EXHIBIT 10.28
--------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT
Between
GRANT GEOPHYSICAL, INC.
And
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
dated as of August 1, 2001
--------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
as of August 1, 2001, by and between Grant Geophysical, Inc., a Delaware
corporation (the "Company"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Executive").
WITNESSETH:
WHEREAS, the Executive is serving as President and Chief Executive
Officer of the Company; and
WHEREAS, on the terms and conditions and for the consideration
hereinafter set forth, the Company and Executive desire to reflect the terms of
the Executive's employment.
NOW, THEREFORE, for and in consideration of the mutual promises,
covenants and obligations contained herein, the Company and Executive agree as
follows:
ARTICLE 1
EMPLOYMENT AND DUTIES
Section 1.1 Employment. Subject to the terms and conditions of this
Agreement, the Company hereby employs the Executive, and Executive hereby agrees
to be so employed by the Company, for the term set forth in Article 3. The
Company shall employ the Executive in the position of President and Chief
Executive Officer, or in such other position or positions as the parties
mutually may agree, and Executive shall perform such duties, consistent with the
Executive's job title or titles, as may be prescribed from time to time by the
Board of Directors of the Company (the "Board").
Section 1.2 Duties and Powers. Executive agrees to serve in the
position referred to in Section 1.1 and to perform diligently and to the best of
his abilities the duties and services of such office or offices. For so long as
Executive is employed by the Company, Executive agrees to devote his full and
exclusive business time and attention to the business of the Company and its
subsidiaries or affiliates (excluding reasonable vacations and sick leave in
accordance with the Company's policies consistent with his position), to perform
all duties in a professional and prudent manner, and to devote the best of his
skill, energy, experience and judgment to such duties. Executive shall have the
powers associated with his position, subject to all policies and guidelines as
may be established by the Board. Executive agrees to devote his full business
time to the performance of services hereunder and not to engage in any other
activity or own any interest that would conflict with the interests of the
Company or would interfere with his responsibilities to the Company and the
performance of his duties hereunder; provided, however, that this Agreement
shall not prohibit the Executive from: (a) serving as a member of the board of
directors, board of trustees or the like of any for profit or non-profit entity,
or performing services of any type for any civic or community entity, whether or
not the Executive receives compensation therefor; (b) investing his assets in
such form or manner as will require no more than nominal services on the part of
the Executive in the operation
1
of the business of the entity in which such investment is made; or (c) serving
in various capacities with, and attending meetings of, industry, trade or
governmental groups and associations, including without limitation the industry,
trade or governmental groups and associations with which the Executive is
currently involved, as long as the Executive's engaging in activities permitted
by virtue of clauses (a), (b) and (c) above does not interfere with the ability
of the Executive to perform the services and discharge the responsibilities
required of him under this Agreement or conflict with any of the provisions
hereof.
ARTICLE 2
COMPENSATION AND BENEFITS
Section 2.1 Salary. In consideration of the full and faithful
performance by Executive of his obligations hereunder, subject to the terms and
conditions set forth herein, the Company (or, at the Company's option, any
subsidiary or affiliate of the Company for which the Executive also provides
services hereunder) shall pay to the Executive an annual base salary of $250,000
per year. Executive's annual base salary shall be paid in equal installments in
accordance with the Company's standard policy regarding payment of compensation
to executives (but no less frequently than monthly) and will be prorated based
upon the number of days elapsed in any partial year. The Executive's salary
shall be reviewed annually by the Board and may be increased at the sole
discretion of the Board.
Section 2.2 Bonus. During the Term, Executive shall be eligible to earn
an annual bonus, the exact amount of which shall be determined by the Board
based on the Executive's and the Company's achievement of performance objectives
that are established by the Board for each year. It is expressly agreed by the
parties that with respect to year 2001, the Executive's annual bonus shall be
25% of annual salary determined 50% by accomplishment of agreed goals and
objectives and 50% by achieving financial target, (budget EBITDA). Bonus will
increase by 1% of annual salary for each 1% increase in EBITDA.
