Attached files
file | filename |
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8-K - FORM 8-K - ENTERPRISE PRODUCTS PARTNERS L.P. | h78310e8vk.htm |
EX-10.2 - EXHIBIT 10.2 - ENTERPRISE PRODUCTS PARTNERS L.P. | h78310exv10w2.htm |
EX-10.1 - EXHIBIT 10.1 - ENTERPRISE PRODUCTS PARTNERS L.P. | h78310exv10w1.htm |
Exhibit 10.3
RETENTION AGREEMENT
This Retention Agreement (Agreement) is made and entered into effective December 1, 2010
between Enterprise Products Company (Company) and A. James Teague (Employee).
WHEREAS, Company desires to enter into this Agreement with Employee to provide a retention
payment to encourage Employee to remain employed with Company, perform in a highly effective
manner, and proactively execute the commercial strategy that the Company and its Company Affiliates
(defined below) employ;
NOW, THEREFORE, in consideration thereof and of the covenants hereafter set forth, the parties
hereby agree as follows:
I. Retention Payment.
A. Vesting Schedule.
1. Subject to Section I.C below, if during the period beginning 24 months from the effective
date of this Agreement and ending on the day immediately preceding 48 months from the effective
date of this Agreement, Employee designates to the Audit, Conflicts and Governance Committee
(Audit Committee) of the Board of Directors of the general partner of Enterprise Products
Partners L.P. (EPD) a candidate to serve as Chief Operating Officer, and such candidate is
determined by the Audit Committee to be satisfactory and is hired by the Company to serve as, and
begins employment with the Company in the capacity of, Chief Operating Officer, and if Employee has
remained continuously employed by the Company from the effective date of this Agreement until the
satisfaction of all of the foregoing requirements (such requirements and the requirement of
continuous employment until their satisfaction being referred to as the Performance Condition and
the period of time during continuous employment is required being referred to as the Performance
Period), Employee will receive from Company a lump sum payment equal to the greater of (i) six
million dollars and no cents ($6,000,000.00) or (ii) ten million dollars and no cents
($10,000,000.00) multiplied by a fraction, the numerator of which is the number of months of the
Performance Period and the denominator of which is 48, less any applicable withholding taxes on
such payment (Performance Payment). The Performance Payment shall be paid within seven (7)
business days after the Performance Condition is satisfied.
2. Subject to Section I.C below, following the completion of 48 months of continuous
employment by Employee with Company from the effective date of this Agreement (Retention Period),
Employee will receive from Company a lump sum payment equal to ten million dollars and no cents
($10,000,000.00), less any applicable withholding taxes on such payment (Retention Payment). The
Retention Payment shall be paid within seven (7) business days after the completion of the
Retention Period.
B. Notwithstanding Section I.A above, Employee shall receive, or in the event of the
Employees death, the designated beneficiary of Employee shall receive, unless otherwise required
under Section V.E, the Retention Payment within thirty (30) days of a Qualifying Termination (as
defined below). A Qualifying Termination means (i) a termination of the Employees employment with
the Company and any Company Affiliate (as defined in Section II) prior to the end of the Retention
Period, which termination constitutes a separation from service as such term is defined by the
regulations under Section 409A of the Internal Revenue Code of 1986, as amended (Section 409A),
due to (a) Employees death or (b) Employees Disability (as defined in Section II); or (ii) a
termination of the Employees employment with the Company and any Company Affiliate by the Company
other than for
Cause as defined in Section II of this Agreement prior to the end of the Retention Period, which
termination constitutes an involuntary separation from service as such term is defined by the
regulations under Section 409A, due to (a) Employees job elimination by Company; (b) a business
reorganization of Company; or (c) a sale of Company or EPD.
C. For the avoidance of doubt, Employee shall be eligible to earn and receive either the
Performance Payment or the Retention Payment and in no event shall Employee be entitled to both the
Performance Payment and the Retention Payment. Accordingly, if Employees right to the Performance
Payment vests and ceases to be forfeitable, Employee shall not be eligible to earn or receive the
Retention Payment.
D. The Performance Payment and the Retention Payment are in addition to any discretionary
incentive compensation that the Company or any Company Affiliate may, in its sole discretion, grant
or have in place from time to time, including participation in a performance-based annual incentive
plan and a long term incentive (LTI) program for executives.
E. Any question as to whether there has been a termination of Employees employment, and the
cause associated with such termination, shall be determined by the Board of Directors of the
general partner of EPD. Any question related to the acceptance and employment of the successor
Chief Operating Officer shall be determined by the Audit Committee in its sole discretion.
II. Termination of Employment.
Termination for Cause under this Agreement shall mean a determination in good faith by the
Board of Directors of the general partner of EPD that Cause exists to terminate the Employee.
Cause shall mean (i) an act of willful misconduct or gross negligence in the performance of
Employees duties resulting in damage or injuries to Company or Company Affiliates, (ii) the
appropriation (or attempted appropriation) of a business opportunity of Company or Company
Affiliates, including attempting to secure or securing any personal gain in connection with any
transaction entered into on behalf of Company or Company Affiliates, (iii) the misappropriation (or
attempted misappropriation) of any of the funds or property of Company or Company Affiliates, (iv)
willful and continued failure to perform any substantial duties of Employees position (other than
any such failure resulting from Employees incapacity due to physical or mental illness or
disability) that is not cured within 30 days following written notice of such failure to perform
from Company to the Employee, or (v) the conviction of, indictment for (or its procedural
equivalent), or the entering of a guilty plea or plea of no contest, with respect to a felony or
other crime of moral turpitude.
