EXHIBIT 10.24
PRIDE INTERNATIONAL, INC.
EMPLOYMENT/NON-COMPETITION/
CONFIDENTIALITY AGREEMENT
XXXX X. XXXXXXX, XX.
EFFECTIVE OCTOBER 15, 1998
TABLE OF CONTENTS
PAGE NO.
I. PRIOR AGREEMENTS/EMPLOYMENT CONTRACTS........................ 2
1.01 Effect of Prior Agreements................................... 2
II. DEFINITION OF TERMS.......................................... 3
2.01 Company...................................................... 3
2.02 Executive/Officer/Employee................................... 3
2.03 Office/Position/Title........................................ 3
2.04 Effective Date............................................... 3
2.05 Change in Control............................................ 3
2.06 Termination.................................................. 4
2.07 Customer..................................................... 5
III. EMPLOYMENT................................................... 5
3.01 Employment................................................... 5
3.02 Best Efforts and Other Employment of Executive............... 6
3.03 Term of Employment........................................... 6
3.04 Compensation and Benefits.................................... 7
3.05 Termination Without Change in Control........................ 7
IV. CHANGE IN CONTROL............................................ 9
4.01 Extension of Employment Period............................... 9
4.02 Change in Control Termination Payments & Benefits............ 9
4.03 Voluntary Resignation Upon Change in Control................. 10
V. NON-COMPETITION AND CONFIDENTIALITY.......................... 10
5.01 Consideration................................................ 10
5.02 Non-Competition.............................................. 10
5.03 Confidentiality.............................................. 11
5.04 Geographical Area............................................ 12
5.05 Company Remedies For Violation of Non-Competition or
Confidentiality Agreement................................. 12
5.06 Termination of Benefits for Violation of Non-Competition and
Confidentiality........................................... 13
VI. GENERAL...................................................... 13
6.01 Enforcement Costs............................................ 13
6.02 Income, Excise or Other Tax Liability........................ 14
6.03 Payment of Benefits Upon Termination for Cause............... 14
6.04 Non-Exclusive Agreement...................................... 15
6.05 Notices...................................................... 15
6.06 Non-Alienation............................................... 15
6.07 Entire Agreement: Amendment.................................. 15
6.08 Successors and Assigns....................................... 15
6.09 Governing Law................................................ 16
6.10 Venue........................................................ 16
6.11 Headings..................................................... 16
6.12 Severability................................................. 16
6.13 Partial Invalidity........................................... 16
6.14 Counterparts................................................. 16
EMPLOYMENT/NON-COMPETITION/CONFIDENTIALITY
AGREEMENT
DATE: October 15, 1998
COMPANY/EMPLOYER: Pride International, Inc.,
A Louisiana corporation
San Xxxxxx Plaza, Suite 3300
0000 Xxx Xxxxxx
Xxxxxxx, Xxxxx 00000
EXECUTIVE/EMPLOYEE Xxxx X. Xxxxxxx, Xx.
-------------------------------
-------------------------------
This Agreement is made as of the date first above written and to become
effective as herein provided.
PREAMBLE
WHEREAS, the Company wishes to attract and retain well-qualified Executives
and key personnel and to assure itself of the continuity of its management;
WHEREAS, Executive will be elected an officer of the Company with
significant management responsibilities in the conduct of its business;
WHEREAS, the Company recognizes that Executive is a valuable resource of
the Company and the Company desires to be assured of the continued services of
Executive;
WHEREAS, the Company desires to obtain assurances that Executive will
devote his best efforts to his employment with the Company and will not enter
into competition with the Company in its business as now conducted and to be
conducted, or solicit customers or other employees of the Company to terminate
their relationships with the Company;
WHEREAS, Executive is a key employee of the Company and he acknowledges
that his talents and services to the Company are of a special, unique, unusual
and extraordinary character and are of particular and peculiar benefit and
importance to the Company;
WHEREAS, the Company is concerned that in the event of a possible or
threatened change in control of the Company, uncertainties necessarily arise;
Executive may have concerns about the continuation of his employment status and
responsibilities and may be approached by others offering competing employment
opportunities; the Company, therefore, desires to provide Executive assurances
as to the continuation of his employment status and responsibilities in such
event;
WHEREAS, the Company further desires to assure Executive that, if a
possible or threatened change in control should arise and Executive should be
involved in deliberations or negotiations in connection therewith, Executive
would be in a secure position to consider and participate in such transaction as
objectively as possible in the best interests of the Company and to this end
desires to protect Executive from any direct or implied threat to his financial
well-being;
WHEREAS, Executive is willing to continue to serve as such but desires
assurances that in the event of such a change in control he will continue to
have the employment status and responsibilities he could reasonably expect
absent such event and, that in the event this turns out not to be the case, he
will have fair and reasonable severance protection on the basis of his service
to the Company to that time;
WHEREAS, different factors affect the Company and Executive under
circumstances of regular employment between the Company and the Executive when
there is no threat of change in control and/or none has occurred, as opposed to
circumstances under which a change in control is rumored, threatened, occurring
or has occurred. For this reason this Employment Agreement is primarily in two
parts. One part deals with the regular employment of Executive under
circumstances whereby no change in control is threatened, occurring or occurred;
herein called "Regular Employment". The second part deals with circumstances
whereby a change in control is threatened, occurring or has occurred. Other
parts of the Agreement deal with matters affecting both Regular Employment and
employment following change in control, including non-competition and
confidentiality; and
WHEREAS, Executive is willing to enter into and carry out the Non-
Competition and Confidentiality Agreement set forth herein in consideration of
the Employment Agreement set forth herein.