Section 2.3 Initial Stock Grant and Stock Options. The Company shall
grant to Executive, an option to purchase 500,000 shares of the Company's common
stock, $.001 par value per share, pursuant to the Stock Option Agreement in the
form attached hereto as Exhibit "A."
Section 2.4 Vacations. Executive shall be excused from rendering his
services during reasonable vacation periods for not more than 20 business days
per year. Executive shall also be entitled to all paid holidays given by the
Company to its employees generally.
Section 2.5. Other Prerequisites. During his employment hereunder,
Executive shall be afforded the following benefits as incidences of his
employment:
(a) Subject to compliance with the Company's standard policies
and procedures with respect to expense reimbursement, the Company shall
reimburse Executive for, or pay on behalf of Executive, reasonable and
appropriate expenses incurred by Executive in connection with the
performance of his duties hereunder.
2
(b) Executive and, to the extent applicable, Executive's
spouse, dependents and beneficiaries, shall be allowed to participate
in all benefits, plans and programs, including improvements or
modifications, which are now, or may hereafter be, generally available
to other executive employees of the Company.
(c) The Company shall reimburse Executive for the monthly dues
of his country club membership and costs incurred in connection with
country club business entertainment.
ARTICLE 3
TERM AND TERMINATION OF EMPLOYMENT
Section 3.1 Term. Unless extended or sooner terminated pursuant to
other provisions hereof, the Company agrees to employ Executive until July 31,
2004 (such period determined in accordance with this Section 3.1, the "Term");
provided, however, that on August 1 of each year, commencing August 1, 2003,
this Agreement shall be automatically renewed for successive one-year periods
unless either party provides the other with written notice of non-renewal prior
to June 30 of that year.
Section 3.2 The Company's Right to Terminate. Notwithstanding the
provisions of Section 3.1, the Company shall have the right to terminate
Executive's employment during the Term at any time for any of the following
reasons:
(a) upon Executive's death;
(b) upon Executive's becoming incapacitated by accident,
sickness or other circumstance which renders him mentally or physically
incapable of performing, in the good faith determination of the Board,
the duties and services required of him hereunder on a full-time basis
for a period of at least 60 consecutive days or for a period of 90 days
in any 12 month period;
(c) for "Cause," which for purposes of this Agreement shall
mean (i) the commission of a felony or any other act or omission
involving dishonesty, disloyalty, or fraud with respect to the Company
or any of its customers or suppliers, (ii) conduct tending to bring the
Company into substantial public disgrace or disrepute, (iii)
substantial and repeated failure to perform duties as reasonably
requested by the Board or its designees, (iv) gross negligence or
willful misconduct in connection with the performance of Executive's
duties as an employee or (v) a material breach (which shall include,
without limitation, all breaches of Article 4 hereof by Executive) or
repeated violation of this Agreement; provided that in the case of a
violation of his duties as described in Article 1, the violation, if
correctable, remains uncorrected for 30 days following written notice
to Executive by the Company of such breach or violation.
(d) without Cause, in which event the Company's obligation to
Executive under this Agreement shall be limited solely to the payment,
at the time and upon the terms
3
provided for herein, of 100% of Executive's then current base annual
salary payable pursuant to Section 2.1, (ii) any bonus payable under
Section 2.2 and (iii) the perquisites specified in Section 2.5, in each
case, for 12 months. Any amounts due to Executive pursuant to this
Section 3.2(d) shall be due and payable as and when they would have
become due and payable had Executive not been so terminated.
