1
EXHIBIT 10.5.2
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement"), by and between Statoil
Energy, Inc., a Virginia corporation (the "Company"), and Stevens V. Gillespie
("Employee"), is hereby entered into as of February 18, 1999 and is effective
as of February 1, 1999. This Agreement hereby supersedes any other employment
agreements or understandings; written or oral, between the Company and
Employee.
RECITALS
WHEREAS Employee is employed hereunder by the Company in a
confidential relationship wherein Employee, in the course of his employment
with the Company, has and will continue to become familiar with and aware of
information as to the Company's customers, specific manner of doing business,
including the processes, techniques and trade secrets utilized by the Company,
and future plans with respect thereto, all of which has been and will be
established and maintained at great expense to the Company; this information is
a trade secret and constitutes the valuable good will of the Company; and
WHEREAS the Company wishes to employ Employee and Employee wishes to
be employed by the Company, each in accordance with the terms and conditions of
this Agreement.
NOW, THEREFORE, in consideration of the mutual promises, terms,
covenants and conditions set forth herein and the performance of each, it is
hereby agreed as follows:
ARTICLE 1
EMPLOYMENT & DUTIES
1.1 Position & Duties. Employee shall hold the office of Senior Vice
President and Employee shall have the powers and authority normally
associated with such position. Employee shall assume such other
responsibilities, consistent with his position as Senior Vice
President, as may be delegated to him from time to time by the
President and Chief Executive Officer of the Company. Such services
shall be provided at the Company's principal executive office located
at 2800 Eisenhower Avenue, Alexandria, Virginia, or such other
location of the Company's principal executive office as the Company
shall reasonably designate in accordance with the provisions of this
Agreement. Employee hereby accepts this employment upon the terms and
conditions herein contained and agrees to devote his time, skill,
labor, attention and efforts to promote and further the business of
the Company.
2
1.2 Company Policies. Employee shall faithfully adhere to, execute and
fulfill all policies established by the Company.
1.3 Other Activities. Employee shall not, during the Term of his
employment hereunder, be engaged in any other business activity
pursued for gain, profit or other pecuniary advantage if such activity
interferes with Employee's duties and responsibilities hereunder.
However, the foregoing limitations shall not be construed as
prohibiting Employee from (i) making personal investments in such form
or manner as will neither require his services in the operation or
affairs of the companies or enterprises in which such investments are
made nor violate the terms of Section 1.4 hereof; (ii) serving on the
board of directors of a reasonable number of other corporations, trade
associations or charitable organizations; or (iii) engaging in any
charitable activities or community affairs, so long as, in each case,
such other activities do not interfere with Employee's performance of
his obligations hereunder.
1.4 Investments. The foregoing covenant shall not be deemed to prohibit
Employee from acquiring as an investment not more than the lesser of
either (i) five percent (5%) of the outstanding capital stock of a
company in direct competition with the Company, or (ii) one million
dollars ($1,000,000) worth of the capital stock of a company in direct
competition with the Company; provided, however, that, notwithstanding
the foregoing, in the event that the Company shall adopt any policy
governing permissible investments by its employees and such policy is
applicable to Employee, any investment made by Employee in compliance
with such policy shall be deemed permissible under this Section 1.4
and any investment made by Employee that is not in compliance with
such policy shall be deemed to constitute a breach of this Agreement.
ARTICLE 2
COMPENSATION
2.1 Base Salary. Effective as of February 1, 1999, the base salary ("Base
Salary") payable to Employee shall be no less than $190,000 per year,
payable on a regular basis in accordance with the Company's standard
payroll procedures, but not less than monthly. On at least an annual
basis, the Board will review Employee's performance and may make
increases to such Base Salary if, in the Board's discretion, any such
increase is warranted. As used herein, "Base Compensation" shall mean
the Employee's Base Salary plus the Employee's Average Bonus (as
defined in Section 2.2 hereof).
