Exhibit 10.3
EMPLOYMENT AGREEMENT
Employment Agreement dated as of July 19, 1995 among William F.
Wallace (the "Executive"), Barrett Resources corporation, a Delaware corporation
(the "Company"), Plains Petroleum Company, a Delaware corporation ("PPC"), and
Plains Petroleum Operating company, a Delaware corporation ("PPOC").
WHEREAS, pursuant to an Agreement and plan of Merger dated as of May
2, 1995 (the "Merger Agreement"), Barrett Energy Inc., a wholly-owned subsidiary
of the Company, merged (the "Merger") with and into PPC, resulting in PPC
becoming a wholly-owned subsidiary of the Company on July 18, 1995 (the
"Effective Time");
WHEREAS, the Executive and PPOC, a wholly-owned subsidiary of PPC,
entered into an Employment Agreement dated as of August 17, 1994 (the "PPOC
Employment Agreement"), pursuant to which PPOC employed the Executive as its
President and Chief Operating Officer, and PPC undertook to perform the
obligations of PPOC thereunder;
WHEREAS, on May 1, 1995, the Executive was elected by the Board of
Directors of PPC to the additional position of President and Chief Operating
Officer of PPC;
WHEREAS, the Company, PPC and PPOC desire that the employment of the
Executive as President and Chief Operating Officer of PPC be terminated,
effective as of the Effective Time, and that the employment of the Executive as
President and Chief Operating Officer of PPOC be terminated pursuant to Section
3.6(a) of the PPOC Employment Agreement, effective as of the Effective Time,
entitling the Executive to the payment of all of the amounts described in
Section 3.6 of the PPOC Employment Agreement as set forth herein;
WHEREAS, the Company desires to employ the Executive as its Vice
Chairman, and the Executive desires to accept such employment, for the term and
upon the other conditions set forth herein; and
WHEREAS, the Company, PPC and PPOC acknowledge that the employment of
the Executive pursuant to the terms of this Agreement does not constitute a
waiver by the Executive of his right to receive the amounts described in Section
3.6 of the PPOC Employment Agreement and that the Executive continues to be
entitled to all such amounts as set forth herein.
NOW, THEREFORE, in consideration of the agreements and covenants
contained herein, the Executive, the Company, PPC and PPOC hereby agree as
follows:
ARTICLE I
Termination of Employment with PPC and PPOC
1.1 Termination of Employment. The employment of the Executive as
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President and Chief Operating Officer of PPC is hereby terminated, effective as
of the Effective Time, and the employment of the Executive as President and
Chief Operating Officer of PPOC under the PPOC Employment Agreement is hereby
terminated pursuant to Section 3.6(a) thereof, effective as of the Effective
Time. As set forth herein, such termination of employment entitles the
Executive to all of the amounts described in Section 3.6 of the PPOC Employment
Agreement, which amounts area listed, described or referred to on Schedule A
attached hereto (the "Termination Amounts").
ARTICLE II
Employment
Section 2.1. Position; Term; Responsibilities. The Company shall
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employ the Executive as its Vice Chairman for a term commencing as of the
Effective Time and ending on December 31, 1995 (the "Employment Period").
Subject to the powers, authorities and responsibilities vested in the Board of
Directors (the "Board") of the Company under the General Corporation Law of the
State of Delaware, in duly constituted committees of the Board and in the Chief
Executive Officer of the Company (the "Company CEO"), and subject to the
direction of both the Board and the Company CEO, the Executive's principal
responsibility will be to assist in the transition and integration of PPC and
PPOC with the Company pursuant to the Merger. The Executive shall also perform
such other executive and administrative duties (not inconsistent with the
position of Vice Chairman) as the Executive may reasonably be expected to be
capable of performing on behalf of the Company, as may from time to time be
authorized or directed by the Company CEO or the Board. The Company, PPC, PPOC
and the Executive agree that the employment of the Executive pursuant to the
terms of this Agreement does not constitute a waiver by the Executive of his
right to receive the Termination Amounts and that the Executive continues to be
entitled to the Termination Amounts as set forth herein.
Section 2.2. Duties. During the Employment Period, the Executive
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shall use his reasonable best efforts to perform faithfully the duties assigned
to him hereunder and shall devote his full and undivided business time and
attention to the Company's business and not engage in any other business
activities except with the approval of the Company CEO. Nothing contained in
this Section 2.2 shall preclude the Executive from making investments in
publicly traded companies for his own account or for the accounts of members of
his family.
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Section 2.3. Service as Director. The Board has appointed the
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Executive as a director of the Company, as of the Effective Time of the Merger,
to serve until the next annual meeting of the stockholders of the Company.
ARTICLE III
Compensation
Section 3.1. Base Salary. As compensation for his services
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hereunder, the Company shall pay to the Executive during the employment period a
salary at the annual rate of $231,000, payable in installments in accordance
with the Company's normal payment schedule for senior executives of the Company.
