Attached files
EXHIBIT
10.30
 |
Executive Employment
Agreement
|
This
Employment Agreement (the “Agreement”),
dated as of the 17th day of February 2010 (the “Effective
Date”), is by and between Deep Down, Inc., a Nevada corporation (the
“Company”),
and Michael Newbury, a resident of Richmond, TX (the “Executive”).
WHEREAS,
the Company is a parent organization that oversees the financial, manufacturing
and service operations of a group of companies that serve both domestic and
international clients related to various activities in deep-water oil and gas
exploration and production (the “Business”);
WHEREAS,
the Company desires to engage the services of the Executive and the Executive
desires to be employed by the Company;
WHEREAS,
the Company desires to be assured that the unique and expert services of the
Executive will be substantially available to the Company, and that the Executive
is willing and able to render such services on the terms and conditions
hereinafter set forth; and
WHEREAS,
the Company desires to be assured that the confidential information and good
will of the Company will be preserved for the exclusive benefit of the Company,
and the Executive acknowledges that Executive will receive specific confidential
information and training relating to the businesses of the Company, which
confidential information and training is necessary to enable Executive to
perform Executive’s duties and to receive future compensation and Executive will
play a significant role in the development and management of the businesses of
the Company and will be entrusted with the Company’s confidential information
relating to the Company and its customers, manufacturers, distributors and
others;
NOW,
THEREFORE, in consideration of such employment and the mutual covenants and
promises herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Executive agree as follows:
Section
1. Employment and
Position.
Subject
to Section 2, the Company hereby employs Executive as its Vice President
Business Development, and Executive hereby accepts such employment, under and
subject to the terms and conditions hereinafter set forth.
Section
2. Term.
The term
of employment under this Agreement shall begin on the Effective Date and, unless
sooner terminated as provided in Section 6, shall conclude on the 1st
anniversary of the date hereof (the “Initial
Term”). This Agreement shall be renewed automatically for
additional one (1) year periods (each a “Renewal
Term”) unless either party shall provide written notice to the other
party not less than ninety (90) days prior to the end of the Initial Term or
such applicable Renewal Term that it or (s)he does not wish to renew the
Agreement. The Initial Term and any Renewal Term are sometimes
collectively referred to herein as the “Employment
Period”. Executive represents to the Company that (s)he has no
present intention to terminate employment with the Company.
Section
3. Duties.
During
the Employment Period, Executive shall serve as Vice President Business
Development of the Company and Executive shall perform services in a manner
consistent with the Executive's position as Vice President Business Development
of the Company, subject to the general supervision of the CEO/President of
the Company. Executive shall devote his/her full business time
attention and energies and use his/her best efforts to the faithful performance
of such duties and to the promotion and forwarding of the business and affairs
of the Company for the Employment Period; provided,
however,
that during the Employment Period it shall not be a violation of this Agreement
for the Executive to (a) serve on corporate, civic or charitable boards or
committees, (b) deliver lectures, fulfill speaking engagements or teach at
educational institutions and (c) manage personal investments, so long as such
activities in clause (a), (b), and (c) together do not interfere in any material
respect with the performance of the Executive's duties and responsibilities as
an employee of the Company in accordance with this Agreement. It is
expressly understood and agreed that to the extent that such activities have
been conducted by the Executive prior to the date hereof, and are listed on
Exhibit
A, the continued conduct of such activities (or the conduct of activities
similar in nature and scope thereto) subsequent to the date hereof shall not
thereafter be deemed to interfere with the performance of the Executive's
responsibilities to the Company. Executive acknowledges and agrees
that Executive owes a fiduciary duty of loyalty, fidelity and allegiance to act
at all time in the best interests of the Company and to do no act which would
injure the Company’s business, its interests or its reputation.
Section
4. Compensation.
Section
4.01. Salary.
In
consideration of the services rendered by Executive under this Agreement, the
Company shall pay the Executive a base salary (the “Base
Salary”) as set forth on the attached Exhibit
B (or, if an Exhibit
B is not attached, the base salary shall be as agreed between Executive
and the Company), and by paying such additional bonus, commissions and/or pay
raises as may be approved by the Company. The Board of Directors of
the Company may review from time to time the Base Salary payable to Executive
hereunder and may, in its sole discretion, increase but not decrease, the
Executive’s rate of compensation. Any such increased Base Salary
shall be and become the “Base Salary” for purposes of this
Agreement. Any increase in the Base Salary may not serve to limit or
reduce any other obligation to the Executive under this Agreement.
Section 4.02. Annual Performance Bonus.
During
the Employment Period, Executive shall be eligible to receive an annual
performance bonus (the “Annual
Bonus”) payable in cash for each fiscal year of service completed by
Executive within the Employment Period in accordance with such incentive bonus
programs as the Board of Directors of the Company (the “Board”)
may adopt from time to time.
Section
5. Benefits.
In
addition to the compensation detailed in Section 4 of this Agreement, as full
compensation for Executive’s services during the Employment Period Executive
shall be entitled to the following benefits:
Page 2 of
20
Section
5.01. Paid
Vacation.
Executive
shall be entitled to accrue three, (3) weeks paid vacation per calendar year,
such vacation to extend for such periods and shall be taken at such intervals as
shall be appropriate and consistent with the proper performance of the
Executive’s duties hereunder. Any vacation time not taken by
Executive in one year may be carried forward to the next year. The
maximum amount of carryover will be determined by approved company
policies. Executive shall be entitled to reimbursement for any unused
vacation time as directed by approved company policy.
Section
5.02. Reimbursement of
Expenses.