AGREEMENT
NOW, THEREFORE, the parties agree as follows:
I. PRIOR AGREEMENTS/EMPLOYMENT CONTRACTS.
1.01 PRIOR AGREEMENTS. Executive has no continuing non-competition agreements
with any prior employers that have not been disclosed to Company.
Executive has completed a Company employment application and all
information provided therein is true and correct to the best of his
knowledge and belief and is incorporated herein by reference.
2
II. DEFINITION OF TERMS.
2.01 COMPANY. Company means Pride International, Inc., a Louisiana corporation,
as the same presently exists, as well as any and all successors,
regardless of the nature of the entity or the State or Nation of
organization, whether by reorganization, merger, consolidation, absorption
or dissolution. For the purpose of the Non-Competition and Confidentiality
Agreement, Company includes any subsidiary or affiliate of the Company to
the extent it is carrying on any portion of the business of the Company or
a business similar to that being conducted by the Company.
2.02 EXECUTIVE/OFFICER/EMPLOYEE. Executive/Officer/Employee means Xxxx X.
Xxxxxxx, Xx.
2.03 OFFICE/POSITION/TITLE. The Office, Position and Title for which the
Executive is employed is that of President of Pride International, S.A. a
subsidiary of the Company and carries with it such duties,
responsibilities, rights, benefits and privileges or as may reasonably be
assigned to the Executive that are customary and usual for such position
at the Company.
2.04 EFFECTIVE DATE. This Agreement becomes effective and binding as of
August 15, 1998.
2.05 CHANGE IN CONTROL. The term "Change in Control" of the Company shall mean,
and shall be deemed to have occurred on the date of the first to occur of
any of the following:
a. there occurs a Change in Control of the Company of the nature that
would be required to be reported in response to item 6(e) of Schedule
14A of Regulation 14A or Item 1 of Form 8(k) promulgated under the
Securities Exchange Act of 1934 as in effect on the date of this
Agreement, or if neither item remains in effect, any regulations issued
by the Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934 which serve similar purposes;
b. any "person" {as such term is used in Sections 12(d) and 14(d)(2) of
the Securities Exchange Act of 1934} is or becomes a beneficial owner,
directly or indirectly, of securities of the Company representing
twenty percent (20%) or more of the combined voting power of the
Company's then outstanding securities;
c. the individuals who were members of the Board of Directors of the
Company immediately prior to a meeting of the shareholders of the
Company involving a contest for the election of Directors shall not
3
constitute a majority of the Board of Directors following such
election;
d. the Company shall have merged into or consolidated with another
corporation, or merged another corporation into the Company, on a basis
whereby less than fifty percent (50%) of the total voting power of the
surviving corporation is represented by shares held by former
shareholders of the Company prior to such merger or consolidation;
e. the Company shall have sold, transferred or exchanged all, or
substantially all, of its assets to another corporation or other entity
or person.
