i) up to 6,667 shares of Common Stock, $.10
par value ("Common Stock"), of the Company at $18.50 per share, and (ii) up to
4,000 shares of Common Stock at $31.563 per share (such options being herein
collectively called the "Options"). Immediately prior to the Effective Date, the
Consultant held unvested options granted under the Company's Option Plans to
purchase (i) up to 3,333 shares of Common Stock at $18.50 per share, (ii) up to
8,000 shares of Common Stock at $31.563 per share, and (iii) up to 12,000 shares
of Common Stock at $30.625 per share (such options being herein called
collectively the "Unvested Options"). Notwithstanding any contrary provision of
the Option Plans or of the several agreements pursuant to which the Unvested
Options were granted to the Consultant, the rights of the Consultant with
respect to said Unvested Options shall be fully vested at the Effective Date
(such Unvested Options hereinafter included in the term the "Options").
(b) The Options remain exercisable by the Consultant in accordance
with the provisions of the Option Plans through February 29, 1999, except as
otherwise provided
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herein. Any Options that remain unexercised, in whole or in part, after the
close of business on February 29, 1999, shall thereupon expire.
(c) If this Agreement is terminated by either party prior to February
29, 1999, as a result of the Consultant's breach of Section 14 or the
Consultant's engaging in a Competitive Business, as provided in Section 15(a)(i)
hereof, rendering advice or services to, or otherwise assisting, any Competitive
Business, as provided in Section 15(a)(ii) hereof, or breaching the other
provisions of Section 15 hereof, any Options that are outstanding at the date of
termination shall be forfeited by the Consultant and shall expire.
(d) If this Agreement is terminated by either party prior to February
29, 1999, for any reason other than as provided in Section 3(c), replacement
options will be granted to the Consultant to purchase up to (i) 10,000 shares of
Common Stock at $18.50 per share, (ii) up to 12,000 shares of Common Stock at
$31.563 per share, and (iii) up to 12,000 shares of Common Stock at $30.625 per
share (collectively, the "Replacement Options"). The terms of the Replacement
Options shall be the same as the terms of the Options. The Company shall
register the shares of Common Stock to be issued to the Consultant upon the
exercise of the Replacement Options under applicable securities laws to the same
extent, if any, that Company now is obligated to register shares of the Common
Stock to be issued to Consultant under the Option Plans. The rights of the
Consultant with respect to the Replacement Options shall be fully vested at the
date on which they are granted, and the Replacement Options shall be
exercisable, in whole or in part, by the Consultant (or, after the death of the
Consultant, by his legal representatives) at any time on or before February 29,
1999. Any Replacement Options that remain unexercised, in whole or in part,
after the close of business on February 29, 1999, shall thereupon expire.
(e) Except as otherwise specifically provided in this Section 3, the
Consultant shall not be entitled to participate in any Option Plan at any time
on or after the Effective Date.
(f) The Company shall be entitled to withhold from any payment to be
made pursuant to Section 2 any portion of any taxable income that (i) is
realized by the Consultant as a result of the exercise of any of the Options and
(ii) the Company shall determine that it is required by law or regulation to so
withhold under applicable tax laws.
Section 4 RESTRICTED STOCK.
(a) Immediately prior to the Effective Date, the Consultant held
5,749 shares of Common Stock that were granted to the Consultant pursuant to the
Company's Restricted Stock Incentive Plan (the "Restricted Stock Plan") and
which remained subject to restrictions on ownership on the Effective Date (such
shares of Common Stock being herein called the "Restricted Shares").
Notwithstanding any contrary provision of the Restricted Stock Plan or of any
agreement pursuant to which the Restricted Shares were granted to Consultant,
(i) the Restricted Shares shall not be forfeited by the Consultant as a result
of either (x) the
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termination of the Consultant's employment by the Company or (y) the death,
disability or incapacity of the Consultant at any time during the Consulting
Period and (ii) all restrictions on ownership shall terminate with respect to
the Restricted Shares on the Effective Date.