2.2 Incentive Bonus Plan. The Company shall pay to the Employee such
bonuses based upon the financial performance of the Company and the
individual performance of the Employee in accordance with any bonus
plan established for senior management of the Company from time to
time by the Board or its designee or as otherwise granted in the
discretion of the Board or its designee; provided, however that any
future bonus plan established for senior management of the Company
shall be no less advantageous to the Employee than the bonus
-2-
3
plan of the Company in effect with respect to the Employee as of the
date hereof. As used herein, "Average Bonus" shall mean the average of
all bonuses paid to the Employee during the previous three years (or,
if applicable, such shorter time that Employee has been employed by
the Company); provided, however that if in one or more of such prior
years to be averaged the Employee was paid a bonus in excess of 50% of
Employee's Base Salary for any such year, then, in calculating the
average of bonuses paid to the Employee, a number equal to 50% of
Employee's Base Salary for any such year shall be substituted for the
actual amount of Employee's bonus in calculating the applicable
Average Bonus.
2.3 Executive Perquisites, Benefits and Other Compensation. Employee shall
be entitled to receive additional benefits and compensation from the
Company in such form and to such extent as specified below:
a. The Employee shall be entitled to receive any employee
benefits, including, without limitation, any retirement
benefit plan, disability, group life, sickness, accident and
health insurance programs and perquisites provided by the
Company to executives such as are the greater of (i) the
employee benefits and perquisites then provided by the
Company to executives with comparable authority or duties
(and in any event not less than those provided to executives
with junior authority or duties), or (ii) such employee
benefits and perquisites as in effect on the date hereof.
b. The Company shall reimburse the Employee for all reasonable
expenses incurred by the Executive in the performance of his
duties under this Agreement upon presentation of
documentation therefor in form and substance satisfactory to
the Company.
c. The Company may provide Employee with other executive
perquisites as may be available to or deemed appropriate for
Employee by the Board.
2.4 Stock Options. The Employee shall receive stock options ("Stock
Options") as shall be granted at the discretion of the Board of
Directors of the Company consistent with historical practices.
2.5 Vacation and Leave. The Employee shall be entitled to four (4) weeks
vacation and to leaves of absence for illness or temporary disability
in accordance with the policies of the Company in effect from time to
time. Any leave on account of illness or temporary disability which is
short of "Total Disability" (as defined below) shall not constitute a
breach by the Employee of his agreements hereunder and in no event
shall the Company be entitled to terminate the employment of the
Employee hereunder for cause due to such leave. "Total Disability"
shall mean the inability of the Employee due to physical or mental
illness or injury to perform his duties hereunder for any period of
more than ninety (90) consecutive days. Upon the Total Disability of
the Employee, the Employee shall be entitled to receive, until
Employee returns to work or, if Employee's employment terminates
pursuant to Section 4.2(b) hereof, the expiration of the Term of this
Agreement, (i) periodic monthly payments
-3-
4
from the Company equal to sixty-six and two-thirds percent (66 2/3%) of
the Base Compensation in effect at the commencement of such Total
Disability, and (ii) any health and other medical related benefits
provided by the Company to the same extent such health and medical
benefits were provided by the Company prior to Employee's Total
Disability; provided, however, that the periodic monthly payments set
forth in clause (i) hereof shall be reduced by the amount of any
disability insurance payment made to the Employee pursuant to any
disability insurance program funded by the Company.
ARTICLE 3
NON-COMPETITION/NON-SOLICITATION
3.1 Non-Competition and Non-Solicitation. During the period of employment
by or with the Company, and for a period following the termination of
his employment under this Agreement equal to the longer of (i) one (1)
year or (ii) the period during which Employee is entitled to receive
and is receiving any payment pursuant to Section 4.2(d), 4.2(e) or 4.3
hereof, Employee will not, for any reason whatsoever, directly or
indirectly, for himself or on behalf of or in conjunction with any
other person, persons, company, partnership, corporation or business
of whatever nature:
a. engage, as an officer, director, owner, partner, joint
venturer, employee, independent contractor, consultant or
advisor in any business selling any products or services in
direct competition with the Company, within one hundred (100)
miles of the principle executive office of the Company or
where any of the Company's affiliates or subsidiaries conduct
business, including any territory serviced by the Company or
any of such affiliates or subsidiaries (the "Territory");
b. call upon any person who is, at that time, within the
Territory, an employee of the Company (including the
affiliates and subsidiaries thereof) in a managerial capacity
for the purpose or with the intent of enticing such employee
away from or out of the employ of the Company (including the
affiliates and subsidiaries thereof), provided that Employee
shall be permitted to call upon and hire any member of his or
her immediate family;
c. call upon any person or entity which is, at that time, or
which has been, within one (1) year prior to that time, a
customer of the Company (including the affiliates and
subsidiaries thereof) within the Territory for the purpose of
soliciting or selling products or services in direct
competition with the Company within the Territory;
d. call upon any prospective acquisition candidate, on
Employee's own behalf or on behalf of any competitor, which
candidate was either called upon by the Company (including
the affiliates and subsidiaries thereof) or for which the
Company made an acquisition analysis, for the purpose of
acquiring such entity, in either case, during the last twelve
(12) months of the Employee's employment with the Company.