The Executive's annual salary may be increased from time to time by the Board in
its discretion. The Executive's annual salary in effect from time to time
pursuant to this Section 3.1 is hereinafter called his "Base Salary."
Section 3.2. Automobile; Club Dues. The Company shall provide to the
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Executive an automobile allowance in the amount of $550 per month during the
Employment Period. The Company shall also, during the Employment Period, pay
the annual dues and assessments for the Executive's membership in (a) one
country club located in the Denver area and (b) the Denver Petroleum Club.
Section 3.3. Benefits. The Executive shall be entitled to
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participate in all employee benefit plans, including group health, life, short-
term disability, long-term disability, 401(k), stock option and any other
employee benefit plans available to senior executives of he Company (the
"Employee Benefit Plans"). The Executive shall be credited with additional
years of service such that his service shall be deemed to have commenced on the
same date as the commencement of his employment by PPOC in those plans available
to the executives of the Company shall the benefits of which are based upon
credited years of service. The Executive shall be entitled to vacation at the
rate of four weeks per year during the Employment Period, and the Executive
shall be entitled to be paid for any unused vacation accrued since the
commencement of the Employment Period in the event of his termination of
employment hereunder for any reason. The Executive shall be entitled to take
time off for illness in accordance with the Company's policy for senior
executives and to receive all other fringe benefits as are from time to time
made generally available to the senior executives of the Company.
Section 3.4. Expense Reimbursement. The Company shall reimburse the
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Executive for all proper expenses incurred by him in the performance of his
duties hereunder in accordance with the Company's policies and procedures.
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ARTICLE IV
Termination of Employment
Section 4.1. Termination For Cause. The Company may terminate the
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Executive's employment for Cause (as hereinafter defined) upon written notice to
the Executive. For purposes of this Agreement, "Cause" shall mean any act of
dishonesty, commission of a felony, significant activities harmful to the
reputation of the Company, refusal to perform or substantial disregard of the
duties properly assigned pursuant to Article II, or significant violation of any
statutory or common law duty of loyalty to the Company. In the event that the
Company exercises its election to terminate the Executive's employment pursuant
to this Section 4.1, the Employment Period shall terminate effective with such
notice and the Executive shall be entitled to receive any unpaid compensation
pursuant to Section 3.1, 3.2 and 3.3 accrued through the date of such
termination and reimbursement for expenses incurred through such date pursuant
to Section 3.4 and PPOC, PPC and the Company shall pay the Termination Amounts
to the Executive at the times specified by Sections 3.6(a) and 3.6(b) of the
PPOC Employment Agreement.
Section 4.2. Death. In the event of the death of the Executive
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during the Employment Period, his successors shall be entitled to receive any
accrued and unpaid compensation pursuant to Sections 3.1, 3.2 and 3.3 and any
unreimbursed expenses pursuant to Section 3.4 and PPOC, PPC and the Company
shall pay the Termination Amounts to such successors at the times specified by
Sections 3.6(a) and 3.6(b) of the PPOC Employment Agreement.
Section 4.3. Disability. In the event that the Executive becomes
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unable to perform his duties hereunder by reason of disability, the Executive
shall be entitled to receive any unpaid compensation pursuant to Sections 3.1,
3.2 and 3.3 accrued through the date of such event and reimbursement for
expenses incurred through such date pursuant to Section 3.4 and PPOC, PPC and
the Company shall pay the Termination amounts to the Executive at the times
specified by Sections 3.6(a) and 3.6(b) of the PPOC Employment Agreement.
Section 4.4. Resignation. Notwithstanding the provisions of Section
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2.1, the Executive shall be entitled during the Employment Period to terminate
his employment hereunder voluntarily upon written notice to the Company. In the
event that the Executive voluntarily terminates his employment pursuant to this
Section 4.4, the Employment Period shall terminate effective upon such
termination and the Executive shall be entitled to receive any unpaid
compensation pursuant to Sections 3.1, 3.2 and 3.3 accrued through the date of
such termination and reimbursement for expenses incurred through such date
pursuant to Section 3.4 and PPOC, PPC and the Company shall pay the
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Termination Amounts to the Executive at the times specified by Sections 3.6(a)
and 3.6(b) of the PPOC Employment Agreement.
