EMPLOYMENT AGREEMENT OF BRADLEY PARRO
EXHIBIT
10.13
EMPLOYMENT AGREEMENT OF
▇▇▇▇▇▇▇ ▇▇▇▇▇
This Employment Agreement (the
“Agreement”) is made and entered into as of May 1, 2008 by and between Deep
Down, Inc., a Nevada company (the “Company”), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
(“Executive”).
RECITALS
The Company is an umbilical and
flexible pipe installation engineering and installation management company that
also fabricates component parts for subsea distribution systems and assemblies
that specialize in the development of offshore subsea fields and tie backs.
These items include umbilicals, flow lines, distribution systems, pipeline
terminations, controls, winches, and launch and retrieval systems, among
others. The Company provides these services from the initial field
conception phase thru manufacturing, site integration testing, installation,
topsides connections, and the final commissioning of a project. Its products and
services serve the offshore industry and are used in deep-water exploration and
production of oil and gas (the “Business”) to customers throughout the world
(the “Territory”). The Company desires to employ Executive in the capacity of
Vice President of the Company, and the Executive desires to accept such
employment, on the terms and subject to the conditions set forth in this
Agreement.
In consideration of the mutual promises
set forth in this Agreement the parties hereto agree as follows:
ARTICLE
I
Term of
Employment
1.01 Subject
to the provisions of Article V, and upon the terms and subject to the conditions
set forth in this Agreement, the Company will employ Executive for the period
beginning on the date first written above (the “Commencement Date”) and ending
on May 1, 2011 (the “Initial Term”). The Initial Term shall be automatically
renewed for up to two successive consecutive one (1) year periods (each, a
“Renewal Term” and the Initial Term and Renewal Term are collectively referred
to as the “term of employment”) thereafter unless either party sends notice to
the other party, not more than 270 days and not less than 90 days before the end
of the then-existing term of employment, of such party’s desire to terminate the
Agreement at the end of the then-existing term, in which case this Agreement
will terminate at the end of the then-existing term. The parties understand and
acknowledge that if Executive remains employed by the Company after the end of
the last Renewal Term, then such employment shall be “at-will” unless this
Agreement is extended, or different terms are established, by the parties in
writing.
ARTICLE
II
Duties
2.01(a) During the term of employment,
Executive will:
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(i)
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Promote
the interests, within the scope of his duties, of the Company and devote
his full working time and efforts to the Company’s business and
affairs;
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(ii)
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Serve
as Vice President, Operations of Company, reporting directly to the Chief
Acquisition Officer of the Company;
and
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(iii)
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Perform
the duties and services consistent with the title and function of such
office, including without limitation, those, if any, set forth in the
Operating Agreement of the Company or as specifically set forth from time
to time by the Company’s Board of Directors (the
“Board”).
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(b)
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Notwithstanding
anything contained in clause 2.01(a)(i) above to the contrary, nothing
contained herein or under law shall be construed as preventing Executive
from
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(i)
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investing
Executive’s personal assets in such form or manner as will not require any
services on the part of Executive in the operation or the affairs of the
companies in which such investments are made and in which his
participation is solely that of a passive investor (provided that he,
collectively with his family and affiliated interests (or persons
constituting a “group” under the federal securities laws) will not exceed
5% of any company’s voting securities);
and
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(ii)
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engaging
(not during normal business hours) in any other professional, civic, or
philanthropic activities, provided that Executive’s investments or
engagement does not result in a violation of his covenants under this
Section or Article VI hereof and are otherwise disclosed to and approved
by the Board in its sole
discretion.
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ARTICLE
III
Base
Compensation
3.01 The
Company will compensate Executive for the duties performed by him hereunder by
payment of a base salary at the rate of Six Thousand Nine Hundred and Twenty
Three Dollars and Eight Cents ($6,923.08) every two weeks (the “Base”), subject
to customary withholding for federal, state, and local taxes and other normal
and customary withholding items. The Base will be increased at the
discretion of the Board.
3.02 Bonus. In addition to
the Base, the Executive will participate in any bonus plan that is adopted by
the Company and available to all employees as a whole.
