EXHIBIT 10.14
AGREEMENT
William J. Sheppard
3786 Spring Drive
Huntsville, Texas 77340
Dear Mr. Sheppard:
In connection with your separation from Mitcham Industries, Inc. (Company) as of
the close of business on January 31, 2003, you and the Company have agreed to
the terms and conditions as described herein and in the attachment to this
Agreement.
In consideration of Company's agreement to provide the benefits, payments,
accelerated vesting and extension of the exercise period of certain options and
other items described herein and in the attachment to this letter, some of which
are in addition to anything to which you are already entitled and the receipt
and sufficiency of which are hereby acknowledged, you hereby knowingly and
voluntarily release and forever discharge Company and its officers, directors,
agents, servants, and employees, its successors, assigns, and insurers, and its
parents, subsidiaries and affiliates, and any and all persons, firms,
organizations, and corporations from any and all known or unknown damages,
losses, causes of action, expenses, demands, liabilities, and claims on behalf
of yourself, your heirs, executors, administrators, and assigns with respect to
all matters relating to Company that arise in any part up to and including the
date you sign this Agreement, and you hereby accept the cash payments, benefits,
and other items described in full settlement of all such known or unknown
damages, losses, causes of action, expenses, demands, liabilities, and claims
you now have or may have with respect to such matters, (except you shall retain
all rights to (i) coverage, if any, under director's and officer's fiduciary
errors and omissions and other liability insurance policies that by their terms
would apply to your acts and omissions while serving the Company, its
subsidiaries and affiliates, and their respective officers, directors, agents,
servants, employees, and their successors and assigns, and (ii) any
indemnification arrangements with the Company (including pursuant to the
Company's Bylaws) that apply to your service to the Company, its subsidiaries
and affiliates).
This release includes, but is not limited to, claims arising under the Title VII
of the Civil Rights Act of 1964, as amended; the Age Discrimination in
Employment Act, as amended; the Older Workers' Benefit Protection Act of 1990,
as amended; the Civil Rights Act of 1986, as amended; the Civil Rights Act of
1991; the Rehabilitation Act of 1973, as amended; the Americans with
Disabilities Act of 1990; the Worker Adjustment and Retraining Notification Act
of 1988; the Pregnancy Discrimination Act of 1978; the Equal Pay Act; the
Employee Retirement Income Security Act of 1974, as amended; the Family and
Medical Leave Act of 1993; the Fair Labor Standards Act; the Occupational Health
and Safety Act; the Texas Commission on Human Rights Act; the Texas Labor Code;
any claims for breach of contract, tort, including but not limited to fraudulent
inducement or misrepresentation, defamation, slander, wrongful termination or
other retaliation claims in connection with workers' compensation claims or
whistleblower status or any claim under any other state or federal statute or
regulation, in equity or at common law.
Further, by accepting the payments described, you agree not to sue Company or
the related persons and entities described above regarding any matter released
by this Agreement. You affirm and agree that your employment relationship has
ended and waive all rights in connection with such relationship except to vested
benefits and the payments and benefits described in the attachment. You
acknowledge that the Company has not promised you continued employment nor
represented you will be rehired in the future. You expressly represent that no
promise or agreement which is not expressed in this latter or in the attachment
to this letter has been made to you and that you are relying on your own
judgment in signing this Agreement and are not relying on any statement or
representation of the Company, its affiliates or any of their agents. You
acknowledge that you are signing with full knowledge and consent which was not
procured through fraud, duress or mistake and that this Agreement has not had
the effect of misleading or failing to inform you.
You acknowledge that providing you benefits under this Agreement and consulting
payments by the Company are not an admission by the Company or its officers,
directors, agents, servants, and employees, its successors, assigns, and
insurers, and its parents, subsidiaries and affiliates, that they engaged in any
wrongful or unlawful act or violated any federal or state law or regulation.
The purpose of the arrangements described in this letter and attachment is to
arrive at a mutually agreeable and amicable basis upon which to separate your
employment with the Company. You and Company agree to refrain from any
criticisms or disparaging comments about each other or in any way relating to
your employment with or separation from Company.
Additionally, you agree that you have returned or will return immediately all
Company property. This includes all Company property that you possess, have
knowledge of or access to, including, but not limited to computers, including
laptops, and associated peripherals, vehicles, pagers, cell phones, digital
cameras, video cameras, palm pilots (pda's), software, stationary, business
cards and promotional client gifts.
