Executive Employment Agreement - Halliburton Co. and Lewis W. Powers
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement ("Agreement"), is entered into by
and between Halliburton Company ("Employer"), a Delaware corporation and Lewis
W. Powers, ("Employee"), to be effective on September 29, 1998 (the "Effective
Date").
W I T N E S S E T H:
WHEREAS, Employee is currently employed by Employer; and
WHEREAS, Employer is desirous of continuing the employment of Employee
after the Effective Date pursuant to the terms and conditions and for the
consideration set forth in this Agreement, and Employee is desirous of
continuing in the employ of Employer pursuant to such terms and conditions and
for such consideration.
NOW, THEREFORE, for and in consideration of the mutual promises,
covenants, and obligations contained herein, Employer and Employee agree as
follows:
ARTICLE 1: EMPLOYMENT AND DUTIES:
1.1. Employer agrees to employ Employee, and Employee agrees to be
employed by Employer, beginning as of the Effective Date and continuing until
the date of termination of Employee's employment pursuant to the provisions of
Article 3 (the "Term"), subject to the terms and conditions of this Agreement.
1.2. Beginning as of the Effective Date, Employee shall be employed as
Senior Vice President - Strategic Account Management of Employer. Employee
agrees to serve in the assigned position or in such other executive capacities
as may be requested from time to time by Employer and to perform diligently and
to the best of Employee's abilities the duties and services appertaining to such
positions as reasonably determined by Employer, as well as such additional or
different duties and services appropriate to such positions which Employee from
time to time may be reasonably directed to perform by Employer.
1.3. Employee shall at all times comply with and be subject to such
policies and procedures as Employer may establish from time to time, including,
without limitation, the Halliburton Company Code of Business Conduct (the "Code
of Business Conduct").
1.4. Employee shall, during the period of Employee's employment by
Employer, devote Employee's full business time, energy, and best efforts to the
business and affairs of Employer. Employee may not engage, directly or
indirectly, in any other business, investment, or activity that interferes with
Employee's performance of Employee's duties hereunder, is contrary to the
interest of Employer or any of its affiliated subsidiaries and divisions
(collectively, the "Halliburton Entities" or, individually, a "Halliburton
Entity"), or requires any significant portion of Employee's business time. The
foregoing notwithstanding, the parties recognize and agree that Employee may
engage in passive personal investments and other business activities which do
not conflict with the business and affairs of the Halliburton Entities or
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interfere with Employee's performance of his or her duties hereunder. Employee
may not serve on the board of directors of any entity other than a Halliburton
Entity during the Term without the approval thereof in accordance with
Employer's policies and procedures regarding such service. Employee shall be
permitted to retain any compensation received for approved service on any
unaffiliated corporation's board of directors.
1.5. Employee acknowledges and agrees that Employee owes a fiduciary
duty of loyalty, fidelity and allegiance to act at all times in the best
interests of the Employer and the other Halliburton Entities and to do no act
which would, directly or indirectly, injure any such entity's business,
interests, or reputation. It is agreed that any direct or indirect interest in,
connection with, or benefit from any outside activities, particularly commercial
activities, which interest might in any way adversely affect Employer, or any
Halliburton Entity, involves a possible conflict of interest. In keeping with
Employee's fiduciary duties to Employer, Employee agrees that Employee shall not
knowingly become involved in a conflict of interest with Employer or the
Halliburton Entities, or upon discovery thereof, allow such a conflict to
continue. Moreover, Employee shall not engage in any activity which might
involve a possible conflict of interest without first obtaining approval in
accordance with Employer's policies and procedures.
1.6 Nothing contained herein shall be construed to preclude the
transfer of Employee's employment to another Halliburton Entity ("Subsequent
Employer") as of, or at any time after, the Effective Date and no such transfer
shall be deemed to be a termination of employment for purposes of Article 3
hereof; provided, however, that, effective with such transfer, all of Employer's
obligations hereunder shall be assumed by and be binding upon, and all of
Employer's rights hereunder shall be assigned to, such Subsequent Employer and
the defined term "Employer" as used herein shall thereafter be deemed amended to
mean such Subsequent Employer. Except as otherwise provided above, all of the
terms and conditions of this Agreement, including without limitation, Employee's
rights and obligations, shall remain in full force and effect following such
transfer of employment.
