EXHIBIT 10.13
November 16, 1998
Xx. Xxxx X. Xxxxxxx
Edge Petroleum Corporation
0000 Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Dear Xxxx:
In connection with your separation from Edge Petroleum Corporation
(Company) and in consideration of your service to the Company, you and the
Company have agreed to the terms and conditions as contained in this letter and
the attachment to this letter concerning your separation from employment
effective as of November 16, 1998.
In consideration of the Company's agreement to provide the benefits,
payments, and other items described in the attachment to this Agreement, the
receipt and sufficiency of which are hereby acknowledged:
(a) You hereby release and forever discharge the Company and its
parents, subsidiaries and affiliates, and their officers, directors,
agents, servants, employees, consultants, attorneys, representatives,
successors, assigns, and insurers from any and all damage, losses, causes
of action, expenses, demands, liabilities, and claims on behalf of
yourself, your heirs, executors, administrators, and assigns with respect
to all matters relating to the Company, and you hereby accept the cash
payments, benefits, and other items described herein and in the attachment
to this Agreement in full settlement of all such damages, losses, causes of
action, expenses, demands, liabilities, and claims you now have or may have
with respect to such matters; provided, however, that, notwithstanding the
foregoing release and discharge, you shall retain all rights to (i)
coverage, if any, under directors' or officers' fiduciary errors and
omissions and other liability insurance policies that by their terms would
apply to your acts or omissions while serving the Company, its subsidiaries
and affiliates and their respective officers, directors, agents, servants,
employees, consultants, attorneys, representatives, successors and assigns,
(ii) you and your dependents rights to payment, coverage, benefits and
other protections in the Company's medical and dental plans, (iii) your
rights under the Company's Employees' Savings and Profit Sharing Plan
Trust, (iv) your rights under this Agreement and (v) any indemnification
arrangements with the Company (including
Page 2 of Letter to
Xxxx X. Xxxxxxx November 16, 1998
pursuant to the Company's Bylaws) that apply to your service with the
Company or its affiliates.
This release includes, but is not limited to, claims arising
under the Age Discrimination in Employment Act, the Older Workers' Benefit
Protection Act, Title VII of the Civil Rights Act of 1964, the Americans
with Disabilities Act, the Family and Medical Leave Act, the Texas Labor
Code, any state or federal statute, regulation or common law pertaining to
"whistleblowers," any claims for breach of contract, tort or personal
injury of any sort, and any claim under any other state or federal statute
or regulation, in equity or at common law. Further, by accepting the
payments described in the attachment to this Agreement, you agree not to
xxx the Company or the related persons and entities described above on
account of any matter released hereby. You affirm and agree that your
employment relationship has ended on your separation date, November 16,
1998, and you withdraw unequivocally, completely, and finally from your
employment, you resign all positions, titles, responsibilities, and
authority as an officer or employee of the Company and its affiliates, and
waive all rights in connection with such relationship except to vested
benefits and the payments and benefits described in the attachment to this
Agreement. You agree that this Agreement is valid, fair, adequate and
reasonable, was with your full knowledge and consent, and was not procured
through fraud, duress, or mistake. You shall have twenty-one days to
decide whether to sign the Agreement and be bound by its terms. You shall
have the right to revoke or cancel it within seven days after you have
signed it. This cancellation or revocation can be accomplished by delivery
of a written notification to me. In the event that this Agreement is
canceled or revoked, the Company shall have no obligation to furnish the
payments and benefits described, except for vacation pay described in
paragraph 2 of the attachment to this Agreement and any rights under the
Company's Savings and Investment Plan, stock option plans, and other
benefit plans that are vested as of your separation date, November 16, 1998
and the Employment Agreement (defined below) will remain in effect.