-4-
5
3.2 Remedies. Because of the difficulty of measuring economic losses to
the Company as a result of a breach of the foregoing covenant, and
because of the immediate and irreparable damage that could be caused
to the Company for which it would have no other adequate remedy,
Employee agrees that the foregoing covenant may be enforced by the
Company by seeking injunctions or restraining orders in the event of a
breach of the foregoing covenant by the Employee.
3.3 Reasonableness and Interpretation. It is agreed by the parties that
the foregoing covenants in this Article 3 impose a reasonable
restraint on Employee in light of the activities and business of the
Company and its affiliates on the date of the execution of this
Agreement and the current plans of the Company and its affiliates; but
it is also the intent of the Company and Employee that such covenants
be construed and enforced in accordance with the changing activities,
business and locations of the Company and its affiliates throughout
the term of this Article III.
3.4 Subsequent Conflicts. It is further agreed by the parties hereto that,
in the event that Employee shall cease to be employed hereunder, and
shall enter into a business or pursue other activities not in
competition with the Company or its affiliates, or similar activities
or business in locations the operation of which, under such
circumstances, does not violate Section 3.1 hereof, and in any event
such new business, activities or location is not in violation of
Section 3.1 hereof or of Employee's obligations under this Article 3,
Employee shall not be chargeable with a violation of this Article 3 if
the Company or its affiliates shall thereafter enter the same, similar
or a competitive (i) business, (ii) course of activities or (iii)
location, as applicable.
3.5 Reformation. The covenants in this Article 3 are severable and
separate, and the unenforceability of any specific covenant shall not
affect the provisions of any other covenant. Moreover, in the event
any court of competent jurisdiction shall determine that the scope,
time or territorial restrictions set forth are unreasonable, then it
is the intention of the parties that such restrictions be enforced to
the fullest extent which the court deems reasonable, and the Agreement
shall thereby be reformed.
3.6 No Defense. All of the covenants in this Article 3 shall be construed
as an agreement independent of any other provision in this Agreement,
and the existence of any claim or cause of action of Employee against
the Company, whether predicated on this Agreement or otherwise, shall
not constitute a defense to the enforcement by the Company of such
covenants; provided, however, that upon the failure of the Company to
make any payments required under this Agreement, the Employee may,
upon thirty (30) days prior written notice to the Company, waive his
right to receive any additional compensation pursuant to this
Agreement and engage in any activity prohibited by the covenants of
this Article 3. It is specifically agreed that the period stated in
Section 3.1, during which the agreements and covenants of Employee
made in this Article 3 shall be effective, shall be computed by
excluding from such computation any time during which Employee is in
violation of any provision of this Article 3.
-5-
6
3.7 Compensation Period. Notwithstanding any of the foregoing, if any
applicable law shall reduce the time period during which Employee
shall be prohibited from engaging in any competitive activity
described in Section 3.1 hereof, the period of time for which Employee
shall be prohibited pursuant to Section 3.1 hereof shall be the
maximum time permitted by law. However, in the event that the time
period specified by Section 3.1 shall be so reduced, then,
notwithstanding the provisions of Sections 4.2(d), 4.2(e) or 4.3
hereof, Employee shall be entitled to receive from the Company his
Base Compensation at the rate then in effect solely for the longer of
(i) the time period during which the provisions of Section 3.1 shall
be enforceable under the provisions of such applicable law, or (ii)
the time period during which Employee is not engaging in any
competitive activity, but in no event longer than the terms provided
in Sections 4.2 and 4.3.