3.03 Stock
Options. Upon execution of the Agreement, Executive will
receive options to purchase 300,000 shares of DPDW on terms consistent with past
practice. In addition, Executive will be eligible to receive
additional shares or options to purchase shares at the discretion of the Board
of the Company.
ARTICLE
IV
Reimbursement and Employment
Benefits
4.01 Health and Other
Medical. Executive shall be eligible to participate in all health,
medical, dental, and life insurance employee benefits as are available from time
to time to other key executive employees (and their families) of the Company,
including a Life Insurance Plan, Medical and Dental Insurance Plan, and a Long
Term Disability Plan (the “Plans”). The Company shall pay 100 % of all premiums
for the Executive with respect to such Plans.
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4.02 Vacation. Executive
shall be entitled to three (3) weeks of vacation per year or as otherwise
dictated by Company policy, to be taken in such amounts and at such times as
shall be mutually convenient for Executive and the Company. Any time not taken
by Executive in one year shall be forfeited and not carried forward to
subsequent years. Executive shall not be entitled to be reimbursement for any
unused vacation or personal time, except as may be required under
law.
4.03 Reimbursable
Expenses. The Company shall in accordance with its standard policies in
effect from time to time reimburse Executive for all reasonable out-of-pocket
expenses actually incurred by him in the conduct of the business of the Company
provided that Executive submits all substantiation of such expenses to the
Company on a timely basis in accordance with such standard policies and further
provided that Executive receives prior approval for all individual expenditures
in excess of $1,000. The Executive shall receive a monthly car
allowance of $1,000.
4.04 Savings Plan.
Executive will be eligible to enroll and participate, and be immediately vested
in, all Company savings and retirement plans, including any 401(k) plans, as are
available from time to time to other key executive employees.
ARTICLE
V
Termination
5.01 General Provisions.
Except as otherwise provided in this Article V, at such time as Executive’s
employment is terminated by the Executive or the Company, any and all of the
Company’s obligations under this Agreement shall terminate, other than the
Company’s obligation to pay Executive, within thirty (30) days of Executive’s
termination of employment, the full amount of any unpaid Base and accrued but
unpaid benefits, including any vacation pay, earned by Executive pursuant to
this Agreement through and including the date of termination and to observe the
terms and conditions of any plan or benefit arrangement which, by its terms,
survives such termination of Executive’s employment. The payments to be made
under this Section 5.01 shall be made to Executive, or in the event of
Executive’s death, to such beneficiary as Executive may designate in writing to
the Company for that purpose, or if Executive has not so designated, then to the
spouse of Executive, or if none is surviving, then to the personal
representative of the estate of Executive. Notwithstanding the foregoing,
termination of employment shall not affect the obligations of Executive under
Article VI hereof that, pursuant to the express provisions of this Agreement,
continue in full force and effect. Upon termination of employment with the
Company for any reason, Executive shall promptly deliver to the Company all
Company property including without limitation all writings, records, data,
memoranda, contracts, orders, sales literature, price lists, client lists, data
processing materials, and other documents, whether or not obtained from the
Company or any Affiliate, which pertain to or were used by Executive in
connection with his employment by the Company or which pertain to any Affiliate,
including, but not limited to, Confidential Information, as well as any
automobiles, computers or other furniture, fixtures or equipment which were
purchased by the Company for Executive or otherwise in Executive’s possession or
control.
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5.02 Consequences
of Termination. Upon any termination of Executive’s employment with the Company,
except for a termination by the Company for Cause (as defined herein) or the
Executive’s resignation for any reason other than Constructive Termination, the
Executive shall be entitled to (a) a payment equal to the lesser of (i) three
(3) months’ Base salary or (ii) two weeks’ Base Salary for every year served
(the “Severance”) and (b) retain the benefits set forth in Article IV for the
lesser of (x) three (3) months or (y) the length of the remaining term
hereof. The Severance shall be paid, at Company’s option, either (x)
in a lump sum upon termination with such payments discounted by the U.S.