Notwithstanding the revocation letter, your termination of employment shall
nevertheless remain effective, including your resignation as both a member
of the Company's Board of Directors and an officer of the Company or its
affiliates. You acknowledge that you have been advised in writing to
consult with an attorney prior to signing this Agreement and have had an
adequate opportunity to seek advice of your own choosing. You acknowledge
that you have read this Agreement, have had an opportunity to ask questions
and have it explained to you and that you understand that this Agreement
will have the effect of knowingly and voluntarily waiving any action you
might pursue, including breach of contract, personal injury, retaliation,
discrimination on the basis of race, age, sex, national origin, or
disability and any other claims arising prior to the date of this
Agreement, including any claims under the Employment Agreement between the
Company and you dated as of February 25, 1997 (Employment Agreement).
Finally, the Company agrees to release you from all claims relating to the
Company, its subsidiaries and affiliates and their respective officers,
directors, agents, servants, employees, consultants, attorneys,
representatives, successors, assigns and insurers, except as specifically
provided to he contrary in this Agreement,
Page 3 of Letter to
Xxxx X. Xxxxxxx November 16, 1998
and agrees that the terms and provisions of this Agreement shall extend
to and be binding upon the Company's successors and assigns. Without
limiting the generality of the foregoing, the Company acknowledges that
the provisions of Section 10 of the Employment Agreement are hereby
released by the Company unless this Letter Agreement is revoked or
cancelled by you.
(b) You agree to hold for the benefit of the Company all secret or
confidential information or data relating to the Company or any of its
affiliates, and their respective businesses, which shall have been obtained
by you during your employment by the Company or any of its affiliates and
which shall not be or become public knowledge (other than acts by you or
representatives of you in violation of this Agreement or the other terms
and conditions of your employment by the Company). You agree that you will
not, without the prior written consent of the Company or as may be
otherwise required by law or legal process, communicate or divulge any such
secret or confidential information or data relating to the Company or any
of its affiliates and their respective businesses to anyone other than the
Company and those designated by it.
(c) You hereby agree to provide consulting services to the Company
for the period commencing November 16, 1998 and ending January 1, 1999.
The services you provide shall be as an independent contractor and shall be
with respect to those matters with which you are suitably experienced and
knowledgeable by reason of your education, training, and background and
your prior employment with the Company, including litigation matters. The
Company and you agree to work out reasonable accommodations for the
provision of such consulting services so that they do not unreasonably
interfere with any of your other personal employment or business endeavors.
Further, the Company agrees that your obligation to provide consulting
services does not impose any duty on you to bring to the Company any
present or future business opportunity. In no event will such service
require more than 70 hours of your time.
The Company will reimburse you for any reasonable travel or other
business expenses incurred in connection with providing such consulting
services, but you shall not be entitled to any other compensation for consulting
other than that described in this Agreement and the attachment thereto.
The purpose of the arrangements described in this Agreement and
attachments is to arrive at a mutually agreeable and amicable basis upon which
to separate your employment with the Company. You and the Company agree to
refrain from any criticisms or disparaging comments about each other or in any
way relating to your employment with or separation from the Company, except in
the context of any disclosure or examination necessary in connection with the
enforcement of your rights under this Agreement or as may be required by law or
judicial process. Furthermore, you agree that you have returned or will return
immediately, any proprietary or confidential information in tangible form or
documents relating to the business and affairs of the Company and its
affiliates.
Page 4 of Letter to
Xxxx X. Xxxxxxx November 16, 1998
You and the Company further agree that the existence and all terms of
this Agreement, including the terms and conditions contained in the attachment,
shall be kept strictly confidential and that any disclosure to anyone for any
purpose whatsoever (save and except disclosure to your spouse, to financial
institutions as part of a financial statement, to immediate family members
and/or heirs, to financial, tax and legal advisors, disclosure necessary in
connection with the enforcement of your rights under this Agreement or as may be
required by law, regulation or judicial process; in the event confirmation of
any such information is requested, the request should be directed to the chief
financial officer of the Company) by you or your agents, representatives, heirs,
children, spouse, employees or spokespersons shall be a breach of this
Agreement. In the event that either party feels that the other has breached any
provision of this Agreement or the attachment, that party shall give the other
written notice and the parties shall endeavor in good faith for not less than 20
days after such notice to resolve the alleged breach prior to exercising or
seeking any other remedy.
