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EXHIBIT
10.1
EXECUTIVE AGREEMENT
This Executive Agreement (“Agreement”) is entered into
by and between Lawrence J. Pope (“Employee”) and
Halliburton Company, for and on behalf of itself, its subsidiaries,
and its affiliated companies (collectively,
“Employer”), as of December 8, 2008 (the
“Effective Date”).
RECITALS
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 entering 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, as of the Effective Date and continuing until the date of
termination of Employee’s employment pursuant to the
provisions of Article 3, subject to the terms and conditions of
this Agreement.
1.2 As
of the Effective Date, Employee is employed as Executive Vice
President – Administration and Chief Human Resources Officer.
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 position 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 companies (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 interfere with Employee's performance of his duties hereunder.
Employee may not serve on the board of directors of any entity
other than a Halliburton Entity while employed by Employer 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 to the extent
permitted under a Halliburton Entity’s policies and
procedures.
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 that might
involve a possible conflict of interest without first obtaining
approval in accordance with the applicable Halliburton Entity'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 as of the Effective Date is four hundred thousand
United States dollars ($400,000) per annum, which shall continue to
be paid in accordance with the Employer's standard payroll practice
for its executives. Employee’s base salary may thereafter be
increased from time to time with the approval of the Compensation
Committee of Halliburton Company’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, unless
comparable reductions in salary are effective for all similarly
situated executives of Employer.
2.2 Employee
shall participate in the 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 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 Employee
shall be nominated for participation in the Performance Unit
Program, or any similar successor long-term incentive program
approved by the Compensation Committee; provided, however, that all
determinations relating to Employee’s participation,
including, without limitation, those relating to the performance
goals applicable to Employee and Employee’s level of
participation and incentive opportunity shall be made in accordance
with applicable guidelines in place at the time of nomination, and
Employee’s participation shall further be subject to such
other terms and conditions as set forth in the Performance Unit
Program Terms and Conditions and other underlying
documentation.
2.4 Employer
shall pay or reimburse Employee for all actual, reasonable and
customary expenses incurred by Employee in the course of his
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. Any
reimbursement provided hereunder during one calendar year shall not
affect the amount or availability of reimbursements in another
calendar year. Any reimbursement provided hereunder
shall be paid no later than the earlier of (i) the time prescribed
under Employer's applicable policies and procedures, or (ii) the
last day of the calendar year following the calendar year in which
Employee incurred the reimbursable expense.
2.5 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 Halliburton Company 1993 Stock
and Incentive Plan (the “1993 Plan”) or any successor
stock-related plan adopted by Halliburton Company'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 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:
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TERMINATION OF EMPLOYMENT AND EFFECTS OF SUCH TERMINATION:
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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 written notice to Employee, or by
Employee upon thirty (30) calendar days' written notice to
Employer, for any or no reason. This Agreement may be
terminated by Employer at any time upon one hundred and eighty
(180) calendar days’ written notice to Employee and no such
termination of this Agreement shall be deemed a termination of
employment for purposes of this Article 3.
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 3.4 hereof:
(i) Death.
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(ii)
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Retirement. “Retirement” shall mean
either (a) Employee's retirement at or after normal retirement age
(either voluntarily or pursuant to the applicable Halliburton
Entity'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).
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(iii)
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Permanent Disability. “Permanent
Disability” shall mean Employee's physical or mental
incapacity to perform his usual duties with such condition likely
to remain continuously and permanently as reasonably determined by
a qualified physician selected by Employer.
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(iv)
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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 termination of
employment by Employee because of a material breach by Employer of
any material provision of this Agreement, provided that (i)
Employee provides written notice to Employer, as provided in
Section 6.2 hereof, of the circumstances Employee claims constitute
“Good Reason” within ninety (90) calendar days of the
first to occur of such circumstances, (ii) such breach remains
uncorrected for thirty (30) calendar days following written notice,
and (iii) Employee’s termination occurs within one hundred
eighty (180) calendar days after the date that the circumstances
Employee claims constitute “Good Reason” first
occurred.
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(v)
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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) calendar days
following written notice of such breach to Employee by
Employer. Determination as to whether or not Cause
exists for termination of Employee's employment will be made by the
Compensation Committee, or its delegate, acting in good faith.
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3.3 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 Section 3.2. Employee, or his
estate in the case of Employee's death, shall be entitled to pro
rata base salary through the date of such termination, payment for
any properly documented but unreimbursed business expenses, and
shall be entitled to any individual annual incentive compensation
not yet paid but earned and payable under Employer's plans for the
year prior to the year of Employee's termination of employment, but
shall not be entitled to any annual incentive compensation for the
year in which he 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 or Halliburton
Entity’s employee benefit plans (as defined in Section 3.5),
stock, stock option or incentive plans, or the applicable
agreements underlying such plans.
3.4 If
Employee's employment is terminated by Employee for Good Reason or
by Employer for any reason other than as set forth in Section 3.2
above, Employee shall be entitled to (A) the payment provided for
in (i) below, subject to the provisions of Section 3.5, and (B) the
payment provided for in (ii) below, as consideration for
Employee’s post-employment covenants under Article 5, subject
to the provisions of (iii) below:
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(i)
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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 benefit shall be paid as soon as
administratively practicable, but no later than the sixtieth (60th)
calendar day following Employee's termination of employment.
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(ii)
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A single lump sum cash payment equal to the value of
Employee’s unvested shares of Halliburton Company restricted
stock in accordance with the table below and based on the closing
price quoted for Halliburton Company common stock on the New York
Stock Exchange on the date of Employee’s termination of
employment or the last business day immediately preceding the date
of Employee’s termination of employment, with such payment,
if due Employee, to be paid on the sixtieth (60th) calendar day
following such second anniversary of Employee’s termination
of employment. (For example, if Employee holds 50,000 shares of
unvested restricted stock on the date of termination of employment,
has at least five (5) years of service, but less than seven (7)
years of service, and the closing price of Halliburton Company
common stock on that date is $40 per share, the value for purposes
of calculating the amount of the payment in this (ii) would be
equal to [(50,000 shares X 0.50) X $40 per share] or [25,000 shares
X $40 per share] or $1,000,000.) All remaining shares
will be forfeited.
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Consecutive Years of Service
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Vested Percentage
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Less than two years
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0%
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At least two, but less than five years
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25%
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At least five, but less than seven years
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50%
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At least seven, but less than ten years
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75%
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Ten or more years
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100%
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(iii)
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Employee understands and agrees that his right to all or any
portion of the payment provided for in Section 3.4(ii), and
Employer’s obligation to make payment of the entire amount or
any portion thereof, are dependent and conditioned on
Employee’s compliance in full with all provisions contained
in Article 5. Any failure on the part of Employee to
comply with each provision, including any attempt by or on behalf
of Employee to have any such provision declared unenforceable in
whole or in part by an arbitrator or court, shall excuse Employer
forever from the obligation to make the payment, in whole or in
part, provided for in Section 3.4(ii).
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3.5 The
benefits paid to Employee pursuant to Section 3.4(i) 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 benefits, Employer, in its sole discr
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