ARTICLE 4
TERM & TERMINATION
4.1 Term. The term of this Agreement (the "Term") shall begin on the
effective date hereof and continue for 24 months. The Term shall be
automatically extended by one day for every day after the effective
date hereof that the Employee is employed by the Company. The Term
shall, at all times, be 24 months from the current date; provided,
however, that if the Board of Directors of the Company shall at any
time determine not to extend the Term, as of the date sixty (60) days
following notification of such decision to the Employee, the Term
shall not extend pursuant to this Section 4.1 and the 24 month Term
described herein shall begin to expire. If this Agreement and
Employee's employment hereunder is terminated in accordance with
Sections 4.2 or 4.3 of this Agreement, from that point forward, this
Agreement shall not be extended as set forth hereunder.
4.2 Termination Without Change in Control of the Company. This Agreement
and Employee's employment may be terminated prior to the expiration of
the Term in any one of the followings ways:
a. Death. The death of Employee shall immediately terminate the
Agreement with no further payments under this Agreement
(except as set forth in Section 4.4 hereof) due to Employee's
estate.
b. Disability. If, as a result of incapacity due to physical or
mental illness or injury, Employee shall have been absent
from his full-time duties hereunder for ninety (90)
consecutive days, then thirty (30) days after written notice
to the Employee (which notice may occur before or after the
end of such ninety (90) day period, but which shall not be
effective earlier than the last day of such ninety (90) day
period), the Company may terminate this Agreement and
Employee's employment hereunder provided Employee is unable
to resume his full-time duties at the conclusion of such
notice period. Also, Employee may terminate this Agreement
and his employment hereunder if his health should become
impaired to an extent that makes the continued
-6-
7
performance of his duties hereunder hazardous to his physical
or mental health or his life, provided that Employee shall
have furnished the Company with a written statement from a
qualified doctor to such effect and provided, further, that,
at the Company's request made within thirty (30) days of the
date of such written statement, Employee shall submit to an
examination by a doctor selected by the Company who is
reasonably acceptable to Employee or Employee's doctor and
such doctor shall have concurred in the conclusion of
Employee's doctor. Subject to Section 3.7 hereof, in the
event this Agreement is terminated as a result of Employee's
disability, until the expiration of the Term of this
Agreement, Employee shall receive from the Company periodic
monthly payments equal to sixty-six and two-thirds percent
(662/3%) of the Base Compensation in effect at the
commencement of such disability less the amount of any
insurance payment made to the Employee pursuant to any
disability insurance program funded by the Company.
c. For Cause. The Board of Directors of the Company may
terminate the Agreement ten (10) days after written notice to
Employee for good cause ("For Cause"), which shall mean: (i)
the willful failure or refusal of Employee to perform any
material obligation under this Agreement or to carry out the
reasonable directives of the Board or the repeated willful or
materially negligent failure to perform the Employee's duties
as determined by the Board in good faith, and the failure of
Employee to cure the same within a period of thirty (30) days
following notice thereof; (ii) Employee's failure to devote
full business time, skill, labor, attention and efforts to
promote and further the business of the Company; (iii)
Employee's conviction of a felony or other crime involving
moral turpitude, or willful misconduct or performance of an
illegal activity in connection with employment; or (iv) after
a request by the Company that the Employee obtain counseling
for any alcohol or illegal drug abuse by Employee, the
Employees' failure within a reasonable time to commence or
complete such counseling, or the Employee's continued alcohol
or drug abuse after the completion of such counseling;
provided, however, that an Employee shall only be considered
to abuse alcohol if the Employee fails to timely and
adequately fulfill his duties under this Agreement due to the
consumption of alcohol. In the event of a termination For
Cause, Employee shall have no right to any further payment
under this Agreement (except as set forth in Section 4.4
hereof).
d. Without Cause. At any time after the commencement of
employment, the Company may, without cause ("Without Cause"),
terminate this Agreement and Employee's employment, effective
thirty (30) days after written notice is provided to the
Employee. Should Employee be terminated by the Company
Without Cause, Employee shall receive from the Company the
Base Compensation at the rate then in effect for the longer
of (i) one year, or (ii) whatever time period is remaining
under the Term, in each case, payable in equal monthly
payments for the remainder of such time.