Treasury rate most closely comparable to the applicable time period left in the
Agreement or (y) as and when normal payroll payments are made. Executive
expressly acknowledges and agrees that the payment of Severance to Executive
hereunder shall be liquidated damages for and in full satisfaction of any and
all claims Executive may have relating to or arising out of Executive’s
employment or termination of Executive’s employment by the Company or relating
to or arising out of this Agreement and the termination thereof, including,
without limitation, those causes of action arising under the Age Discrimination
in Employment Act of 1967, as amended, 29 U.S.C. §621 et seq., Title VII of the
Civil Rights Act of 1964, as amended, 42 U.S.C. §2000e et seq., the Americans
with Disabilities Act of 1990, as amended, 42 U.S.C. §12101 et seq., the Fair
Labor Standards Act of 1938, as amended, 29 U.S.C. §201 et seq., the Civil
Rights Act of April 9, 1866.1 42 U.S.C. §1981 et seq., the National Labor
Management Relations Act, 29 U.S.C. §141 et seq., the Occupational Safety and
Health Act, 29 U.S.C. §651 et seq., and the Family Medical Leave Act of 1993, 29
U.S.C. §2601 et seq. Notwithstanding the foregoing, Executive’s right to receive
Severance Pay is contingent upon Executive not violating any of his on-going
obligations under this Agreement.
5.03 Automatic
Termination. This Agreement shall be automatically terminated upon the
first to occur of the following (a) the expiration of this Agreement in
accordance with Section 1.01 hereof, (b) the Company’s termination pursuant to
section 5.04, (c) the Executive’s termination pursuant to section 5.05 or (d)
the Executive’s death.
5.04 By the Company. This
Agreement may be terminated by the Company upon written notice to the Executive
upon the first to occur of the following:
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(a)
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Disability.
Upon the Executive’s Disability (as defined herein). The term “Disability”
shall mean, in the sole determination of the Company’s Board, whose
determination shall be final and binding, the reasonable likelihood that
the Executive will be unable to perform his duties and responsibilities to
the Company by reason of a physical or mental disability or infirmity for
either: (i) a continuous period of four months; or (ii) 180 days during
any consecutive twelve (12) month
period.
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(b)
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Cause. Upon the
Executive’s commission of Cause (as defined herein). The term “Cause”
shall mean the following:
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(i)
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Any
violation by Executive of any material provision of this Agreement
(including without limitation any violation of any provision of Sections
6.01, 6.02 or 6.03 hereof, any and all of which are material in all
respects), upon notice of same by the Company describing in detail the
breach asserted and stating that it constitutes notice pursuant to this
Section 5.04(b)(i), which breach, if capable of being cured, has not been
cured to the Company’s sole and absolute satisfaction within 30 days after
such notice (except for breaches of any provisions of sections 6.01, 6.02
or 6.03 which are not subject to cure or any
notice);
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(ii) Embezzlement
by Executive of funds or property of the Company;
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(iii)
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Habitual
absenteeism, bad faith, fraud, refusal to perform his duties, gross
negligence or willful misconduct on the part of Executive in the
performance of his duties as an employee of the Company, provided that the
Company has given written notice of and an opportunity of not less than 30
days to cure such breach, which notice describes in detail the breach
asserted and stating that it constitutes notice pursuant to this Section
5.05(b)(iii), provided that no such notice or opportunity needs to be
given if (x) in the judgment of the Company’s Board of Directors, such
conduct is habitual or would unnecessarily or unreasonably expose the
Company to undue risk or harm or (y) one previous notice had already been
given under this section or under section (i) above;
or
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(iv)
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a
felonious act, conviction, or plea of nolo contendere of Executive under
the laws of the United States or any state (except for any conviction or
plea based on a vicarious liability theory and not the actual conduct of
the Executive).
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5.05 By the Executive.
This Agreement may be terminated by the Executive upon written notice to the
Company upon the first to occur of the following:
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(a)
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Constructive
Termination. Upon the occurrence of a “Constructive Termination”
(as defined herein) by the Company. The term “Constructive Termination”
shall mean any of the following: any breach by the Company of any material
provision of this Agreement, including, without limitation, the assignment
to the Executive of duties inconsistent with his position specified in
Section 2.01 hereof or any breach by the Company of such Section, which is
not cured within 60 days after written notice of same by Executive,
describing in detail the breach asserted and stating that it constitutes
notice pursuant to this Section
5.05.