The
Company shall reimburse Executive for all reasonable and necessary expenses
actually incurred by Executive directly in connection with the business affairs
of the Company and the performance of his/her duties hereunder, upon
presentation of proper receipts or other proof of expenditure and subject to
such reasonable guidelines or limitations provided by the Company from time to
time. Executive shall comply with such reasonable limitations and
reporting requirements with respect to such expenses as the Board of Directors
or other authorized management personnel of the Company may establish from time
to time.
Section
5.03. Benefit
Plans.
During
the Employment Period, upon satisfaction of the applicable eligibility
requirements, Executive shall be entitled to participate in all employee benefit
plans, practices, policies and programs, applicable generally to other employees
of the Company as determined by the Board of Directors of the Company from time
to time. Nothing in this Section 5.03 is to be construed or
interpreted to provide greater rights, participation, coverage or benefits under
such savings and retirement plans, practices, policies and programs than
provided to similarly situated employees pursuant to the terms and conditions
thereof.
Section
5.04. Fringe
Benefits.
During
the Employment Period, the Executive shall be entitled to such business-related
fringe benefits (including, without limitation, payment of cellular telephone,
vehicle allowance in the amount of one thousand dollars ($1000.00) per month,
payment of club dues, payment of professional or organizational fees,
tolls and taxes and related expenses, as appropriate) in accordance
with the plans, practices, programs and policies of the Company for other peer
executives at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, those provided generally
at any time after the Effective Date to other peer executives of the
Company. Notwithstanding the foregoing, no amounts shall be payable
under this section to the extent considered under U.S. Internal Revenue Service
(IRS) Internal Revenue Code (IRC) Section 409(a) amounts.
Section
5.05. Absence of
Limitations.
The
Company shall not by reason of this Section 5 be obligated to institute,
maintain or refrain from changing, amending or discontinuing any such incentive
compensation or employee benefit program or plan, so long as such actions are
similarly applicable to covered employees similarly situated.
Page 3 of
20
Section
6. Termination.
This
Agreement shall be terminated at the end of the Employment Period or earlier as
follows:
Section
6.01. Death.
This
Agreement shall automatically terminate upon the death of the
Executive.
Section
6.02. Permanent
Disability.
In the
event of any physical or mental disability of the Executive rendering the
Executive substantially unable to perform his/her duties in any material respect
hereunder for a continuous period of at least 90 days or 120 days out of any
twelve-month period and the further determination that the disability is
permanent with regard to the Executive’s ability to return to work in his/her
full capacity, in such event, the Executive's employment with the Company shall
terminate effective thirty (30) days after receipt of such notice by the
Executive (the "Disability
Effective Date"), provided that within the thirty (30)-day period after
such receipt, the Executive shall not have returned to full-time performance of
the Executive's duties. Any determination of disability shall be made
by the Board of Directors of the Company in consultation with a qualified
physician or physicians selected by the Board and reasonably acceptable to the
Executive. The failure of the Executive to submit to a reasonable
examination by such physician or physicians shall act as an estoppel to any
objection by the Executive to the determination of disability by the
Board. In such event, the Disability Effective Date shall be thirty
(30) days after receipt of such notice by the Company.
Section
6.03. By the Company For
Cause.
The
employment of the Executive may be terminated by the Company for Cause (as
defined below) at any time effective upon written notice to the
Executive. For purposes hereof, the term “Cause”
shall mean that the Board has determined that any one or more of the following
has occurred:
|
|
(a)
|
the
Executive shall have been convicted of, or shall have pleaded guilty or
nolo
contendere to, any felony;
|
|
|
(b)
|
the
Executive shall have willfully or intentionally failed or refused to carry
out the reasonable and lawful instructions, policies and procedures,
whether written or oral, of the CEO/President or Board (other than as a
result of illness or disability) concerning duties or actions consistent
with the Executive's position as Vice President Business Development and
such failure or refusal shall have continued for a period of five (5) days
following written notice from the CEO/President or
Board;
|
|
|
(c)
|
the
Executive shall have breached any material provision of this Agreement
(including Section 8 or 9 hereof) or any approved Company policies in
effect at the time of such breach or been negligent or incompetent in the
performance of his/her duties with respect to
employment;
|
Page 4 of
20
|
|
(d)
|
the
Executive shall have engaged in any conduct or course of conduct that has
the effect of materially damaging the reputation of the Company or its
business;
|
|
|
(e)
|
the
Executive shall have excessive absenteeism, including, without limitation,
an unapproved or unexcused absence after one prior warning for either an
unapproved or unexcused absence; or
|
|
|
(f)
|
the
Executive shall have committed any fraud, embezzlement, misappropriation
of funds, misrepresentation, sexual harassment, breach of fiduciary duty
or other act of dishonesty against the
Company.
|
|
|
(g)
|
the
commission by the Executive of any deliberate and premeditated act taken
by the Executive in bad faith against the interests of the
Company.
|
Notwithstanding
the foregoing, the occurrence of the event specified in (c) above shall not
constitute Cause unless the Company gives Executive written notice that such
event constitutes Cause and, provided that such breach or action is reasonably
capable of being cured, the Executive thereafter fails to cure such event within
thirty (30) days after receipt of such notice.
Section
6.04. By the Company without
Cause.
The
Company may terminate the Executive’s employment at any time without Cause
effective upon written notice to the Executive.
Section
6.05. By the Executive
Voluntarily.
The
Executive may terminate this Agreement at any time effective upon at least
fifteen (15) days prior written notice to the Company.
Section
6.06. By the Executive for Good
Reason.