ARTICLE 2: COMPENSATION AND BENEFITS:
2.1. Employee's base salary during the Term shall be not less than
$325,000 per annum which shall be paid in accordance with the Employer's
standard payroll practice for its executives. Employee's base salary may be
increased from time to time with the approval of the Compensation Committee of
Employer's Board of Directors (the "Compensation Committee") or its delegate, as
applicable. Such increased base salary shall become the minimum base salary
under this Agreement and may not be decreased thereafter without the written
consent of Employee.
2.2. During the Term, Employee shall participate in the Halliburton
Annual Performance Pay Plan, or any successor annual incentive plan approved by
the Compensation Committee; provided, however, that all determinations relating
to Employee's participation, including, without limitation, those relating to
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the performance goals applicable to Employee and Employee's level of
participation and payout opportunity, shall be made in the sole discretion of
the person or committee to whom such authority has been granted pursuant to such
plan's terms.
2.3 Employer shall grant to Employee under the Halliburton Company
1993 Stock and Long-Term Incentive Plan (the "1993 Plan") 10,000 shares of
Employer's common stock subject to restrictions.
2.4. During the Term, Employer shall pay or reimburse Employee for all
actual, reasonable and customary expenses incurred by Employee in the course of
his or her employment; including, but not limited to, travel, entertainment,
subscriptions and dues associated with Employee's membership in professional,
business and civic organizations; provided that such expenses are incurred and
accounted for in accordance with Employer's applicable policies and procedures.
2.5. While employed by Employer, Employee shall be allowed to
participate, on the same basis generally as other executive employees of
Employer, in all general employee benefit plans and programs, including
improvements or modifications of the same, which on the Effective Date or
thereafter are made available by Employer to all or substantially all of
Employer's similarly situated executive employees. Such benefits, plans, and
programs may include, without limitation, medical, health, and dental care, life
insurance, disability protection, and qualified and non-qualified retirement
plans. Except as specifically provided herein, nothing in this Agreement is to
be construed or interpreted to increase or alter in any way the rights,
participation, coverage, or benefits under such benefit plans or programs than
provided to similarly situated executive employees pursuant to the terms and
conditions of such benefit plans and programs. While employed by Employer,
Employee shall be eligible to receive awards under the 1993 Plan or any
successor stock-related plan adopted by Employer's Board of Directors; provided,
however, that the foregoing shall not be construed as a guarantee with respect
to the type, amount or frequency of such awards, if any, such decisions being
solely within the discretion of the Compensation Committee or its delegate, as
applicable.
2.6. Except as otherwise provided in Section 2.2 hereof, Employer
shall not, by reason of this Article 2, be obligated to institute, maintain,
or refrain from changing, amending or discontinuing, any incentive compensation,
employee benefit or stock or stock option program or plan, so long as such
actions are similarly applicable to covered employees generally.
2.7. Employer may withhold from any compensation, benefits, or amounts
payable under this Agreement all federal, state, city, or other taxes as may be
required pursuant to any law or governmental regulation or ruling.
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ARTICLE 3: TERMINATION OF EMPLOYMENT AND EFFECTS OF SUCH TERMINATION:
3.1. Employee's employment with Employer shall be terminated (i) upon
the death of Employee, (ii) upon Employee's Retirement (as defined below), (iii)
upon Employee's Permanent Disability (as defined below), or (iv) at any time by
Employer upon notice to Employee, or by Employee upon thirty (30) days' notice
to Employer, for any or no reason.
3.2. If Employee's employment is terminated by reason of any of the
following circumstances, Employee shall not be entitled to receive the benefits
set forth in Section 3.3 hereof:
(i) Death.
(ii) Retirement. "Retirement" shall mean either (a) Employee's
retirement at or after normal retirement age (either
voluntarily or pursuant to Employer's retirement policy) or
(b) the voluntary termination of Employee's employment by
Employee in accordance with Employer's early retirement policy
for other than Good Reason (as defined below).
(iii) Permanent Disability. "Permanent Disability" shall mean
Employee's physical or mental incapacity to perform his or
her usual duties with such condition likely to remain
continuously and permanently as determined by the Compensation
Committee.
(iv) Voluntary Termination. "Voluntary Termination" shall mean a
termination of employment in the sole discretion and at the
election of Employee for other than Good Reason. "Good
Reason" shall mean (a) a termination of employment by Employee
because of a material breach by Employer of any material
provision of this Agreement which remains uncorrected for
thirty (30) days following notice of such breach by Employee
to Employer, provided such termination occurs within sixty
(60) days after the expiration of the notice period or (b)
a termination of employment by Employee within six (6) months
after a material reduction in Employee's rank or
responsibility with Employer.
