AMENDED AND RESTATED EMPLOYMENT AGREEMENT
EXHIBIT 10(p)
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT
This AMENDED AND RESTATED EMPLOYMENT AGREEMENT made as of September 28, 2008, by and between
MAGELLAN PETROLEUM CORPORATION, a Delaware corporation (hereinafter called the “Company”), having
its principal place of business located at 00 Xxxxxxxx Xxxxxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, and
XXXXXX X. XXXXXX, an individual residing at 000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx 00000
(hereinafter called “Employee”).
W I T N E S S E T H
WHEREAS, the Company and Employee entered into an Employment Agreement dated March 1, 2004;
and
WHEREAS, Employee desires to continue to render faithful and efficient service to the Company;
and
WHEREAS, the Company desires to continue to receive the benefit of Employee’s service; and
WHEREAS, Employee is willing to continue to be employed by the Company; and
WHEREAS, the Board of Directors of the Company has determined that it is in the best interests
of the Company and its shareholders to (i) assure that the Company will have the dedication and
services of Employee, notwithstanding the possibility, threat of occurrence of a Change of Control
(as defined below) of the Company, and (ii) to provide Employee with compensation and benefits
arrangements upon a Change of Control which ensure that the compensation and benefits expectations
of Employee will be satisfied and which are competitive with those of other corporations; and
WHEREAS, the Company and Employee wish to amend and restate the Agreement to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).
NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter set
forth, the parties agree as follows:
1. Offices.
(a) The Company hereby employs Employee as its Chief Financial/Accounting Officer and Acting
President and Chief Executive Officer. Employee hereby agrees to serve the Company in such
capacities for the remainder of the Employment Period (as hereinafter defined). Employee will have
such duties as are appropriate to his positions, and will have such authority as required to enable
him to perform these duties.
Consistent with the foregoing, Employee shall comply with all reasonable instructions of the
Board of Directors of the Company (the “Board”).
2. Term of Employment. Employee’s employment shall be for the “Employment Period”,
with the term commencing March 1, 2004 and continuing for a period of three (3) years and thirty
(30) days commencing as of said date. Such three (3) year, thirty (30) day term shall
automatically be renewed on the same terms and conditions contained herein at the end of each
thirty (30) day period such that at no time will the balance of the term of Employee’s employment
hereunder be less than three (3) years, unless Employee elects to retire or unless this Agreement
is sooner terminated by one of the parties in accordance with the terms hereof or is terminated
under Section 4 hereof.
3. Disability. If the Company determines in good faith that the Disability of
Employee has occurred during the Employment Period (pursuant to the definition of Disability set
forth below), it may give to Employee written notice in accordance with Section 16 of this
Agreement of its intention to terminate Employee’s employment. In such event, Employee’ employment
with the Company shall terminate effective on the 30th day after receipt of such notice by Employee
(the “Disability Effective Date”), provided that, within the 30 days after such receipt, Employee
shall not have returned to fulltime performance of his duties. For purposes of this Agreement,
“Disability” shall be deemed to have occurred when Employee shall be unable to perform the duties
of his employment with the Company for an aggregate period of more than 90 days in a consecutive
period of 52 weeks as a result of incapacity due to mental or physical illness or impairment (other
than as a result of addiction to alcohol or any drug) as determined by a physician selected by the
Company or its insurers and acceptable to Employee or his legal representative.
4. Death. The Employment Period shall automatically terminate upon the death of
Employee.
5. Responsibilities.
(a) During the Employment Period, and excluding any periods of vacation and sick leave to
which Employee is entitled, Employee shall devote reasonable attention and time during normal
business hours to the business and affairs of the Company and, to the extent necessary to discharge
the responsibilities assigned to Employee by the Board hereunder, to use Employee’s reasonable best
efforts to perform faithfully and efficiently such responsibilities. As part of his employment
duties hereunder, Employee shall be required to make business trips to visit the principal business
offices of the Company’s wholly-owned subsidiary, Magellan Petroleum Australia Limited (“MPAL”),
located in Brisbane, Australia and other Australian locations of MPAL business operations, from
time to time as reasonably requested by the Board.