(b) Except as otherwise specifically provided in this Section 4, the
Consultant shall not be entitled to participate in the Restricted Stock Plan at
any time on or after the Effective Date.
(c) The Company shall be entitled to withhold from any payments to be
made pursuant to Section 2 any portion of any taxable income that (i) is
realized by the Consultant as a result of the termination of any restriction on
ownership on any of the Restricted Shares and (ii) the Company shall determine
that it is required by law or regulation to so withhold under applicable tax
laws.
Section 5 CERTAIN OTHER BENEFIT PLANS.
(a) The Consultant shall not be entitled to make contributions to, or
otherwise participate in, except as provided in Subsection (d) below, the
Company's 401(k) Savings Plan, the Supplemental Savings Plan, the Pension Plan
or any similar plan of the Company (collectively, the "Benefit Plans" and,
individually, a "Benefit Plan") at any time on or after the Effective Date.
(b) For purposes of determining the benefits (if any) that are
payable to the Consultant pursuant to the terms of any Benefit Plan, the
Consultant's vested interest in each account maintained for the benefit of the
Consultant pursuant to the terms of such Benefit Plan, and the balance of such
account, shall be determined immediately prior to the Effective Date. The
Company shall not be obligated to make any contribution pursuant to the terms of
any Benefit Plan for the benefit of the Consultant for any period commencing on
or after the Effective Date.
(c) At the Effective Date, the Consultant shall become entitled to
receive those benefits (if any) that are payable to the Consultant pursuant to
the terms of the several Benefit Plans as a result of the termination of the
Consultant's employment by the Company for reasons other than death, disability
or retirement. The Company shall cause those benefits to be paid to the
Consultant at the times and in the manner provided in the several Benefit Plans.
(d) To the extent the Consultant has vested amounts in any account
maintained for the benefit of the Consultant pursuant to any Benefit Plan, the
Consultant shall have the right to request that a distribution not be made and
to leave such account balances with the Trustee of the several Benefit Plans,
such amounts to be invested in accordance with the Benefits Plans, until such
time as the Consultant directs the Company to make a distribution of benefits as
provided in the several Benefits Plans.
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Section 6 HEALTH BENEFITS.
(a) Immediately prior to the Effective Date, the Consultant
participated in the health and dental insurance plans provided by the Company
(collectively, the "Health Plan"). The Health Plan provided for the
reimbursement of the Consultant for a portion of the amounts expended by the
Consultant for certain health care and dental services rendered to the
Consultant or to certain eligible dependents of the Consultant, subject to the
payment by the Consultant to the Company of a portion of each monthly premium
paid by the Company to obtain coverage under the Health Plan for the Consultant
and such dependents. Pursuant to the terms of such Health Plan, the Consultant's
participation therein shall terminate at the Effective Date.
(b) The coverage extended to the Consultant pursuant to the Health
Plan is extended pursuant to the Consolidated Omnibus Budget Reconciliation Act
("COBRA") for 18 months after the Effective Date, provided that the Consultant
shall pay to the Company no later than the last business day of each month (or
authorizes the Company to withhold such amount from amounts otherwise owed to
the Consultant pursuant to Section 2 hereof) an amount equal to the COBRA
premium established by the Company from time to time for the Consultant and
other employees whose employment by the Company has terminated. The Consultant
shall have no further rights to coverage under COBRA after August 31, 1999.
(c) After August 31, 1999, the Consultant shall be entitled to
convert the Health Plan, as it relates to the Consultant and any eligible
dependents, to an individual policy, upon payment of the applicable conversion
fee.
(d) The Consultant shall not seek reimbursement from the Company for
any amount that is reimbursed to the Consultant, or that the Consultant is
entitled to have reimbursed to him, under any health insurance plan or other
arrangement provided to the Consultant by any future employer of the Consultant,
and the Company shall not be obligated to reimburse the Consultant for such
amount.
(e) The Company shall not be obligated to provide health and dental
insurance to its employees and no provision hereof shall in any way affect the
right of the Company to terminate or change the terms of the Health Plan
(including without limitation the amount of the monthly premium charged to
participants) at any time.