(v) Termination for Cause. Termination of Employee's employment
by Employer for Cause. "Cause" shall mean any of the
following: (a) Employee's gross negligence or willful
misconduct in the performance of the duties and services
required of Employee pursuant to this Agreement, (b)
Employee's final conviction of a felony, (c) a material
violation of the Code of Business Conduct or (d) Employee's
material breach of any material provision of this Agreement
which remains uncorrected for thirty (30) days following
notice of such breach to Employee by Employer. Determination
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as to whether or not Cause exists for termination of
Employee's employment will be made by the Compensation
Committee.
In the event Employee's employment is terminated under any of the
foregoing circumstances, all future compensation to which Employee is otherwise
entitled and all future benefits for which Employee is eligible shall cease and
terminate as of the date of termination, except as specifically provided in this
Section 3.2. Employee, or his or her estate in the case of Employee's death,
shall be entitled to pro rata base salary through the date of such termination
and shall be entitled to any individual bonuses or individual incentive
compensation not yet paid but payable under Employer's plans for years prior to
the year of Employee's termination of employment, but shall not be entitled to
any bonus or incentive compensation for the year in which he or she terminates
employment or any other payments or benefits by or on behalf of Employer except
for those which may be payable pursuant to the terms of Employer's employee
benefit plans (as defined in Section 3.4), stock, stock option or incentive
plans, or the applicable agreements underlying such plans.
3.3 If Employee's employment is terminated by Employer for any
reason other than as set forth in Section 3.2 above Employee shall be entitled
to each of the following:
(i) To the extent not otherwise specifically provided in any
underlying restricted stock agreements, all shares of
Halliburton common stock previously granted to Employee under
the Halliburton Company Career Executive Incentive Stock Plan,
the 1993 Plan, and any similar plan adopted by Employer in the
future, which at the date of termination of employment are
subject to restrictions (the "Restricted Shares") will be
treated in a manner consistent with Employer's past practices
for treatment of Restricted Shares held by executives whose
employment was involuntarily terminated by Employer for
reasons other than Cause, which, in most instances, have
been to forfeit the Restricted Shares and pay to such
executive a lump sum cash payment equal to the value of the
Restricted Shares (based on the closing price of Halliburton
common stock on the New York Stock Exchange on the date of
termination of employment); although in some cases, Employer
has, in lieu of, or in combination with, the foregoing and
in its discretion, caused the forfeiture restrictions with
respect to all or a portion of the Restricted Shares to lapse
and provided for the retention of such shares by such
executive.
(ii) Subject to the provisions of Section 3.4, Employer shall pay
to Employee a severance benefit consisting of a single lump
sum cash payment equal to two years' of Employee's base salary
as in effect at the date of Employee's termination of
employment. Such severance benefit shall be paid no later than
sixty (60) days following Employee's termination of
employment.
(iii) Employee shall be entitled to any individual bonuses or
individual incentive compensation not yet paid but payable
under Employer's plans for years prior to the year of
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Employee's termination of employment. Such amounts shall be
paid to Employee in a single lump sum cash payment no later
than sixty (60) days following Employee's termination of
employment.
(iv) Employee shall be entitled to any individual bonuses or
individual incentive compensation under Employer's plans for
the year of Employee's termination of employment determined as
if Employee had remained employed by the Employer for the
entire year. Such amounts shall be paid to Employee at the
time that such amounts are paid to similarly situated
employees except that no portion of such amounts shall be
deferred to future years.
