HOS 8-K
Hornbeck Offshore Services, Inc. (HOS)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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EXPLANATORY NOTE
As previously disclosed, the transactions (the “Transactions”) contemplated by that certain Agreement and Plan of Merger entered into on April 22, 2026 by Helix Energy Solutions Group, Inc., a Minnesota corporation (“Helix”), with Hornbeck Offshore Services, Inc., a Delaware corporation (“Legacy Hornbeck”), and certain subsidiaries of Helix, were completed on September 1, 2026. Following completion of the Transactions, Helix was converted to a Delaware corporation, Legacy Hornbeck became a wholly owned subsidiary of Helix following such conversion and Helix was renamed “Hornbeck Offshore Services, Inc.” (the “Company”).
This Current Report on Form 8-K is being filed to report certain compensatory arrangements adopted or entered into in connection with the Transactions. The board of directors of the Company is referred to herein as the “Board.”
| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Executive Employment Arrangements
Employment Agreement with Todd M. Hornbeck
In connection with the Transactions, on September 1, 2026, Todd M. Hornbeck entered into a second amended and restated employment agreement (the “CEO Employment Agreement”) with the Company and Hornbeck Offshore Operators, LLC (“HOO”) setting forth the terms of his employment as President and Chief Executive Officer. The CEO Employment Agreement provides for a five-year initial term with automatic one-year renewals. So long as Mr. Hornbeck serves as Chief Executive Officer, the Company will nominate him for election to the Board at each applicable stockholders’ meeting and use best efforts to have him elected. The CEO Employment Agreement provides for (i) an annual base salary of not less than $875,000, (ii) a target annual bonus of 140% of base salary, (iii) a target long-term incentive opportunity of $4,500,000 and (iv) an automobile provided by the Company (the “Automobile Benefit”).
Upon termination due to death, disability or qualifying retirement, Mr. Hornbeck will receive (i) a pro-rata bonus based on actual performance (the “Pro-Rata Bonus”), (ii) upon death or disability, COBRA reimbursement for up to 12 months, (iii) upon disability, six months of base salary continuation and (iv) upon qualifying retirement with at least 20 years of service, Company-sponsored medical coverage for Mr. Hornbeck and his spouse for five years (the “Retiree Medical Benefit”). Upon termination by the Company without “cause,” by Mr. Hornbeck for “good reason” or due to Company’s non-renewal of his employment term (each, a “Qualifying Termination”), and subject to a release of claims, Mr. Hornbeck will receive (a) the Pro-Rata Bonus, (b) 2.5 times his base salary plus target bonus, payable over 24 months, (c) COBRA reimbursement for up to 30 months, payable over 24 months and (d) accelerated vesting of time-based equity awards. Upon a Qualifying Termination within two years following, or a termination without “cause” within six months prior to, a change of control of the Company (a “CIC Qualifying Termination”), Mr. Hornbeck will receive the foregoing benefits, except that (A) the Pro-Rata Bonus will be based on target performance, (B) severance will be paid in a lump sum and (C) the Automobile Benefit will continue for up to 30 months.
The CEO Employment Agreement includes perpetual confidentiality and non-disparagement covenants, assignment of inventions, and non-competition and non-solicitation restrictions for the employment term plus two years.
The foregoing description of the CEO Employment Agreement is qualified in its entirety by the full text of the CEO Employment Agreement attached hereto as Exhibit 10.1 and incorporated herein by reference.
Employment Agreements with Robert P. Adams, Samuel A. Giberga, Scott A. Sparks, Ben D. Todd and Brian M. Cook
In connection with the Transactions, on September 1, 2026, each of Robert P. Adams (Executive Vice President and Chief Financial Officer), Samuel A. Giberga (Executive Vice President, General Counsel and Corporate Secretary), Scott A. Sparks (Executive Vice President and Chief Operating Officer, Subsea Services and Well Intervention), Ben D. Todd (Executive Vice President and Chief Operating Officer, Marine Transportation and Specialty) and Brian M. Cook (Executive Vice President and Chief Accounting Officer) (collectively, the “EVPs”) entered into an employment
agreement with the Company and HOO (collectively, the “EVP Employment Agreements”). The EVP Employment Agreements provide for a five-year initial term, with one-year automatic renewals, unless earlier terminated by the parties, except Mr. Giberga’s EVP Employment Agreement provides for an initial term ending on May 31, 2027, subject to renewal if mutually agreed between the parties. The EVP Employment Agreements provide for (i) a base salary at an annual rate of not less than $500,000 for Messrs. Sparks and Todd and $400,000 for Messrs. Adams, Giberga and Cook, (ii) an annual target bonus opportunity equal to 100% of their base salary and (iii) for Mr. Giberga only, the Automobile Benefit.