Section 7 LIFE INSURANCE. Immediately prior to the Effective Date, the
Consultant participated in a group life insurance plan provided by the Company
(such plan being herein called the "Life Insurance Plan"), which life insurance
policy provided for the payment of two times the Consultant's annual base salary
immediately prior to the Effective Date to a designated beneficiary of the
Consultant upon the death of the Consultant. Pursuant to the terms of the Life
Insurance Plan, the Company's obligations to the Consultant pursuant to
the Life Insurance Plan shall terminate at the Effective Date; however, the
Consultant shall be
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entitled to convert the Life Insurance Plan to an individual policy in
accordance with the terms thereof.
Section 8 OTHER ITEMS.
(a) The Consultant shall retain, and shall not owe the Company any
amounts in connection with, one membership in Lakeside Country Club, which
membership currently is maintained in the name of the Consultant. The Company
shall not be obligated to pay, or reimburse the Consultant for, any dues or
other expenses incurred with respect to such membership for any period
commencing on or after March 1, 1998.
(b) As soon as practicable following Consultant's request, the
Company shall transfer to the Consultant the Company's interest in one
membership in the Houstonian, which membership currently is maintained by the
Company in the name of the Consultant, provided that such transfer is permitted.
The Company shall not be obligated to pay, or reimburse the Consultant for, any
dues or other expenses incurred with respect to such membership for any period
commencing on or after March 1, 1998. Any fee charged by the Houstonian in
connection with such transfer shall be paid by the Company.
Section 9 CHANGE OF CONTROL AGREEMENT.
(a) The Company and the Consultant are parties to a Change of Control
Agreement dated August 16, 1996, between the Company and the Consultant
regarding the Consultant's employment in the event of a change of control (the
"Change of Control Agreement"). The Change of Control Agreement is rescinded as
of December 15, 1997, and the Consultant and the Company waive any provision of
the Change of Control Agreement that limits the circumstances under which any
provision thereof may be modified, waived or discharged.
(b) The Company and the Consultant hereby release each other from all
liabilities under, and all obligations to perform or observe any term or
provision of the Change of Control Agreement.
Section 10 INDEMNIFICATION AGREEMENT. The Company and the Consultant are
parties to an Indemnification Agreement, effective as of March 1, 1993 (the
"Indemnification Agreement"). Notwithstanding the termination of the
Consultant's employment by the Company on the Effective Date, the
Indemnification Agreement shall remain in full force and effect with respect to
acts or decisions made by the Consultant while performing consulting services
for the Company hereunder, provided that the Consultant shall not be entitled to
be indemnified by the Company, whether pursuant to the terms of the
Indemnification Agreement or otherwise, on account of any Claim (as defined in
the Indemnification Agreement) that is brought by the Company against the
Consultant for any alleged breach by the Consultant of any provision of this
Agreement.
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Section 11 NO CHANGE OF CONTROL. Solely for the purpose of defining the
respective rights and obligations of the Company and the Consultant under each
of the Benefit Plans, the Option Plans and the Restricted Stock Plan, (i) the
Company and the Consultant stipulate that at the Effective Date, no event that
constitutes a "change of control" of the Company, within the meaning of, or as
defined in, any of those plans, has occurred and (ii) the Company and the
Consultant agree that the respective rights and obligations of the Company and
the Consultant under this Agreement, or under any of those plans, shall not be
affected by the occurrence of such an event on or after the Effective Date.
Section 12 TERMINATION OF EMPLOYMENT AND OF OTHER COMPENSATION
ARRANGEMENTS; RELEASE OF ALL CLAIMS.
(a) The employment of the Consultant by the Company, and the
employment of the Consultant by each of the Subsidiaries, is terminated as of
the Effective Date.