2.06 TERMINATION. The term "termination" shall mean termination, prior to the
expiration of the Employment Period, of the employment of the Executive
with the Company {including death and disability (as described below) for
any reason other than cause (as described below) or voluntary resignation
(as described below). Termination includes "Constructive Termination" as
described below. Termination includes non-renewal or failure to extend
this Agreement at the end of any employment term, except for cause.
a. The term "disability" means physical or mental incapacity qualifying
the Executive for a long-term disability under the Company's long-term
disability plan. If no such plan exists on the Effective Date of this
Agreement, the term "disability" means physical or mental incapacity as
determined by a doctor jointly selected by the Executive and the Board
of Directors of the Company qualifying the Executive for long-term
disability under reasonable employment standards.
b. The term "cause" means: (i) the failure of the Executive to perform his
duties with the Company (other than any failure due to physical or
mental incapacity) after a demand for substantial performance is
delivered to him by his supervisor which specifically identifies the
manner in which the he believes he has not substantially performed his
duties, (ii) misconduct materially and demonstrably injurious to the
Company, (iii) violation of any Company policy including the covenant
not to compete (except after termination under the Change in Control
provisions and confidentiality provisions hereof), or (iv) making a
false statement on his employment application which is incorporated
herein by reference. The unwillingness of the Executive to accept any
change in the nature or scope of his position, authorities or duties or
any other reasonable request of the Company in respect of his position,
authority, or responsibility may be considered by his
4
supervisor to be a failure to perform by the Executive unless it
occurs after a Change in Control. Notwithstanding the foregoing, the
Executive shall not be deemed to have been terminated for cause for
purposes of this Agreement unless and until there shall have been
delivered to him a letter setting out the particulars and basis for
his termination for cause.
c. The resignation of the Executive shall be deemed "voluntary" if it is
for any reason other than one or more of the following:
(i) the Executive's resignation or retirement is requested by the
Company other than for cause;
(ii) any reduction in the Executive's total compensation or benefits
from that provided in the Compensation and Benefits Section
hereof;
(iii) the material breach by the Company of any other provision of
this Agreement;
(iv) non-renewal or failure to extend any employment term, contrary
to the wishes of the Executive.
Termination that entitles the Executive to the payments and benefits
provided in the "Termination Payments and Benefits" Section hereof shall not be
deemed or treated by the Company as the termination of the Executive's
employment or the forfeiture of his participation, award, or eligibility, for
the purpose of any plan, practice or agreement of the Company referred to in the
Compensation and Benefits Section hereof.
2.07 CUSTOMER. The term "Customer" includes all persons, firms or entities that
are purchasers or end-users of services or products offered, provided,
developed, designed, sold or leased by the Company during the relevant
time periods, and all persons, firms or entities which control, or which
are controlled by, the same person, firm or entity which controls such
purchase.
III. EMPLOYMENT.
3.01 EMPLOYMENT. Except as otherwise provided in this Agreement, the Company
hereby agrees to continue the Executive in its employ, and the Executive
hereby agrees to remain in the employ of the Company, for the Term of
Employment ("Employment Period") herein specified. During the Employment
Period, Executive shall exercise such position and authority and perform
such responsibilities as are commensurate with the position and as
directed by his supervisor which services shall be performed at such
location as the Company may reasonably require.
5
3.02 BEST EFFORTS AND OTHER EMPLOYMENT OF EXECUTIVE.
a. Executive agrees that he will at all times faithfully, industriously
and to the best of his ability, experience and talents, perform all of
the duties that may be required of and from him pursuant to the express
and implicit terms hereof, to the reasonable satisfaction of the
Company and in compliance with the Company Policy Manual. Said duties
shall be rendered at such place or places within or outside the United
States as the Company shall in good faith require or as the interest,
needs, business, or opportunities of the Company shall require.
b. Executive shall devote his normal and regular business time, attention
and skill to the business and interests of the Company, and the Company
shall be entitled to all of the benefits, profits or other issue
arising from or incident to all work, services and advice of Executive
performed for the Company. Such employment shall be considered "full
time" employment. Executive shall have the right to make investments in
businesses which engage in activities other than those engaged by the
Company. Executive shall also have the right to devote such incidental
and immaterial amounts of his time which are not required for the full
and faithful performance of his duties hereunder to any outside
activities and businesses which are not being engaged in by the Company
and which shall not otherwise interfere with the performance of his
duties hereunder. Executive shall have the right to make investments in
the manner and to the extent authorized and set forth in the Non-
Competition Section of this Agreement and the Securities' Transaction
Policy of the Company (Policy I-37 dated 12-1-97).
3.03 TERM OF EMPLOYMENT. ("Employment Period"). Executive's regular employment
(no Change in Control being presently contemplated) will commence on the
Effective Date of this Agreement and will be for a term of two (2) years
ending at 12:00 o'clock midnight October 15, 2000; thereafter, the Term of
Employment of Executive will be automatically extended for successive
terms of one (1)year each commencing October 15, 2000, and on October 15
of each year thereafter, unless Company or Executive gives written notice
to the other that employment will not be renewed or continued after the
next scheduled expiration date which is not less than one (1) year after
the date that the notice of non-renewal was given. All extended employment
terms will be considered to be within the Employment Period while
Executive is employed with the Company.
