EXHIBIT 10.11
LETTERHEAD OF
ATLAS AMERICA,
INC.
January 15, 2009
Mr. Eugene N.
Dubay
558 West Lincoln Street
Birmingham, MI 48009
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Re:
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Summary of
Employment Terms
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Dear Gene:
This letter (the “
Agreement ”) will summarize the arrangements that we
have agreed to regarding your prospective employment by Atlas
America, Inc. (“ ATLS ”). Specifically, you will
be joining us and will be employed as a Senior Vice-President of
ATLS, and will also serve as (i) President and Chief Executive
Officer of Atlas Pipeline Partners GP, LLC, the general partner of
Atlas Pipeline Partners, L.P. (“ APL ”);
(ii) President and Chief Executive Officer of Atlas Pipeline
Mid-Continent, LLC ( “ Atlas Mid-Continent ”)
(by itself, “ Atlas Mid-Continent ”, and
together with ATLS, APL and Atlas Pipeline Holdings, L.P. (“
AHD ”), the “ Company ”); and
(iii) in such other capacit(ies) to be determined with respect
to the Company’s pipeline operations. The general terms and
conditions of your employment are as follows:
1. Titles, Positions and
Location . You will serve as a Senior Vice-President of
ATLS, and your principal day-to-day responsibilities will be as
President and Chief Executive Officer of the APL, as President and
Chief Executive Officer of Atlas Mid-Continent (the “
Position ”). You will initially be principally based
at Atlas Mid-Continent’s offices in Tulsa, Oklahoma. Your
permanent principal location, effective as of June 30, 2009,
will be determined in writing by you and ATLS. You will visit
locations of the Company as is appropriate and necessary to carry
out your duties and responsibilities with respect to the
Position.
2. Services .
You will serve the Company and its affiliates diligently,
competently, and to the best of your ability during the Employment
Term (defined below). You will devote substantially all of your
working time and attention to the business of the Company and its
affiliates, and you will not undertake any other duties which
conflict with your responsibilities to the Company and its
affiliates. The Company shall provide you with sufficient support,
capital and personnel to assist you in performing and discharging
your duties. You shall report to the Chief Executive Officer of
ATLS (currently Edward E. Cohen) and, as applicable, to the boards
of directors of APL and AHD (the “ Boards ”).
You will render such services as may reasonably be required of you
to accomplish the business purposes of the Company.
3. Employment Term .
The term of your employment shall commence as of January 15,
2009 (the “ Employment Effective Date ”) and
shall continue for a period of two (2) years thereafter. After
the initial two (2)-year term, your employment shall automatically
renew for one (1) year renewal terms at the end of each term
or renewal term, unless ATLS gives notice, not less than sixty
(60) days prior to the end of the term or renewal term then in
effect, of its intention not to renew. The period commencing on the
Employment Effective Date and ending on the date on which the term
of your employment under this Agreement shall terminate is
hereinafter referred to as the “ Employment Term
.”
4. Compensation. Your
compensation shall be as follows:
(a) Base Salary . You shall
receive an annual base salary (“ Annual Base Salary
”) of Four Hundred Thousand Dollars ($400,000). The Annual
Base Salary shall be payable in accordance with ATLS’s
regular payroll practices for its senior executives, as in effect
from time to time.
(b) Bonus . You will be
eligible to be considered for bonus compensation. Such bonus
compensation will based upon reasonable criteria, including
performance criteria, as the Board of Directors of ATLS shall
reasonably determine. For the period ending December 31, 2009,
your bonus shall be at least Three Hundred Thousand Dollars
($300,000). Notwithstanding anything to the contrary in the
incentive compensation plan, program or arrangement pursuant to
which a bonus is payable, any annual bonus that you shall become
entitled to receive hereunder shall be deemed earned as of
December 31, and shall be paid on or before March 15 of
the calendar year following the calendar year for which such annual
bonus is earned.
(i) Initial Equity Grant . On
or shortly after the Employment Effective Date, you will be granted
restricted shares, phantom units and/or options to acquire shares
of APL, AHD and/or ATLS under their respective equity compensation
plans, as set forth on Schedule A hereto.
(ii) Equity-Based
Compensation . You shall be eligible to receive additional
incentive equity-based compensation in the form of stock options,
grants of restricted stock and/or other forms of equity-based
compensation in APL and/or AHD as shall be determined by the
Boards. Such incentive equity-based compensation shall be subject
to such restrictions and vesting as is provided under the equity
compensation plans of APL, AHD and/or ATLS, as
applicable.
(c) Benefits . You
shall be entitled to receive the following employment related
benefits:
(i) Participation in Benefit
Plans . (1) you shall be entitled to participate in all
applicable incentive, savings, and retirement plans, practices,
policies, and programs of ATLS to the extent they are generally
available to other senior officers, directors or executives of
ATLS, and (2) you and/or your family, as the case may be,
shall be eligible for participation in, and shall receive all
benefits under, all applicable welfare benefit plans, practices,
policies, and programs provided by ATLS, including, without
limitation, medical, prescription, dental, disability, sickness
benefits, employee life insurance, accidental death, and travel
insurance plans and programs, to the same extent as other senior
officers, directors or executives of ATLS.
