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SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT

Employee Retention Agreement

SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT | Document Parties: ROSETTA RESOURCES INC. You are currently viewing:
This Employee Retention Agreement involves

ROSETTA RESOURCES INC.

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Title: SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Governing Law: Texas     Date: 3/2/2009
Industry: Oil and Gas Operations     Sector: Energy

SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT, Parties: rosetta resources inc.
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Exhibit 10.37

 

SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

 

This Second Amended and Restated Employment Agreement (this “Agreement”), effective as of December 31, 2008 (the “Amendment Date”) is between Rosetta Resources Inc., a Delaware corporation (“Employer”), and Michael H. Hickey (“Executive”), and supersedes and replaces that certain Amended and Restated Employment Agreement between Employer and Executive dated September 1, 2007.

 

WHEREAS, Executive has been employed as Vice President and General Counsel of Employer; and

 

WHEREAS, the parties desire to amend and restate the Amended and Restated Employment Agreement dated as of September 1, 2007, all as herein provided;

 

NOW, THEREFORE, the parties hereto agree as follows:

 

1.              Definitions .  As used in this Agreement, the following terms have the following meanings:

 

(a)           “Affiliate” means, with respect to any entity, any other corporation, organization, association, partnership, sole proprietorship or other type of entity, whether incorporated or unincorporated, directly or indirectly controlling or controlled by or under direct or indirect common control with such entity.

 

(b)           “Annual Period” means the time period of each year beginning on the first day of the Employment Term and ending on the day before the anniversary of that date.

 

(c)           “Board” means the Board of Directors of Employer.

 

(d)           “Cause” means a finding by the Board of acts or omissions, whether occurring during or before the Employment Term, constituting, in the Board’s reasonable judgment, (i) a breach of duty by Executive in the course of his employment involving fraud, acts of dishonesty (other than inadvertent acts or omissions), disloyalty to Employer or its Affiliates, or moral turpitude constituting criminal felony; (ii) conduct by Executive that is materially detrimental to Employer, monetarily or otherwise, or reflects unfavorably on Employer or Executive to such an extent that Employer’s best interests reasonably require the termination of Executive’s employment; (iii) acts or omissions of Executive materially in violation of his obligations under this Agreement or at law; (iv) Executive’s failure to comply with or enforce Employer’s policies concerning equal employment opportunity, including engaging in sexually or otherwise harassing conduct; (v) Executive’s repeated insubordination; (vi) Executive’s failure to comply with or enforce, in any material respect, all other personnel policies of Employer or its Affiliates; (vii) Executive’s failure to devote his full working time and best efforts to the performance of his responsibilities to Employer or its Affiliates; (viii) Executive’s conviction of, or entry of a plea agreement or consent decree or similar arrangement with respect to a felony or any violation of federal or state securities laws; or (ix) Executive’s failure to cooperate with any investigation or inquiry authorized by the Board or conducted by a governmental authority related to the business or Executive’s conduct, or (x) Executive’s failure to maintain a law license in good standing in the State of Texas.

 

 

 


 