Section 3.3 Executive's Right to Terminate. Executive shall have the
right to terminate this Agreement by written notice to the Company within 60
days following the occurrence of a Change in Control (as defined in the
Company's 1997 Equity and Performance Incentive Plan) that results in a
diminution in Executive's duties, responsibilities or position in the management
of the Company. If Executive has made an election to terminate this Agreement
under this Section 3.3 and has given the required notice, then Executive shall
be entitled to receive from the Company (a) the payment of an amount equal to
Executive's then current base annual salary payable pursuant to Section 2.1, (b)
an amount equal to the average of the bonuses, if any, paid pursuant to Section
2.2 to the Executive for each year in the three year period (or such shorter
period) preceding the year in which the Change of Control occurs, and (c) the
perquisites specified in Section 2.5, in each case, for 24 months from the date
of written termination.. Any amounts due to Executive pursuant to this Section
3.3 shall be due and payable as and when they would have become due and payable
had Executive not been so terminated.
Section 3.4 Notice of Termination. If the Company desires to terminate
Executive's employment hereunder at any time prior to expiration of the Term, it
shall do so by giving written notice to Executive that it has elected to
terminate Executive's employment hereunder and stating the effective date of
such termination and the reason for such termination, provided that, except as
provided herein, no such action shall alter or amend any other provisions hereof
or rights arising hereunder, including, without limitation, the provisions of
Article 4. Any notice of termination from the Company to Executive shall
indicate the specific termination provision of this Agreement relied upon and
set forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of Executive's employment under the provision so
indicated. Except as provided in Sections 3.2(d) (if applicable), upon any such
termination, the Company shall cease paying Executive the compensation and
benefits set forth in Article 2 and have no further obligation to Executive.
Section 3.5 Termination prior to Merger or Change in Control If the
Company's notice of termination is given as set forth in Section 3.4 within six
months, either prior to, or after a change in control (as defined in the
Company's 1997 Equity and Performance Incentive Plan) then Executive shall be
entitled to all the same benefits as described in Section 3.3 as if he had
exercised his right to terminate.
4
ARTICLE 4
PROTECTION OF INFORMATION
Section 4.1 Disclosure to Executive. The Company shall disclose to
Executive, or place Executive in a position to have access to or develop, trade
secrets or confidential information of the Company and/or its affiliates; and/or
shall entrust Executive with business opportunities of the Company and/or its
affiliates; and/or shall place Executive in a position to develop business good
will on behalf of the Company and/or its affiliates.
Section 4.2 Disclosure to and Property of the Company. Executive agrees
not to disclose or utilize, for Executive's personal benefit or for the direct
or indirect benefit of any other person or entity, or for any other reason,
whether for consideration or otherwise, during the term of his employment or at
any time thereafter, any information, ideas, concepts, improvements, discoveries
or inventions, whether patentable or not, which are conceived, made, developed,
or acquired by Executive, individually or in conjunction with others, during
Executive's employment by the Company (whether during business hours or
otherwise and whether on the Company's premises or otherwise) which relate to
the business, products, or services of the Company (including, without
limitation, all such business ideas, prospects, proposals or other opportunities
which are developed by Executive during his employment, or originated by any
third party and brought to the attention of Executive during his employment,
together with information relating thereto (including, without limitation, data,
memoranda, opinions or other written, electronic or charted means, or any other
trade secrets or other confidential or proprietary information of or concerning
the Company)) (collectively, "Business Information"). Moreover, all documents,
drawings, notes, files, data, records, correspondence, manuals, models,
specifications, computer programs, E-mail, voice mail, electronic databases,
maps, and all other writings or materials of any type embodying any such
Business Information are and shall be the sole and exclusive property of the
Company. Upon termination of Executive's employment by the Company, for any
reason, Executive promptly shall deliver all Business Information, and all
copies thereof, to the Company.
Section 4.3 No Unauthorized Use or Disclosure. Executive will not, at
any time during or after Executive' s employment by the Company, make any
unauthorized disclosure of Business Information of the Company or its
affiliates, or make any use thereof, except in the carrying out of Executive's
employment responsibilities hereunder. Affiliates of the Company shall be third
party beneficiaries of Executive's obligations under this Article 4. As a result
of knowledge of confidential Business Information of third parties, such as
customers, suppliers, partners, joint ventures, and the like, of the Company and
its affiliates, Executive also agrees to preserve and protect the
confidentiality of such third party Business Information to the same extent, and
on the same basis, as the Company's Business Information.