(b) During the Employment Period it shall not be a violation of this Agreement for Employee to
(i) serve on corporate, civic or charitable boards or committees, or (ii) manage personal
investments, so long as such activities do not significantly interfere with the
performance of Employee’s responsibilities as an employee of the Company in accordance with
this Agreement.
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6. Compensation; Benefit Plans and Programs.
(a) Base Salary. Commencing July 1, 2004 and during the remainder of the Employment
Period, Employee shall receive an annual base salary of not less than $175,000 (the “Base Salary”)
which shall be payable in equal monthly installments in advance not later than the sixth day of
each month. Commencing January 1, 2005, the Board may, in its sole and absolute discretion,
increase Employee’s Base Salary in light of Employee’s performance, inflation, changes in the cost
of living and other factors deemed relevant by the Board. The Compensation Committee of the
Company’s Board of Directors (or the entire Board acting as such Committee) shall meet with
Employee annually to review Employee’s performance, objectives and compensation, including salary,
bonus and stock options. If the Compensation Committee determines that any adjustments thereto are
appropriate, such committee shall make a recommendation to the full Board and the Board shall make
such adjustments, if any, as it deems appropriate and consistent with this Agreement.
(b) Bonus. During the Employment Period, Employee will be eligible to receive an
annual bonus award (a “Bonus”) of up to $25,000, if and as determined by the Board in its sole and
absolute discretion after receiving the recommendation of the Compensation Committee. Payment of
any such Bonus shall be made 30 days following the Board’s determination that Employee will receive
a Bonus. Following Employee’s first year of employment hereunder, the Compensation Committee and
Employee shall discuss the development of an incentive-based bonus plan for Employee which shall be
based upon the achievement of suitable performance goals, which may include absolute or relative
growth in earnings per share, rate of return on stockholders’ equity, earnings per share, or other
measurement of corporate performance and may be determined by the Compensation Committee in its
sole discretion after consultation with Employee.
(c) Grant of Non-Qualified Stock Option. Effective July 1, 2004, Employee was granted
a non-qualified stock option (the “Stock Option”) under the Magellan Petroleum Corporation 1998
Stock Option Plan, as amended on October 24, 2007 (the “Option Plan”), which Stock Option entitled
Employee to purchase up to Thirty Thousand (30,000) shares of Common Stock of the Company. These
and any other terms and conditions of the Stock Option were set forth in a written agreement dated
July 1, 2004, the form and content of which was substantially similar to the option agreements
evidencing other awards under the Plan. Future awards of stock options or other awards under the
Plan (or any successor plan), if any, shall be made by the Board in its sole discretion, after
receipt of a recommendation by the Compensation Committee.
(d) Benefit Plans; Retirement Program. The Company shall make an annual contribution
of 15% of Employee’s total Base Salary and Bonus to the Company’s SEP/XXX plan. During the
Employment Period, Employee shall be eligible for participation in all other incentive, bonus and
benefit plans and programs made available by the Company to its employees.
(e) Insurance Coverage. During the Employment Period, the Company shall reimburse
Employee a maximum of $15,000 per year for family health insurance coverage,
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which shall consist of
medical, prescription and dental benefits, and shall also reimburse Employee for long term
disability insurance coverage with an annual premium not to exceed $6,000. In addition, the
Company shall purchase a term life insurance policy with coverage of up to $400,000 to supplement
Employee’s existing term life insurance coverage. Reimbursements under this paragraph shall be
made no later than the end of the year following the year in which such expenses were incurred by
Employee. The expenses eligible for reimbursement during Employee’s taxable year may not affect
the expenses eligible for reimbursement in any other year, and the right to reimbursement is not
subject to liquidation or exchange for another benefit.
(f) Vacation and Holidays. During the Employment Period, Employee shall be entitled
to paid vacation leave of four (4) weeks per year. Employee will be entitled to such holidays as
are established by the Company for all employees.