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(b)
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Voluntary
Termination. Executive’s resignation for reasons other than as
specified in Section 5.05(a).
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5.06 Representations.
Executive represents, warrants, and covenants to Company that
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(a)
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there
is no other agreement or relationship which is binding on him which
prevents him from entering into or fully performing under the terms hereof
and
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(b)
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the
Company may contact any past, present, or future entity with whom he has a
business relationship and inform such entity of the existence of this
Agreement and the terms and conditions set forth
herein.
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ARTICLE
VI
Covenants
6.01 Competition/Solicitation.
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(a)
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During
the period in which Executive performs services for the Company and,
except for termination of Executive’s employment pursuant to section 5.04
(a), Executive hereby covenants and agrees that he shall not, directly or
indirectly, except in connection with his duties hereunder or otherwise
for the sole account and benefit of the Company, whether as a sole
proprietor, partner, member, shareholder, employee, director, officer,
guarantor, consultant, independent contractor, or in any other capacity as
principal or agent, or through any person, subsidiary, affiliate, or
employee acting as nominee or agent, except with the consent of the
Company:
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(i)
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Conduct
or engage in, or be interested in or associated with, any person or entity
in Texas, St. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, Assumption, Plaquemines, LaFourche, St.
▇▇▇▇▇▇▇ parishes Louisiana, Florida, the Gulf of Mexico or any
market in which the Company does business (plus any such additional
geographical markets to which the Company may have expanded during the
course of Executive’s employment) other than the Company and its
affiliates which conducts or engages in the Business (plus any such
additional product or service markets to which the Company may have
expanded during the course of Executive ‘s
employment);
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(ii)
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Solicit,
attempt to solicit, or accept business from, or cause to be solicited or
have business accepted from, any then-current customers of Company, any
persons or entities who were customers of the Company within the 180 days
preceding the Termination Date, or any prospective customers of the
Company for whom bids were being prepared or had been submitted as of the
Termination Date; or
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(iii)
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Induce,
or attempt to induce, hire or attempt to hire, or cause to be induced or
hired, any employee of the Company, or persons who were employees of the
Company within the 180 days preceding the Termination Date, to leave or
terminate his or her employment with the Company, or hire or engage as an
independent contractor any such employee of the
Company.
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(b)
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Notwithstanding
the foregoing, Executive shall not be prevented from (i) investing in or
owning up to two percent (2%) of the outstanding stock of any corporation
engaged in any business provided that such shares are regularly traded on
a national securities exchange or in any over-the-counter market or (ii)
retaining any shares of stock in any corporation which Executive owned
before the date of his employment with the
Company.
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6.02 Confidential
Information. Executive acknowledges that in his employment he is or will
be making use of, acquiring, or adding to the Company’s confidential information
which includes, but is not limited to, memoranda and other materials or records
of a proprietary nature; technical information regarding the operations of the
Company; and records and policy matters relating to finance, personnel, market
research, strategic planning, current and potential customers, lease
arrangements, service contracts, management, and operations. Therefore, to
protect the Company’s confidential information and to protect other employees
who depend on the Company for regular employment, Executive agrees that he will
not in any way use any of said confidential information except in connection
with his employment by the Company, and except in connection with the business
of the Company he will not copy, reproduce, or take with him the original or any
copies of said confidential information and will not directly or indirectly
divulge any of said confidential information to anyone without the prior written
consent of the Company.