(e)           “Corporate Change” means (i) the dissolution or liquidation of Employer; (ii) a reorganization, merger or consolidation of Employer with one or more corporations (other than a merger or consolidation effecting a reincorporation of Employer in another state or any other merger or consolidation in which the shareholders of the surviving corporation and their proportionate interests therein immediately after the merger or consolidation are substantially identical to the shareholders of Employer and their proportionate interests therein immediately prior to the merger or consolidation) (collectively, a “Corporate Change Merger”); (iii) the sale of all or substantially all of the assets of Employer or an affiliate as defined in the Rosetta Resources Inc. 2005  Long-Term Incentive Plan; or (iv) the occurrence of a Change in Control.  A “Change in Control” shall be deemed to have occurred if (x) individuals who were directors of Employer immediately prior to a Control Transaction shall cease, within two years of such Control Transaction to constitute a majority of the Board of Directors of Employer (or of the Board of Directors of any successor to Employer or to a company which has acquired all or substantially all its assets) other than by reason of an increase in the size of the membership of the applicable Board that is approved by at least a majority of the individuals who were directors of Employer immediately prior to such Control Transaction or (y) any entity, person or Group acquires shares of Employer in a transaction or series of transactions that result in such entity, person or Group directly or indirectly owning beneficially 50% or more of the outstanding shares of Common Stock.  As used herein, “Control Transaction” means (A) any tender offer for or acquisition of capital stock of Employer pursuant to which any person, entity, or Group directly or indirectly acquires beneficial ownership of 20% or more of the outstanding shares of Common Stock; (B) any Corporate Change Merger of Employer; (C) any contested election of directors of Employer; or (D) any combination of the foregoing, any one of which results in a change in voting power sufficient to elect a majority of the Board of Directors of Employer.  As used herein, “Group” means persons who act “in concert” as described in Sections 13(d)(3) and/or 14(d)(2) of the Securities Exchange Act of 1934, as amended.  Notwithstanding the foregoing, “Corporate Change” shall not include the Acquisition, the Offering or any public offering of equity of Employer pursuant to a registration that is effective under the Securities Act of 1933, as amended.  As used herein, “Acquisition” and “Offering” shall have the same meaning given to those terms in the Rosetta Resources Inc. 2005 Long-Term Incentive Plan.

 

 

 


 

(f)           “Competitor” means any person or entity that is engaged in the acquisition, exploration, development and production of oil and gas properties in competition with the activities of Employer or an Affiliate.

 

(g)           “Confidential Information” means any information about Rosetta or its Affiliates that is protected by the attorney-client privilege and any unprivileged information relating to Rosetta or its Affiliates or furnished to Executive by reason of Executive’s legal representation of Rosetta or its Affiliates and Executive’s employment by Rosetta, including, without limitation, all documents or information, in whatever form or medium, concerning or evidencing sales; costs; pricing; strategies; forecasts and long range plans; financial and tax information; personnel information; business, marketing and operational projections, plans and opportunities; customer, vendor, and supplier information; geological and geophysical maps, data, interpretations, and analyses; project and prospect locations and leads; well logs, interpretations, and analyses; and production information; but excluding any such information that is or becomes generally available to the public other than as a result of any breach of this Agreement or other unauthorized disclosure by Executive.

 

(h)           “Employment Termination Date” means the effective date of termination of Executive’s employment as established under Paragraph 6(g).

 

(i)           “Good Reason” means any of the following actions if taken without Executive’s prior written consent: (i) any demotion of Executive as evidenced by a material diminution in Executive’s responsibilities or duties; (ii) a material diminution in Executive’s base compensation; (iii) any permanent relocation of Executive’s place of business to a location 50 miles or more from the then-current location, provided such relocation is a material change in geographic location at which Executive must provide services for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations thereunder; or (iv) any other action or inaction by Employer that constitutes a material breach by Employer of its obligations under Paragraphs 12 or 20 of this Agreement.  Neither a transfer of employment among Employer and any of its Affiliates, a change in the co-employment relationship, nor a mere change in job title constitutes “Good Reason.”

 

(j)           “Inability to Perform” means and shall be deemed to have occurred if Executive has been determined under Employer’s long-term disability plan to be eligible for long-term disability benefits.  In the absence of Executive’s participation in, application for benefits under, or existence of such a plan, “Inability to Perform” means a finding by the Board in its sole judgment that Executive is, despite any reasonable accommodation required by law, unable to perform the essential functions of his position because of an illness or injury for (i) 60% or more of the normal working days during six consecutive calendar months or (ii) 40% or more of the normal working days during twelve consecutive calendar months.

 

 

 


 

(k)           “Work Product” means all ideas, works of authorship, inventions, and other creations, whether or not patentable, copyrightable, or subject to other intellectual-property protection, that are made, conceived, developed or worked on in whole or in part by Executive while employed by Employer and/or any of its Affiliates, that relate in any manner whatsoever to the business, existing or proposed, of Employer and/or any of its Affiliates, or any other business or research or development effort in which Employer and/or any of its Affiliates engages during Executive’s employment.  Work Product includes any material previously conceived, made, developed, or worked on during Executive’s employment with Employer or any Affiliate.