Section 4.4 Ownership by the Company. If during Executive's employment
by the Company, Executive creates any work of authorship fixed in any tangible
medium of expression which is the subject matter of copyright (such as written
presentations, computer programs, E-mail, voice mail, electronic databases,
drawings, maps, models, manuals, brochures, or the like) relating to the
Company's business, whether such work is created solely by Executive or jointly
with others (whether during business hours or otherwise and whether on the
Company's premises or otherwise),
5
the Company shall be deemed the author of such work if the work is prepared by
Executive in the scope of Executive's employment; or, if the work is not
prepared by Executive within the scope of Executive's employment but is
specially ordered by the Company as a contribution to a collective or compiled
work then the work shall be considered to be work made for hire and the Company
shall be author of the work. If such work is neither prepared by Executive
within the scope of Executive's employment nor a work specially ordered that is
deemed to be a work made for hire, then Executive hereby agrees to assign, and
by these presents does assign, to the Company all of Executive's worldwide
right, title, and interest in and to such work and all rights of copyright
therein free and clear of any liens, security interests or any other adverse
claims.
Section 4.5 Assistance by Executive. Both during the period of
Executive's employment by the Company and thereafter, Executive shall assist the
Company and its nominee, at any time, in the protection of the Company's
worldwide right, title, and interests in and to information, ideas, concepts,
improvements, discoveries, and inventions, and copyrighted works including
without limitation, the execution of all formal assignment documents requested
by the Company or its nominee and the execution of all lawful oaths and
applications for patents and registration of copyright in the United States or
foreign countries.
Section 4.7 No Conflicts, Disclose. In keeping with Executive's duties
to the Company during the period of Executive' s employment by the Company,
Executive shall not, acting alone or in conjunction with others, directly or
indirectly, become involved in any conflict of interest, or upon discovery
thereof, allow such a conflict to continue. Executive shall promptly disclose to
the Company any facts that might involve any reasonable possibility of a
conflict of interest. It is agreed that any direct or indirect interest in,
connection with, or benefit from any outside activities, particularly commercial
activities, which interest might in any way adversely affect the Company
involves a possible conflict of interest. Circumstances in which a conflict of
interest on the part of Executive would or might arise, and which should be
reported immediately by Executive to the Company include, but are not limited
to, the following: (a) acceptance, directly or indirectly, of payments, services
or loans from a supplier, contractor, subcontractor, customer or other entity
with which the Company does business, including, but not limited to, gifts,
trips, entertainment or other favors of more than nominal value; (b) misuse of
information or facilities of the Company to which Executive has access in a
manner which is detrimental to the interests of the Company such as utilization
for Executive's own benefit of know-how or information developed through the
business or research activities of the Company; and (c) the appropriation to
Executive or the diversion to others, directly or indirectly, of any business
opportunity with respect to which it is known or could reasonably be anticipated
that the Company would be interested such as the opportunity for the creation of
a joint venture or other business relationship, or the marketing of products,
services or the like. Executive shall make full disclosure to the Company of any
and all business opportunities pertaining to the Company's business.
Section 4.8 Statements Concerning the Company. Executive shall refrain,
both during his employment relationship with the Company and after such
employment relationship terminates, from publishing any oral or written
statements about the Company, any of its affiliates, or any of such entities'
officers, executives, agents or representatives that are slanderous, libelous,
or defamatory; or that disclose private or confidential information about the
Company, any of its
6
affiliates, or any of such entities' business affairs, officers, executives,
agents, or representatives; or that constitute an intrusion into the seclusion
or private lives of the Company, any of its affiliates, or any of such entities'
officers, executives, agents or representatives or that give rise to
unreasonable publicity about the private lives of the Company, any of its
affiliates, or any of such entities' officers, executives, agents, or
representatives; or that place the Company, any of its affiliates, or any of
such entities' officers, executives, agents, or representatives in a false light
before the public; or that constitute a misappropriation of the name or likeness
of the Company, any of its affiliates, or any of such entities' officers,
employees, agents, or representatives.