Section 4.5. Other Termination. The Company may, pursuant to this
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Section 4.5, terminate the Executive's employment hereunder for any reason other
than the reasons set forth in Sections 4.1, 4.2, 4.3 or 4.4 upon written notice
to the Executive. In addition, the Executive may, pursuant to this Section 4.5,
terminate his employment hereunder for any reason upon written notice to the
Company. In the event that the Company shall exercise its election to terminate
the Executive's employment pursuant to this Section 4.5 or in the event that the
Executive shall exercise his election to terminate his employment pursuant to
this Section 4.5, the Employment Period shall terminate effective with such
notice and the Executive shall be entitled to receive any unpaid compensation
pursuant to Sections 3.1, 3.2 and 3.3 accrued through the date of such
termination and reimbursement of expenses incurred through such date pursuant to
Section 3.4 and PPOC, PPC and the Company shall pay the Termination Amounts to
the Executive at the times specified by Sections 3.6(a) and 3.6(b) of the PPOC
Employment Agreement.
ARTICLE V
Rights at End of Employment Period
5.1 Election by the Company. If not less than 15 days prior to the
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end of the Employment Period, the Company does not,in its sole discretion, make
an offer to the Executive of the position of Chef Executive Officer of the
Company or another significant leadership position of Chief Executive Officer of
the Company or another significant leadership position as an executive officer
of the Company (the "Continued Employment Offer"), then the Company shall be
deemed to have elected not to make the Continued Employment Offer to the
Executive.
5.2 Election by the Executive. In the event that the Company makes
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the Continued Employment Offer to the Executive, the Executive shall advise the
Company, within 15 days of his receipt thereof, whether he elects, in his sole
discretion, to pursue such offer, subject to the parties' mutually agreeing to
enter into a mutually acceptable written employment agreement.
5.3 Rights upon Elections. If the Company makes the Continued
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Employment Offer to the Executive pursuant to Section 5.1 and the Executive
elects to pursue the Continued Employment Offer pursuant to Section 5.2, the
Company and the Executive shall negotiate in good faith to enter into an
employment agreement that will continue to provide the Executive with the
Termination Amounts upon termination of such employment agreement. If the
Company elects not to make the continued Employment Offer or if the Company
makes the Continued Employment Offer and the Executive elects not to pursue such
offer, or if
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the Company makes the Continued Employment Offer and the Executive elects to
pursue such offer, but the Company and the Executive are unable to reach
agreement with respect to a new employment agreement within 30 days following
the election to pursue such offer by the Executive, then, in any of such events,
PPOC, PPC and the Company shall pay the Termination Amounts to the Executive at
the times specified by Sections 3.6(a) and 3.6(b) of the PPOC Employment
Agreement, and PPOC, PPC and the Company shall have no further obligation or
liability to the Executive pursuant to the provisions of this Article V.
ARTICLE VI
Miscellaneous
Section 6.1. Notices. Any notice or request required or permitted to
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be given hereunder shall be sufficient if in writing and delivered personally or
by courier or overnight express delivery service or sent by registered or
certified mail, return receipt requested, as follows: if to the Executive, to
30036 Snowbird Lane, Evergreen, Colorado 80439, and if to the Company, to
Barrett Resources Corporation, 1125 Seventeenth Street, Suite 2400, Denver,
Colorado 80202, Attention Chief Executive Officer, or to any other address
designated by either party by notice similarly given. Such notice shall be
deemed to have been given upon the personal delivery thereof, upon the delivery
thereof by courier or overnight express delivery services or five business days
after the mailing thereof, as the case may be.
Section 6.2. Assignment and Succession. The rights and obligations
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of the Company under this Agreement shall inure to the benefit of and be binding
upon its successors and assigns, and the Executive's rights and obligations
hereunder shall inure to the benefit of and be binding upon his successors.
Section 6.3. Headings. The Article, Section, paragraph and
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subparagraph headings are for convenience of reference only and shall not define
or limit the provisions hereof.
Section 6.4. Applicable Law. This Agreement shall at all times be
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governed by and construed, interpreted and enforced in accordance with the
internal laws (as opposed to the conflict of laws provisions) of the State of
Delaware.
IN WITNESS WHEREOF, each of the Company, PPC and PPOC has caused this
Agreement to be signed by its duly authorized officer and the Executive has
signed this Agreement as of the day and year first above written.
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BARRETT RESOURCES CORPORATION
By: /s/ Wm. J. Barrett
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William J. Barrett
PLAINS PETROLEUM COMPANY
By: /s/ Wm. J. Barrett
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PLAINS PETROLEUM OPERATING COMPANY
By: /s/ Wm. J. Barrett
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EXECUTIVE:
/s/ William F. Wallace
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William F. Wallace
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SCHEDULE A
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TERMINATION AMOUNTS
I. SEVERANCE AGREEMENT
All benefits pursuant to Section 3.6(a)(i) of the PPOC
Employment Agreement, as follows:
Base Compensation Multiple Gross Benefit
$240,960 2.99 $720,470.40
All benefits pursuant to Sections 3.6(a)(ii), 3.6(a)(iii)
and
3.6(b) of the PPOC Employment Agreement.
II. UNUSED VACATION
Unused Hours of Vacation
(As of June 30, 1995)
140 To be used by December 31, 1995.
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