Upon termination due to death, disability or qualifying retirement, each EVP will receive (i) the Pro-Rata Bonus (which Mr. Giberga will also receive upon the expiration of his term) and (ii) upon death or disability, COBRA reimbursement for up to 12 months. Upon a Qualifying Termination (for Mr. Giberga, excluding non-renewal), each EVP will receive (a) the Pro-Rata Bonus, (b) 2 times base salary plus target bonus, payable over 24 months, and (c) COBRA reimbursement for up to 24 months. Upon a CIC Qualifying Termination (for Mr. Giberga, excluding non-renewal), each EVP will receive the foregoing benefits, except that (A) the Pro-Rata Bonus will be based on target performance and (B) severance will be paid in a lump sum. In addition, Mr. Giberga will receive the Retiree Medical Benefit upon any termination.
The EVP Employment Agreements include perpetual confidentiality and non-disparagement covenants, assignment of inventions, and non-competition and non-solicitation restrictions for the employment term plus two years.
The foregoing description of the EVP Employment Agreements is qualified in its entirety by the full text of the form of EVP Employment Agreement attached hereto as Exhibit 10.2 and incorporated herein by reference.
2026 Omnibus Inducement Incentive Plan
In connection with the Transactions, on September 2, 2026, the Board adopted the Hornbeck Offshore Services, Inc. 2026 Omnibus Inducement Incentive Plan (the “Inducement Plan”) without stockholder approval pursuant to NYSE Listed Company Manual Rule 303A.08 (“Rule 303A.08”). The Board reserved 1,500,000 shares of the Company’s common stock, par value $0.00001 per share (“Common Stock”), for issuance under the Inducement Plan. The Inducement Plan provides for the grant of non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, other stock-based awards and cash awards. All awards under the Inducement Plan are intended to qualify as “employment inducement awards” as described in Rule 303A.08 or any successor provision of the NYSE Listing Rules and, in accordance with Rule 303A.08, may only be granted to a prospective employee of the Company or any of its subsidiaries who has not previously been an employee or director of the Company or who is commencing employment with the Company or any of its subsidiaries following a bona fide period of non-employment.
The foregoing description of the Inducement Plan is qualified in its entirety by the full text of the Inducement Plan attached hereto as Exhibit 10.3 and incorporated herein by reference.
Equity Award Grants
Performance-Based Restricted Stock Unit Award for Todd M. Hornbeck
In connection with the Transactions, on September 4, 2026, the Company granted Mr. Hornbeck an award of 1,000,000 performance-based restricted stock units (“PSUs”), with an opportunity to earn up to1,500,000 shares of Common Stock, under the Inducement Plan. The PSUs vest in two tranches: (i) 500,000 PSUs vest upon achievement of $75 million in annualized gross synergies on a run-rate basis by year-end 2029 (as determined pursuant to the award agreement) and (ii) 500,000 PSUs (with an opportunity to earn 1,000,000 shares) vest based on stock price measured on six dates in 2028 and 2029, with 500,000 shares vesting at $14 per share (“target”) and 1,000,000 shares vesting at $20 per share (“maximum”), with linear interpolation between levels. Performance-vested PSUs settle in restricted shares that time-vest on December 31, 2029; shares are subject to clawback if Mr. Hornbeck resigns without “good reason” or is terminated for “cause” prior to that date. The PSUs accelerate upon (a) a termination without “cause,” death, disability or resignation for “good reason,” (b) Mr. Hornbeck not being elected chairman at the second annual meeting following the Transactions, or (c) a change in control.
The foregoing description of Mr. Hornbeck’s PSU award is qualified in its entirety by the full text of the PSU award agreement attached hereto as Exhibit 10.4 and incorporated herein by reference.
