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Exhibit 10.1
CHANGE IN CONTROL
TERMINATION BENEFITS AGREEMENT
THIS
CHANGE IN CONTROL TERMINATION BENEFITS AGREEMENT (the “
Agreement ”), dated as of the
day of
, is between Endeavour
International Corporation, a Nevada corporation (the “
Company ”), and
(the “ Executive ”).
W I T N E S S E T H:
WHEREAS,
the Company considers it essential to the best interests of the
Company and its stockholders that its executive management be
encouraged to remain with the Company and to continue to devote
full attention to the Company’s business in the event of a
transaction or series of transactions that could or do result in a
change in control of the Company;
WHEREAS,
the Company recognizes that the possibility of a change in control
and the uncertainty which it may raise among management may result
in the departure or distraction of management personnel to the
detriment of the Company and its stockholders;
WHEREAS,
the Executive is a key executive-level employee of the Company;
WHEREAS,
the Company believes that the Executive has made (and will continue
to make) valuable contributions to the Company;
WHEREAS,
should the Company receive a proposal for, or otherwise consider,
any such transaction, in addition to the Executive’s regular
duties, the Executive may be called upon to assist in the
assessment of proposals, advise management and the Board of
Directors of the Company (the “ Board ”) as to
whether a proposed transaction would be in the best interests of
the Company and its stockholders, and take such other actions as
the Board might determine to be appropriate; and
WHEREAS,
the Board has determined that it is in the best interests of the
Company and its stockholders to assure that the Company will have
the continued services of the Executive, notwithstanding the
possibility, threat or occurrence of a change in control of the
Company and believes that it is imperative to diminish the
potential distraction of the Executive by virtue of the personal
uncertainties and risks created by a pending or threatened change
in control, to assure the Executive’s full attention and
dedication to the Company in the event of any threatened or pending
change in control, and to provide the Executive with appropriate
severance arrangements following a change in control.
NOW,
THEREFORE, to assure the Company that it will have the continued
undivided attention and services of the Executive and the
availability of the Executive’s advice and counsel
notwithstanding the possibility, threat or occurrence of a change
in control of the Company, and to induce the Executive to remain in
the employ of the Company, and for other good and valuable
consideration, the Company and the Executive agree as follows:
1. Change in Control . For purposes of the Agreement, a
“ Change in Control ” shall be deemed to have
taken place if any of the following occurs:
(a) the Company (i) shall not be the surviving entity in
any merger, consolidation or other reorganization (or survives only
as a subsidiary of an entity other than a previously wholly-owned
subsidiary of the Company), or (ii) is to be dissolved and
liquidated, and as a result of or in connection with such
transaction, the persons who were directors of the Company before
such transaction shall cease to constitute a majority of the
Board;
(b) any person or entity, including a “group” as
contemplated by Section 13(d)(3) of the Exchange Act, acquires
or gains ownership or control (including, without limitation, power
to vote) of 30% or more of the outstanding shares of the
Company’s voting stock (based upon voting power), and as a
result of or in connection with such transaction, the persons who
were directors of the Company before such transaction shall cease
to constitute a majority of the Board;
(c) the Company sells all or substantially all of the assets
of the Company to any other person or entity (other than a
wholly-owned subsidiary of the Company) in a transaction that
requires shareholder approval pursuant to applicable corporate law;
or
(d) during a period of two consecutive calendar years,
individuals who at the beginning of such period constitute the
Board, and any new director(s) whose election by the Board or
nomination for election by the Company’s stockholders was
approved by a vote of at least a majority of the directors then
still in office, who either were directors at the beginning of the
two (2) year period or whose election or nomination for
election was previously so approved, cease for any reason to
constitute a majority of the Board.
2. Circumstances Triggering Receipt of Termination
Benefits.
(a) Subject to Section 2(c), the Company will provide the
Executive with the benefits set forth in Section 4 upon any
termination of the Executive’s employment:
(i) by the
Company at any time within the first 24 months after a Change
in Control;
(ii) by the
Executive for “Good Reason” (as defined in Section 2(b)
below) at any time within the first 24 months after a Change
in Control; or
(iii) by
the Company or the Executive pursuant to Section 2(d).