7. Business Expenses. During the Employment Period, the Company shall allow Employee
his reasonable expenses of travel and business entertainment incurred in the performance of his
duties hereunder, subject to the rules and regulations adopted by the Company for the handling of
such business expenses. Reimbursements under this Section shall be made no later than the end of
the year following the year in which such expenses were incurred by Employee.
8. Office Expenses and Rent; Administrative Support Services. The Company shall bear
the costs of maintaining and operating the Company’s head office located in Hartford, Connecticut.
The Company shall provide Employee with administrative support services at such head office, as
reasonably determined by Employee.
9. Termination Without Cause. In the event that Employee is terminated without Cause
and while this Agreement is in effect:
(a) the Company shall pay to Employee an amount equal to three (3) times the sum of (x)
Employee’s annual Base Salary in effect at the Date of Termination and (y) the average of
Employee’s annual Bonus paid for the three full fiscal years preceding the date of termination of
the Employment Period. Payment of these amounts shall be made in two lump sums. The first lump
sum shall be paid on the day following the date of Employee’s separation from service and shall
equal the lesser of two times (i) the sum of Employee’s annualized compensation based upon the
annual rate of pay for services provided to the Company for the taxable year of Employee preceding
the taxable year in which Employee has a separation from service or (ii) the maximum amount that
may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for
the year in which Employee has a separation from service. The second lump sum payment shall be
equal to the difference between the amount calculated under the first sentence of this paragraph
and the amount calculated under the third sentence of this paragraph, and such lump sum shall be
paid on the first day of the seventh (7th)
month following Employee’s separation from service. Each lump sum shall be deemed a separate
payment for purposes of Section 409A of the Code.
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(b) all options granted to him shall be vested and exercisable to the extent provided in the
applicable agreements relating thereto.
(c) For purposes of this Agreement, “Cause” shall be limited to and mean only the following:
(i) Misappropriating any funds or property of the Company;
(ii) Attempting to obtain any personal profit from any transaction in which Employee
has an interest which is adverse to the interest of the Company, unless Employee shall have
first obtained the consent of the Board of Directors;
(iii) Neglect or unreasonable refusal or continued failure (other than any such failure
resulting from incapacity due to physical or mental illness) to perform the duties assigned
to Employee under or pursuant to this Agreement; or
(iv) Being convicted of any felony or an offense involving moral turpitude.
10. Grounds for Termination of Employment. The Company may terminate the Employment
Period by written notice to Employee, specifying the ground or grounds for such termination, if
any, but should Employee’s termination be without Cause, the provisions of Section 9 of this
Agreement shall be applicable.
11. Effect of Termination of the Employment Period. Upon the termination of the
Employment Period, this Agreement shall terminate, and all of the parties’ obligations hereunder
shall forthwith terminate, except that rights and remedies accruing prior to such termination or
arising out of this Agreement shall survive.
12. Separation from Service. No termination shall be deemed to have occurred under
this Agreement unless there has been a “separation from service” as defined under Section 409A of
the Code, and the term “termination of employment” and the like shall be construed to mean
“separation from service” as so defined.
13. Change of Control. In the event of a Change of Control, as defined herein, the
provisions of this Section 13 shall supersede the provisions of Sections 3 through 10 of this
Agreement, except as otherwise provided herein.
(a) Effective Date. The “Effective Date” shall mean the date upon which a Change of
Control occurs. Anything in this Agreement to the contrary notwithstanding, if a Change of Control
occurs and if Employee’s employment with the Company is terminated prior to the date on which the
Change of Control occurs, and if it is reasonably demonstrated by
Employee that such termination of employment (i) was at the request of a third party who has
taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in
connection with or anticipation of a Change of Control, then for all purposes of this Agreement
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the “Effective Date” shall mean and a Change of Control shall be deemed to occur on the date
immediately prior to the date of such termination of employment.