The
Executive may terminate this Agreement effective upon written notice to the
Company for Good Reason. Such notice must provide a detailed
explanation of the Good Reason. Any such termination shall be treated
for purposes of this Agreement as a termination by the Company without
Cause. For this purpose, the term “Good
Reason” shall mean: (i) the assignment to the Executive of any duties
inconsistent in any substantial respect with the Executive’s position, authority
or responsibilities as contemplated by Section 1 of this Agreement or any duties
which are illegal or unethical or any diminution of any of the Executive’s
significant duties; (ii) any material reduction or discontinuance in any of
the benefits described in Sections 4 or 5 of this Agreement (other than any such
reduction or discontinuance applicable generally to employees of the Company);
(iii) the relocation by the Company of the Executive's primary place of
employment with the Company to a location not within a fifty (50) mile radius of
the Executive’s principal place of employment as of the date of employment; or
(iv) other material breach of this Agreement by the
Company. Notwithstanding the foregoing, in the event the Executive
provides notice of Good Reason contained in subclauses (i) or (iv) of the
immediately preceding sentence, the Company shall have the opportunity to cure
such Good Reason within 30 days of receiving such notice. If such
termination occurs, the exercising of any outstanding options and awards shall
be governed by the “Deep Down, Inc. 2003 Directors, Officers and Consultants
Stock Option, Stock Warrant and Stock Award Plan, (the “Option Plan”) as amended
and executed in EXIBIT C.
Page 5 of
20
Section
7. Termination Payments and
Benefits.
Section
7.01. Death, Voluntary
Termination, Termination For Cause.
Upon any
termination of Executive’s employment under this Agreement either (i)
voluntarily by the Executive, (ii) by the Company for Cause as provided in
Section 6.03 or (ii) as a result of the Executive’s death, all payments, salary
and other benefits hereunder shall cease at the effective date of
termination. Notwithstanding the foregoing, the Executive shall be
entitled to receive from the Company (a) all salary earned or accrued through
the date the Executive’s employment is terminated, (b) reimbursement for any and
all monies advanced in connection with the Executive’s employment for reasonable
and necessary expenses incurred by the Executive through the date the
Executive’s employment is terminated and (c) all other payments and benefits to
which the Executive may be entitled under the terms of any applicable
compensation arrangement or benefit plan or program of the Company, including
any earned and accrued, but unused vacation pay (collectively, “Accrued
Benefits”), except that, for this purpose, Accrued Benefits shall not
include any entitlement to severance under any Company severance policy
generally applicable to the Company’s salaried employees.
Section
7.02. Termination without Cause or
for Good Reason.
In the
event that this Agreement is terminated by the Company without Cause, or by the
Executive for Good Reason, the Executive shall be entitled to receive, as
his/her exclusive right and remedy in respect of such termination, (i) his/her
Accrued Benefits, except that, for this purpose, Accrued Benefits shall not
include any entitlement to severance under any Company severance policy
generally applicable to the Company’s salaried employees, (ii) as long as the
Executive does not violate the provisions of Section 8 and Section 9 hereof,
severance pay equal to the Executive’s then current monthly Base Salary, payable
in accordance with the Company’s regular pay schedule, for twelve (12) months
from the date of termination of employment, and (iii) the Executive shall
continue to be covered, upon the same terms and conditions as described
hereinabove, by the same or equivalent medical, dental, and life insurance
coverages, if any, as in effect for the Executive immediately prior to the
termination of his/her employment, until the earlier of (A) the expiration of
the period for which (s)he receives severance pay pursuant to clause (ii) above
and (B) the date the Executive has commenced new employment and has thereby
become eligible for comparable benefits, subject to the Executive’s rights under
COBRA. Any amount to be paid by the Company under subclauses (ii) and
(iii) of this Section 7.02 shall be paid to Executive in accordance with the
payroll and insurance payment policies from time to time in effect at the
Company.
Page 6 of
20
Section
7.03. Termination
due to Permanent Disability.
In the
event that this Agreement is terminated due to the Permanent Disability of the
Executive, the Executive shall receive (i) Accrued Benefits, except that, for
this purpose, Accrued Benefits shall not include any entitlement to severance
under any Company severance policy generally applicable to the Company’s
salaried employees and (ii) an amount equal to the Executive’s salary as is in
effect at the effective date of termination for a period of twelve (12) months
from the effective date of termination, pursuant to the Company’s normal payroll
practices; provided,
however,
that the such payments by the Company shall be reduced by the amount of any
disability insurance payments made to the Executive pursuant to insurance, if
any, provided under Section 5.03 above. Any amount to be paid by the
Company under Section 7.03(ii) shall be paid to Executive in accordance with the
payroll policies from time to time in effect at the Company.
Section
7.04. Accrued
Benefits.
Notwithstanding
anything else herein to the contrary, all Accrued Benefits to which the
Executive (or his/her estate or beneficiary) is entitled shall be payable in
cash promptly upon termination of his/her Employment Period, except as otherwise
specifically provided herein or under the terms of any applicable policy, plan
or program under which an applicable Accrued Benefit arises.
Section
7.05..No Other
Benefits.
Except as
specifically provided in this Section 7, upon termination of this Agreement for
any reason whatsoever, the Executive shall not be entitled to any compensation,
severance or other benefits from the Company or any of its subsidiaries or
affiliates. Payment by the Company of all Accrued Benefits and other
amounts and contributions to the cost of the Executive’s confirmed participation
in the Company’s medical, dental and life insurance plans that may be due to the
Executive under the applicable termination provision of this Section 7 shall
constitute the entire obligation of the Company to the
Executive. Acceptance by the Executive of performance by the Company
and any such payments shall constitute full settlement of and release for any
claims that the Executive might otherwise assert against the Company, its
affiliates or any of their respective shareholders, partners, directors,
officers, employees or agents relating to such termination to the maximum extent
permitted by law.