(b) Except as otherwise specifically provided in this Agreement,
(i) the Consultant's participation in all compensation, employee
benefit or incentive plans or arrangements theretofore provided by or
on behalf of the Company, or by or on behalf of any of the
Subsidiaries, is hereby terminated as of the Effective Date;
(ii) all employment agreements or understandings between the
Company and the Consultant, or between any of the Subsidiaries and
the Consultant, are hereby rescinded as of the Effective Date; and
(iii)all legal or equitable rights (if any) of the Consultant
(whether vested, contingent, accrued or unaccrued and whether
contractual in nature or arising by virtue of any interest in any
plan, arrangement or understanding) to receive cash or other
consideration from the Company, or from any of the Subsidiaries, on
account of the Consultant's employment are hereby relinquished by the
Consultant as of the Effective Date.
Without limiting the generality of the foregoing, but subject to the provisions
of Section 2(a), the Consultant shall not participate in any future bonuses paid
by the Company to its executive officers or other employees, including any bonus
that otherwise might have been paid or payable by the Company to the Consultant
on account of the performance of the Consultant during that portion of the
fiscal year of the Company ending December 31, 1998, that preceded the Effective
Date.
(c) Except for the Company's specific obligations under this
Agreement and the Indemnification Agreement, by execution of this Agreement, the
Consultant for himself, his legal representatives, heirs and beneficiaries,
forever releases the Company, and each of the
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Xxxxxxxxxxx Group Entities, and their directors, officers, employees, agents, or
successors from liability for any and all claims, injuries, economic losses,
damages and causes of action of any kind, whether presently known or unknown,
including but not limited to those related to his employment by the Company
and/or the termination of his employment, and forever waives any and all rights
he may have in connection with such matters. The Consultant understands and
agrees that this release and waiver of all claims includes, but is not limited
to, claims or causes of action arising under federal and/or state fair
employment or discrimination laws (including without limitation the Age
Discrimination in Employment Act), laws pertaining to breach of employment
contract, wrongful discharge and common law tort, and any other federal, state
or local laws, including but not limited to those relating in any way to his
employment, events occurring during the course of his employment, and/or the
termination of his employment with the Company. The Consultant understands and
specifically agrees that this Agreement and the consideration the Consultant
will receive hereunder constitute a complete settlement and release and an
absolute bar to any and all claims the Consultant has or may have against the
Company or the other indemnified parties, known or suspected. The Consultant
acknowledges and agrees, and represents to the Company, that (i) he understands
the effect of the provisions of this Subsection (c), (ii) he has had a
reasonable time to consider the effect of the provisions of this Subsection (c),
and (iii) he was encouraged to consult an attorney with respect to the effect of
the provisions of this Subsection (c) and his execution of this Agreement.
The Consultant covenants and agrees not to bring or join any lawsuit
or file any charge or claim against the Company (including each of the
Xxxxxxxxxxx Group Entities, and their directors, officers, employees, agents, or
successors, in any court or before any government agency (except as necessary to
protect his rights under this Agreement and any other agreement entered into
between the Company and the Consultant including the Indemnification Agreement)
relating to his employment and/or the termination of his employment or any
events occurring prior to the execution of this Agreement. Moreover, the
Consultant shall defend, indemnify and hold harmless the Company and each of the
Xxxxxxxxxxx Group Entities, and their directors, officers, employees, agents and
successors, from any claim, demand or cause of action brought by any heir,
administrator, executor, representative, agent or other entity acting by,
through or on behalf of the Consultant relating to, based upon or arising out of
the subject matters of the release granted herein.
(d) Except for the Consultant's specific obligations under this
Agreement, by execution of this Agreement, the Company, for itself and each of
the Subsidiaries and their respective successors and assigns, forever releases
the Consultant from liability for any and all claims, injuries, economic losses,
damages and causes of action of any kind, whether presently known or unknown,
including but not limited to those related to his employment by the Company, and
forever waives any and all rights it may have in connection with such matters.
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Section 13 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement and understanding between the Company and the Consultant with respect
to (i) the resignation of the Consultant from the offices and positions
identified on EXHIBIT A hereto; (ii) the payment to the Consultant by the
Company, or by any of the Subsidiaries, of any and all settlement, severance or
similar consideration; and (iii) any other matter addressed in this Agreement.