(b) Change of Control. For the purpose of this Agreement, a “Change of Control” shall
mean:
(i) the acquisition by any individual, entity or Group (within the meaning of section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 50% or more of either (A) the then outstanding shares of common
stock of the Company (the "Outstanding Company Common Stock”) or (B) the combined voting
power of the then outstanding voting securities of the Company entitled to vote generally in
the election of directors (the “Outstanding Company Voting Securities”); provided, however,
that for purposes of this subparagraph (i), the following acquisitions shall not constitute
a Change of Control: (A) any acquisition directly from the Company, (B) any acquisition by
the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the Company or (D) any
acquisition by any corporation pursuant to a transaction which complies with clauses (A),
(B) and (C) of subparagraph (iii) of this paragraph (b); or
(ii) Individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company’s shareholders, was approved by a vote
of at least a majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but excluding,
for this purpose, any such individual whose initial assumption of office occurs as a result
of an actual or threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by or on behalf
of a person other than the Board; or
(iii) consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company (a “Business
Combination”), in each case, unless, following such Business Combination, (A) all or
substantially all of the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of, respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation resulting
from such Business Combination (including, without limitation, a
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corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership, immediately prior to
such Business Combination of the Outstanding Company Common Stock and Outstanding Company
Voting Securities, as the case may be (B) no Person (excluding any corporation resulting
from such Business Combination or any employee benefit plan (or related trust) of the
Company or such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the combined voting
power of the then outstanding voting securities of such corporation except to the extent
that such ownership existed prior to the Business Combination and (C) at least a majority of
the members of the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business Combination; or
(iv) Approval by the shareholders of the Company of a complete liquidation or
dissolution of the Company.
Anything herein to the contrary notwithstanding, if the Incumbent Board (as defined in Section
13(b)(ii) hereof) by a majority vote of directors then in office, consents in advance to any
action, event, or occurrence set forth in Sections 13(b)(i), (ii), (iii) or (iv) hereof which would
otherwise be deemed to be a Change in Control, such action, event, or occurrence shall not be
deemed to be a Change in Control.
(c) Terms of Employment Following Change of Control. During the Employment Period
following a Change of Control, Employee shall continue to receive the same compensation (other
than the initial award of the Stock Option), retirement benefits, insurance coverage and vacation
and holiday benefits described in Section 6 of this Agreement.
(d) Termination of Employment Following Change of Control.
(i) Death or Disability. Employee’s employment shall terminate automatically
upon Employee’s death during the Employment Period following a Change of Control. If the
Company determines in good faith that the Disability of Employee has occurred during the
Employment Period following a Change of Control, the provisions of section 3 hereof shall be
applicable.
(ii) Cause. The Company may terminate Employee’s employment during the
Employment Period following a Change of Control for Cause, as said term is defined in
Section 9(c) hereof.
(iii) Good Reason. Employee’s employment may be terminated by Employee during
the Employment Period following a Change of Control for Good Reason. For purposes of this
Agreement, “Good Reason” shall mean:
(A) a material negative change to Employee resulting from the assignment to
Employee of any duties inconsistent in any respect with Employee’s position
(including status, offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 13(c), or any other action by the
Company which results in a material diminution in such position, authority, duties
or responsibilities;
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(B) any failure by the Company to comply with any of the provisions of Section
13(c) that results in a material negative change to Employee;
(C) The Company materially changing the geographic location in which Employee
must perform services from the location at which he is performing such services at
the time this Amended and Restated Employment Agreement is entered into; or
(D) any purported termination by the Company of Employee’s employment otherwise
than as expressly permitted by this Agreement.
For purposes of this subsection (d)(iii), any good faith determination of “Good Reason” made by
Employee shall be conclusive.