Section 4.9 Covenants. In consideration of the acknowledgements and
agreements by Executive in Section 4.11 hereof, and in consideration of the
compensation and benefits to be paid or provided to Executive by the Company,
Executive covenants that he will not, directly or indirectly:
(a) at any time during Executive's employment hereunder and
for a period beginning on the date of termination of Executive's
employment with the Company and ending on the first anniversary of the
Executive's termination of employment, Executive shall not engage or
invest in, manage, operate, finance, control, or participate in the
ownership, management, operation, financing, or control of, be employed
by, associated with, or in any manner connected with, lend Executive's
name or any similar name to, lend Executive's credit to or render
services or advice to, any business whose products or activities
compete in whole or in part with the products or activities of the
Company or any affiliate of the Company, which restriction, because of
Executive's position, duties and responsibilities as President and
Chief Executive Officer of the Company, shall have effect and be
enforceable anywhere within the geographic areas in which the Company
or any such affiliate now or hereafter conducts its business; provided,
however, that Executive may purchase or otherwise acquire up to (but
not more than) one percent of any class of securities of any enterprise
(but only as a passive investor and without otherwise participating in
the activities of such enterprise) if such securities are listed on any
national or regional securities exchange or have been registered under
Section 12(g) of the Securities Exchange Act of 1934;
(b) at any time during Executive's employment hereunder and
for a period beginning on the date of termination of Executive's
employment with the Company and ending on the first anniversary of the
Executive's termination of employment, whether for Executive's own
account or for the account of any other person, solicit business of the
same or similar type being carried out by the Company or any affiliate
of the Company, from any customer of the Company or any such affiliate
during or after Executive's employment hereunder, whether or not
Executive had personal contact with such person; or
(c) at any time during Executive's employment hereunder and
for a period beginning on the date of termination of Executive's
employment with the Company and ending on the first anniversary of the
Executive's termination of employment, whether for Executive's own
account or the account of any other person, (i) solicit, employ, or
otherwise engage as an employee, independent contractor, or otherwise,
any person who is or was an
7
employee of the Company or any affiliate of the Company at any time
during or after Executive's employment with the Company or in any
manner induce or attempt to induce any employee of the Company or any
such affiliate to terminate his employment with the Company; or (ii)
interfere with the Company's or any affiliate's relationship with any
person, including any person who at any time during or after
Executive's employment with the Company is or was an employee,
contractor, supplier, or customer of the Company or such affiliate.
If any covenant in this Section 4.9 is held to be unreasonable,
arbitrary, or against public policy, such covenant will be considered to be
divisible with respect to scope, time, and geographic area, and such lesser
scope, time, or geographic area, or all of them, as a court of competent
jurisdiction may determine to be reasonable, not arbitrary, and not against
public policy, will be effective, binding, and enforceable against Executive.
Executive will, while the covenant under this Section 4.9 is in effect,
give notice to the Company, within ten days of accepting any other employment,
of the identity of Executive's new employer. The Company may notify such new
employer that Executive is bound by this Agreement.
Section 4.10 Remedies. Executive acknowledges that money damages would
not be sufficient remedy for any breach of this Article by Executive, and the
Company shall be entitled to enforce the provisions of this Article by specific
performance and injunctive relief as remedies for such breach or any threatened
breach. Such remedies shall not be deemed the exclusive remedies for a breach of
this Article, but shall be in addition to all remedies available at law or in
equity to the Company, including the recovery of damages from Executive and his
agents involved in such breach and remedies available to the Company pursuant to
any other agreement with Executive.