 

2.              Employment .  Employer agrees to employ Executive (directly or through an Affiliate), and Executive agrees to be employed, for the period set forth in Paragraph 3.  Executive will be employed in the position and with the duties and responsibilities set forth in Paragraph 4(a) and upon the other terms and conditions set out in this Agreement.  Employer and Executive agree that such employment may be through a co-employment relationship with a professional employer organization.

 

3.              Term .  Executive’s employment under this Agreement shall commence on August 1, 2005 and shall be for an initial term of one Annual Period (the “Employment Term”), unless sooner terminated as provided in this Agreement.  Subject to earlier termination as provided in this Agreement, the Employment Term shall be automatically extended for an additional Annual Period unless either Executive or Employer gives written notice to the other six months or more prior to the end of the initial term or, if the Agreement has been automatically extended beyond the initial term, six months or more prior to the end of the additional Annual Period.  In the event of such an automatic extension, each additional Annual Period shall be part of the “Employment Term.”  Upon such timely written notice, Executive’s employment and this Agreement will end upon the expiration of the Employment Term.  The ending of Executive’s employment as a result of the expiration of the Employment Term shall not constitute a termination of employment by either party under this Agreement.

 

4.              Position and Duties .

 

(a)           Executive shall be employed as Vice President and General Counsel.  In such capacity, Executive, subject to the ultimate control and direction of the Chief Executive Officer of Employer, shall have such duties, functions, responsibilities, and authority as are from time to time delegated to Executive by the Chief Executive Officer of Employer; provided, however, that such duties, functions, responsibilities, and authority are reasonable and customary for a person serving in the same or similar capacity of an enterprise comparable to Employer, and provided further, however, that Executive shall not be directed by the Chief Executive Officer or Board to take any action that would reasonably require Executive to withdraw from representation of the Company (other than a withdrawal due to an actual or potential conflict of interest) or that could reasonably be expected to result in sanctions under the Texas Disciplinary Rules of Professional Conduct to the extent that such direction is provided or continues to be provided after Executive has notified the chairman of the Board in writing that the contemplated actions would require withdrawal and/or could reasonably be expected to result in sanctions

 

 

 


 

(b)           During the Employment Term, Executive shall devote his full time, skill, and attention and his best efforts to the business and affairs of Employer to the extent necessary to discharge fully, faithfully, and efficiently the duties and responsibilities delegated and assigned to Executive in or pursuant to this Agreement, except for usual, ordinary, and customary periods of vacation and absence due to illness or other disability.

 

(c)           In connection with Executive’s employment under this Agreement, Executive shall be based in Houston, Texas, or at any other place where the principal executive offices of Employer may be located during the Employment Term.  Executive also will engage in such travel as the performance of Executive’s duties in the business of Employer may require.

 

(d)           All services that Executive may render to Employer or any of its Affiliates in any capacity during the Employment Term shall be deemed to be services required by this Agreement and the consideration for such services is that provided for in this Agreement.

 

(e)           Executive hereby acknowledges that he has read and is familiar with Employer’s policies, including but not limited to those regarding business ethics and conduct and securities trading, and will comply with all such policies, and any amendments thereto, during the Employment Term.

 

5.              Compensation and Related Matters .

 

(a)            Base Salary .  During each Annual Period of the Employment Term, Employer shall pay to Executive for his services under this Agreement an annual base salary (“Base Salary”).  The Base Salary effective as of Amendment Date shall be $240,000.  The Base Salary is subject to adjustments at the discretion of the Board, but in no event shall Employer pay Executive a Base Salary less than that set forth above without the consent of Executive.  The Base Salary shall be payable in installments in accordance with the general payroll practices of Employer, or as otherwise mutually agreed upon.

 

(b)            Annual Incentives .  During the Employment Term, Executive will participate in any incentive compensation plan (ICP) or retention bonus arrangement applicable to Executive’s position, as may be adopted by Employer from time to time and in accordance with the terms of such plan(s).  Executive’s target award opportunity for the year ending on December 31, 2007, will be based upon 65% of Executive’s Base Salary paid to Executive by Employer prorated for the number of months in such period as compared to a full year and shall be subject to such other terms, conditions and restrictions as may be established by the Board or the compensation committee.