(b) In the event of a Change in Control, the Executive may
terminate employment with the Company and/or any subsidiary for
“Good Reason,” following notice and opportunity for
remedy as set forth herein and in Section 3. For purposes
hereof, “ Good Reason ” shall mean (subject to
such notice and opportunity to remedy) any of the occurrence of any
of the following events without the Executive’s prior written
consent:
(i) A
material reduction of the Executive’s authorities, duties, or
responsibilities as an executive and/or officer of the Company from
those in effect as of ninety (90) calendar days prior to the Change
in Control, other than an insubstantial and inadvertent reduction
that is remedied by the Company promptly after receipt of notice
thereof given by the Executive; provided , however ,
that any reduction in the foregoing resulting merely from the
acquisition of the Company and its existence as a subsidiary or
division of another entity such as a change in reporting
relationship or title shall not be sufficient to constitute Good
Reason;
(ii) The
Company’s requiring the Executive to be based at a location
in excess of fifty (50) miles from the location of the
Executive’s principal job location or office immediately
prior to the Change in Control; except for required travel on the
Company’s business to an extent substantially consistent with
the Executive’s then present business travel obligations;
(iii) A
reduction by the Company of the Executive’s Base Salary
and/or target annual bonus opportunity in effect on the Effective
Date hereof, or as the same shall be increased from time to
time;
(iv) The
failure of the Company to obtain a satisfactory agreement from any
successor to the Company to assume and agree to perform the
Company’s obligations under this Agreement, as contemplated
in Section 8 (where it requires successors to accept this
Agreement) herein; or
(v) A
material breach of this Agreement by the Company which is not
remedied by the Company within ten (10) business days of
receipt of written notice of such breach delivered by the Executive
to the Company.
(c) Notwithstanding Sections 2(a) and (b) above, no
benefits shall be payable by reason of this Agreement in the event
of:
(i) Termination of the Executive’s employment with the
Company and/or its subsidiaries by reason of the Executive’s
death or Disability, provided that the Executive has not
previously given a valid “Notice of Termination”
pursuant to Section 3. For purposes hereof, “
Disability ” shall mean the Executive’s
inability, due to physical or mental infirmity, to perform the
Executive’s material duties and responsibilities to the
Company and its subsidiaries for any period of six consecutive
months or for any period of eight months out of any 12-month
period, as determined by a physician selected by the Company or its
insurers and acceptable to the Executive or the Executive’s
legal representative (such agreement as to acceptability not to be
withheld unreasonably);
(ii) Termination of the Executive’s employment with the
Company and/or its subsidiaries on account of the Executive’s
retirement without Good Reason; provided , however ,
that, if at the time of such retirement the Executive has Good
Reason to terminate the Executive’s employment hereunder,
then such retirement shall be treated hereunder as a termination of
the Executive’s employment for Good Reason and the Executive
shall be entitled to the benefits provided in Section 4
hereof;
(iii) Termination of the Executive’s employment with the
Company and its subsidiaries for Cause. For the purposes hereof,
“ Cause ” shall mean:
(A) The
Executive’s willful failure to substantially perform his or
her duties with the Company (other than any such failure resulting
from the Executive’s Disability), after a written demand for
substantial performance is delivered to the Executive that
specifically identifies the manner in which the Committee believes
that the Executive has not substantially performed his or her
duties, and the Executive has failed to remedy the situation within
fifteen (15) business days of such written notice from the
Company;
(B) Gross
negligence in the performance of the Executive’s duties which
results in material financial harm to the Company;
(C) The
Executive’s conviction of, or plea of guilty or nolo
contendere , to any felony or any other crime involving the
personal enrichment of the Executive at the expense of the
Company;
(D) The
Executive’s willful engagement in conduct that is
demonstrably and materially injurious to the Company, monetarily or
otherwise; or
(E) The
Executive’s willful violation of any of the covenants
contained in Section 7.
Notwithstanding the foregoing, “Cause” shall not exist
unless and until the Company has delivered to the Executive, along
with the Notice of Termination for Cause, a copy of a resolution
duly adopted by three-quarters (3/4) of the entire Board (excluding
the Executive if the Executive is a Board member) at a meeting of
the Board called and held for such purpose (after reasonable notice
to the Executive and an opportunity for the Executive, together
with counsel, to be heard before the Board), finding that in the
good faith opinion of the Board an event (or events) set forth in
clauses (A)-(E) above has occurred and specifying the particulars
thereof in detail.
This
Section 2(c) shall not preclude the payment of any amounts
otherwise payable to the Executive under any of the Company’s
employee benefit plans, stock plans, programs and arrangements,
which payment shall be governed exclusively by the terms
thereof.