Restricted Stock Unit and Stock Option Awards for Todd M. Hornbeck, Robert P. Adams, Scott A. Sparks, Ben D. Todd and Brian M. Cook
In connection with the Transactions, on September 2, 2026, the Company granted equity awards to Messrs. Hornbeck, Adams, Sparks, Todd and Cook (the “Executive Equity Awards”) with the following grant date fair values: $4,500,000 (Mr. Hornbeck), $1,400,000 (each of Messrs. Sparks and Todd) and $800,000 (each of Messrs. Adams and Cook). The Executive Equity Awards were granted as 50% RSUs and 50% non-qualified stock options under the Hornbeck Offshore Services, Inc. 2005 Long Term Incentive Plan (f/k/a Helix Energy Solutions Group, Inc. 2005 Long Term Incentive Plan) (the “2005 Plan”). The awards cliff-vest on September 1, 2029, subject to continued service. Upon death or disability, all awards fully vest. Upon a Qualifying Termination, Mr. Hornbeck’s awards fully vest; for other executives, awards vest pro-rata. Upon a CIC Qualifying Termination, all awards fully vest. Upon qualifying retirement (as defined in the award agreement) on or after the one-year anniversary of the grant date, awards continue to vest without regard to continued service. If, upon a change in control, the surviving entity does not assume the awards, all awards fully vest.
The foregoing description of the Executive Equity Awards is qualified in its entirety by the full text of the forms of RSU and non-qualified stock option award agreements for executive officers attached hereto as Exhibits 10.5 and 10.6, respectively, and incorporated herein by reference.
Cash Award for Samuel A. Giberga
In connection with the Transactions, on September 2, 2026, the Company granted Mr. Giberga a $300,000 cash award under the 2005 Plan (the “Giberga Cash Award”). The award vests on May 31, 2027, subject to continued service. Upon death or disability, the award fully vests. Upon a Qualifying Termination (excluding non-renewal), the award vests pro-rata. Upon a CIC Qualifying Termination or if, upon a change in control, the surviving entity does not assume the award, the award fully vests.
The foregoing description of the Giberga Cash Award is qualified in its entirety by the full text of the form of cash award agreement attached hereto as Exhibit 10.7 and incorporated herein by reference.
Director Compensation
Director Compensation Policy
In connection with the Transactions, the Board adopted a non-employee director compensation policy (the “Director Compensation Policy”) providing for (i) an annual cash retainer of $100,000 (plus $135,000 for the non-executive chairperson, $25,000 for the Audit Committee chair and $20,000 for each of the Compensation Committee and the Sustainability and Nominating & Governance Committee chairs), (ii) additional annual cash retainers of $12,500 for Audit Committee service and $10,000 for service on the Compensation Committee or the Sustainability and Nominating & Governance Committee, (iii) an annual RSU grant with a grant date value of $175,000 and (iv) discretionary sign-on or special event equity grants.
The foregoing description of the Director Compensation Policy is qualified in its entirety by the full text of the Director Compensation Policy attached hereto as Exhibit 10.8 and incorporated herein by reference.
Director RSU Grants
In connection with the Transactions, on September 2, 2026, the Company granted RSUs (the “Director RSUs”) to each non-employee director other than Aaron Rosen (who is ineligible under the Director Compensation Policy) with grant date values of $325,000 for Messrs. Transier and Jindal (reflecting the annual equity retainer and a special event grant for their contributions in connection with the Transactions) and $175,000 for Messrs. Fink, Lavoi and Myers (reflecting the annual equity retainer). The Director RSUs vest on the earlier of the next annual meeting or the first anniversary of the grant date. Upon a termination due to death or disability, the awards fully vest. Upon removal without cause or resignation, the awards vest pro-rata. Upon a change in control, the awards fully vest.
The foregoing description of the Director RSUs is qualified in its entirety by the full text of the form of RSU award agreement for non-employee directors attached hereto as Exhibit 10.9 and incorporated herein by reference.
| Item 7.01. | Regulation FD Disclosure. |
On September 4, 2026, in accordance with Rule 303A.08, the Company issued a press release announcing Mr. Hornbeck’s PSU award, a copy of which is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
The information contained in Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any registration statement or other filings under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| HORNBECK OFFSHORE SERVICES, INC. | ||
| By: | /s/ Todd M. Hornbeck | |
| Todd M. Hornbeck | ||
| President and Chief Executive Officer | ||
Date: September 4, 2026
Exhibit 10.1
SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of September 1, 2026 (the “Effective Date”), by and among Hornbeck Offshore Operators, LLC, a Delaware limited liability company (the “Company”), Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (“Parent”), and Todd M. Hornbeck, an individual (the “Executive”). Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in Section 23.