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(ii) Expenses . ATLS shall
pay, or reimburse you for, all reasonable and necessary expenses
incurred in carrying out your duties under this Agreement in
accordance with Company policy, including all such costs incurred
in connection with your being principally based in Tulsa, Oklahoma
through June 30, 2009. In addition to the aforementioned
expenses related to Tulsa, in 2009, ATLS shall also pay directly up
to $40,000 of your costs and expenses in relocating your residence
to the permanent principal location. Also in addition to the
forgoing, upon forty five (45) days written notice from you
(which notice must be given not later than July 31, 2009) ATLS
will purchase your current personal residence from you for an
amount equal to your original purchase cost of $1,000,000, and will
assume all attributes, responsibilities, costs and benefits of
ownership of such residence. You agree that, if prior to
June 30, 2011, your employment hereunder shall be terminated
by you without Good Reason, or by ATLS for Cause (as such terms are
later defined herein), then you shall repay to ATLS, within ninety
(90) days of such termination of employment, an amount equal
to the (i) the amount paid by ATLS to you for such residence,
less (ii) the fair market value of such residence on the date
ATLS acquires it from you, such fair market value to be determined
by an MAI appraiser to be retained by ATLS during the forty-five
(45) day notice period.
5. Confidential Information;
No Solicitation; Non-Competition
(a) All confidential information or
trade secrets which you may obtain relating to the business of the
Company and its affiliates shall not be published, disclosed, or
made accessible by you to any other person, firm, or corporation
except in connection with the business, and for the benefit, of the
Company and its affiliates. You shall not, until two years after
your employment with the Company has terminated, for yourself or on
behalf of any other person, firm, partnership, corporation, or
other entity, directly or indirectly solicit or hire, or attempt to
solicit or hire, any employee of the Company or its affiliates away
from the Company or its affiliates.
(b) In the event that your
employment is terminated by ATLS for Cause, or is terminated by you
for any reason other than for Good Reason (each as defined in
Section 6 hereof), then you shall not, until eighteen
(18) months after the termination of your employment, for
whatever reason, for yourself or on behalf of any other person,
firm, partnership, corporation, or other entity, directly or
indirectly engage in any natural gas pipeline and/or processing
business in the continental United States. For purposes of this
clause 5(c), “to engage” shall include your acting as
an owner (of more than 5%), employee, director or officer of an
entity so engaged.
(c) You acknowledge that the
restrictions contained in this Section 5 are, in view of the
nature of the business of the Company, reasonable and necessary to
protect the legitimate interests of the Company, and that any
violation of any provision of this Section will result in
irreparable injury to the Company. You also acknowledge that in the
event of any such violation, the Company shall be entitled to
preliminary and permanent injunctive relief, without
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the necessity of proving actual damages or
posting a bond, and to an equitable accounting of all earnings,
profits and other benefits arising from any such violation, which
rights shall be cumulative and in addition to any other rights or
remedies to which the Company may be entitled. You agree that in
the event of any such violation, an action may be commenced for any
such preliminary and permanent injunctive relief and other
equitable relief in any federal or state court of competent
jurisdiction sitting in Pennsylvania or in any other court of
competent jurisdiction. You hereby waive, to the fullest extent
permitted by law, any objection that you may now or hereafter have
to such jurisdiction or to the laying of the venue of any such
suit, action or proceeding brought in such a court and any claim
that such suit, action or proceeding has been brought in an
inconvenient forum. You agree that effective service of process may
be made upon you by mail under the notice provisions contained in
Section 9 hereof.
6. Termination .
Notwithstanding anything herein to the contrary, your employment
shall terminate as a result of any of the following
events:
(a) Your death;
(b) Termination by ATLS for Cause.
“ Cause ” shall encompass any of the following:
i) you have committed any demonstrable and material act of
fraud; (ii) illegal or gross misconduct by you that is willful
and results in damage to the business or reputation of the Company;
(iii) you are charged with a felony; (iv) the continued
failure of you to substantially to perform your duties under this
Agreement (other than as a result of physical or mental illness or
injury), after ATLS delivers you a written demand for substantial
performance that specifically identifies, with reasonable
opportunity to cure, the manner in which ATLS believes that you
have not substantially performed your duties; or (v) you have
failed to follow reasonable written directions of ATLS which are
consistent with your duties hereunder and not in violation of
applicable law. ATLS’s termination of your employment for
Cause shall be effected by ATLS providing you written notice
(“ Notice of Termination for Cause ”) of its
intention to terminate your employment for Cause, setting forth in
reasonable detail the specific conduct constituting Cause and the
specific provision(s) of this Agreement on which it relies. You
shall have ten (10) business days after receipt of such
written notice to cure such failure;
(c) Termination by ATLS without
Cause upon forty-five (45) days prior written notice to
you;
(d) Termination by
ATLS upon your Disability. “ Disability ” shall
mean that you become disabled by reason of physical or mental
disability for more than one hundred eighty (180) days in the
aggregate or a period of ninety (90) consecutive days during
any 365-day period and the Board determines, in good faith, that
you, by reason of such physical or mental disability, are rendered
unable to perform your duties and services hereunder. A termination
of your employment by ATLS for Disability shall be communicated to
you by written notice, and shall be effective on the thirtieth
(30 th ) day after your receipt of
such notice (the “ Disability Effective Date ”),
unless you return to full-time performance of your duties before
the Disability Effective Date;
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