6
3.04 COMPENSATION AND BENEFITS. During the Employment Period the Executive
shall receive the following compensation and benefits:
a. He shall receive an annual base salary which is not less than his
annual base salary, with the opportunity for increases, from time to
time thereafter, which are in accordance with the Company's regular
executive compensation practices ("annual base salary"). Executive's
salary will be reviewed at least annually. Executive's initial annual
base salary will be $180,000.
b. To the extent that such plans exist immediately prior to the Effective
Date of this Agreement, he shall be eligible to participate on a
reasonable basis, and to continue his existing participation, in
annual bonus, stock option and other incentive compensation plans
which provide opportunities to receive compensation in addition to his
annual base salary which is provided by the Company for Executives
with comparable duties.
c. To the extent such plans exist immediately prior to the Effective Date
of this Agreement, he will be entitled to receive and participate in
exempt employee benefits (including, but not limited to, medical,
life, health, accident and disability insurance and disability
benefits) and prerequisites provided by the Company to Executives with
comparable duties.
d. Paid vacations each year to the same extent as provided to Executives
with comparable duties. Presently vacation accrues at the rate of two
weeks annually for those salaried employees with less than ten (10)
years of service.
e. Participation in all other executive incentive stock and benefit plans
approved by the Committee.
3.05 TERMINATION WITHOUT CHANGE IN CONTROL. The Company shall have the right to
terminate Executive at any time during the Employment Period (including
any extended term). Should the Company choose not to renew or extend the
Employment Period of this Employment Agreement or choose to terminate the
Executive, during or at the end of, the Employment Period, or in the event
of death or disability of the Executive, if the termination is not after a
Change in Control and is not for cause, the Company shall, within thirty
(30) days following such termination, pay and provide to the Executive (or
his Executor, Administrator or Estate in the event of death, as soon as
reasonably practical):
7
a. An amount equal to one (1) full year of his base salary (including the
amount allocated to the covenant not to compete), which base salary is
here defined as twelve (12) times the then current monthly salary in
effect for the Executive and all other benefits due him based upon the
salary in effect on the Date of Termination (but not less than the
highest annual base salary paid to the Executive during any of the
three (3) years immediately preceding his Date of Termination). There
shall be deducted only such amounts as may be required by law to be
withheld for taxes and other applicable deductions.
b. The Company shall make available to Executive and his immediate family
for a period of one (1) full year following the Date of Termination,
life, health, accident and disability insurance which are not less
than the highest benefits furnished to the Executive and his immediate
family during the term of this Agreement.
c. An amount equal to the target award for the Executive under the
Company's annual bonus plan for the fiscal year in which termination
occurs, provided that if the Executive has deferred his award for such
year under a Company plan, the payment due the Executive under this
subparagraph shall be paid in accordance with the terms of the
deferral or as specified by the Executive.
d. The Company shall pay, distribute and otherwise provide to the
Executive the amount and value of his entire plan account and interest
under any employee benefit plan, investment plan or stock ownership
plan, if any exists on the Date of Termination, and all employer
contributions made or payable to any such plan for his account prior
to the end of the month in which Termination occurs shall be deemed
vested and payable to him. Such payment or distribution shall be in
accordance with the elections made by the Executive in respect of
distributions in accordance with the plan as if the Executive's
employment in the Company terminated at the end of the month in which
Termination occurs.
e. All stock options and awards to which the Executive is entitled will
immediately vest and the time for exercising any option will be as
specified in the plan as if the Executive were still employed by the
Company; provided however if the immediate vesting of all benefits
under the plan is not permitted by the plan, then the benefits will be
vested only to the extent authorized or permitted by the plan.
f. All life, health, hospitalization, medical and accident benefits
available
8
to Executive's spouse and dependents shall continue for the same term
as the Executive's benefits. If the Executive dies, all benefits will
be provided for a term of one (1) year (or two (2) years after a
Change in Control) after the date of death of the Executive.
g. The Company's obligation under this Section to continue to pay or
provide health care, life, accident and disability insurance to the
Executive, the Executive's spouse and Executive's dependents, during
the remainder of the Employment Period shall be reduced when and to the
extent any of such benefits are paid or provided to the Executive by
another employer, provided that the Executive shall have all rights
afforded to retirees to convert group insurance coverage to the
individual insurance coverage as, to the extent of, and whenever his
group insurance coverage under this Section is reduced or expires.
Apart from this subparagraph, the Executive shall have and be subject
to no obligation to mitigate.
h. The Company shall deduct applicable withholding taxes in performing
its obligations under this Section.