Section 14 CONFIDENTIALITY AGREEMENT.
(a) The Consultant has had, and (in the course of performing the
services required to be performed by the Consultant pursuant to the terms of
this Agreement) may continue to have, access to certain confidential financial
and other proprietary information of the Company or of each of the Xxxxxxxxxxx
Group Entities. Such information constitutes valuable, special and unique
property of the Company and the Xxxxxxxxxxx Group Entities. Subject to the
provisions of paragraph (b) of this Section 14, the Consultant shall not,
without the prior written consent of the Company, disclose any of such
information.
(b) This Section 14 shall not be construed to prohibit the Consultant
from, or subject the Consultant to liability for, disclosing such information
(i) to any director of the Company, (ii) to any officer, employee or other agent
of the Company to whom such information is furnished in the normal course of
business under established policies of the Company, (iii) when ordered to do so
by a governmental authority to whose jurisdiction the Consultant is subject or
(iv) if the Consultant is required by law or regulation to do so.
(c) This Section 14 shall not apply with respect to information which
shall be deemed to be in the public domain or which shall become publicly
available, other than through the Consultant's breach of this Section 14, or
which was available to Consultant on a non-confidential basis or became known to
Consultant from a non-confidential source.
Section 15 NON-COMPETE; NON-SOLICITATION; NO ACTION THAT WOULD ADVERSELY
AFFECT THE COMPANY.
(a) As part of the consideration for the compensation and other
benefits to be provided to the Consultant hereunder, and as additional incentive
for the Company to enter into this Agreement, the Consultant and the Company
agree to the non-competition provisions of this Section 15. The Consultant
agrees that during the Consulting Period, the Consultant will not, directly or
indirectly, for the Consultant or others, in any geographic area or market where
the Company or any of the Xxxxxxxxxxx Group Entities are conducting any business
as of the Effective Date or during the Consulting Period:
(i) engage in (whether by investment or ownership, or as a
director, officer, employee, paid agent or paid consultant) any
business competitive with the businesses conducted by the Company or
any of the Xxxxxxxxxxx Group Entities, for which the Consultant was
responsible as of the Effective Date, which
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primarily involve tubular services, fishing and downhole services
and the rental of oilfield equipment (a "Competitive Business")
provided that ownership of securities or other ownership interest of
an entity of which the Consultant owns less than five percent of any
class of outstanding securities or other ownership interest shall be
permitted;
(ii) render advice or services to, or otherwise assist, any
other person, association or entity who is engaged, directly or
indirectly, in a Competitive Business;
(iii)induce any employee of the Company or any of the
Xxxxxxxxxxx Group Entities to terminate his or her employment with
the Company or the Xxxxxxxxxxx Group Entities or solicit the
employment of any such employee by any person, association or entity
not affiliated with the Company; or
(iv) interfere with any relationship between the Company or any
of the Xxxxxxxxxxx Group Entities and any customer or supplier of the
Company or such Xxxxxxxxxxx Group Entities.
(b) In addition, during the period of the non-compete agreement, the
Consultant shall not take any action that might reasonably be expected to (i)
injure the reputation of the Company or any of the Xxxxxxxxxxx Group Entities,
(ii) damage the goodwill of the Company or any of the Xxxxxxxxxxx Group
Entities, or (iii) otherwise adversely affect the business, assets, income or
competitive position of the Company or any of the Xxxxxxxxxxx Group Entities.
(c) The Consultant understands that the foregoing restrictions may
limit his ability to engage in certain businesses during the Consulting Period,
but acknowledges that he will receive sufficiently high compensation and other
benefits hereunder to justify such restrictions.
(d) It is expressly understood and agreed that the Company and the
Consultant consider the restrictions contained in this Section 15 to be
reasonable and necessary to protect the business of the Company. Nevertheless,
if any of the preceding restrictions are found by a court having jurisdiction to
be unreasonable, or overly broad as to geographic area or time, or otherwise
unenforceable, the parties intend for the restrictions therein set forth to be
modified by such court so as to be reasonable and enforceable and, as so
modified by the Court, to be enforced.