Company Affiliate under this Agreement shall mean and include (i) EPCO Holdings, Inc., (ii)
Enterprise Products OLPGP, Inc., (iii) EPD, (iv) Enterprise Products Holdings LLC, (v) Enterprise
Products Operating LLC, (vi) DEP Holdings LLC, (vii) Duncan Energy Partners L.P. (DEP), (viii)
the respective subsidiaries or affiliates of any of the foregoing entities, (ix) any other entity
(A) which is controlled, directly or indirectly, individually, collectively or in any combination,
by the Company or any of the foregoing entities or (B) in which any of the Company or any of the
foregoing entities has a direct or indirect ownership interest, (x) any other entity (a) which is
controlled, directly or indirectly, by the Estate of Dan L. Duncan, Deceased, his spouse, his
descendants or any trusts for any of their respective benefit, individually, collectively or in any
combination, or (b) in which any of them has a direct or indirect ownership interest and (xi) any
predecessors, subsidiaries, related entities, officers, directors, shareholders, parent companies,
agents, attorneys, employees, successors, or assigns of any of the foregoing.
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Disability under this Agreement shall mean the state or condition pursuant to which the
Employee is, by reason of a medically determinable physical or mental impairment that can be
expected to result in death or can be expected to last for a continuous period of not less than 12
months, receiving income replacement benefits for a period of not less than three months under an
accident and health plan covering employees of the Company.
III. Non-solicitation of Company Employees
In the event Employee has been paid the Performance Payment or the Retention Payment pursuant
to Section I.B, Employee agrees that, for a period equal to the lesser of (i) 18 months after the
date of the event which gives rise to the payment of the Performance Payment or the Retention
Payment, as the case may be, or (ii) the remainder of the Retention Period as if this Agreement
were in full force and effect for the full Retention Period, Employee will not solicit or induce,
either directly or indirectly, any employees of the Company or any Company Affiliate to cease
employment with the Company or any Company Affiliate and will not assist any other person or entity
in such a solicitation. Employee and Company agree that employees of the Company or any Company
Affiliate may respond to open advertisements of employment with a future employer of Employee
without inducement from Employee. Such voluntary actions by employees of the Company or any
Company Affiliate do not violate this non-solicitation provision. Employee agrees that the
restrictions in this Section III are reasonable and necessary to protect the Companys investment
in human resources and shall survive the termination of this Agreement.
IV. Term of Agreement.
This Agreement shall terminate (subject to the survival of Section III hereof pursuant to the
last sentence of Section III) on the earliest of (i) the date of payment of the Performance Payment
to Employee, (ii) the date of payment of the Retention Payment to Employee or his designated
beneficiary if a Qualifying Termination occurs prior to the end of the Retention Period; (iii) the
date of Employees termination of employment which does not constitute a Qualifying Termination; or
(iv) December 1, 2014.
V. Miscellaneous.
A. Neither Employee, nor any person claiming under Employee, shall have the power to
anticipate, encumber or dispose of any right, title, interest or benefit hereunder in any manner or
any time, until the same shall have been actually distributed free and clear of the terms of this
Agreement.
B. This Agreement shall be binding upon and inure to the benefit of any successors to Company
and all persons lawfully claiming under Employee. Nothing in this Agreement shall confer on
Employee any right to continued employment or affect in any way the right of Company to terminate
Employees employment at any time.
C. The payments under this Agreement are neither intended nor should be construed as being
additions to base salary or included in calculations of salary increases.
D. This Agreement shall be governed by and construed in accordance with the laws of the State
of Texas, notwithstanding any conflict of law principles, and without regard to the place of
execution or performance of employment duties, or residence of the parties. The exclusive venue
for any dispute relating to this Agreement shall be Harris County, Texas.
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E. If the Performance Payment or the Retention Payment becomes payable, in either case, by
reason of a Qualifying Termination and fails to satisfy the requirements of the short-term deferral
exception under Section 409A and/or otherwise constitutes nonqualified deferred compensation
subject to Section 409A, and if Employee is a specified employee within the meaning of Section
409A (as determined by the Company in accordance with any method permitted under Section 409A),
then notwithstanding any provision of this Agreement to the contrary, such Performance Payment or
Retention Payment, as applicable, shall be paid on the first day of the seventh (7th)
calendar month beginning after the date on which the Qualifying Termination occurs. This Agreement
is intended, and its terms shall be interpreted as necessary, to comply with Section 409A.
F. This Agreement constitutes the entire agreement of the parties with regard to the specific
subject matter hereof and contains all of the covenants, promises, representations, warranties and
agreements between the parties with respect to such subject matter, and supersedes, replaces and
terminates any prior employment or retention agreement between the undersigned and the Company or
Company Affiliates. Each party to this Agreement acknowledges that no representation, inducement,
promise or agreement, oral or written, has been made by either party with respect to such subject
matter, which is not embodied herein, and that no agreement, statement or promise relating to the
subject matter that is not contained in this Agreement shall be valid or binding. Any modification
of this Agreement will be effective only if it is in writing and signed by each party whose rights
hereunder are affected thereby, provided that any such modification must be further authorized or
approved by the Board of Directors of the general partner of EPD.
[Signature Page to Follow]
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IN WITNESS WHEREOF, the parties hereto have caused the Agreement to be executed and effective on
the day and year first above written.
COMPANY | EMPLOYEE | |||||||
Enterprise Products Company | ||||||||
By: |
/s/ Gary P. Smith | /s/ A. James Teague | ||||||
Name:
|
Gary P. Smith | Name: A. James Teague | ||||||
Title:
|
Senior Vice President, Human Resources | This 9th day of December, 2010 | ||||||
This 9th day of December, 2010 |
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