Section
7.06. Survival of Certain
Provisions.
Provisions
of this Agreement shall survive any termination of employment if so provided
herein or if necessary or desirable fully to accomplish the purposes of such
provision, including, without limitation, the obligations of the Executive under
Section 8 and 9 hereof. The obligation of the Company to make
payments to or on behalf of the Executive under Section 7 hereof is expressly
conditioned upon the Executive’s continued full performance of obligations under
Section 8 and Section 9 hereof and Executive acknowledges and agrees that the
Company shall be entitled to deduct from any amounts due to Executive hereunder
any obligations owned by Executive to the Company. The Executive
recognizes that, except as expressly provided in this Section 7, no compensation
is earned after termination of employment.
Page 7 of
20
Section
8. Confidential Information; Inventions
in the Field.
Section
8.01. Confidential
Information.
As a
condition of Executive's employment hereunder, the Company agrees to provide
Executive with, and to give him/her access to, Confidential
Information. The Executive shall hold in a fiduciary capacity for the
benefit of the Company all trade secrets, confidential information, knowledge
and data relating to the Company, its subsidiaries and their respective
businesses, affiliates employees, partners, managers, agents and
representatives, which shall have been obtained by the Executive during the
Executive's employment by the Company and/or its subsidiaries which shall not
have been or hereafter become public knowledge (other than by acts by the
Executive or representatives of the Executive in violation of this Agreement)
(hereinafter being collectively referred to as "Confidential
Information"). After termination of the Executive's employment
with the Company, the Executive shall not, without the prior written consent of
the Company or as may otherwise be required by law or legal process,
communicate, use, disclose or divulge any such trade secrets, information,
knowledge or data to anyone other than the Company and those designated by the
Company. Any termination of the Executive's employment or of this
Agreement shall have no effect on the continuing operation of this Section 8.01. The
Executive agrees to return all Confidential Information, including all
photocopies, extracts and summaries thereof, and any such information stored
electronically on tapes, computer disks or in any other manner to the Company at
any time upon request by the Company and upon the termination of his/her
employment hereunder for any reason. In no event shall an asserted
violation of the provision of this Section 8.01
constitute a basis for deferring or withholding any amounts otherwise payable to
the Executive under this Agreement.
Section
8.02. Fiduciary
Obligations.
The
Executive agrees that Confidential Information is of critical importance to the
Company and a violation of this Section 8.02 and Section 8.03 would seriously
and irreparably impair and damage the Company’s business. The
Executive agrees that (s)he shall keep all Confidential Information in a
fiduciary capacity for the sole benefit of the Company and its applicable
subsidiaries and affiliates. Executive further agrees to take all
reasonable measures to prevent unauthorized persons or entities from obtaining
or using Confidential Information. Executive acknowledges understands
and acknowledges that the provision of Confidential Information to Executive for
the performance of his/her duties of employment is distinct consideration for
the Company’s obligations in this Agreement, and that the provisions of Section
9 are intended in part to protect the Confidential Information provided to
Executive.
Section
8.03. Non-Use and
Non-Disclosure.
The
Executive shall not during the Employment Period or at any time thereafter (a)
disclose, directly or indirectly, any Confidential Information to any person
other than the Company or employees thereof at the time of such disclosure who,
in the reasonable judgment of the Executive, need to know such Confidential
Information or such other persons to whom the Executive has been specifically
instructed or authorized to make disclosure by the Board or CEO/President and in
all such cases only to the extent required in the course of the Executive’s
service to the Company or (b) use any Confidential Information, directly or
indirectly, for his/her own benefit or for the benefit of any other person or
entity.
Page 8 of
20
Section
8.04. Assignment of
Inventions.
The
Executive agrees that all Inventions in the Field (as defined below) shall be
the sole and exclusive property of the Company and Executive agrees, on
his/her behalf
and on behalf of his/her heirs,
assigns and representatives, to assign and transfer to the Company or its
designee, without any separate remuneration or compensation, his/her entire
right, title and interest in and to all Inventions in the Field, together with
all United States and foreign rights with respect thereto, and, at the Company’s
expense, to execute, acknowledge and deliver all papers and to do any and all
other things necessary for or incident to the applying for, obtaining and
maintaining of such letters patent, copyrights, trademarks or other intellectual
property rights and to perform all lawful acts, including giving testimony, and
to execute and deliver all such instruments that may be necessary or proper to
vest all such Inventions in the Field and patents and copyrights with respect
thereto in the Company, and to assist the Company in the prosecution or defense
of any interference which may be declared involving any of said patent
applications, patents, copyright applications or copyrights. In the
event the Company is unable, after reasonable efforts and, in any event, after
ten (10) business days, to secure Executive’s signature on a written assignment
to the Company, of any application for letters patent, trademark registration or
to any common law or statutory copyright or other property right therein,
whether because of his/her physical or mental incapacity, or for any other
reason whatsoever, Executive irrevocably designates and appoints the Secretary
of the Company as Executive’s attorney-in-fact to act on Executive’s behalf to
execute and file any such applications and to do all lawfully permitted acts to
further the prosecution or issuance of such assignments, letters patent,
copyright or trademark. Executive agrees to fully and promptly
disclose to the Company any Inventions in the Field. For purposes of
this Agreement, the words “Inventions
in the Field” shall include any and all inventions, developments,
applications, techniques, discoveries, innovations, writings, domain names,
improvements, trade secrets, designs, drawings, business processes, secret
processes and know-how, whether or not patentable or constituting a copyright or
trademark and whether reduced to practice or not, which Executive may create,
conceive, develop or make, either alone or in conjunction with others and
related or in any way connected with the Company, its strategic plans, products,
processes, apparatus or business now or hereafter carried on by the
Company. The provisions of this Section 8.04 shall not apply to any
Inventions in the Field for which it can be reasonably demonstrated that no
equipment, supplies, facility, or trade secret information of the Company or any
affiliate of the Company is used by Executive and which is developed entirely on
Executive’s own time, unless (a) such Inventions in the Field relate (i) to the
business of the Company or an Affiliate or (ii) to the actual or demonstrably
anticipated research or development of the Company or an affiliate of the
Company, or (b) such Inventions in the Field result from work performed by
Executive for the Company. Executive represents, warrants and
covenants on the date hereof that (i) (s)he does not have any applications for
patents or copyright registrations pending, either domestic or foreign, (ii)
his/her performance of the foregoing disclosure and assignment provisions will
not breach any invention assignment or proprietary information agreement with
any former employer or other party, and (iii) there is no invention or works or
authorship now in his/her possession which (s)he will claim to be excluded
herefrom.