Nothing in this Section is intended, nor shall be deemed or interpreted, to
be an amendment to any compensation, benefit or other plan to the Company. To
the extent the Company's performance under this Section includes the performance
of the Company's obligations to the Executive under any other plan or under
another agreement between the Company and the Executive, the rights of the
Executive under such other plan or other agreements, which are discharged under
this Agreement, are discharged, surrendered, or released pro tanto.
IV. CHANGE IN CONTROL.
4.01 EXTENSION OF EMPLOYMENT PERIOD. Upon any Change in Control the Employment
Period shall be immediately and without further action extended for a term
of two (2) years following the Effective Date of the Change in Control and
will expire at 12:00 o'clock midnight on the last day of the month
following two (2) years after the Change in Control. Thereafter, the
employment period will be extended for successive terms of one (1) year
each, unless terminated, all in the manner specified in the Term of
Employment Section pertaining to regular employment.
4.02 CHANGE IN CONTROL TERMINATION PAYMENTS AND BENEFITS. In the event the
Executive is terminated within two (2) years following a Change in
Control, the Executive will receive the payments and benefits specified in
the "Termination without Change in Control" Section in the same time and
manner therein specified except as amended and modified hereby:
9
a. The salary and benefits specified in Section 3.05a. will be paid based
upon a multiple of two (2) years (instead of one (1) year).
b. Life, health, accident and disability insurance specified in Section
3.05b. will be provided until (i) Executive becomes reemployed and
receives similar benefits from a new employer or (ii) two (2) years
after the Date of Termination, whichever is earlier.
c. An amount equal to two (2) times the maximum award that the Executive
could receive under the Company's Annual Bonus Plan for the fiscal
year in which the termination occurs, instead of the benefits provided
in Section 3.05c.
d. All other rights and benefits specified in Section 3.05.
4.03 VOLUNTARY RESIGNATION UPON CHANGE IN CONTROL. If the Executive voluntarily
resigns his employment within six (6) months after a Change in Control
(whether or not Company may be alleging the right to terminate employment
for cause), he will receive the same payments, compensation and benefits
as if he had been terminated on the date of resignation after Change in
Control.
V. NON-COMPETITION AND CONFIDENTIALITY.
5.01 CONSIDERATION. The base salary awarded to the Executive and to be paid to
the Executive in the future includes consideration for the Non-Competition
and Confidentiality Agreement set forth herein and the amount to be paid
to Executive in the event of the termination of employment of Executive,
voluntarily, involuntarily, or under a Change of Control, under Section
3.05a and 4.02a hereof constitute payment, in part, for the Non-
Competition and Confidentiality of the Executive. It is contracted,
stipulated and agreed that fifteen percent (15%) of such amount paid and
to be paid to the Executive shall constitute the consideration for the
Non-Competition and Confidentiality Agreement set forth herein.
5.02 NON-COMPETITION. Executive acknowledges that his employment with the
Company has in the past and will, of necessity, provide him with
specialized knowledge which, if used in competition with the Company could
cause serious harm to the Company. Accordingly, the Executive agrees that
during his employment with the Company and for a period of one (1) year
after he is no longer employed by the Company (unless his employment is
terminated after a Change in Control, in which event there will be no
covenant not to compete and the provisions of the covenant not to compete
herein contained will terminate on the date of termination of Executive)
Executive will not, directly or indirectly, either as an individual,
proprietor, stockholder {other than as a holder of up to one percent (1%)
of the outstanding shares of a corporation whose shares are listed on a
stock exchange or traded in accordance with the automated quotation system
of the National Association of Securities
10
Dealers}, partner, officer, employee or otherwise:
a. work for, become an employee of, invest in, provide consulting services
or in any way engage in any business which provides, produces, leases
or sells products or services of the same or similar type provided,
produced, leased or sold by the Company and with regard to which
Executive was engaged, or over which Executive had direct or indirect
supervision or control, within one (1) year preceding the Executive's
termination of employment, in any area where the Company provided,
produced, leased or sold such products or services at any time during
the one (1) year preceding such termination of employment; or
b. provide, sell, offer to sell, lease, offer to lease, or solicit any
orders for any products or services which the Company provided and with
regard to which the Executive had direct or indirect supervision or
control, within one (1) year preceding Executive's termination of
employment, to or from any person, firm or entity which was a customer
for such products or services of the Company during the one (1) year
preceding such termination from whom the Company had solicited business
during such one (1) year; or
c. solicit, aid, counsel or encourage any officer, director, employee or
other individual to (i) leave his or her employment or position with
the Company or (ii) compete with the business of the Company, or (iii)
violate the terms of any employment, non-competition or similar
agreement with the Company; or
d. employ, directly or indirectly; permit the employment of; contract for
services or work to be performed by; or otherwise, use, utilize or
benefit from the services of any officer, director, employee or any
other individual holding a position with the Company within two (2)
years after the Date of Termination of employment of Executive with the
Company or within two (2) years after such officer, director, employee
or individual terminated employment with the Company, whichever occurs
earlier.