 

 

 


 

(c)            Long-Term Incentives .  During the Employment Term, Executive will participate in Employer’s long-term incentive (LTI) plan applicable to Executive’s position, in accordance with the terms of such plan(s).  Except as provided in Paragraph 5(d), Executive will participate in such LTI plan award opportunities as may be determined by the Board or the compensation committee of the Board, as applicable.

 

(d)            Employee Benefits .  During the Employment Term, Executive shall be entitled to participate in all employee benefit plans, programs, and arrangements that are generally made available by Employer to its similarly situated employees, including without limitation Employer’s life insurance, long-term disability, and health plans.  Executive agrees to cooperate and participate in any medical or physical examinations as may be required by any insurance company in connection with the applications for such life and/or disability insurance policies.

 

(e)            Expenses .  Executive shall be entitled to receive reimbursement for all reasonable expenses incurred by Executive during the Employment Term in performing his duties and responsibilities under this Agreement, consistent with Employer’s policies or practices for reimbursement of expenses incurred by other senior executives of Employer (“Business Expenses”).  Notwithstanding the foregoing, (i) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year, (ii) the reimbursement must be made on or before the last day of the calendar year following the calendar year in which the expense was incurred and (iii) the right to reimbursement shall not be subject to liquidation or exchange for any other benefit.

 

(f)            Vacations .  During each Annual Period of the Employment Term, Executive shall be eligible for four weeks’ paid vacation, as well as sick pay and other paid and unpaid time off in accordance with the policies and practices of Employer.  Executive agrees to use his vacation and other paid time off at such times that are (i) consistent with the proper performance of his duties and responsibilities and (ii) mutually convenient for Employer and Executive.

 

(g)            Fringe Benefits .  During the Employment Term, Executive shall be entitled to the perquisites and other fringe benefits that are made available by Employer to its senior executives generally and to such perquisites and fringe benefits that are made available by Employer to Executive in particular, subject to any applicable terms and conditions of any specific perquisite or other fringe benefit.

 

 

 


 

6.              Termination of Employment and Agreement .

 

(a)            Death .  Executive’s employment and this Agreement shall terminate automatically upon his death.

 

(b)            Inability to Perform .  Employer may terminate this Agreement or this Agreement and Executive’s employment for Inability to Perform.

 

(c)            Termination by Employer for Cause .  Employer may terminate Executive’s employment and this Agreement for Cause by providing Executive with a Notice of Termination as set out in Paragraph 6(f).  Before terminating Executive’s employment and this Agreement for Cause, Employer must provide Executive with written notice of its intent to do so, which notice must specify the particular circumstances or events that Employer contends gives rise to the existence of Cause; provided, however, that if Employer intends to exercise its right to terminate Executive’s employment and this Agreement in whole or part under provisions (v) or (vi) of the definition of Cause, Employer must first provide Executive with a reasonable period of time to correct those circumstances or events Employer contends give rise to the existence of Cause under such provision(s) (the “Correction Period”), but only to the extent Employer determines that they may reasonably be corrected.  A 30-day Correction Period shall be presumptively reasonable.  Executive will be given the opportunity within 30 calendar days of his receipt of Employer’s written notice of its intent to terminate Executive’s employment and this Agreement for Cause to defend himself with respect to the circumstances or events specified in such notice and in a manner and under such procedures as the Chief Executive Officer of Employer may establish.  Nothing in this Paragraph 6(c) precludes informal discussions between Executive and Employer regarding such circumstances or events.

 

(d)            Termination by Executive for Good Reason .  Executive may terminate his employment and this Agreement for Good Reason.  To exercise his right to terminate for Good Reason, Executive must provide written notice to Employer of his belief that Good Reason exists within 60 days of the initial existence of the Good Reason condition, and that notice shall describe the condition(s) believed to constitute Good Reason.  Employer shall have 30 days to remedy the Good Reason condition(s).  If not remedied within that 30-day period, Executive may submit a Notice of Termination; provided, however, that the Notice of Termination invoking Executive’s right to terminate his employment for Good Reason must be given no later than 100 days after the date the Good Reason condition first arose; otherwise, Executive is deemed to have accepted the condition(s), or the Employer’s correction of such condition(s), that may have given rise to the existence of Good Reason.

