E
XHIBIT
10.1
SEPARATION AGREEMENT AND
RELEASE
THIS SEPARATION AGREEMENT AND
RELEASE (“Agreement”) is made and entered
into this 21st day of December, 2006, by and between WILLBROS
USA, INC. (“Employer”) and MICHAEL F. CURRAN
(“Employee”).
WITNESSETH:
WHEREAS , Employee is employed by Employer pursuant to
that certain Employment Agreement dated December 31, 2004 (the
“Employment Agreement”); and
WHEREAS , Employee will retire from his employment with
Employer effective December 29, 2006 (“Retirement
Date”); and
WHEREAS , Employer and Employee wish to achieve a final
and amicable resolution of all issues related to their employment
relationship;
NOW, THEREFORE,
for and in consideration of the
mutual covenants and promises set forth below, as well as other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as
follows:
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1.
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Employee’s Retirement
. Employee and Employer confirm and agree that
Employee will retire from employment with Employer as of the
Retirement Date, that the employment relationship which existed
between Employee and Employer and/or any of Employer’s
affiliated companies will cease as of the Retirement Date, and that
the Employment Agreement will terminate on the Retirement Date.
However, nothing contained herein shall prevent or interfere with
the ability of the parties to enter into future agreements for
Employee to provide consulting services and advice to Employer or
Employer’s affiliates on an independent contractor basis
(“Subsequent Agreement”). In addition, it is
anticipated that Employee will continue to serve as a non-employee
Class III member of the Board of Directors of Willbros Group, Inc.
(“WGI”), Employer’s parent company, after the
Retirement Date and that Employee will also serve as Chairman of
such Board. Employer acknowledges that Employee will be entitled to
receive compensation as a non-employee member of the Board of
Directors of WGI and Employee hereby declines his Initial Award
under the Willbros Group, Inc. 2006 Director Restricted Stock Plan.
Except as provided in any Subsequent Agreement or in policies which
apply generally to non-employee members of the WGI Board
(“Board Policies”), all of Employer’s obligations
to Employee on or after the Retirement Date are set forth herein.
Accordingly, except as otherwise provided herein, in a Subsequent
Agreement or in Board Policies, Employer shall have no further
obligations whatsoever to Employee after the Retirement Date.
Employer shall cause its personnel records to reflect that Employee
retired from employment with Employer effective on the Retirement
Date.
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2.
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Prior
Agreements Superseded . Except as otherwise specifically provided
herein, this Agreement supersedes and replaces all other prior
agreements, written or oral, including the Employment Agreement,
relating to Employee’s employment with Employer and/or any of
Employer’s affiliated companies. Employee acknowledges that
as of the Retirement Date he will no longer be a participant in the
Willbros Group, Inc. Severance Plan.
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3.
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2006
Salary and Bonus; Accrued, Unpaid Vacation
. Employee will receive the balance of his
current, regular salary for 2006 (as if he had been employed until
December 31, 2006) on the Retirement Date, less applicable
withholding taxes. In addition, on the Retirement Date, Employee
will vest in a bonus for the calendar year 2006 in the amount of
Nine Hundred Twenty-Five Thousand U.S. Dollars (U.S. $925,000).
Under the Employment Agreement to avoid adverse income tax
consequences to the Employer and the Employee under
Section 409A of the Internal Revenue Code of 1986, as amended
(“Section 409A”), the amount of the total compensation
payable to Employee for 2006 that exceeds One Million U.S. Dollars
(U.S. $1,000,000) was payable on July 1, 2008. Accordingly,
Three Hundred Thousand U.S. Dollars (U.S. $300,000) of
Employee’s bonus for 2006 shall be paid on the Retirement
Date and Six Hundred Twenty-Five Thousand U.S. Dollars (U.S.
$625,000) shall be paid on July 1, 2008, in each case less
applicable withholding taxes. The Six Hundred Twenty-Five Thousand
U. S. Dollars (U.S. $625,000) not to be paid until July 1,
2008, shall be increased by that amount which would be earned on
such deferred amount if it were invested on December 30, 2006,
until June 30, 2008, in an interest bearing obligation that
earned interest at the London InterBank Offered Rate
(“LIBOR”) plus three percent (3%). Employer shall be
entitled to withhold from any payments or deliveries made to
Employee pursuant to this Agreement on or as of July 1, 2008,
including any payments and deliveries under Sections 3, 4 and 8,
all amounts that Employer is obligated to withhold under any tax
laws.
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On the Retirement Date Employer
shall pay to Employee Ninety-Six Thousand Nine Hundred Fifty U.S.
Dollars (U.S. $96,950), less applicable withholding taxes, in full
satisfaction of Employee’s accrued, but unused vacation pay
rights.
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4.
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2005
Bonus . Under the
Employment Agreement and in consideration of Section 409A the
payment of Three Hundred Thirty-Seven Thousand Five Hundred U.S.