5.03 CONFIDENTIALITY. Executive acknowledges that his employment with the
Company has in the past and will, of necessity, provide him with
specialized knowledge which, if used in competition with the Company, or
divulged to others, could cause serious harm to the Company. Accordingly,
Executive will not at any time during or after his employment by the
Company, directly or indirectly, divulge, disclose or communicate to any
person, firm or corporation in any manner whatsoever any information
concerning any matter
11
affecting or relating to the Company or the business of the Company.
While engaged as an employee of the Company, Executive may only use
information concerning any matters affecting or relating to the Company or
the business of the Company for a purpose which is necessary to the
carrying out of the Executive's duties as an employee of the Company, and
Executive may not make use of any information of the Company after he is
no longer an employee of the Company. Executive agrees to the foregoing
without regard to whether all of the foregoing matters will be deemed
confidential, material or important, it being stipulated by the parties
that all information, whether written or otherwise, regarding the
Company's business, including, but not limited to, information regarding
customers, customer lists, costs, prices, earnings, products, services,
formulae, compositions, machines, equipment, apparatus, systems,
manufacturing procedures, operations, potential acquisitions, new location
plans, prospective and executed contracts and other business arrangements,
and sources of supply, is prima facie presumed to be important, material
and confidential information of the Company for the purposes of this
Agreement, except to the extent that such information may be otherwise
lawfully and readily available to the general public. Executive further
agrees that he will, upon termination of his employment with the Company,
return to the Company all books, records, lists and other written, typed
or printed materials, whether furnished by the Company or prepared by
Executive, which contain any information relating to the Company's
business, and Executive agrees that he will neither make nor retain any
copies of such materials after termination of employment.
5.04 GEOGRAPHICAL AREA. The geographical area within which the non-competition
covenants of this Agreement shall apply is that territory within two
hundred (200) miles of (i) any of the Company's present offices, (ii) any
of the Company's present rig yards or rig operations, and (iii) any
additional location where the Company, as of the date of any action taken
in violation of the non-competition covenants of this Agreement, has an
office, a rig yard, rig operation or definitive plans to locate an office,
a rig operation or a rig yard or has recently conducted rig operations.
Notwithstanding the foregoing, if the two hundred (200) mile radius
extends into another country or its territorial waters and the Company is
not then doing business in that other country, there will be no
territorial limitations extending into such other country.
5.05 COMPANY REMEDIES FOR VIOLATION OF NON-COMPETITION OR CONFIDENTIALITY
AGREEMENT. Without limiting the right of the Company to pursue all other
legal and equitable rights available to it for violation of any of the
covenants made by Executive herein, it is agreed that:
a. the skills, experience and contacts of Executive are of a special,
unique, unusual and extraordinary character which give them a peculiar
value;
b. because of the business of the Company, the restrictions agreed to by
Executive as to time and area contained in this Agreement are
12
reasonable; and
c. the injury suffered by the Company by a violation of any covenant in
this Agreement resulting from loss of profits created by the
competitive use of such skills, experience and contacts and otherwise
will be difficult to calculate in damages in an action at law and
cannot fully compensate the Company for any violation of any covenant
in this Agreement, accordingly:
(i) the Company shall be entitled to injunctive relief to prevent
violations of such covenants or continuing violations thereof and
to prevent Executive from rendering any services to any person,
firm or entity in breach of such covenant and to prevent
Executive from divulging any confidential information; and
(ii) compliance with this Agreement is a condition precedent to the
Company's obligation to make payments of any nature to Executive.
5.06 TERMINATION OF BENEFITS FOR VIOLATION OF NON-COMPETITION AND
CONFIDENTIALITY. If Executive's termination was not after a Change in
Control and if Executive shall be violating the Confidentiality and/or
Non-Competition Agreement or any agreement he may have signed as an
employee of the Company, Executive agrees that after receipt of written
notice he shall continue such action and that there shall be no obligation
on the part of the Company to provide any payments or benefits (other than
payments or benefits already earned or accrued) described in the
Termination of Rights and Benefits Section hereof, subject to the
provisions of Section 6.01 hereof. There will be no withholding of
benefits or payments if the termination occurred after a Change in Control
and Executive will not be bound by the non-competition provisions if
terminated while the Change in Control provisions hereof are applicable.