Section 4.11 Reasonableness. Executive expressly acknowledges,
recognizes and agrees that the restraints imposed by this Article 4 are: (a)
reasonable as to time, geographic limitation and scope of activity; (b)
reasonably necessary to the enjoyment by the Company of the value of its assets
and to protect its legitimate interests; and (c) not oppressive. Executive
further expressly recognizes and agrees that the restraints imposed by this
Article 4 represent a reasonable and necessary restriction for the protection of
the legitimate interests of the Company, that it is and will continue to be
difficult to ascertain the harm and damages to the Company that a failure by
Executive to comply with such restrictions would cause, that the consideration
received by Executive for entering into these covenants and agreements is fair,
that the covenants and agreements and their enforcement will not deprive
Executive of his ability to earn a reasonable living in the oil and gas industry
or otherwise, and that Executive has knowledge and skills in his field that will
allow him to obtain employment without violating these covenants and agreements.
Executive further expressly acknowledges that he has been encouraged to and has
consulted independent counsel, and has reviewed and considered this Agreement
with that counsel before executing this Agreement.
8
ARTICLE 5
MISCELLANEOUS
Section 5.1 Notices. For purposes of this Agreement, notices and other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when personally delivered or when mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to the Company to: Grant Geophysical, Inc.
Attention: Chairman of the Board
▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
If to Executive to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address as either party may furnish to the other in writing in
accordance herewith, except that notices of changes of address shall be
effective only upon receipt.
Section 5.2 Applicable Law. This Agreement is entered into under, and
shall be governed for all purposes by, the laws of the State of Texas without
regard to its conflicts of law principles.
Section 5.3 No Waiver. No failure by either party hereto at any time to
give notice of any breach by the other party of, or to require compliance with,
any condition or provision of this Agreement shall be deemed a wavier of similar
or dissimilar provisions or conditions at the same or at any prior or subsequent
time.
Section 5.4 Severability. If a court of competent jurisdiction
determines that any provision of this Agreement is invalid or unenforceable,
then the invalidity or unenforceability of that provision shall not affect the
validity or enforceability of any other provision of this Agreement, and all
other provisions shall remain in full force and effect.
Section 5.5 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together will constitute one and the same Agreement.
Section 5.6 Withholding of Taxes and Other Employee Deductions. The
Company may withhold from any benefits and payments made pursuant to this
Agreement all federal, state, city and other taxes as may be required pursuant
to any law or governmental regulation or ruling and all other normal employee
deductions made with respect to the Company's employees generally.
9
Section 5.7 Headings. The Section headings have been inserted for
purposes of convenience and shall not be used for interpretive purposes.
Section 5.8 Gender and Plurals. Wherever the context so requires, the
masculine gender includes the feminine or neuter, and the singular number
includes the plural and conversely.
Section 5.9 Affiliate. As used in this Agreement, the term "affiliate"
shall mean any entity which owns or controls, is owned or controlled by, or is
under common ownership or control with, the entity or person in question.
Section 5.10 Assignment. This Agreement shall be binding upon and inure
to the benefit of the Company and any successor of the Company, by merger or
otherwise. Except as provided in the preceding sentence, this Agreement, and the
rights and obligations of the parties hereunder, are personal and neither this
Agreement, nor any right, benefit, or obligation of either party hereto, shall
be subject to voluntary or involuntary assignment, alienation or transfer,
whether by operation of law or otherwise, without the prior written consent of
the other party.
Section 5.11 Entire Agreement. Except as provided in any signed written
agreement contemporaneously or hereafter executed by the Company and Executive,
this Agreement constitutes the entire agreement of the parties with regard to
the subject matter hereof, and contains all the covenants, promises,
representations, warranties and agreements between the parties with respect to
employment of Executive by the Company. Without limiting the scope of the
preceding sentence, all prior understandings and agreements among the parties
hereto relating to the subject matter hereof are hereby null and void and of no
further force and effect. Any modification of this Agreement will be effective
only if it is in writing and signed by the party to be charged.
10
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
COMPANY:
GRANT GEOPHYSICAL, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇
Chairman of the Board
EXECUTIVE:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
11