Dollars (U.S. $337,500) of the bonus awarded to Employee for 2005
was deferred until July 1, 2008, and such amount is to be
increased by that amount which would be earned on such deferred
amount if it were invested on the date it was awarded, until
June 30, 2008, in an interest bearing obligation that earned
interest at the London InterBank Offered Rate (“LIBOR”)
plus three percent (3%). The Employer acknowledges its liability
for the payment of such amount to Employee on July 1, 2008 and
nothing in this Agreement shall affect any rights of Employee to
receive such payment.
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5.
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Medical Insurance
Continuation . Employer’s Group Medical Plan allows
Employer to include under such plan coverage for consultants to the
Employer and their dependents. As provided below, Employee will
enter into a consulting agreement with Employer and provide
consulting services to Employer for two years. Employer will take
those steps necessary to
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include coverage for Employee and
his eligible dependents under Employer’s Group Medical Plan
for 2007 and 2008 on the same terms as Employee would be entitled
were he an employee of the Employer for 2007 and 2008. Employer
acknowledges that following 2008 Employee will be entitled to
continue participation for a limited period of time in
Employer’s Group Medical Plan under the Consolidated Omnibus
Budget Reconciliation Act of 1985 (“COBRA”). Detailed
information concerning the costs and procedures applicable to such
insurance coverage will be provided separately by
Employer.
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6.
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Life
Insurance Conversion . Employee has the right to convert
Employee’s life insurance coverage under Employer’s
Group Life Plan and dependent life insurance coverage obtained by
the Employee under Employer’s Dependent Life Plan to
individual life insurance policies. Conversion forms and premium
rates applicable to such conversion programs will be provided
separately by the relevant insurer.
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7.
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Vesting
of Restricted Stock . Employee has been granted 25,000 shares of
restricted stock under the Willbros Group, Inc. 1996 Stock Plan, as
amended (the “1996 Stock Plan”). Employee has vested in
12,500 of such shares and the ownership of 12,500 of such shares
has not yet vested in Employee pursuant to the terms of the
Restricted Stock Award Agreements evidencing such grant. Employer
agrees that all of such shares of restricted stock granted to
Employee shall vest in full as of the Retirement Date. Employee
acknowledges that withholding taxes will be due on the value of
such shares when vested on the Retirement Date. The Compensation
Committee of the Board of Directors of WGI has approved allowing
Employee to satisfy the withholding requirement, in whole or in
part, by having Employer withhold shares of restricted stock having
a Fair Market Value (as defined in the 1996 Stock Plan) on the date
the tax is to be determined equal to the minimum statutory total
tax which could be withheld on the transaction.
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8.
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Vesting
of Restricted Stock Rights . Under the 1996 Stock Plan and pursuant to the
Employment Agreement , Employee has been granted restricted
stock rights entitling him to receive up to 225,000 shares of
common stock of WGI when and if he vests in such restricted stock
rights, with all such shares to which be becomes entitled
deliverable on July 1, 2008. He has vested in 41,666 of such
restricted stock rights and has not yet vested in 183,334 of such
restricted stock rights pursuant to the terms of the Restricted
Stock Rights Award Agreements evidencing such grants. Employer
agrees that all of such restricted stock rights granted to Employee
shall vest in full as of the Retirement Date. Employee acknowledges
that income taxes will be due on the income represented by the
value of the shares of WGI common stock deliverable in respect of
such restricted stock rights when such shares are delivered on
July 1, 2008. In the event under any circumstances the
satisfaction of Employee’s rights under this Section are
accelerated for any reason, then, in addition to the rights of
Employee under Section 12 below, Employer shall be liable to
Employee for any such amount by which Employee’s liability
for taxes of all kinds are increased as a result of such
acceleration.
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9.
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Stock
Options . Employee is vested in certain incentive stock
options (66,000 shares) and certain non-qualified stock options
(134,000 shares) provided by WGI pursuant to the 1996 Stock Plan.
Nothing in this Agreement shall affect any rights or obligations of
Employee or WGI under the Incentive Stock Option Agreements or the
Non-Qualified Stock Option Agreements entered into between Employee
and WGI pursuant to the 1996 Stock Plan. Employee acknowledges that
any of Employee’s incentive stock options awarded under the
1996 Stock Plan which are exercised more than three (3) months
after the Retirement Date will be treated as non-qualified stock
options for U.S. federal income tax purposes.
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10.
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Lump Sum
Payment . On
the Retirement Date Employer shall pay to Employee a lump sum
amount of One Million Five Hundred Seventy-Five Thousand U.S.
Dollars (U.S. $1,575,000), less applicable payroll tax withholding
for any obligations that accrue under this Agreement as of the
Retirement Date including any withholding tax liability as a result
of the vesting of any rights hereunder, in consideration of the
release specified below and the acknowledgements, waivers,
representations and undertakings specified herein. All or part of
the sums paid hereunder is consideration to which Employee is not
otherwise entitled under any Employer plan, program or prior
agreement.
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11.
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Employer
Investment Plan . Employee is fully vested in the Willbros
Employees 401(k) Investment Plan (“Investment Plan”).
Employee has the option of receiving a lump-sum distribution of
Employee’s total account balance in the Investment Plan,
transferring such account balance to another tax-qualified plan or
to an Individual Retirement Account or leaving such account balance
in the
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