WHEREAS, the Executive and the Company are party to that certain Amended and Restated Employment Agreement, dated as of September 4, 2020 (the “Original Agreement”), which this Agreement will replace and supersede in its entirety, effective as of the Effective Date;
WHEREAS, the Executive is currently employed by the Company and will serve as the President and Chief Executive Officer of Parent;
WHEREAS, that certain Agreement and Plan of Merger, dated as of April 22, 2026, by and among Parent, Hornbeck Offshore Services, Inc., a Delaware corporation, and the other parties thereto (the “Merger Agreement” and the transactions contemplated by the Merger Agreement, the “Transaction”), includes a non-binding employment agreement term sheet setting forth the terms of the Executive’s employment as President and Chief Executive Officer of Parent, with the goal of entering into an employment agreement with the Executive promptly following the Closing (as defined in the Merger Agreement) (the “Term Sheet”); and
WHEREAS, the Company and the Executive desire to enter into this Agreement to set out the terms and conditions for the continued employment relationship of the Executive with the Company and that this Agreement replace and supersede the Original Agreement and the Term Sheet.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties hereto agree as follows:
1. Term. The Company agrees to continue to employ the Executive pursuant to the terms of this Agreement, and the Executive agrees to continue to be so employed, commencing as of the Effective Date and ending on December 31, 2031 (the “Initial Term”). On the last day of the Initial Term and on each one (1)-year anniversary thereof, the term of this Agreement shall be automatically extended for an additional one (1)-year period, unless either party hereto elects not to extend this Agreement by giving written notice to the other party at least ninety (90) days prior to any such renewal date. Notwithstanding the foregoing, the Executive’s employment hereunder may be earlier terminated in accordance with Section 4 hereof. The period of time between the Effective Date and the termination of the Executive’s employment hereunder is referred to herein as the “Term.” Upon any termination of the Executive’s employment with the Company, the Executive shall be deemed to have resigned from all positions with any member of the Company Group.
2. Positions and Duties.
(a) During the Term, the Executive shall serve as the President and Chief Executive Officer of Parent. In these capacities, the Executive shall have the duties, authorities and responsibilities generally commensurate with the duties, authorities and responsibilities of persons serving in similar capacities in similarly sized and situated companies, and such other duties, authorities and responsibilities as the Board of Directors of Parent (the “Board”) shall designate from time to time that are not inconsistent with the Executive’s positions, which duties, authorities and responsibilities will include reviewing Confidential Information and providing services to Parent’s direct and indirect Subsidiaries. The Executive shall report directly to the Board. Unless otherwise determined by the Board, the Executive shall not be able to resign as Chief Executive Officer of Parent and continue to be President of Parent. If the Executive resigns as Chief Executive Officer of Parent, the Executive must also resign as President of Parent. If the Executive only resigns as Chief Executive Officer of Parent, the Board may remove the Executive from the position of President of Parent.
(b) The Executive shall devote substantially all of the Executive’s business time to the performance of the Executive’s duties hereunder and the advancement of the business and affairs of Parent and the Company; provided, that the Executive shall be entitled to: (i) serve as a member of the board of directors (or equivalent governing body) of, or advisor to, (A) the entities listed on Exhibit A attached hereto and (B) such other entities that are not Competitive Enterprises, subject to the Executive providing prior written notice to the Board, (ii) serve on civic, charitable, educational, religious, public interest or public service boards, and (iii) manage the Executive’s personal and family investments, in each case, to the extent such activities do not interfere, individually or in the aggregate, with the performance of the Executive’s duties and responsibilities hereunder or create a business or fiduciary conflict; and provided, further, that, the Company acknowledges and agrees that the Executive’s roles and responsibilities with respect to both (I) the Fourth Amended and Restated Trade Name and Trademark License Agreement, executed as of April 23, 2026, and entered into by and between HFR, LLC, a Texas limited liability company (“HFR”), and the Company (the “Trademark License Agreement”), and (II) the Amended and Restated Facilities Use Agreement, dated as of September 4, 2020, by and between Larry D. Hornbeck and Hornbeck Offshore Services, Inc., a Delaware corporation, as amended or assigned from time to time (the “Facilities Use Agreement”), shall not, under any circumstances, be deemed to create a potential business or fiduciary conflict.