(iv) Notice of Termination. Any termination by the Company for Cause, or by
Employee for Good Reason, shall be communicated by Notice of Termination to the other party
hereto given in accordance with Section 16 of this Agreement. For purposes of this
Agreement, a “Notice of Termination” means a written notice which (A) indicates the specific
termination provision in this Agreement relied upon, (B) to the extent applicable, sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of Employee’s employment under the provision so indicated and (C) if the Date of
Termination (as defined below) is other than the date of receipt of such notice, specifies
the termination date. If Employee is providing Notice of Termination to the Company under
Section 13(d)(iii), Employee shall provide such notice to the Company not later than 90 days
following the initial existence of the condition constituting Good Reason. If the Company
shall have remedied the condition giving rise to such Good Reason condition within 30 days
of the receipt of such notice, no “Good Reason” condition shall have been deemed to have
occurred. The failure by Employee or the Company to set forth in the Notice of Termination
any fact or circumstance which contributes to a showing of Good Reason or Cause shall not
waive any right of Employee or the Company, respectively, hereunder or preclude Employee or
the Company, respectively, from asserting such fact or circumstance in enforcing Employee’s
or the Company’s rights hereunder.
(v) Date of Termination. “Date of Termination” means (A) if Employee’s
employment is terminated by the Company for Cause, the date of receipt of
the Notice of Termination or any later date specified therein, as the case may be, (B)
if Employee’s employment is terminated by the Company other than for Cause or Disability,
the Date of Termination shall be the date on which the Company notifies Employee of such
termination, (C) if Employee’s employment is terminated by reason of death or Disability,
the Date of Termination shall be the date of death of Employee or the Disability Effective
Date, as the case may be, and (D) if Employee’s employment is terminated by Employee for
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Good Reason, the Date of Termination shall be the date 30 days following the date of receipt
of the Notice of Termination or any later date specified therein, as the case may be.
(e) Obliqations of the Company upon Termination of Employment Following a Change of
Control.
(i) Good Reason: other Than for Cause, Death or Disability and Within Two
Years. If, during the Employment Period following a Change of Control and within the
two (2) year period following a Change of Control, the Company shall terminate Employee’s
employment other than for Cause or Disability or Employee shall terminate employment for
Good Reason, then the Company shall pay to Employee the following amounts:
(A) The product of (x) the average of Employee’s annual Bonus paid for the
three full fiscal years preceding the date of termination of the Employment Period
and (y) a fraction, the numerator of which is the number of days in the current
fiscal year through the Date of Termination, and the denominator of which is 365;
such payment shall be made in a lump sum on the first day of the seventh month
following Employee’s separation from service; and
(B) An amount equal to three (3) times the sum of (x) Employee’s annual Base
Salary in effect at the Date of Termination and (y) the average of Employee’s annual
Bonus paid for the three full fiscal years preceding the date of termination of the
Employment Period. Payment of these amounts shall be made in two lump sums. The
first lump sum shall be paid on the date of Employee’s separation from service and
shall equal the lesser of two times (i) the sum of Employee’s annualized
compensation based upon the annual rate of pay for services provided to the Company
for the taxable year of Employee preceding the taxable year in which Employee has a
separation from service or (ii) the maximum amount that may be taken into account
under a qualified plan pursuant to Section 401(a)(17) for the year in which Employee
has a separation from service. The second lump sum payment shall be equal to the
difference between the amount calculated under the first sentence of this paragraph
and the amount calculated under the third sentence of this paragraph, and such lump
sum shall be paid on the first day of the seventh (7th) month following
Employee’s separation from service. Each lump sum shall be deemed a separate
payment for purposes of 409A; and
(C) for three years after Employee’s separation from service, the Company shall
pay Employee $15,000 per year, in lieu of medical benefits and medical insurance
coverage to Employee and/or Employee’s family. The first such payment shall be made
on the first day of the seventh month following Employee’s separation from service.
The second such payment shall be made on the first anniversary of Employee’s
separation from service, and the third such payment shall be made on the second
anniversary of Employee’s separation from
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service. Nothing herein shall limit
Employee’s right to elect continuation of medical benefits under Section 4980B of
the Code or similar state law, if the Company maintains a group health plan subject
to any such requirements; and
(D) all options granted to him shall be vested and exercisable to the extent
provided in the applicable agreements relating thereto.