Page 9 of
20
Section
8.05. Return of
Documents.
All
notes, letters, documents, records, tapes and other media of every kind and
description relating to the business, present or otherwise, of the Company or
its affiliates and any copies, in whole or in part, thereof (collectively, the
“Documents”),
whether or not prepared by the Executive and whether or not containing
Confidential Information, shall be the sole and exclusive property of the
Company. The Executive shall safeguard all Documents and shall
surrender to the Company at the time his/her employment terminates, or at such
earlier time or times as the Board or its designee or CEO/President may specify,
all Documents (including all photocopies, extracts and summaries thereof) and
other property of the Company then in the Executive’s possession or
control.
Section
9. Restrictions on Activities of
the Executive.
Section
9.01. Acknowledgments.
The
Executive and Company agree that (s)he is being employed hereunder in a key
capacity with the Company under an agreement-for-term
(and not at-will)
and that the Company is engaged in a highly competitive business and that the
success of the Company’s business in the marketplace depends upon its goodwill
and reputation for quality and dependability. The Executive and
Company further agree that reasonable limits may be placed on the Executive’s
ability to compete against the Company as provided herein to the extent that
they protect and preserve the legitimate business interests and good will of the
Company.
Section
9.02. General
Restrictions.
|
|
(a)
|
For
the Non-Competition Period (as defined below), the Executive will not
(anywhere in the world where the Company or any of its subsidiaries then
conducts business) engage or participate in, directly or indirectly, as
principal, agent, employee, employer, consultant, investor or partner, or
assist in the management of, or provide advisory or other services to, or
own any stock or any other ownership interest in, or make any financial
investment in, any business which is Competitive with the Company (as
defined below); provided
that the ownership of not more than five percent (5%) of
the outstanding securities of any class listed on an exchange or regularly
traded in the over-the-counter market shall not constitute a violation of
this Section 9.02. Because it is impossible to know which
business or operations Executive will participate in during Executive’s
employment by the Company, Executive agrees that a reasonable definition
of any business which is “Competitive
with the Company” is any business which engages in any business or
operations that are engaged in, or committed to be engaged in, by the
Company during Executive’s employment with the
Company.
|
|
|
(b)
|
For
purposes of this Agreement, the “Non-Competition
Period” shall mean a period beginning on the Effective Date and
ending on the earlier to occur of (i) the expiration of a period of twelve
(12) consecutive months after the Executive's employment with the Company
terminates and (ii) the date on which the Company ceases paying any
amounts to the Executive hereunder or otherwise providing benefits to the
Executive.
|
Page 10
of 20
|
|
(c)
|
Executive
also agrees that, during the Non-Competition Period, Executive will not,
directly or indirectly, make any statement or perform any acts intended to
advance the interest of any person engaged in or proposing to engage in a
business which is Competitive with the Company in any way that could
injure the interests of the
Company.
|
Section
9.03. Executives, Customers and
Suppliers.
During
the Non-Competition Period, the Executive will not directly or
indirectly
|
(a)
|
solicit,
or attempt to solicit, any officer, director, consultant or employee of
the Company or any of its subsidiaries or affiliates to leave his/her or
her engagement with the Company or such subsidiary or
affiliate,
|
|
(b)
|
solicit,
or attempt to solicit, any person or entity that was an officer, director,
consultant, agent or employee of the Company or any of its subsidiaries or
affiliates at any time within six (6) months prior to any proposed
solicitation to work for a third party that is engaged in a business that
is Competitive with the Company;
nor
|
|
(c)
|
call
upon, solicit, divert, entice away or in any other manner persuade, or
attempt to do any of the foregoing, from the Company or any of its
subsidiaries or affiliates any of their customers or suppliers, or
potential customers or suppliers, to
either;
|
|
(i)
|
become
a customer or supplier of any third party;
or
|
|
(ii)
|
cease
doing business with the Company or any of its subsidiaries or affiliates;
provided,
however,
that nothing in this Section 9.03 shall be deemed to prohibit the
Executive from calling upon or soliciting a customer or supplier during
the Non-Competition Period if such action relates solely to a business
which is not Competitive with the Company; and provided,
further,
however,
that nothing in this Section 9.03 shall be deemed to prohibit the
Executive
|
|
(A)
|
from
soliciting or hiring any Executive of the Company or any of its
subsidiaries or affiliates, if such Executive is a member of the
Executive’s immediate family;
|
|
(B)
|
from
placing advertisements in newspapers or other media of general circulation
advertising employment opportunities;
and
|
|
(C)
|
from
hiring persons who respond to such advertisements, provided that they were
not otherwise solicited by the Executive in violation of this
section.
|
Section
9.04. Executive’s Capability of
Support.