(c) The Executive’s principal place of employment will be Houston, Texas; provided, that the Executive may be required to travel from time to time for business purposes (it being understood that the Executive may divide working time between Houston, Texas and other corporate locations, consistent with the needs of the Company).
(d) So long as the Executive serves as the Chief Executive Officer of Parent, the Executive will continue to serve as a member of the Board until the Executive’s seat is first scheduled for election following the Effective Date and thereafter Parent shall nominate the Executive for election as a member of the Board at each shareholders’ meeting occurring during the Term that the Executive’s seat is scheduled for election and shall use best efforts to have the Executive so elected.
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3. Compensation and Benefits.
(a) Base Salary. During the Term, the Company shall pay to the Executive a base salary at an annual rate of not less than $875,000, in substantially equal installments in accordance with the regular payroll practices of the Company, but not less frequently than monthly. The Executive’s base salary shall be reviewed annually by the Compensation Committee of the Board (the “Committee”) taking into account the Company’s compensation philosophy as in effect from time to time and market and peer group data (beginning in fiscal year 2027 with review of the most recent market and peer group data then available), and may be increased, but not decreased, from time to time by the Committee. The base salary as determined herein and adjusted from time to time shall constitute “Base Salary” for purposes of this Agreement.
(b) Annual Bonus. During each fiscal year during the Term, the Executive shall be eligible to participate in the Company’s annual bonus plan, as established by the Committee and in effect from time to time for its senior executives, and will be paid a cash annual bonus under such plan (the “Annual Bonus”), to the extent earned based on performance against reasonably obtainable objective performance criteria. The performance criteria for each fiscal year shall be determined by the Committee, after consultation with the Executive, no later than ninety (90) days following the commencement of the applicable fiscal year. The Executive’s target Annual Bonus opportunity for each fiscal year shall equal 140% of the Executive’s annualized Base Salary for that fiscal year (the “Target Bonus”). The Executive’s actual Annual Bonus for each fiscal year will equal a percentage of the Target Bonus, determined as follows: (i) 100% of the Target Bonus, if target levels of performance for that fiscal year are achieved; (ii) 50% of the Target Bonus, if threshold levels of performance for that fiscal year are achieved; (iii) 200% of the Target Bonus, if maximum levels of performance for that fiscal year are achieved; and (iv) a percentage of the Target Bonus determined in accordance with the plan, if performance for that fiscal year is in between threshold, target and maximum levels of performance. Unless otherwise determined by the Committee, the Executive will not earn an Annual Bonus if threshold levels of performance are not achieved. The Executive’s Annual Bonus for each fiscal year shall be determined by the Committee after the end of the applicable fiscal year and shall be paid to the Executive when bonuses for such fiscal year are paid to other senior executives of the Company generally, but in no event later than seventy-four (74) days following the end of such fiscal year, subject to the Executive’s continued employment with the Company through the end of the fiscal year with respect to which such Annual Bonus was earned. In carrying out its functions under this Section 3(b), the Committee shall at all times act reasonably and in good faith.
(c) Long-Term Incentive Awards. During the Term, the Executive shall participate in Parent’s equity incentive plan, subject to approval by the Board. Executive’s target annual long-term incentive opportunity shall be equal to $4,500,000.
(d) Benefit Plans. During the Term, the Executive shall be entitled to participate in any employee benefit plan that Parent or the Company has adopted or may adopt, maintain or contribute to for the benefit of its employees generally and/or for the benefit of its senior executives as in effect from time to time, subject to satisfying the applicable eligibility requirements, except to the extent such plans are duplicative of the benefits otherwise provided hereunder; provided, however, that Parent or the Company, as applicable, shall make commercially reasonable efforts to ensure that any health insurance benefit plan will not provide for a preexisting condition limitation. The Executive’s participation will be subject to the terms of the applicable plan documents and generally applicable Parent and Company policies. Notwithstanding the foregoing, Parent and the Company may modify or terminate any employee benefit plan at any time.