-7-
8
e. Termination by Employee for Good Reason. The Employee may
terminate his employment hereunder for "Good Reason" at any
time within sixty (60) days of any event or occurrence (or
earlier written notice to the Employee of an event or
occurrence) giving rise to Employee's right to terminate
under this Subsection 4.2(e). If Employee does not terminate
his or her employment within sixty (60) days of such event or
occurrence (or, where applicable, written notification by the
Company of such an event or occurrence), Employee shall be
deemed to have waived his right to terminate his or her
employment under this Subsection 4.2(e) with respect to such
event or occurrence. As used herein, "Good Reason" shall mean
the continuance of any of the following after ten (10) days'
prior written notice by Employee to the Company, specifying
the basis for such Employee's having Good Reason to terminate
this Agreement:
i. a material adverse change in Employee's compensation
package;
ii. the assignment to Employee of any duties materially
and adversely inconsistent with a professional or
management position with the Company;
iii. any other material breach of this Agreement by the
Company, including the failure to pay Employee on a
timely basis the amounts to which he is entitled
under this Agreement;
iv. the Company requires the Employee to change his
principal work site to a location fifty (50) or more
miles away from Employee's current principal work
site; or
v. the Board of Directors determines not to extend this
Agreement by providing the written notice referenced
in Section 4.1 hereof.
If Employee resigns or otherwise terminates his employment
for Good Reason, Employee shall receive from the Company the
Base Compensation at the rate then in effect for the longer
of (i) one year, or (ii) whatever time period is remaining
under the Term of this Agreement, in each case, payable in
equal monthly payments for the remainder of such Term. If
Employee resigns or otherwise terminates his employment for
any reason other than Good Reason, Employee shall have no
right to any further payment under this Agreement (except as
set forth in Section 4.4 hereof).
-8-
9
4.3 Termination With Change in Control of the Company.
a. Definition. For the purpose of the Agreement, "Change in
Control" shall be deemed to have occurred if:
i. any person, other than Den norske stats oljeselskap,
a.s. ("Statoil"), an affiliate of the Company or
Statoil, or an employee benefit plan of the Company,
or an affiliate of the Company, acquires directly or
indirectly the Beneficial Ownership (as defined in
Section 13(d) of the Securities Exchange Act of
1934, as amended) of any voting security of the
Company and immediately after such acquisition such
Person is, directly or indirectly, the Beneficial
Owner of voting securities representing more than
fifty percent (50%) or more of the total voting
power of all of the then-outstanding voting
securities of the Company;
ii. the stockholders of the Company approve a merger,
consolidation or reorganization of the Company
unless (A) such transaction would result in more
than fifty percent (50%) of the total voting power
represented by the voting securities of the
surviving entity outstanding immediately after such
transaction being Beneficially Owned by the holders
of outstanding voting securities of the Company
immediately prior to the transaction, with the
voting power of each such continuing holder relative
to other such continuing holders being substantially
the same as prior to the transaction, or (B) the
members constituting the Board of Directors of the
Company prior to such merger, consolidation,
recapitalization or reorganization constitute fifty
percent (50%) or more of the members of the Board of
Directors of the Company after the first vote to
elect members of the Board of Directors after such
merger, consolidation, recapitalization or
reorganization; or
iii. the stockholders of the Company approve a plan of
complete liquidation, dissolution or disposition of
all or substantially all of the assets or business
of the Company; or
iv. (A) the Company sells or otherwise transfers the
business unit or division for which Employee has
primary responsibility to any person, other than
Statoil, the Company or an entity controlled by the
Company or Statoil; and (B) the Company, Statoil or
an entity controlled by the Company or Statoil does
not offer Employee a position (x) substantially
similar, as to responsibilities and duties, to his
or her position with the Company as of the time of
such sale or transfer; and (y) where the Employee
will be entitled to the Base Compensation and all
other benefits provided to the Employee under this
Agreement.