THE
EXECUTIVE REPRESENTS AND WARRANTS THAT THE KNOWLEDGE, SKILLS AND ABILITIES THE
EXECUTIVE POSSESSES AT THE TIME OF COMMENCEMENT OF EMPLOYMENT HEREUNDER ARE
SUFFICIENT TO PERMIT THE EXECUTIVE, IN THE EVENT OF TERMINATION OF THE
EXECUTIVE’S EMPLOYMENT HEREUNDER, TO EARN A LIVELIHOOD SATISFACTORY TO THE
EXECUTIVE WITHOUT VIOLATING ANY PROVISION OF SECTION 8 OR 9 HEREOF, FOR EXAMPLE,
BY USING SUCH KNOWLEDGE, SKILLS AND ABILITIES, OR SOME OF THEM, IN THE SERVICE
OF A NON-COMPETITOR. Furthermore, Executive represents and warrants
that Executive is not bound by the terms of a confidentiality agreement,
non-competition or other agreement with a third party that would conflict with
Executive’s obligations hereunder.
Page 11
of 20
Section
10. Remedies in Respect of
Restrictive Covenants.
Section
10.01. Specific Performance;
Election of Remedies.
It is
specifically understood and agreed that any breach of the provisions of Section
8 or 9 of this Agreement is likely to result in irreparable injury to the
Company and that the remedy at law alone will be an inadequate remedy for such
breach, and that in addition to any other remedy it may have, the Company shall
be entitled to enforce the specific performance of this Agreement by the
Executive and to seek both temporary and permanent injunctive relief (to the
extent permitted by law) without bond and without liability should such relief
be denied, modified or violated. Neither the right to obtain such
relief nor the obtaining of such relief shall be exclusive or preclude the
Company from any other remedy.
Section
10.02. Extension of
Obligations.
The
period of time during which the restrictions set forth in Section 9 hereof will
be in effect will be extended by the length of time during which Executive is in
breach of the terms of those provisions as determined by any court of competent
jurisdiction on the Company’s application for injunctive relief.
Section
10.03. No Right to Continued
Employment.
Nothing
in Sections 8 or 9 of this Agreement shall confer upon Executive any right to
continue in the employ of the Company or shall interfere with or restrict in any
way the rights of the Company, which, subject to the terms of this Agreement,
are hereby reserved, to discharge Executive at any time for any reason
whatsoever, with or without cause.
Section
10.04. Resolution of Disputes Relating
to Restrictive Covenants.
In
respect of any controversy or claim arising out of or relating to Section 8 or 9
of this Agreement, Executive and the Company agree to the following regarding
resolution thereof:
|
(a)
|
Early
Resolution Conference. Each of Sections 8 and 9 of this
Agreement is understood to be clear and enforceable as written and is
executed by both parties on that basis. However, should
Executive determine to later challenge any provision as unclear,
unenforceable or inapplicable to an activity that Executive intends to
engage in, Executive will first notify the Company in writing and meet
with a representative of the Company and a neutral mediator (if the
Company elects to retain one at its expense) to discuss resolution of any
dispute between the parties with respect to such
challenge. Executive will provide this notification at least
fourteen (14) days before Executive engages in any activity on behalf of a
business that is Competitive with the Company or engages in other activity
that could foreseeably fall within a questioned
restriction. The failure to comply with this requirement shall
waive parties right to challenge the reasonable scope, clarity,
applicability or enforceability of this Agreement and its restrictions at
a later time. All rights of the parties will be preserved if
the early resolution conference requirement is complied with even if no
agreement is reached in the
conference.
|
Page 12
of 20
|
(b)
|
Legal
Action. If Executive or the Company shall institute
action to enforce or interpret the terms and conditions of either of
Section 8 or 9 (or both) of this Agreement or to collect any monies under
it, venue for any such action shall be in Houston,
Texas. Executive irrevocably consents to the jurisdiction of
the courts located in the State of Texas for all suits or actions arising
out of or relating to Section 8 or 9 of this Agreement. Each of
Executive and the Company waives to the fullest extent possible, the
defense of an inconvenient forum, and each agrees that a final judgment in
any action shall be conclusive and may be enforced in other jurisdictions
by suit on the judgment or in any other manner provided by
law. THE COMPANY AND EXECUTIVE AGREE THAT THEY HEREBY
IRREVOCABLY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY SUCH ACTION TO ENFORCE
OR INTERPRET THIS AGREEMENT OR TO COLLECT MONIES UNDER
IT.
|
Section
11. Severable Provisions.
The
provisions of this Agreement are severable and the invalidity of any one or more
provisions shall not affect the validity of any other provision. In
the event that a court of competent jurisdiction shall determine that any
provision of this Agreement or the application thereof is unenforceable in whole
or in part because of the duration or scope thereof, the parties hereto agree
that said court in making such determination shall have the power to reduce the
duration and scope of such provision to the extent necessary to make it
enforceable, and that the Agreement in its reduced form shall be valid and
enforceable to the full extent permitted by law.