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(e) Business Expenses. The Executive is authorized to incur reasonable business expenses in carrying out the Executive’s duties and responsibilities under this Agreement. The Executive shall be promptly reimbursed for all reasonable out-of-pocket business expenses incurred and paid by the Executive during the Term, subject to and in accordance with the Company’s expense reimbursement policy as in effect from time to time.
(f) Automobile. During the Term, the Company shall continue to provide the Executive with an automobile and pay for such automobile’s auto insurance, maintenance and fuel; provided, that the automobile shall be substantially equivalent to the highest value automobile provided to any other officer of the Company or Parent; provided, further, that the Executive shall pay all taxes related to the Executive’s personal use of the automobile.
4. Termination of Employment; Severance.
(a) General. The Executive’s employment and the Term shall terminate upon the earliest to occur of (i) the Executive’s death, (ii) a termination by the Company due to the Executive’s Disability, (iii) a termination by the Company with or without Cause, (iv) a termination by the Executive with or without Good Reason or due to Retirement, and (v) the expiration of the Term (the date of such termination, the “Termination Date”). On the Termination Date, the Executive’s role as (A) an officer of any member of the Company Group, (B) a member of the Board or similar body of any member of the Company Group and (C) a fiduciary of any Company Group benefit plan shall be deemed to have terminated, in each case, to the extent applicable and the Executive shall confirm the foregoing by submitting to the Company a written confirmation of such resignations upon request by the Board; provided, that the foregoing shall not modify or diminish in any way the rights and/or remedies otherwise available to the Executive in connection with such termination.
(b) Termination Due to the Executive’s Death or Disability or Retirement. The Executive’s employment and the Term shall terminate automatically upon the Executive’s death or Retirement. The Company may terminate the Executive’s employment and the Term upon a final determination as to the occurrence of the Executive’s Disability (with such determination made, for the avoidance of doubt, in accordance with the definition of Disability set forth below), with such termination to be effective ten (10) days following the date on which the Company provides written notice to the Executive of such determination in accordance with this Agreement and of such termination. Upon a termination of the Executive’s employment and the Term due to the Executive’s death or Disability or Retirement, the Executive’s estate or the Executive, as applicable, shall be entitled to the following:
(i) payment of any earned but unpaid Base Salary through the Termination Date, no later than sixty (60) days following the Termination Date (or such earlier date as may be required by applicable law);
(ii) payment of any earned but unpaid Annual Bonus for the fiscal year preceding the fiscal year in which the Termination Date occurs, to be paid in accordance with Section 3(b) (the “Prior Year Bonus”);
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(iii) payment in lieu of any earned but unused vacation time in accordance with Company policy as in effect from time to time;
(iv) all other payments, benefits or fringe benefits to which the Executive shall be entitled under the terms of any applicable compensation arrangement or benefit, equity or fringe benefit plan or program or grant or this Agreement, payable in accordance therewith;
(v) reimbursement for any unreimbursed business expenses incurred through the Termination Date, in accordance with Section 3(e) (with the payments and benefits described in subparagraphs (i), (ii), (iii), (iv) and (v) hereof, collectively, the “Accrued Benefits”);
(vi) a pro-rata portion of the Annual Bonus for the fiscal year in which the Termination Date occurs, determined by multiplying (A) the Annual Bonus that the Executive would have received for such fiscal year, based on actual performance (provided, that, any subjective performance goals will be deemed satisfied at target levels), by (B) a fraction, (I) the numerator of which is the number of calendar days that the Executive was employed with the Company during the fiscal year in which the Termination Date occurs, and (II) the denominator of which is the total number of calendar days in the fiscal year in which the Termination Date occurs, which amount shall be paid in accordance with Section 3(b); provided, however, that, for the avoidance of doubt, the requirement in Section 3(b) that payment of the Annual Bonus be subject to the Executive’s continued employment with the Company through the end of the fiscal year with respect to which such Annual Bonus was earned shall not apply (the “Pro-Rata Bonus”);
(vii) solely upon a termination of the Executive’s employment and the Term due to Executive’s death or Disability (and not due to the Executive’s Retirement) and subject to the Executive timely electing to continue the Executive’s coverage, reimbursement for the employer portion of the monthly cost of maintaining medical, dental and/or vision benefits for the Executive and the Executive’s covered dependents under a group health plan of the Company for purposes of the Consolidated Omnibus Budget Reconciliation Act of 1985 (as amended, “COBRA”), based on the premium rate applicable to similarly situated active employees of the Company (the “Benefit Payment”), until the earlier to occur of (A) twelve (12) months following the Termination Date and (B) the date the Executive ceases to be eligible for such COBRA coverage under applicable law or plan terms. The first installment of the Benefit Payment shall be paid on the sixtieth (60th) day following the Termination Date and shall include all amounts that would otherwise have been paid prior thereto absent the delay;