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6.03 Inventions. All
discoveries, designs, improvements, ideas, and inventions, whether patentable or
not, relating to (or suggested by or resulting from) products, services, or
other technology of the Company or any Affiliate or relating to (or suggested by
or resulting from) methods or processes used or usable in connection with the
business of the Company or any Affiliate that may be conceived, developed, or
made by Executive during employment with the Company (hereinafter “Inventions”),
either solely or jointly with others, shall automatically become the sole
property of the Company or an Affiliate. Executive shall immediately disclose to
the Company all such Inventions and shall, without additional compensation,
execute all assignments and other documents deemed necessary to perfect the
property rights of the Company or any Affiliate therein. These obligations shall
continue beyond the termination of Executive’s employment with respect to
Inventions conceived, developed, or made by Executive during employment with the
Company. The provisions of this Section 6 shall not apply to any Invention for
which no equipment, supplies, facility, or trade secret information of the
Company or any Affiliate is used by Executive and which is developed entirely on
Executive’s own time, unless
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(a)
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such
Invention relates (i) to the business of the Company or an Affiliate or
(ii) to the actual or demonstrably anticipated research or development of
the Company or an Affiliate, or
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(b)
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such
Invention results from work performed by Executive for the
Company.
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6.04 Non-Disparagement.
For a period commencing on the date hereof and continuing indefinitely,
Executive hereby covenants and agrees that he shall not, directly or indirectly,
defame, disparage, create false impressions, or otherwise put in a false or bad
light the Company, its products or services, its business, reputation, conduct,
practices, past or present employees, financial condition or
otherwise.
6.05 Blue Penciling. If at
the time of enforcement of any provision of this Agreement, a court shall hold
that the duration, scope, or area restriction of any provision hereof is
unreasonable under circumstances now or then existing, the parties hereto agree
that the maximum duration, scope or area reasonable under the circumstances
shall be substituted by the court for the stated duration, scope, or
area.
6.06 Remedies. Executive
acknowledges that any breach by him of the provisions of this Article VI of this
Agreement shall cause irreparable harm to the Company and that a remedy at law
for any breach or attempted breach of Article VI of this Agreement will be
inadequate, and agrees that, notwithstanding section 9.01 hereof, the Company
shall be entitled to exercise all remedies available to it, including specific
performance and injunctive and other equitable relief, without the necessity of
posting any bond, in the case of any such breach or attempted
breach.
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ARTICLE
VII
Assignment
7.01 This
Agreement shall be binding upon and inure to the benefit of the successors and
assigns of the Company and shall relieve the Company of its obligations
hereunder if the assignment is pursuant to a Change in Control. Neither this
Agreement nor any rights hereunder shall be assignable by Executive and any such
purported assignment by him shall be void.
ARTICLE
VIII
Entire
Agreement
This Agreement constitutes the entire
understanding between the Company and Executive concerning his employment by the
Company or subsidiaries and supersedes any and all previous agreements between
Executive and the Company or any of its affiliates or subsidiaries concerning
such employment, and/or any compensation, bonuses or incentives. Each party
hereto shall pay its own costs and expenses (including legal fees) except as
otherwise expressly provided herein incurred in connection with the preparation,
negotiation, and execution of this Agreement. This Agreement may not be changed
orally, but only in a written instrument signed by both parties
hereto.
ARTICLE
IX
Applicable Law;
Miscellaneous
9.01 Governing Law. This
Agreement shall be governed by and construed in accordance with the laws of the
State of Texas. All actions brought to interpret or enforce this Agreement shall
be brought in federal or state courts located in ▇▇▇▇▇▇ County, Texas.
Notwithstanding the foregoing, at the sole option of the Company, all
controversies under this Agreement may be subject to resolution by arbitration.
Without limiting the generality of the foregoing, the following shall be
considered controversies for this purpose:
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(i)
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all
questions relating to the interpretation or breach of this
Agreement;
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(ii)
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all
questions relating to any representations, negotiations, and other
proceedings leading to the execution of this Agreement;
and
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(iii)
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all
questions as to whether the right to arbitrate any such question exists.