 

(e)            Termination by Either Party Without Cause or Without Good Reason .  Either Employer or Executive may terminate Executive’s employment and this Agreement without Cause or Good Reason upon at least 60 days’ prior written notice to the other party.

 

 

 


 

(f)            Notice of Termination .  Any termination of Executive’s employment or, pursuant to Paragraph 6(b), a termination of this Agreement alone, by Employer or by Executive (other than a termination pursuant to Paragraph 6(a)) shall be communicated by a Notice of Termination.  A “Notice of Termination” is a written notice that must (i) indicate the specific termination provision in this Agreement relied upon; (ii) in the case of a termination for Inability to Perform, Cause, or Good Reason, set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision invoked; and (iii) if the termination is by Executive under Paragraph 6(e), or by Employer for any reason, specify the Employment Termination Date or, pursuant to Paragraph 6(b), the date of termination of this Agreement.  The failure by Employer or Executive to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Cause or Good Reason shall not waive any right of Employer or Executive or preclude either of them from asserting such fact or circumstance in enforcing or defending their rights.

 

(g)            Employment Termination Date .  The Employment Termination Date, whether occurring before or after a Corporate Change, shall be as follows: (i) if Executive’s employment is terminated by his death, the date of his death; (ii) if Executive’s employment is terminated by Employer because of his Inability to Perform or for Cause, the date specified in the Notice of Termination, which date shall be no earlier than the date such notice is given; (iii) if Executive’s employment is terminated by Executive for Good Reason, the date on which the Notice of Termination is given; or (iv) if the termination is under Paragraph 6(e), the date specified in the Notice of Termination, which date shall be no earlier than 60 days after the date such notice is given.

 

(h)            Deemed Resignation .  In the event of termination of Executive’s employment or the expiration of the Employment Term, Executive agrees that if at such time he is a member of the Board or is an officer of Employer or a director or officer of any of its Affiliates, he shall be deemed to have resigned from such position(s) effective on the Employment Termination Date or the expiration of the Employment Term, unless the Board notifies Executive prior to the Employment Termination Date or the expiration of the Employment Term of the Board’s desire that Executive remain a member of the Board, in which case Executive shall not be deemed to have resigned his position as a member of the Board merely by virtue of the termination of his employment or the expiration of the Employment Term.  Executive agrees to execute and deliver any documents evidencing his resignation from such positions that Employer may reasonably request.

 

(i)            Investigation; Suspension .  Employer may suspend Executive with pay pending an investigation authorized by the Board or a governmental authority or a determination by the Board whether Executive has engaged in acts or omissions constituting Cause, and such paid suspension shall not constitute a termination of this Agreement or Executive’s employment, or Good Reason.  Executive agrees to cooperate with Employer in connection with any such investigation.

 

 

 


 

7.              Compensation Upon Termination of Employment or Expiration of Employment Term .

 

(a)            Death .  If Executive’s employment is terminated by reason of Executive’s death, Employer shall pay to such person as Executive shall designate in a written notice to Employer (or, if no such person is designated, to his estate) any unpaid portion of Executive’s Base Salary through the Employment Termination Date (the “Compensation Payment”), any earned but unused vacation (the “Vacation Payment”), and any unreimbursed Business Expenses, at the time and in the manner required by applicable law.

 

(b)            Inability to Perform .  If Executive’s employment and this Agreement is terminated by reason of Executive’s Inability to Perform, Employer shall pay to Executive the Compensation Payment, the Vacation Payment, and any unreimbursed Business Expenses at the time and in the manner required by applicable law.

 

(c)            Termination by Executive Without Good Reason .  If Executive’s employment is terminated by Executive pursuant to and in compliance with Paragraph 6(e), Employer shall pay to Executive the Compensation Payment, the Vacation Payment, and any unreimbursed Business Expenses, at


 
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