(viii) solely upon a termination of the Executive’s employment and the Term due to the Executive’s Disability (and not due to the Executive’s death or Retirement), an amount equal to six (6) months of the Executive’s Base Salary, at the rate in effect as of the Termination Date, which amount shall be payable in equal monthly installments over the six (6) month period following the Termination Date, provided, that, the first installment shall be paid on the sixtieth (60th) day following the Termination Date and shall include all amounts that would otherwise have been paid prior thereto absent the delay; and
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(ix) solely upon a termination of the Executive’s employment and the Term due to the Executive’s Retirement that occurs at a time when the Executive has completed at least twenty (20) years of service with Parent, the Company or any of their respective Subsidiaries (and not due to any other Retirement or the Executive’s death or Disability), Company-sponsored medical plan coverage for the Executive and the Executive’s spouse for five (5) years following the date of the Executive’s Retirement (the “Retiree Medical Benefit”); provided that, once the Executive becomes eligible for Medicare, the Retiree Medical Benefit will not be offered to the extent it is duplicative of Medicare; provided, further, that the Company may modify the continuation coverage contemplated by this Section 4(b)(ix) to the extent reasonably necessary to avoid the imposition of any excise taxes on the Company for failure to comply with the nondiscrimination requirements of Section 105(h) of the Code; the Patient Protection and Affordable Care Act of 2010, as amended; and/or the Health Care and Education Reconciliation Act of 2010, as amended, and in each case, the regulations and guidance promulgated thereunder (to the extent applicable).
For the avoidance of doubt, any equity awards outstanding as of the Termination Date will receive the treatment set forth in the applicable award agreement. Following a termination of the Executive’s employment due to death or Disability, except as set forth in this Section 4(b), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(c) Termination by the Company for Cause. The Company may terminate the Executive’s employment at any time for Cause, effective upon delivery to the Executive of written notice of such termination. If the Executive’s employment is terminated by the Company for Cause, the Executive shall be entitled only to the Accrued Benefits, exclusive, for the avoidance of doubt, of the Prior Year Bonus (if any), which shall be forfeited upon a termination for Cause.
Following the termination of the Executive’s employment by the Company for Cause, except as set forth in this Section 4(c), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(d) Termination by the Company Without Cause, Termination by the Executive for Good Reason or Termination Due to the Company’s Non-Renewal of the Term. The Company may terminate the Executive’s employment at any time without Cause, effective upon delivery to the Executive of written notice of such termination. The Executive may terminate the Executive’s employment for Good Reason by providing the Company written notice in the manner set forth below. In the event that the Executive’s employment is terminated by the Company without Cause (other than due to the Executive’s death or Disability), by the Executive for Good Reason or due to the Company’s non-renewal of the Term (each, a “Qualifying Termination”), in each case, subject to Section 4(g) below, the Executive shall be entitled to:
(i) the Accrued Benefits;
(ii) the Pro-Rata Bonus;
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(iii) an amount equal to two and one-half (2.5) times the sum of the Executive’s (A) Base Salary, at the rate in effect as of the Termination Date, and (B) Target Bonus, at the rate in effect as of the Termination Date (provided, that if the Qualifying Termination is due to the Executive’s termination of employment for Good Reason caused, in whole or in part, by a reduction in the Executive’s Base Salary and/or Target Bonus, or if the Executive would have had grounds to terminate the Executive’s employment for Good Reason on such basis at the time of a Qualifying Termination, each such amount shall be included in the foregoing calculation at the rate in effect prior to any decrease thereof) (the “Cash Severance”), which amount shall be payable in equal monthly installments over the twenty-four (24) month period following the Termination Date, provided, that, the first installment shall be paid on the sixtieth (60th) day following the Termination Date and shall include all amounts that would otherwise have been paid prior thereto absent the delay; and
(iv) the Benefit Payment, which shall be an aggregate amount equal to thirty (30) months of Benefit Payments, payable over the twenty-four (24)-month period following the Termination Date, or, if earlier, until the date on which the Executive ceases to be eligible for such COBRA coverage under applicable law or plan terms. The first installment of the Benefit Payment shall be paid on the sixtieth (60th) day following the Termination Date and shall include all amounts that would otherwise have been paid prior thereto absent the delay.