VI. GENERAL.
6.01 ENFORCEMENT COSTS. The Company is aware that upon the occurrence of a
Change in Control, or under other circumstances even when a Change in
Control has not occurred, the Board of Directors or a shareholder of the
Company may then cause or attempt to cause the Company to refuse to comply
with its obligations under this Agreement, or may cause or attempt to
cause the Company to institute, or may institute, litigation seeking to
have this Agreement declared unenforceable, or may take, or attempt to
take, other action to deny Executive the benefits intended under this
Agreement; or actions may be taken to enforce the non-competition or
confidentiality provisions of this Agreement. In these circumstances, the
purpose of this Agreement could be frustrated. It is the intent of the
parties that the
13
Executive not be required to incur the legal fees and expenses associated
with the protection or enforcement of his rights under this Agreement by
litigation or other legal action because such costs would substantially
detract from the benefits intended to be extended to Executive hereunder,
nor be bound to negotiate any settlement of his rights hereunder under
threat of incurring such costs. Accordingly, if at any time after the
Effective Date of this Agreement, it should appear to Executive that the
Company is or has acted contrary to or is failing or has failed to comply
with any of its obligations under this Agreement for the reason that it
regards this Agreement to be void or unenforceable, that Executive has
violated the terms of this Agreement, or for any other reason, or that the
Company has purported to terminate his employment for cause or is in the
course of doing so, or is withholding payments or benefits, or is
threatening to withhold payments or benefits, contrary to this Agreement,
or in the event that the Company or any other person takes any action to
declare this Agreement void or unenforceable, or institutes any litigation
or other legal action designed to deny, diminish or to recover from
Executive the benefits provided or intended to be provided to him
hereunder, and Executive has acted in good faith to perform his
obligations under this Agreement, the Company irrevocably authorizes
Executive from time to time to retain counsel of his choice at the expense
of the Company to represent him in connection with the protection and
enforcement of his rights hereunder, including, without limitation,
representation in connection with termination of his employment or
withholding of benefits or payments contrary to this Agreement or with the
initiation or defense of any litigation or any other legal action, whether
by or against Executive or the Company or any Director, Officer,
Shareholder or other person affiliated with the Company, in any
jurisdiction. Company is not authorized to withhold the periodic payments
of attorneys' fees and expenses hereunder based upon any belief or
assertion by the Company that Executive has not acted in good faith or has
violated this Agreement. If Company subsequently establishes that
Executive was not acting in good faith and has violated this Agreement,
Executive will be liable to the Company for reimbursement of amounts paid
due to Executive's actions not based on good faith and in violation of
this Agreement. The reasonable fees and expenses of counsel selected from
time to time by Executive as hereinabove provided shall be paid or
reimbursed to Executive by the Company, on a regular, periodic basis
within thirty (30) days after presentation by Executive of a statement or
statements prepared by such counsel in accordance with its customary
practices, up to a maximum aggregate amount of One Hundred Fifty Thousand
Dollars.($150,000).
6.02 INCOME, EXCISE OR OTHER TAX LIABILITY. Executive will be liable for and
will pay all income tax liability by virtue of any payments made to
Executive under this Agreement, as if the same were earned and paid in the
normal course of business and not the result of a Change in Control and
not otherwise triggered by the "golden parachute" or excess payment
provisions of the Internal Revenue Code of the United States, which would
cause additional tax liability to be imposed.
6.03 PAYMENT OF BENEFITS UPON TERMINATION FOR CAUSE. If the termination of
Executive is for cause and not after a Change in Control, the Company will
have the right
14
to withhold all payments (except those specified in Section 6.01);
provided however that if a final judgment is entered finding that cause
did not exist for termination, the Company will pay all benefits to
Executive to which he would have been entitled had the termination not
been for cause, plus interest on all amounts withheld from Executive at
the rate specified for judgments under Article 5069-1.05 V.A.T.S. If the
termination for cause occurs after a Change in Control, the Company shall
not have right to suspend or withhold payments to Executive under any
provision of this Agreement until or unless a final judgment is entered
upholding the Company's determination that the termination was for cause,
in which event Executive will be liable to the Company for all amounts
paid, plus interest at the rate allowed for judgments under Article 5069-
1.05 V.A.T.S.
6.04 NON-EXCLUSIVE AGREEMENT. The specific arrangements referred to herein are
not intended to exclude or limit Executive's participation in other
benefits available to executive personnel generally, or to preclude or
limit other compensation or benefits as may be authorized by the Board of
Directors of the Company at any time, or to limit or reduce any
compensation or benefits to which Executive would be entitled but for this
Agreement.