In addition, you agree that you have returned or will return immediately, and
will maintain in strictest confidence and not use in any way, any proprietary,
confidential, or other nonpublic information or documents relating to the
business and affairs of Company and its affiliates. For the purposes of this
Agreement, "proprietary, confidential or other nonpublic information" shall mean
any information concerning the Company or its affiliates, which you developed or
learned through your employment and which is not generally known or available
outside of the Company. Such information,
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without limitation, includes information, written or otherwise, regarding the
Company's earnings, expenses, material sources, equipment sources, customers,
business plans, strategies, practices and procedures, prospective and executed
contracts and other business arrangements. You acknowledge and agree that all
records, papers, reports, computer programs, strategies, documents (including,
without limitation, memoranda, notes, files and correspondence), opinions,
evaluations, inventions, ideas, technical data, products, services, processes,
procedures, and interpretations that are or have been produced by you or any
employee, officer, director, agent, contractor, or representative of the Company
whether provided in written or printed form, or orally, all comprise
confidential and proprietary business information. You understand and agree that
in the event of any breach of this provision by you, the Company may, in its
discretion, discontinue any or all payments provided for in the Plan and recover
any and all payments already made and the Company shall be entitled to apply to
a court or competent jurisdiction for such relief by way of specific
performance, restraining order, injunction or otherwise as may be appropriate to
ensure compliance with this provision.
You further agree that all terms of this Agreement, including the terms and
conditions contained in the attachment, shall be kept strictly confidential and
that any disclosure to anyone for any purpose whatsoever (save and except
disclosure to your spouse, financial advisors or institutions for financial
statement purposes, attorney, or as required by law) by you or your agents,
representatives, heirs, children, spouse, employees or spokespersons shall be a
breach of this Agreement and the Company may elect either to cease performance
hereunder or enforce this Agreement; however, in the event the Company believes
a breach of confidentiality has occurred, you will be given notice and thirty
days to respond.
For a period of twelve (12) months after your separation date, you shall not,
directly or indirectly, or through others, induce or otherwise entice any
employee of the Company to leave the Company, or to join another company, nor
shall you participate or provide information in any attempt by any person or
entity to hire any of the Company's employees.
Should you be contacted or served with legal process seeking to compel you to
disclose any information about the Company or this Agreement, you agree to
notify the Company immediately, in order that the Company may seek to resist
such process if they so choose. If you are called upon to serve as a witness or
consultant in or with respect to any potential litigation, litigation, or
regulatory proceeding, you agree to cooperate with the Company to the full
extent permitted by law, and the Company agrees that any such call shall be
reasonable notice, shall not unnecessarily interfere with your later employment,
and shall provide for payment for your reasonable expenses in such matters.
You shall have twenty-one days to decide whether to sign the Agreement and be
bound by its terms. You shall have the right to revoke or cancel it within seven
days after you have signed it. This cancellation or revocation can be
accomplished by delivery of a
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written notification to me. In the event that this Agreement is canceled or
revoked, Company shall have no obligation to furnish the payments and benefits
described in the attachment. YOU ACKNOWLEDGE THAT YOU HAVE BEEN ADVISED IN
WRITING TO CONSULT WITH AN ATTORNEY PRIOR TO SIGNING THIS AGREEMENT AND HAVE HAD
AN ADEQUATE OPPORTUNITY TO SEEK ADVICE OF YOUR OWN CHOOSING. You acknowledge
that you have read this Agreement, have had an opportunity to ask questions and
have it explained to you and that you understand that this Agreement will have
the effect of knowingly and voluntarily waiving any action you might pursue,
including breach of contract, personal injury, retaliation, discrimination on
the basis of race, age, gender, national origin, or disability and any other
claims arising prior to the date of this Agreement. No payment will be made to
you under this Agreement earlier than the eighth day after you have signed the
Agreement and delivered it to the Company.
Should any of the provisions set forth in this letter and attachment be
determined to be invalid by a court, agency or other tribunal of competent
jurisdiction, it is agreed such determination shall not affect the
enforceability of other provisions of this letter and attachment. This letter
and attachment sets forth the entire understanding and agreement between you and
the Company concerning the subject matter of this letter and attachment and
supersedes any prior or contemporaneous oral and/or written agreements or
representations, if any, between you and the Company.
Very truly yours,
MITCHAM INDUSTRIES, INC.
By: /s/ Billy F. Mitcham, Jr.
-----------------------------------------
Billy F. Mitcham, Jr., President and
Chief Executive Officer
AGREED TO AND ACCEPTED this 4th day of April, 2003.