3.4. The severance benefit paid to Employee pursuant to Section 3.3
shall be in consideration of Employee's continuing obligations hereunder after
such termination, including, without limitation, Employee's obligations under
Article 4. Further, as a condition to the receipt of such severance benefit,
Employer, in its sole discretion, may require Employee to first execute a
release, in the form established by Employer, releasing Employer and all other
Halliburton Entities, and their officers, directors, employees, and agents, from
any and all claims and from any and all causes of action of any kind or
character, including, but not limited to, all claims and causes of action
arising out of Employee's employment with Employer and any other Halliburton
Entities or the termination of such employment. The performance of Employer's
obligations under Section 3.3 and the receipt of the severance benefit provided
thereunder by Employee shall constitute full settlement of all such claims and
causes of action. Employee shall not be under any duty or obligation to seek or
accept other employment following a termination of employment pursuant to which
a severance benefit payment under Section 3.3 is owing and the amounts due
Employee pursuant to Section 3.3 shall not be reduced or suspended if Employee
accepts subsequent employment or earns any amounts as a self-employed
individual. Employee's rights under Section 3.3 are Employee's sole and
exclusive rights against the Employer or its affiliates and the Employer's sole
and exclusive liability to Employee under this Agreement, in contract, tort or
otherwise, for the termination of his or her employment relationship with
Employer. Employee agrees that all disputes relating to Employee's termination
of employment, including, without limitation, any dispute as to "Cause" or
"Voluntary Termination" and any claims or demands against Employer based upon
Employee's employment for any monies other than those specified in Section 3.3,
shall be resolved through the Halliburton Dispute Resolution Plan as provided in
Section 5.6 hereof; provided, however, that decisions as to whether "Cause"
exists for termination of the employment relationship with Employee and whether
and as of what date Employee has become permanently disabled are delegated to
the Compensation Committee for determination and any dispute of Employee with
any such decision shall be limited to whether the Compensation Committee reached
such decision in good faith. Nothing contained in this Article 3 shall be
construed to be a waiver by Employee of any benefits accrued for or due Employee
under any employee benefit plan (as such term is defined in the Employees'
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Retirement Income Security Act of 1974, as amended) maintained by Employer,
except that Employee shall not be entitled to any severance benefits pursuant to
any severance plan or program of the Employer.
3.5. Termination of the employment relationship does not terminate
those obligations imposed by this Agreement which are continuing obligations,
including, without limitation, Employee's obligations under Article 4.
ARTICLE 4: OWNERSHIP AND PROTECTION OF INTELLECTUAL PROPERTY AND
CONFIDENTIAL INFORMATION:
4.1. All information, ideas, concepts, improvements, discoveries,
and inventions, whether patentable or not, which are conceived, made, developed
or acquired by Employee, individually or in conjunction with others, during
Employee's employment by Employer or any of its affiliates (whether during
business hours or otherwise and whether on Employer's premises or otherwise)
which relate to the business, products or services of Employer or its affiliates
(including, without limitation, all such information relating to corporate
opportunities, research, financial and sales data, pricing and trading terms,
evaluations, opinions, interpretations, acquisition prospects, the identity of
customers or their requirements, the identity of key contacts within the
customer's organizations or within the organization of acquisition prospects, or
marketing and merchandising techniques, prospective names, and marks), and all
writings or materials of any type embodying any of such items, shall be the sole
and exclusive property of Employer or its affiliates, as the case may be.
4.2. Employee acknowledges that the businesses of Employer and its
affiliates are highly competitive and that their strategies, methods, books,
records, and documents, their technical information concerning their products,
equipment, services, and processes, procurement procedures and pricing
techniques, the names of and other information (such as credit and financial
data) concerning their customers and business affiliates, all comprise
confidential business information and trade secrets which are valuable, special,
and unique assets which Employer or its affiliates use in their business to
obtain a competitive advantage over their competitors. Employee further
acknowledges that protection of such confidential business information and trade
secrets against unauthorized disclosure and use is of critical importance to
Employer and its affiliates in maintaining their competitive position. Employee
hereby agrees that Employee will not, at any time during or after his or her
employment by Employer, make any unauthorized disclosure of any confidential
business information or trade secrets of Employer or its affiliates, or make any
use thereof, except in the carrying out of his or her employment
responsibilities hereunder. Confidential business information shall not include
information in the public domain (but only if the same becomes part of the
public domain through a means other than a disclosure prohibited hereunder). The
above notwithstanding, a disclosure shall not be unauthorized if (i) it is
required by law or by a court of competent jurisdiction or (ii) it is in
connection with any judicial, arbitration, dispute resolution or other legal
proceeding in which Employee's legal rights and obligations as an employee or
under this Agreement are at issue; provided, however, that Employee shall, to
the extent practicable and lawful in any such events, give prior notice to
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Employer of his or her intent to disclose any such confidential business
information in such context so as to allow Employer or its affiliates an
opportunity (which Employee will not oppose) to obtain such protective orders or
similar relief with respect thereto as may be deemed appropriate.
4.3. All written materials, records, and other documents made by,
or coming into the possession of, Employee during the period of Employee's
employment by Employer which contain or disclose confidential business
information or trade secrets of Employer or its affiliates shall be and remain
the property of Employer, or its affiliates, as the case may be. Upon
termination of Employee's employment by Employer, for any reason, Employee
promptly shall deliver the same, and all copies thereof, to Employer.