(ii) Good Reason: Other Than for Cause, Death or Disability and After Two
Years. If, during the Employment period following a Change of Control, and after two
(2) years have elapsed following a Change of Control, the Company shall terminate Employee’s
employment other than for Cause or Disability or Employee shall terminate employment for
Good Reason, the provisions of subparagraph (e)(i) of this Section 12 shall not apply, and
the following provisions shall apply instead:
(A) the Company shall pay to Employee an amount equal to his then current
annual Base Salary; plus the average of Employee’s annual Bonus paid for the three
full fiscal years preceding the date of termination of the Employment Period.
Payment of these amounts shall be made in two lump sums. The first lump sum shall
be paid on the date of Employee’s separation from service and shall equal the lesser
of two times (i) the sum of Employee’s annualized compensation based upon the annual
rate of pay for services provided to the Company for the taxable year of Employee
preceding the taxable year in which Employee has a separation from service or (ii)
the maximum amount that may be taken into account under a qualified plan pursuant to
Section 401(a)(17) for the year in which Employee has a separation from service.
The second lump sum payment (if any) shall be equal to the difference between the
amount calculated under the first sentence of this paragraph and the amount
calculated under the third sentence of this paragraph, and such lump sum shall be
paid on the first day of the seventh (7th) month following Employee’s
separation from service. Each lump sum shall be deemed a separate payment for
purposes of 409A; and
(B) all options granted to him shall be vested and exercisable to the extent
provided in the applicable agreements relating thereto.
(iii) Death. If Employee’s employment is terminated by reason of Employee’s
death during the Employment Period following a Change of Control, this Agreement shall
terminate without further obligations to Employee’s legal representatives under this
Agreement, other than for payment of amounts under Section 15 or 16, if any.
Amounts described in Section 16 shall be paid to Employee’s estate in a lump sum in
cash on the date which is 30 days following the Date of Termination.
(iv) Disability. If Employee’s employment is terminated by reason of
Employee’s Disability during the Employment Period following a Change of Control, this
Agreement shall terminate without further obligations to Employee, other than for payment of
amounts under Section 15 or 16, if any.
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(v) Cause: Other than for Good Reason. If Employee’s employment shall be
terminated for Cause during the Employment Period following a Change of Control, this
Agreement shall terminate without further obligations to the Employer other than the
obligation to pay to Employee amounts under Section 15 or 16, in each case to the extent
theretofore unpaid. If Employee voluntarily terminates employment during the Employment
Period following a Change of Control, excluding a termination for Good Reason, this
Agreement shall terminate without further obligations to Employee, other than for amounts
described in Section 15 or 16, if any.
14. Payment Limit.
(a) Notwithstanding the other provisions of this Employment Agreement, the Company shall make
no payment that would constitute an “excess parachute payment” within the meaning of Section 280G
of the Internal Revenue Code of 1986 or any successor provision.
(b) In the event that the accounting firm selected in accordance with Section 13(e) hereof
(the “Auditors”) determines that any payment or benefit provided by the Company to or for the
benefit of Employee, whether paid, payable or provided pursuant to the terms of this Agreement or
otherwise (a “Payment”) would constitute an excess parachute payment, then the aggregate present
value of the Payments pursuant to this Agreement shall be reduced (but not below zero) to the
Reduced Amount. The “Reduced Amount” shall be an amount expressed in present value which maximizes
the aggregate present value of Payments without causing any Payment to constitute an excess
parachute payment.
(c) If the Auditors determine that any Payment would constitute an excess parachute payment,
then the Company shall promptly give Employee notice to that effect and a copy of the detailed
calculation thereof and of the Reduced Amount, and all payments hereunder shall be reduced on a pro
rata basis to the extent necessary so that no payment hereunder shall constitute an excess
parachute payment.
(d) All determinations made by the Auditors shall be binding upon the Company and Employee and
shall be made within 60 days of Employee’s Date of Termination.
(e) The Auditors shall be a regional or national accounting firm selected by mutual agreement
of the Company and Employee and may, but need not be, the auditors of the Company.