/s/ William J. Sheppard
- ---------------------------------------------
William J. Sheppard
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ATTACHMENT TO AGREEMENT
BETWEEN WILLIAM J. SHEPPARD AND COMPANY
1. SEPARATION DATE
Your last day of employment was January 31, 2003. Your last day as an
officer and director with the Company was January 22, 2003. Your separation date
is January 31, 2003. This Agreement and this Attachment constitute, among other
things, your resignation as an employee, officer and director of the Company.
2. WITHHOLDING AND SET OFFS
All payments and entitlements made and provided to you under this Agreement
which by law, or contract, the Company is required or entitled to make
withholding or set offs, shall be paid or credited to you subject to lawfully
and contractually required withholding and set offs. All taxes and withholding
as required by law, shall be deducted from moneys and options and other benefits
and entitlements due you under the Agreement. It is agreed that the Company
shall set off from all payments and entitlements owed to you pursuant to this
Agreement, all employee receivables and company credit card debt owed by you.
3. FIRST CONSULTING AGREEMENT
You will receive a consulting benefit as an independent contractor for six
months, at the rate of $10,000.00 per month gross, payable on the first day of
each month. The severance period began on February 1, 2003 and will end July 31,
2003. During that period of time, you shall make yourself available for
consultation with the Company, upon reasonable notice, pursuant to the terms of
the First Consultant Agreement.
4. SECOND CONSULTING AGREEMENT
You will receive a consulting benefit as an independent contractor for
twelve months of $5,000.00 per month, payable on the first day of each month.
This Second Consulting Period will begin January 1, 2004 and will end December
31, 2004. During that period, you shall make yourself available for consultation
with the Company, upon reasonable notice, pursuant to the terms of the Second
Consultant Agreement.
5. MEDICAL AND DENTAL COVERAGE COBRA
The Company agrees to provide you and your current dependent child during
your first consulting period medical and dental coverage generally available to
all salaried company employees.
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At the end of your first consulting period, the Company will pay an additional
six months of medical and dental coverage, after which you will have the option
of continuing the medical and dental benefits at your expense to the extent
permitted by COBRA legislation.
6. OFFSETS UPON SUBSEQUENT EMPLOYMENT
In the event you elect to commence new employment elsewhere subsequent to
your separation date, medical and dental insurance available to you on either a
contributory or noncontributory basis through your new employer will be
considered by the Company as the primary coverage for you without regard to
whether or not you elected such coverage.
7. STOCK PLAN OPTIONS
You have the following stock options, unless you have previously exercised
them. The Company has agreed to accelerate vesting of certain options. The
following schedule reflects the status of your options.
OPTIONS THAT WILL EXPIRE 90 DAYS FROM THE DATE OF YOUR SEPARATION
<Table>
<Caption>
OPTION GRANT STRIKE NO. OF NON-
PLAN DATE PRICE SHARES VESTED VESTED
------ ------------ ------------ ------------ ------------ ------------
1994 08/14/96 $ 5.75 9,000 9,000 -0-
1994 10/03/97 $ 22.00 15,000 15,000 -0-
1998 02/23/99 $ 3.56 51,500 51,500 -0-
2000 07/27/00 $ 5.125 30,000 20,000 10,000
2000 07/18/01 $ 5.00 20,000 6,667 13,333
</Table>
OPTIONS EXTENDED UNTIL DECEMBER 1, 2005
<Table>
<Caption>
OPTION GRANT STRIKE NO. OF
PLAN DATE PRICE SHARES VESTED
---- ------------ ------------ ------------ ------------
1994 12/04/95 $ 3.29 21,000 21,000
1998 02/23/99 $ 3.56 19,000 19,000
2000 08/15/02 $ 1.99 10,000 10,000
</Table>
8. FUTURE CONSULTANCY PAYMENTS
Future payments under your consulting agreements with the Company will be
mailed to the address noted on the payment or, if you are on automatic bank
deposit, that service will continue while you receive such payments. The pay
stub will be mailed to the address on the payment. You should notify Chris
Siffert, at the Company, of any address change.
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9. SET OFFS
You have been advanced $48,382.96 by the Company, which will be set off
against your Second Consulting Agreement.
10. COMPANY VEHICLE
Title to a company vehicle, a 1996 Lincoln Continental VIN
1LNLM97V5TY624238, will be transferred to you. Applicable taxes and charges will
be set off against payments made to you pursuant to this Agreement.
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