4.4 For purposes of this Article 4, "affiliates" shall mean
entities in which Employer has a 20% or more direct or indirect equity interest.
ARTICLE 5: MISCELLANEOUS:
5.1. Except as otherwise provided in Section 4.4 hereof, for
purposes of this Agreement, the terms "affiliate" or "affiliated" means an
entity who directly, or indirectly through one or more intermediaries, controls,
is controlled by, or is under common control with Employer or in which Employer
or has a 50% or more equity interest.
5.2. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when received by or tendered to Employee or Employer, as
applicable, by pre-paid courier or by United States registered or certified
mail, return receipt requested, postage prepaid, addressed as follows:
If to Employer, to Halliburton Company at 3600 Lincoln Plaza, 500 North
Akard Street, Dallas, Texas 75201-3391, to the attention of the General
Counsel.
If to Employee, to his or her last known personal residence.
5.3. This Agreement shall be governed by and construed and
enforced, in all respects in accordance with the law of the State of Texas,
without regard to principles of conflicts of law, unless preempted by federal
law, in which case federal law shall govern; provided, however, that the
Halliburton Dispute Resolution Plan and the Federal Arbitration Act shall govern
in all respects with regard to the resolution of disputes hereunder.
5.4. No failure by either party hereto at any time to give notice
of any breach by the other party of, or to require compliance with, any
condition or provision of this Agreement shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.
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5.5. It is a desire and intent of the parties that the terms,
provisions, covenants, and remedies contained in this Agreement shall be
enforceable to the fullest extent permitted by law. If any such term, provision,
covenant, or remedy of this Agreement or the application thereof to any person,
association, or entity or circumstances shall, to any extent, be construed to be
invalid or unenforceable in whole or in part, then such term, provision,
covenant, or remedy shall be construed in a manner so as to permit its
enforceability under the applicable law to the fullest extent permitted by law.
In any case, the remaining provisions of this Agreement or the application
thereof to any person, association, or entity or circumstances other than those
to which they have been held invalid or unenforceable, shall remain in full
force and effect.
5.6. It is the mutual intention of the parties to have any dispute
concerning this Agreement resolved out of court. Accordingly, the parties agree
that any such dispute shall, as the sole and exclusive remedy, be submitted for
resolution through the Halliburton Dispute Resolution Plan; provided, however,
that the Employer, on its own behalf and on behalf of any of the Halliburton
Entities, shall be entitled to seek a restraining order or injunction in any
court of competent jurisdiction to prevent any breach or the continuation of any
breach of the provisions of Article 4 and Employee hereby consents that such
restraining order or injunction may be granted without the necessity of the
Employer posting any bond. The parties agree that the resolution of any such
dispute through such Plan shall be final and binding.
5.7. This Agreement shall be binding upon and inure to the benefit
of Employer, to the extent herein provided and any other person, association, or
entity which may hereafter acquire or succeed to all or substantially all of the
business or assets of Employer by any means whether direct or indirect, by
purchase, merger, consolidation, or otherwise. Employee's rights and obligations
under this Agreement are personal and such rights, benefits, and obligations of
Employee shall not be voluntarily or involuntarily assigned, alienated, or
transferred, whether by operation of law or otherwise, without the prior written
consent of Employer, other than in the case of death or incompetence of
Employee.
5.8. Except for any stock option and restricted stock agreements
and any agreements pertaining to intellectual property or confidential
information of Employer, which agreements remain in full force and effect, this
Agreement replaces and merges any previous agreements and discussions pertaining
to the subject matter covered herein. This Agreement constitutes the entire
agreement of the parties with regard to the terms of Employee's employment,
termination of employment and severance benefits, and contains all of the
covenants, promises, representations, warranties, and agreements between the
parties with respect to such matters. 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 the foregoing matters which is not
embodied herein, and that no agreement, statement, or promise relating to the
employment of Employee by Employer that is not contained in this Agreement shall
be valid or binding. Any modification of this Agreement will be effective only
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if it is in writing and signed by each party whose rights hereunder are affected
thereby, provided that any such modification must be authorized or approved by
the Compensation Committee or its delegate, as appropriate.
IN WITNESS WHEREOF, Employer and Employee have duly executed this
Agreement in multiple originals to be effective on the Effective Date.
HALLIBURTON COMPANY
By: /s/ David J. Lesar
--------------------------
Name: David J. Lesar
Title: President and Chief Operating Officer
EMPLOYEE
/s/ Lewis W. Powers
-----------------------------
Lewis W. Powers
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