(e) It is specifically understood and agreed by the Company that the
Consultant may at his option terminate this Agreement at any time prior to the
Expiration Date by giving notice of termination to the Company at least five (5)
days before the date of termination whereupon this Agreement shall terminate;
provided that the Company may elect to earlier
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terminate this Agreement upon receipt of the Consultant's notice of termination.
In the event this Agreement is so terminated by the Consultant, the Company
shall be released from its obligations to pay the Consultant any compensation
under Section 2(c) hereof accruing thereafter, and the Consultant shall be
released, after the date of termination, from his obligations (i) to perform
consulting services hereunder and (ii) not to engage in a Competitive Business,
as provided in Section 15(a)(i), or not to render advice or services to, or not
to otherwise assist, any Competitive Business, as provided in Section 15(a)(ii);
provided, however, that although the Consultant may be released as provided in
this Section 15(e) from his obligations under Sections 15(a)(i) and 15(a)(ii)
above, such that there will be no breach of this Section 15 in the event the
Consultant is employed or engaged as a consultant by a Competitive Business or
renders advice or services, or otherwise assists, any Competitive Business, it
is specifically understood and agreed by the Consultant that should he be so
employed or engaged, the Options shall terminate on the date of termination of
this Agreement.
Xxxxxxx 00 XXXXXXXXXX XXXXXX; CESSATION OF PAYMENTS UPON BREACH.
(a) Each Party acknowledges that a remedy at law for any actual or
threatened breach of the provisions of Section 14 or Section 15 of this
Agreement would be inadequate, and each Party agrees that the other shall be
entitled to injunctive relief in the event of an actual or threatened breach of
any of those provisions.
(b) Whether or not the Company shall obtain injunctive relief for any
actual breach by the Consultant of the provisions of Section 14 or 15 of this
Agreement, in the event of such a breach, the Company shall be entitled to
withhold payment of any amounts otherwise required to be paid to the Consultant
pursuant to the terms of this Agreement to secure the payment of any damage
resulting from such breach; provided that the Company must first give the
Consultant notice of the facts which the Company believes give rise to such
breach and give the Consultant 30 days after the date of such notice to cure
such breach.
Section 17 BINDING EFFECT. This Agreement shall inure to the benefit of
and be binding upon (i) the Company and its successors and assigns and (ii) the
Consultant and his legal representatives. The Consultant shall not assign or
attempt to assign any rights accruing to the Consultant under this Agreement.
Section 18 GOVERNING LAW. The rights and duties of the Company and the
Consultant with respect to this Agreement, and the enforceability,
interpretation and construction of this Agreement shall be governed by the laws
of the State of Texas.
Section 19 NOTICES.
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(a) Notices to the Consultant under this Agreement shall be given to
him in writing at 000 Xxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000, or at such other
address as the Consultant shall specify to the Company in writing.
(b) Notices to the Company under this Agreement shall be given to it
in writing at 0000 Xxxx Xxx Xxxxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, marked
to the attention of the President and Chief Executive Officer.
Section 20 RIGHT OF REVOCATION. Consultant acknowledges that he has
carefully read this Severance and Consulting Agreement (including without
limitation the Release of All Claims provision included in Section 12 hereof);
that he has had the opportunity to review it with his legal counsel; that he
fully understands its effect; that the only promises made to him to sign this
Agreement are those stated herein; that he has been granted 21 days after the
date of his receipt of this Agreement to decide whether to accept it; that he
shall have seven days after his execution of this Agreement to revoke his
agreement to this document; and that he is signing this Agreement voluntarily.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officer, and the Consultant has executed this Agreement,
in each case as of the date first above written.
XXXXXXXXXXX ENTERRA, INC.
By:/s/
-----------------------------------------
Xxxxxx X. Xxxxx, Xx.
President and Chief Executive Officer
CONSULTANT
/s/
-----------------------------------------
XXXXXX X. EAGLES
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