-9-
10
b. Termination. If within two (2) years following a Change in
Control, Employee (i) is terminated Without Cause ("Change in
Control Termination"), or (ii) terminates his employment for
Good Reason after the occurrence of an event listed in
Section 4.2(e), (a "Change in Control Constructive
Termination"), Employee shall receive from the Company the
severance compensation package detailed in Exhibit A to this
Agreement in lieu of any compensation set forth in Section
4.2.
c. Cap on Parachute. Notwithstanding anything in this Agreement
to the contrary, if any amounts due to the Employee under
this Agreement and any other plan or program of the Company
constitute a "parachute payment," as such term is defined in
Code Section 280G(b)(2), and the amount of the parachute
payment, reduced by all federal, state and local taxes
applicable thereto, including the excise tax imposed pursuant
to Code Section 4999, is less than the amount the Employee
would receive if he were paid three times his "base amount,"
as defined in Code Section 280G(b)(3), less one dollar,
reduced by all federal, state and local taxes applicable
thereto, then the aggregate of the amounts constituting the
parachute payment shall be reduced to an amount that will
equal three times his base amount less one dollar. The
determinations to be made with respect to this Section shall
be made by an accounting firm jointly selected by the
Committee and the Employee and paid by the Company, and which
may be the Company's independent auditors.
4.4 Payment Through Termination. Upon termination of this Agreement for
any reason provided above, Employee shall be entitled to receive his
Base Salary earned and all benefits and reimbursements (including
payments for accrued vacation and sick leave) due through the
effective date of termination. In addition, upon termination of this
Agreement for any reason other than For Cause or by the Employee
without Good Reason, Employee shall be entitled to receive one-twelfth
(1/12th) of Employee's Average Bonus for each complete month served by
the Employee during the year of the Employee's termination through the
effective date of termination. Additional compensation subsequent to
termination, if any, will be due and payable to Employee only to the
extent and in the manner expressly provided above. All other rights
and obligations of the Company and Employee under this Agreement shall
cease as of the effective date of termination, except that the
Company's obligations under Articles 4 and 6 herein and Employee's
obligations under Articles 3 and 5, and Section 7.1 herein shall
survive such termination in accordance with their terms.
4.5 Payment in Lieu of Employee Benefits.
a. If this Agreement is terminated by the Company Without Cause,
due to a Total Disability or as part of a Change in Control
Termination or if this Agreement is terminated by the
Employee with Good Reason, as part of a Change in Control
Constructive Termination or pursuant to Section 4.2(b)
hereof, Employee shall receive as severance compensation from
the Company payment of the Benefits Equivalent (as defined
below).
-10-
11
b. The Benefits Equivalent shall be paid in equal pro-rata
installments over the same time period that the Employee is
entitled to receive payment of his or her Base Compensation
as set forth elsewhere in this Article 4.
c. Employee's receipt of the Benefits Equivalent shall be in
lieu of any future employee benefits or perquisites that
might be made available to the Employee by the Company. By
executing this Agreement, Employee hereby waives his or her
rights to any such employee benefits or perquisites, other
than payment to the Employee of the Benefits Equivalent, as
of the effective date of the termination of this Agreement.
d. As used herein, "Benefits Equivalent" shall mean the lesser
of (i) ten percent (10%) of Employee's Base Compensation or
(ii) $20,000 (multiplied by a fraction whose denominator is
the Consumer Price Index as of the date of this Agreement,
and whose numerator is the Consumer Price Index as of the
effective date of the termination of this Agreement). In
either case, the Board of Directors may determine, in its
sole discretion from time to time, to increase the "Benefits
Equivalent" by an amount equal to the increase in value, on
an after tax basis, of any significant additional employee
benefit available to the Employee as of the effective date of
termination of this Agreement, but not available to the
Employee as of the date hereof. (e.g., a Supplemental
Employee Retirement Plan).
ARTICLE 5
PROPRIETARY INFORMATION
5.1 Return of Company Property. All records, designs, patents, business
plans, financial statements, manuals, memoranda, lists and other
property delivered to or compiled by Employee by or on behalf of the
Company, or their representatives, vendors or customers which pertain
to the business of the Company shall be and remain the property of the
Company, as the case may be, and be subject at all times to their
discretion and control. Likewise, all correspondence, reports,
records, charts, advertising materials and other similar data
pertaining to the business, activities or future plans of the Company
which is collected by Employee shall be delivered promptly to the
Company without request by it upon termination of Employee's
employment.
5.2 Inventions. Employee shall disclose promptly to the Company any and
all significant conceptions and ideas for inventions, improvements and
valuable discoveries, whether patentable or not, which are conceived
or made by Employee, solely or jointly with another, during the period
of employment or within one (1) year thereafter, and which are
directly related to the business or activities of the Company and
which Employee conceives as a result of his employment by the Company.