Very truly yours,
/s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
Chief Financial Officer
Edge Petroleum Corporation
AGREED TO AND ACCEPTED this
16 day of November, 1998
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/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
Page 5 of Letter to
Xxxx X. Xxxxxxx November 16, 1998
Attachment to Letter Agreement Dated November 16, 1998
1. ADDITIONAL CASH COMPENSATION
As soon as reasonably practicable after November 16, 1998, provided
the payment is seven days after you execute and return to Edge Petroleum
Corporation ("Company") the attached Letter Agreement, the Company will pay you
(i) a lump sum amount equal to $600,000 plus (ii) commencing on the first
business day of January 1999 and thereafter on the first business day of each
succeeding calendar month in 1999 the lump sum amount of $25,000, plus (iii) on
January 7, 2000 the lump sum amount of $213,602. The amount in clause (iii) has
been estimated by the parties and shall be adjusted, if appropriate, so that the
total of the amounts in clauses (i), (ii) and (iii) shall aggregate the lump sum
amount described in Section 4(a)(i)(B) of the Employment Agreement, with
disputes to be resolved by Ernst & Young. The amounts payable under clauses
(ii) and (iii) shall bear interest, which the Company shall pay quarterly
beginning January 1, 1999 at ChaseBank Texas, N.A.'s prime rate plus 1%,
compounded monthly. All such payments shall be subject to applicable FICA and
withholding for income taxes. You acknowledge these payments are greater than
any cash severance or other compensation or benefits from the Company to which
you are otherwise entitled.
2. VACATION
You will receive a lump sum payment, subject to applicable FICA and
withholding for income taxes, for all your 1998 earned vacation days, less any
vacation days taken in 1998, plus your accrued vacation days, if any, through
November 16, 1998.
3. MEDICAL AND DENTAL COVERAGE
Beginning November 17, 1998 and ending February 25, 2002, you will be
eligible to continue your participation in the medical and dental coverage
available to you on November 16, 1998, except that the coverage shall be
secondary payor to any coverages provided by another employer. You and your
dependents will be eligible on February 25, 2002 to continue coverage under such
plans pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA").
4. LIFE INSURANCE AND AD&D
Your term life insurance coverage of $2,000,000 will continue until
February 25, 2002. You will have a 31 day period after February 25, 2002 to
exercise the conversion options for life insurance and AD&D, according to the
terms and conditions in effect at that time. It will be your responsibility to
complete the conversion process if you so desire.
Page 6 of Letter to
Xxxx X. Xxxxxxx November 16, 1998
5. STD/LTD
Short-term and long-term disability coverage are not in effect after
your separation date, November 16, 1998.
6. SAVINGS PLAN
As soon as reasonably practicable after seven days after you execute
and return to the Company the attached Letter Agreement, the Company will pay
you in cash, subject to applicable FICA and withholding for income taxes, an
amount equal to any portion of your Employees' Savings and Profit Sharing Plan
Trust interest which was not fully vested as of November 16, 1998, as if it had
been fully vested. The vested portion of your Savings and Investment Plan
account, plus employee contributions, will be available for distribution to you
in accordance with the terms of the Plan.
7. STOCK OPTIONS
All of the Company stock options you hold as of November 16, 1998
(options on 133,645 shares of Company stock) will vest upon the date of your
termination of employment and all such vested stock options, to the extent not
theretofore exercised, will remain exercisable following November 16, 1998 as if
you had continued in employment until the expiration of the 10-year term of the
option.
8. RESTRICTED STOCK AWARD
Subject to your providing the consulting services described in the
Letter Agreement, 106,916 shares of Restricted Stock granted to you by the
Company pursuant to Section 2(b)(x) of your Employment Agreement with the
Company shall be fully vested and nonforfeitable as of January 2, 1999. 13,365
shares shall be forfeited as of November 16, 1998. You will be responsible for
remitting to the Company applicable FICA and withholding taxes due by reason of
the vesting of such Restricted Stock.
9. 1998 BONUS
As soon as practical after the end of 1998 you will be paid the
amount, if any, described in Section 4(a)(i)(E) of the Employment Agreement.