Any party may, without inconsistency with this Agreement, seek from a
court any interim or provisional relief that may be necessary to protect
the rights or property of that party, pending the establishment of the
arbitral tribunal (or pending the tribunal’s determination of the merits
of the controversy). The tribunal shall have authority to make the final
determination of the rights of the parties, including authority to make
permanent, modify, or dissolve any judicial order granting such
provisional relief. The Company, if it desires arbitration, shall so
notify the other parties, identifying in reasonable detail the matters to
be arbitrated and the relief sought. Arbitration shall be before a
three-person tribunal of neutral arbitrators, consisting of attorneys with
at least ten (10) years’ experience in commercial law. The American
Arbitration Association (“AAA”) shall submit a list of persons meeting the
criteria outlined above, and the parties shall mutually agree upon the
three arbitrators. If the parties fail to select arbitrators as required
above within twenty (20) days after delivery of notice from the party
desiring arbitration, the AAA shall appoint the arbitrator or arbitrators
that have not been selected by the parties. The arbitrators shall be
entitled to a fee commensurate with their fees for professional services
requiring similar time and effort. All matters arbitrated hereunder shall
be arbitrated in Houston, Texas, and shall be governed by Texas law,
exclusive of its conflicts-of-laws rules. The arbitrators shall conduct a
hearing no later than sixty (60) days after designation of the tribunal,
and a decision shall be rendered by the arbitrators within thirty (30)
days after the hearing. At the hearing, the parties shall present such
evidence and witnesses as they may choose, with or without counsel.
Adherence to formal rules of evidence shall not be required but the
arbitration panel shall consider any evidence and testimony that it
determines to be relevant, in accordance with procedures that it
determines to be appropriate. Any award entered shall be made by a written
opinion stating the reasons for the award made. The arbitrators may award
legal or equitable relief, including but not limited to specific
performance. The arbitrators are not empowered to award damages in excess
of compensatory damages, and each party irrevocably waives any right to
recover such damages with respect to any dispute resolved by arbitration.
This submission and agreement to arbitrate shall be specifically
enforceable. Arbitration may proceed in the absence of any party if notice
of the proceedings has been given to such party. The parties agree to
abide by all awards rendered in such proceedings. Such awards shall be
final and binding on all parties. Each party shall continue to perform its
obligations under this Agreement pending conclusion of the arbitration. No
party shall be considered in default hereunder during the pendency of
arbitration proceedings relating to such default. The arbitrators’ fees
and other costs of the arbitration shall be borne by the party against
which the award is rendered, except as the arbitration panel may otherwise
provide in its written opinion.
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9.02 Attorneys’ Fees. In
addition to all other rights and benefits under this Agreement, each party
agrees to reimburse the other for, and indemnify and hold harmless such party
against, all costs and expenses (including attorney’s fees) incurred by such
party (whether or not during the term of this Agreement or otherwise), if and to
the extent that such party prevails on or is otherwise successful on the merits
with respect to any action, claim or dispute relating in any manner to this
Agreement or to any termination of this Agreement or in seeking to obtain or
enforce any right or benefit provided by or claimed under this Agreement, taking
into account the relative fault of each of the parties and any other relevant
considerations.
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9.03 Indemnification of
Executive. The Company shall indemnify and hold harmless Executive to the
full extent authorized or permitted by law with respect to any claim, liability,
action, or proceeding instituted or threatened against or incurred by Executive
or his legal representatives and arising in connection with Executive’s conduct
or position at any time as a director, officer, employee, or agent of the
Company or any subsidiary thereof. The Company shall not change, modify, alter,
or in any way limit the existing indemnification and reimbursement provisions
relating to and for the benefit of its directors and officers without the prior
written consent of the Executive, including any modification or limitation of
any directors and officers liability insurance policy.
9.04 Waiver. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a continuing waiver or a waiver of any similar
or dissimilar provisions or conditions at the same or at any prior or subsequent
time. No agreements or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by either party hereto
which are not set forth expressly in this Agreement.
9.05 Unenforceability. The
invalidity or unenforceability of any provision or provisions of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.
9.06 Counterparts. This
Agreement may be executed in several counterparts, each of which shall be deemed
to be an original and all of which together shall constitute one and the same
instrument.
9.07 Section Headings. The
section headings contained in this Agreement are inserted for reference purposes
only and shall not affect the meaning or interpretation of this
Agreement.
IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first written
above.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇,
▇▇.
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇▇, ▇▇.
Chairman
of the Board of Directors
By: /s/ ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇
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