Employee hereby assigns and agrees to assign all his interests therein
to the Company or its nominee. Whenever requested to do so by the
Company, Employee shall execute any and all applications, assignments
or other instruments
-11-
12
that the Company shall deem necessary to apply for and obtain patents
in the United States or any foreign country or to otherwise protect
the Company's interest therein.
5.3 Trade Secrets. Employee agrees that he will not, during or after the
term of this Agreement with the Company, disclose the specific terms
of the Company's relationships or agreements with their respective
significant vendors or customers or any other significant and material
trade secret of the Company, whether in existence or proposed, to any
person, firm, partnership, corporation or business for any reason or
purpose whatsoever.
ARTICLE 6
INDEMNIFICATION & INSURANCE
6.1 Indemnification. In addition to any indemnification rights the
Executive may have by statute, by-law or otherwise, the Company to the
fullest extent permitted by, and in accordance with and subject to the
requirements of, the General Corporation Law of the Commonwealth of
Virginia (i) shall indemnify the Executive and hold him harmless for
all losses, costs, expenses or liabilities (whether or not arising
during the Executive's employment hereunder), based upon or relating
to acts, decisions or omissions made by him in good faith while
performing services for the Company, and (ii) shall advance to the
Executive and pay all expenses, including, but not limited to,
reasonable attorney's fees and court fees, actually and necessarily
incurred by the Executive in connection with the investigation or
defense of, or being a witness in, any action, suit or proceeding
arising therefrom and in connection with any appeal thereof.
6.2 Indemnity Insurance. The Company shall make coverage available to the
Executive at the Company's expense, under any insurance against
directors' and officers' liabilities otherwise made available to other
directors and officers of the Company.
6.3 Term of Indemnity and Insurance. The indemnification provision in
Section 6.1 hereof and the Executive's coverage under any insurance
provided under Section 6.2 hereof shall survive the termination of
employment hereunder; provided, however, that the obligation to
provide insurance coverage under Section 6.2 shall terminate on the
second anniversary of the termination of employment hereunder.
6.4 Life Insurance. The Executive agrees that the Company, in its
discretion, may apply for and procure in its own name and for its own
benefit, life insurance insuring the life of the Executive in any
amount or amounts considered advisable, and that the Executive shall
have no right, title or interest therein. Further, the Executive
agrees to submit to any medical or other examination and to execute
and deliver any application or other instrument in writing reasonably
necessary to effectuate such insurance.
-12-
13
ARTICLE 7
GENERAL PROVISIONS
7.1 No Prior Agreements. Employee hereby represents and warrants to the
Company that the execution of this Agreement by Employee and his
employment by the Company and the performance of his duties hereunder
will not violate or be a breach of any agreement with a former
employer, client or any other person or entity. Further, Employee
agrees to indemnify the Company for any claim, including, but not
limited to, attorneys' fees and expenses of investigation or
litigation, by any such third party that such third party may now have
or may hereafter come to have against the Company based upon or
arising out of any non-competition agreement, invention or secrecy
agreement between Employee and such third party which was in existence
as of the date of this Agreement.
7.2 Assignment; Binding Effect. Employee understands that he has been
selected for employment by the Company on the basis of his personal
qualifications, experience and skills. Employee agrees, therefore, he
cannot assign all or any portion of his performance under this
Agreement. This Agreement may not be assigned or transferred by the
Company without the prior written consent of Employee; provided,
however that the Company may assign this Agreement to a majority-owned
subsidiary or affiliate of the Company without Employee's consent if
the Company agrees in writing to guarantee any payments to be made to
the Employee under this Agreement for the remainder of the Term.
Subject to the preceding two (2) sentences, this Agreement shall be
binding upon, inure to the benefit of and be enforceable by the
parties hereto and their respective heirs, legal representatives,
successors and assigns.
7.3 Complete Agreement. This Agreement is not a promise of future
employment. Employee has no oral representations, understandings or
agreements with the Company or any of its officers, directors or
representatives covering the same subject matter of this Agreement.