6.05 NOTICES. Notices, requests, demands and other communications provided for
by this Agreement shall be in writing and shall either be personally
delivered by hand or sent by: (i) Registered or Certified Mail, Return
Receipt Requested, postage prepaid, properly packaged, addressed and
deposited in the United States Postal System; (ii) via facsimile
transmission if the receiver acknowledges receipt; or (iii) via Federal
Express or other expedited delivery service provided that acknowledgment
of receipt is received and retained by the deliverer and furnished to the
sender, if to Executive, at the last address he has filed, in writing,
with the Company, or if to the Company, to its Corporate Secretary at its
principal executive offices.
6.06 NON-ALIENATION. Executive shall not have any right to pledge, hypothecate,
anticipate, or in any way create a lien upon any amounts provided under
this Agreement, and no payments or benefits due hereunder shall be
assignable in anticipation of payment either by voluntary or involuntary
acts or by operation of law. So long as Executive lives, no person, other
than the parties hereto, shall have any rights under or interest in this
Agreement or the subject matter hereof. Upon the death of Executive, his
Executors, Administrators, Devisees and Heirs, in that order, shall have
the right to enforce the provisions hereof.
6.07 ENTIRE AGREEMENT: AMENDMENT. This Agreement constitutes the entire
agreement of the parties with respect of the subject matter hereof. No
provision of this Agreement may be amended, waived, or discharged except
by the mutual written agreement of the parties. The consent of any other
person(s) to any such amendment, waiver or discharge shall not be
required.
6.08 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the Company, its successors and assigns, by operation of
law or otherwise, including, without limitation, any corporation or other
entity or persons which shall succeed
15
(whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of
the Company, and the Company will require any successor, by agreement in
form and substance satisfactory to Executive, expressly to assume and
agree to perform this Agreement. Except as otherwise provided herein, this
Agreement shall be binding upon and inure to the benefit of Executive and
his legal representatives, heirs and assigns, provided however, that in
the event of Executive's death prior to payment or distribution of all
amounts, distributions and benefits due him hereunder, each such unpaid
amount and distribution shall be paid in accordance with this Agreement to
the person or persons designated by Executive to the Company to receive
such payment or distribution and in the event Executive has made no
applicable designation, to his Estate. If the Company should split, divide
or otherwise become more than one entity, all liability and obligations of
the Company shall be the joint and several liability and obligation of all
of the parts.
6.09 GOVERNING LAW. Except to the extent required to be governed by the laws of
the State of Louisiana because the Company is incorporated under the laws
of said State, the validity, interpretation and enforcement of this
Agreement shall be governed by the laws of the State of Texas.
6.10 VENUE. Venue for all proceedings hereunder will be in the U.S. District
Court for the Southern District of Texas, Houston Division. Executive
hereby waives his right to request a jury.
6.11 HEADINGS. The headings in this Agreement are inserted for convenience of
reference only and shall not affect the meaning or interpretation of this
Agreement.
6.12 SEVERABILITY. In the event that any provision or portion of this Agreement
shall be determined to be invalid or unenforceable for any reason, the
remaining provisions of this Agreement shall be unaffected thereby and
shall remain in full force and effect.
6.13 PARTIAL INVALIDITY. In the event that any part, portion or Section of this
Agreement is found to be invalid or unenforceable for any reason, the
remaining provisions of this Agreement shall be binding upon the parties
hereto and the Agreement will be construed to give meaning to the
remaining provisions of this Agreement in accordance with the intent of
this Agreement.
6.14 COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be original, but all of which together
constitute one and the same instrument.
16
IN WITNESS WHEREOF, Executive has hereunto set his hand and, pursuant to
the authorization from its Board of Directors and the Compensation Committee,
the Company has caused these presents to be executed in its name and on its
behalf, and its corporate seal to be hereunto affixed and attested by its
Secretary or Assistant Secretary, all as of the day and year first above
written.
EXECUTED in multiple originals and/or counterparts as of the Effective
Date.
/s/ Xxxx X. Xxxxxxx, Xx.
---------------------------------
XXXX X. XXXXXXX , XX.
PRIDE INTERNATIONAL, INC.
CORPORATE SEAL
BY: /s/ Xxx X. Xxxxxx
-----------------------------
XXX X. XXXXXX
CEO and Chairman of the Board
17