15. Compensation Under Other Plans. In the event of Employee’s termination for any
reason, any compensation previously deferred by him shall be paid in accordance with the terms of
the plan, program, or agreement pursuant to which such deferral was made. In addition, to the
extent not theretofore paid or provided, the Company shall timely pay or provide to Employee any
other amounts or benefits required to be paid or provided or which Employee is eligible to receive
under any plan, program, policy or practice or contract or agreement of the Company and its
affiliated companies, such amounts or benefits to be paid in accordance with the terms of the
applicable plan, program, policy, practice, contract or agreement.
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16. Accrued Obligations. In the event of Employee’s termination for any reason, the
Company shall pay to him a lump sum equal to the sum of Employee’s Annual Base Salary through the
Date of Termination to the extent not theretofore paid, and any accrued vacation pay to the extent
not theretofore paid. Such payment will be made on the day following the date of the of Employee’s
separation from service from the Company.
17. Restrictive Covenants. Employee shall not, during the Employment Period, directly
or indirectly, alone or as a member of a partnership or association, or as an officer, director,
advisor, consultant, agent or employee of any other company, be engaged in or concerned with any
other business duties or pursuits requiring his personal services except as may be permitted under
Section 5 hereof or otherwise with the prior written consent of the Board of Directors of the
Company. Nothing herein contained shall preclude the ownership by Employee of stocks or other
investment securities.
18. Trade Secrets and Non-compete. Employee shall hold in a fiduciary capacity for
the benefit of the Company all secret or confidential information, knowledge or data relating to
the Company or any of its subsidiaries or affiliates, and their respective businesses, which shall
have been obtained by Employee during Employee’s employment by the Company or any of its
subsidiaries or affiliates and which shall not be or become public knowledge (other than by act by
Employee or representatives of Employee in violation of this Agreement). Employee hereby covenants
and agrees to use his best efforts and the utmost diligence to guard and protect such confidential
information, knowledge and data and that he will not, without the prior written consent of the
Company, for a period of three (3) years following the termination of this Agreement use for
himself or others or disclose or permit to be disclosed to any third party by any method whatsoever
any such confidential information, knowledge and data of the Company. For purposes of this
paragraph, confidential information, knowledge or data shall include, but not be limited to, any
and all records, notes, memoranda, data, ideas, processes, methods, devices, programs, computer
software, writings, research, personnel information, customer information, financial information,
plans or any information of whatever nature, in the possession or control of the Company which
gives to Employee an opportunity to obtain an advantage over competitors who do not know or use it.
Employee recognizes that the Company is engaged in a highly competitive business. Therefore,
Employee further covenants that for a period of one (1) year after ceasing employment with the
Company he shall not, without the prior written approval of the Board of Directors of the Company:
(a) become an officer, employee, agent or partner.of any business enterprise in substantial
direct competition with the Company (or any of its subsidiaries or affiliates), as the business of
the Company (or any such subsidiary or affiliate) may be constituted during the term of employment
or at the termination thereof.
(b) interfere with the relationship of the Company and any employee, agent or representative;
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(c) directly or indirectly divert or attempt to divert from the Company any business in which
the Company has been actively engaged during the past three (3) years nor interfere with
relationships of the Company with policyholders, dealers, distributors, marketers, sources of
supply, or customers; or
(d) engage in any pattern of conduct that involves the making or publishing or written or oral
statements or remarks (including, without limitation, the repetition or distribution of derogatory
rumors, allegations, negative reports or comments) which are disparaging or damaging to the
integrity, reputation or good will of the Company and its management.
Employee further specifically acknowledges that the geographic area to which the covenants
contained in paragraphs (a) through (d) applies is the same geographic area in which he performed
services for the Company during the past three (3) years. In the event that Employee is terminated
without Cause, Employee will not be subject to the covenants set forth in this Section.