This written Agreement is the final, complete and exclusive statement
and expression of the agreement between the Company and Employee and
of all the terms of this Agreement. This Agreement is intended to
amend and restate and replace any prior employment agreement or
arrangement between the Employee and the Company and this Agreement
cannot be varied, contradicted or supplemented by evidence of any
prior or contemporaneous oral or written agreements. This written
Agreement may not be later modified except by a further writing signed
by a duly authorized officer of the Company and Employee, and no term
of this Agreement may be waived except by writing signed by the party
waiving the benefit of such term.
-13-
14
7.4 Notice. Whenever any notice is required hereunder, it shall be given
in writing addressed as follows:
To the Company:
Statoil Energy, Inc.
2800 Eisenhower Avenue
Alexandria, Virginia 22314
Attention: David A. Dresner
To Employee:
Statoil Energy, Inc.
2800 Eisenhower Avenue
Alexandria, Virginia 22314
Attention: Stevens V. Gillespie
Notice shall be deemed given and effective three (3) days after the
deposit in the U.S. mail of a writing addressed as above and sent
first class mail, certified, return receipt requested, or when
actually received. Either party may change the address for notice by
notifying the other party of such change in accordance with this
Section 7.4.
7.5 Severability; Headings. If any portion of this Agreement is held
invalid or inoperative, the other portions of this Agreement shall be
deemed valid and operative and, so far as is reasonable and possible,
effect shall be given to the intent manifested by the portion held
invalid or inoperative. The Section headings herein are for reference
purposes only and are not intended in any way to describe, interpret,
define or limit the extent or intent of the Agreement or of any part
hereof.
7.6 Arbitration. Any unresolved dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by
arbitration, conducted in Washington, D.C. in accordance with the
rules of the American Arbitration Association then in effect. The
arbitrators shall not have the authority to add to, detract from, or
modify any provision hereof nor to award punitive damages to any
injured party. The arbitrators shall have the authority to order
back-pay, severance compensation, vesting of options (or cash
compensation in lieu of vesting of options), reimbursement of costs,
including those incurred to enforce this Agreement, and interest
thereon in the event the arbitrators determine that Employee was
terminated without disability or not For Cause, as defined in Sections
4.2(b) and 4.2(c), respectively, or that the Company has otherwise
materially breached this Agreement. A decision by a majority of the
arbitration panel shall be final and binding. Judgment may be entered
on the arbitrators' award in any court having jurisdiction. The direct
expense of any arbitration proceeding shall be borne by the party that
does not prevail in such arbitration.
-14-
15
7.7 Governing Law. This Agreement shall in all respects be construed
according to the laws of the Commonwealth of Virginia.
7.8 Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, and all of which together shall
constitute one document.
7.9 Waiver. Except as otherwise specifically set forth herein, the failure
of either party to insist in any one or more instances upon
performance of any terms or conditions of this Agreement shall not be
construed as a waiver of future performance of any such term, covenant
or condition, and the obligations of either party with respect to such
term, covenant or condition shall continue in full force and effect.
7.10
No Duty to Mitigate. Employee has no obligation to seek or find other
employment or to otherwise mitigate his or her loss of income in order
to receive any amounts payable by the Company pursuant to this
Agreement upon Employee's termination. The Company's payment
obligations pursuant to this Agreement shall not be reduced because of
any compensation payable to Employee from other employment after
Employee's termination, or any claims that the Company may have
against the Employee at the time of or after Employee's termination.
-15-
16
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
Company: STATOIL ENERGY, INC.
a Virginia corporation,
By: /s/ DAVID A. DRESNER
------------------------------
Name: David A. Dresner
Title: President and Chief
Executive Officer
Employee: /s/ STEVENS V. GILLESPIE
----------------------------------
Stevens V. Gillespie
-16-
17
EXHIBIT A
Severance Compensation Package
In the event of a Change in Control Termination or Change in
Control Constructive Termination pursuant to Section 4.3 , the following shall
occur:
(i) Employee shall receive an amount equal to two (2)
times the sum of (i) such Employee's Base Salary, at
the time of termination and (ii) the Employee's
Average Bonus. Such amount to be paid in equal
monthly installments over the remainder of the Term
of this Agreement;
(ii) Employee shall receive the Benefits Equivalent as
set forth in Section 4.5 hereof; and
(iii) all non-vested Stock Options available to Employee
through the remainder of the Term of employment
shall automatically vest and such Stock Options
shall be exercisable by such Employee until the
first anniversary of Employee's termination.