(d) A
termination of the Executive’s employment by the Company
without Cause or by the Executive for an event that would
constitute Good Reason following a Change in Control that occurs,
in either event, prior to a Change in Control, but occurs
(i) not more than 180 days prior to the date on which a
Change in Control occurs and (ii) (x) at the request of a
third party who has indicated an intention or taken steps
reasonably calculated to effect a Change in Control or (y)
otherwise arose in connection with, or in anticipation of, a Change
in Control, shall be deemed to be a termination or removal of the
Executive without Cause within the first 24 months after a
Change in Control for purposes of this Agreement and the date of
such Change in Control shall be deemed to be the date immediately
preceding the date the Executive’s employment terminates.
3. Notice of Termination; Termination Date . Any
termination of the Executive’s employment with the Company
and its subsidiaries as contemplated by Section 2 shall be
communicated by written “Notice of Termination” to the
other party hereto. Any “Notice of Termination” shall
indicate the effective date of termination, which, shall be more
than 60 days after the date the Notice of Termination is
delivered (the “ Termination Date ”), the
specific provision in this Agreement relied upon, and, except for a
termination pursuant to Section 2(d), will set forth in
reasonable detail the facts and circumstances claimed to provide a
basis for such termination including, if applicable, the failure by
the Company, after provision of written notice by the Executive, to
effect a remedy pursuant to the final clause of
Section 2(b)(i) or 2(b)(vi). Executive must provide the Notice
of Termination to the Company within 90 days of the events
constituting “Good Reason” for termination and the
Company shall have a period of 30 days after the Notice of
Termination during which the Company may remedy the condition
before such termination shall be effective. In the event the
Company effects a remedy within such 30-day period and the
Executive does not rescind the Notice of Termination upon being
notified of such remedy, the termination benefits described in
Section 4 hereof shall not be payable with respect to such
termination.
4. Termination Benefits. Subject to the conditions set
forth in Section 2(a) and contingent upon the Executive’s
executing (and not revoking) the “Release” (as defined
below), the following post-termination payments or benefits shall
be paid or provided to the Executive following the
Executive’s termination of employment:
(a)
Severance Payment . The Company shall pay to the Executive,
as a severance payment, an amount equal to the sum of (i) two
times (A)the Executive’s “Base Pay”, which shall
be an amount equal to the greater of (x) the Executive’s
rate of annual base salary (prior to any deferrals) at the
Termination Date or (y) the Executive’s rate of annual
base salary (prior to any deferrals) immediately prior to the
Change in Control, and (B) the Executive’s
“Incentive Pay”, which shall be an amount equal to the
average annual bonus earned by the Executive under the
Company’s incentive compensation plan or any other annual
bonus plan (whether paid currently or on a deferred basis) during
the three fiscal years of the Company immediately preceding the
fiscal year of the Company in which the Change in Control occurred
plus (ii) a pro rata portion of the Executive’s target
bonus for the fiscal year in which the Termination Date occurs,
which payment shall be made in a single lump sum on the first
business day following the expiration of the revocation period for
the Release. Notwithstanding the foregoing, if all or any portion
of the severance payment is determined to be “nonqualified
deferred compensation” subject to Section 409A of the
Internal Revenue Code of 1986, as amended (the “ Code
”), and the Company determines that the Executive is a
“specified employee” as defined in
Section 409A(a)(2)(B)(i) of the Code and Final Treasury
Regulations promulgated thereunder (the “ Treasury
Regulations ”) and other guidance published thereunder,
then such payment (or portion thereof) shall be paid on the first
day of the seventh month following the Executive’s
“separation from service” (as such term is defined in
the Treasury Regulations, giving effect to the default presumptions
of Section 1.409A-1(h) thereof).
(b)
Health Benefits . To the extent the Executive timely elects
to continue healthcare coverage through COBRA, the Company shall
pay that portion of the COBRA premium equal to the difference
between the COBRA premium and Executive’s monthly
contribution towards health benefits that is in effect as of the
date of Executive’s termination of employment for a period
equal to 18 months following the Termination Date;
provided , that, the Company’s obligation to provide
such health benefits shall cease at the time Executive becomes
eligible for such health benefits from another employer
(c)
Release . The Company’s obligation to make the
payment and provide the benefits described in this Section 4
are conditioned expressly on the Executive’s executing (and
not revoking) a general release of claims against the Company (as
“Company” is defined in Section 8) and its
subsidiaries in a form reasonably satisfactory to the Company (the
“ Release ”) within 45 days following the
Termination Date. The Company will provide the Release to the
Executive within seven days following the Termination Date.
5. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary
notwithstanding, in the event that it shall be determined (as
hereafter provided) that any payment (other than the Gross-Up
payments provided for in this Section&
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