Section
12. Notices.
Any
notice, request, consent or other communication required, permitted or desired
to be given hereunder, to be effective, shall be in writing and shall be deemed
to have been sufficiently delivered for all purposes when telecopied (with
electronic confirmation of receipt), delivered by hand or received by registered
or certified mail, postage and fees prepaid, or by overnight courier service
addressed to the party to receive such notice, request, consent or communication
at the following address or any other address substituted therefore by notice
pursuant to these provisions:
|
|
If
to the Company:
With
a copy to:
If to
the Executive:
|
Deep
Down, Inc.
8827
W. Sam Houston Pkwy N.
Suite
100
Houston,
Texas 77040
Facsimile
No: +1-281-517-5001
Attention: General
Counsel
Looper
Reed & McGraw, P.C.
1300
Post Oak Blvd.
Suite
2000
Houston,
Texas 77056
Michael Newbury
At
the address set forth in his
personnel
file at Deep Down, Inc,
|
Page 13
of 20
Section
13. Miscellaneous.
Section
13.01. Amendment.
This
Agreement may not be amended, modified or revised except by a writing signed by
the parties.
Section 13.02. Assignment
and Transfer.
The
provisions of this Agreement shall be binding on and shall inure to the benefit
of any such successor in interest to the Company. Neither this
Agreement nor any of the rights, duties, interests or obligations of the
Executive shall be assignable or delegable by the Executive (except for a
delegation of duties to qualified personnel of the Company made in the routine
performance of Executive’s position), nor shall any of the payments required or
permitted to be made to the Executive by this Agreement be encumbered,
transferred or in any way anticipated, except as required by applicable
laws. However, all rights of the Executive under this Agreement shall
inure to the benefit of and be enforceable by the Executive’s personal or legal
representatives, estates, executors, administrators, heirs and
beneficiaries. All amounts payable to the Executive hereunder shall
be paid, in the event of the Executive’s death, to the Executive’s estate, heirs
or representatives.
Section
13.03. Waiver.
No term
or condition of this Agreement will be deemed to have been waived except in
writing by the party charged with waiver. The failure of the Company
to enforce at any time any of the provisions of this Agreement shall not be
deemed or construed to be a waiver of any such provision, nor in any way affect
the validity of this Agreement or any provision hereof or the right of the
Company to enforce thereafter each and every provision of this
Agreement. A waiver by the Company or the Executive of any provision
of this Agreement by the other party shall not operate or be construed as a
waiver of any other or subsequent breach by the other party.
Section
13.04. Entire
Agreement.
This
Agreement contains the entire agreement of the parties with respect to the
subject matter hereof and supersedes all prior understandings and agreements
among the parties, whether written or oral.
Section
13.05. Withholding.
The
Company shall be entitled to withhold from any amounts to be paid or benefits
provided to the Executive hereunder any United States of America federal, state,
or local withholding or other taxes or charges which it is from time to time
required to withhold. Any foreign withholdings will be addressed on a
case by case basis in writing and agreed to by both Parties.
Page 14
of 20
Section
13.06. Captions.
Captions
herein have been inserted solely for convenience of reference and in no way
define, limit or describe the scope or substance of any provision of this
Agreement.
Section
13.07. Binding Arbitration; Fees and Expenses.
|
(a)
|
Resolution
of Disputes Generally. Executive and the Company hereby
agree that any controversy or claim arising out of or relating to this
Agreement, the employment relationship between Executive and the Company,
or the termination thereof, including the arbitrability of any controversy
or claim, which cannot be settled by mutual agreement will be finally
settled by binding arbitration in accordance with the Federal Arbitration
Act (or if not applicable, the applicable state arbitration law) as
follows: Any party who is aggrieved will deliver a notice to
the other party setting forth the specific points in
dispute. Any points remaining in dispute twenty (20) days after
the giving of such notice may, upon ten (10) days’ notice to the other
party, be submitted to arbitration in Houston, Texas, to the American
Arbitration Association, before a single arbitrator appointed in
accordance with the Commercial Dispute Resolution Procedures and Rules of
the American Arbitration Association, as such procedures and rules may be
amended from time to time and modified only as herein expressly
provided. The arbitrator may enter a default decision against
any party who fails to participate in the arbitration
proceedings. Notwithstanding the foregoing, Executive and the
Company agree that resolution of any controversy or claim arising out of
or relating to Section 8 or 9 of this Agreement shall be resolved in
accordance with the provisions of Section 10 of this
Agreement.
|
|
(b)
|
Binding
Effect. The decision of the arbitrator on the points in
dispute will be final, unappealable and binding, and judgment on the award
may be entered in any court having jurisdiction thereof. The
parties agree that this provision has been adopted by the parties to
rapidly and inexpensively resolve any disputes between them and that this
provision will be grounds for dismissal of any court action commenced by
either party with respect to this Agreement, other than post-arbitration
actions seeking to enforce an arbitration award. In the event
that any court determines that this arbitration procedure is not binding,
or otherwise allows any litigation regarding a dispute, claim, or
controversy covered by this Agreement to proceed, the parties hereto
hereby waive any and all right to a trial by jury in or with respect to
such litigation.
|
|
(c)
|
Confidentiality. The
parties will keep confidential, and will not disclose to any person,
except as may be required by law, the existence of any controversy under
this Section 13.07, the referral of any such controversy to arbitration or
the status or resolution thereof. In addition, the
confidentiality restrictions set forth in Section 8 of this Agreement
shall continue in full force and
effect.