If the provisions of this Section 18 are violated, in whole or in part, the Company shall be
entitled to seek, upon application to any court of proper jurisdiction and an appropriate showing
to such court, a temporary restraining order or preliminary injunction to restrain and enjoin
Employee from such violation without prejudice to any other remedies the Company may have at law or
in equity. Further, in the event that the provisions of this Section 18 should ever be deemed to
exceed the time, geographic or occupational limitations permitted by applicable laws, Employee and
the Company agree that such provisions shall be and hereby are reformed to the maximum time,
geographic or occupational limitations permitted by the applicable laws.
19. Notices. All notices and other communications hereunder shall be in writing and
shall be given by hand delivery to the other party or by registered or certified mail return
receipt requested, postage prepaid, addressed as follows:
If to Employee
Xxxxxx X. Xxxxxx
000 Xxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
000 Xxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
If to the Company:
Magellan Petroleum Corporation
x/x Xxxxxx Xxxxxxx XXX
XxxxXxxxx I
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxxxxx, Secretary
x/x Xxxxxx Xxxxxxx XXX
XxxxXxxxx I
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxxxxx, Secretary
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or to such other address as either party shall have furnished to the other in writing in
accordance herewith. Notice and communications shall be effective when actually received by the
addressee.
20. Alternative Dispute Resolution. Any controversy, dispute or questions arising out
of, in connection with or in relation to this Agreement or its interpretation, performance or
nonperformance or any breach thereof shall be resolved through mediation. In the event mediation
fails to resolve the dispute within 60 days after a mediator has been agreed upon or such other
longer period as may be agreed to by the parties, such controversy, dispute or question shall be
settled by arbitration in accordance with the Center for Public Resources Rules for NonAdministered
Arbitration of Business Disputes, by a sole arbitrator. The arbitration shall be governed by the
United States Arbitration Act, 9 U.S.C. Sec. 1-16, and judgment upon the award rendered by the
arbitrator may be entered by any court having jurisdiction thereof. The place of the arbitration
shall be Hartford, Connecticut.
21. Successors.
(a) Benefits payable pursuant to this Agreement shall not be funded, and the Company shall not
be required to segregate or earmark any of its assets for the benefit of Employee or his estate.
Such benefits shall not be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment or garnishment by creditors of Employee or his estate,
and any attempt to anticipate, alienate, transfer, assign or attach these benefits shall be void.
Employee or his estate shall have only a contractual right against the Company for the benefits
hereunder and shall have the status of general unsecured creditors.
(b) This Agreement shall inure to the benefit or and be binding upon the Company and its
successors and assigns.
(c) The Company will require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or assets of the
Company to assume expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession had taken place. As
used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor
to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
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22. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance with the laws of the State
of Connecticut, without reference to principles of conflict of laws. The captions of this
Agreement are not part of the provisions hereof and shall have no force and effect. This Agreement
may not be amended or modified otherwise than by a written agreement executed by the parties hereto
or their respective successors and legal representatives.
(b) The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.
(c) The Company may withhold from any amounts payable under this Agreement such Federal,
state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or
regulation.
(d) Employee’s or the Company’s failure to insist upon strict compliance with any provision of
this Agreement or the failure to assert any right Employee or the Company may have hereunder,
including, without limitation, the right of Employee to terminate employment for Good Reason
following a Change of Control pursuant to Section 13(d)(iii) of this Agreement, shall not be deemed
to be a waiver of such provision or right or any other provision or right of this Agreement.
(e) This Agreement may be executed in one or more counterparts, each of which shall be deemed
to be an original but all of which together will constitute one and the same instrument.
(f) This Agreement is intended to comply with the provisions of Section 409A of the Code and
shall be interpreted and administered in a manner consistent therewith.
(g) This
Amendment and Restatement shall be effective as of September 28, 2008.
* * * * * *
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.
| MAGELLAN PETROLEUM CORPORATION | ||||
/s/ Xxxxxx X. Xxxxxx
|
By | /s/ Xxxxxx X. Xxxxxxxxxx | ||
Xxxxxx X. Xxxxxx
|
Name: Xxxxxx X. Xxxxxxxxxx | |||
| Title: Secretary | ||||
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