|
|
(d)
|
Waiver. Executive
acknowledges that this agreement to submit to arbitration includes all
controversies or claims of any kind (e.g.,
whether in contract or in tort, statutory or common law, legal or
equitable) now existing or hereafter arising under any federal, state,
local or foreign law (except for any claims or controversy arising out of
Section 8 or 9 of this Agreement), including, but not limited to, the Age
Discrimination in Employment Act, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1866, the Employee Retirement Income
Security Act, the Family and Medical Leave Act, the Americans With
Disabilities Act and all similar federal, state and local laws, and
Executive hereby waives all rights thereunder to have a judicial tribunal
and/or a jury determine such
claims.
|
Page 15
of 20
|
(e)
|
Fees
and Expenses. In the event that any action is brought to
enforce any of the provisions of this Agreement, or to obtain money
damages for the breach thereof, and such action results in the award of a
judgment for money damages or in the granting of any injunction in favor
of one of the parties to this Agreement, all expenses, including
reasonable attorneys’ fees, shall be paid by the non-prevailing
party. Any arbitrator appointed to resolve a dispute under this
Section 13.07 shall be authorized to apportion its fees and expenses and
the reasonable attorneys’ fees and expenses of either part as the
arbitrator deems appropriate. In the absence of apportionment
of fees and expenses by a court of competent jurisdiction or an arbitrator
(as the case may be), the fees and expenses of the arbitrator will be
borne equally be each party, and each party will bear the fees and
expenses of its own
attorney.
|
Section
13.08. Drug
Test.
The
Executive agrees that, if requested by the Company, (s)he shall submit to a drug
test at the commencement of his/her employment hereunder and thereafter at the
Company’s reasonable request in accordance with the Company policy and
procedures and that failure of such drug test shall constitute
Cause.
Section
13.09. Counterparts.
This
Agreement may be executed in one or more counterparts (including by facsimile),
each of which shall be deemed an original and shall have the same effect as if
the signatures hereto and thereto were on the same instrument.
Section
13.10. Governing
Law.
This
Agreement shall be construed under and enforced in accordance with the laws of
the State of Texas and its validity, interpretation, performance and enforcement
will be governed by the laws of that state applicable to contracts made and to
be performed entirely within that state, notwithstanding any conflicts of laws
or principles thereof.
Section
13.11. Acknowledgement.
PARTIES
ACKNOWLEDGE THAT BEFORE ENTERING INTO THIS AGREEMENT, PARTIES HAVE HAD THE
OPPORTUNITY TO CONSULT WITH ANY ATTORNEY OR OTHER ADVISOR OF PARTIES CHOICE,
PARTIES FURTHER ACKNOWLEDGES THAT PARTIES HAVE ENTERED INTO THIS AGREEMENT OF
PARTIES OWN FREE WILL, AND THAT NO PROMISES OR REPRESENTATIONS HAVE BEEN MADE TO
PARTIES BY ANY PERSON TO INDUCE PARTIES TO ENTER INTO THIS AGREEMENT OTHER THAN
THE EXPRESS TERMS SET FORTH HEREIN. PARTIES FURTHER ACKNOWLEDGES THAT
PARTIES HAS READ THIS AGREEMENT AND UNDERSTANDS ALL OF ITS TERMS, INCLUDING THE
WAIVER OF RIGHTS SET FORTH IN SECTION 13.07(d) OF THIS AGREEMENT.
Page 16
of 20
Section
13.12. Indemnity.
To the
extent permitted by applicable law, and the By-Laws of the Company, the Company
agrees to defend, indemnify and hold harmless the Executive from any and all
claims, demands or causes of action, including reasonable attorneys' fees and
expenses, suffered or incurred by the Executive as a result of the assertion or
filing of any claim, demand, litigation or other proceedings based, in whole or
in part, upon statements, acts or omissions made by or on behalf of the
Executive in the course and scope of the Executive's employment by the
Company. Within ten (10) days after notice from the Executive of the
filing or assertion of any claim for which indemnification is provided (or
sooner if action is required sooner in order to properly defend the Executive),
the Company shall designate competent, experienced counsel to represent the
Executive, at the Company's expense, which counsel shall be subject to the
Executive's approval, which shall not be unreasonably
withheld. Should the Company fail to so designate or pay, or make
arrangements for payment of, such counsel, then Executive shall have the right
to engage counsel of the Executive's choosing, and the Company shall be
obligated to pay or reimburse any and all fees and expenses incurred by the
Executive in defending himself in connection with any such claim.
[Remainder
of page left intentionally blank]
Page 17
of 20
IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement as a
sealed instrument as of the day and year first above written.
|
DEEP
DOWN, INC.
By:
/s/
Ronald E.
Smith
Name: Mr.
Ron Smith
Title:
President/CEO
/s/
Michael J.
Newbury
Executive
signature: Michael Newbury
Michael
J.
Newbury
Printed
Name: Michael Newbury
|
Page 18
of 20
Exhibit
A
Activities
of Executive
|
/s/
Michael J.
Newbury
Signature
of Executive
|
/s/ Ronald E.
Smith
Signature
of Hiring Manager
|
|
February 17,
2010
Date
|
February 17,
2010
Date
|
Page 19
of 20
Exhibit B
Base
Salary
Executive
Summary Compensation Sheet
The
agreed annual cash compensation for Michael Newbury of Deep Down, Inc., as of
April 14, 2010, is as follows:
Executive
Annual Base Salary: $7307.6923 per bi-weekly pay
cycle.
|
/s/
Michael J.
Newbury
Signature
of Executive
|
/s/ Ronald E.
Smith
Signature
of Hiring Manager
|
|
February 17,
2010
Date
|
February 17,
2010
Date
|
Page 20
of 20