For the avoidance of doubt, any equity awards outstanding as of the Termination Date will receive the treatment set forth in the applicable award agreement; provided, that, to the extent not already provided in the applicable award agreement (and notwithstanding anything to the contrary therein), upon a Qualifying Termination, all time- or service-based vesting conditions applicable to any equity awards outstanding as of the Termination Date will be deemed to be fully satisfied (and, for clarity, the treatment of any performance-based vesting conditions will receive the treatment set forth in the applicable award agreement). Payments and benefits provided in this Section 4(d) shall be in lieu of any termination or severance payments or benefits for which the Executive may be eligible under any of the plans, policies or programs of the Company Group or under the Worker Adjustment Retraining Notification Act of 1988 or any similar state statute or regulation.
Following the termination of the Executive’s employment due to a Qualifying Termination, except as set forth in this Section 4(d), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(e) Change of Control Qualifying Termination. This Section 4(e) shall apply if (i) the Executive’s Qualifying Termination occurs during the two (2)-year period immediately following a Change of Control, or (ii) the Executive is terminated by the Company without Cause within the six (6)-month period immediately prior to a Change of Control (each, a “Change of Control Qualifying Termination”). To the extent a Change of Control Qualifying Termination occurs and the Executive is already receiving the benefits described in Section 4(d) in accordance with the terms thereof, the Executive shall no longer be eligible for the benefits described in Section 4(d) and instead shall be entitled exclusively to all of the benefits provided in this Section 4(e); provided, that the benefits set forth under this Section 4(e) shall be reduced by any payments and benefits that the Executive already received in accordance with the terms of Section 4(d). For the avoidance of doubt, there shall be no duplication of the benefits under Section 4(d). If any such Change of Control Qualifying Termination occurs, the Executive (or the Executive’s estate, if the Executive dies after such termination and execution of the Release (as defined in Section 4(g)) but before receiving such amount) shall receive the benefits set forth in Section 4(d), except that (A) the amount of the Pro-Rata Bonus shall be determined based on
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deemed achievement of all performance criteria at target levels; (B) the Pro-Rata Bonus, Cash Severance and Benefit Payment will be payable in a lump sum; and (C) the Executive shall continue to receive the benefits set forth in Section 3(f) until the earlier to occur of (x) the Executive’s death and (y) the thirty (30)-month anniversary of the Qualifying Termination.
(f) Termination by the Executive Without Good Reason or Due to the Executive’s Non-Renewal of the Term. The Executive may terminate the Executive’s employment without Good Reason by providing sixty (60) days’ prior written notice to the Company or by electing not to renew the Term in accordance with Section 1 hereof. Upon receipt of such notice, the Company may, in its sole discretion, remove the Executive’s title and require that the Executive not attend the workplace, perform any duties or contact any clients, suppliers or employees of the Company or any associated persons through the Termination Date (the “Garden Leave Period”); provided, that, for the avoidance of doubt, the foregoing restriction shall not prohibit the Executive from contacting employees for logistical or human resources purposes, in each case relating to the transition of the Executive’s duties and/or termination of his employment, attending the workplace for purposes of removing the Executive’s personal effects from the workplace (as reasonably permitted by the Company) or performing other ministerial tasks as required by the Company; and provided, further, that during the Garden Leave Period, the Company shall continue to (i) pay to the Executive the Base Salary and (ii) provide to the Executive the existing benefits in accordance with the terms of the applicable plans. Upon the Executive’s voluntary termination of employment without Good Reason, the Executive shall be entitled only to the Accrued Benefits. For the avoidance of doubt, any equity awards outstanding as of the Termination Date will receive the treatment set forth in the applicable award agreement. Following any such termination of the Executive’s employment, except as set forth in this Section 4(f), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(g) Release of Claims, Continued Compliance. Notwithstanding any provision herein to the contrary, the payment and provision of the Severance Benefits pursuant to Section 4(b)(vi) (but only upon the Executive’s Retirement and not upon the Executive’s death or Disability), Section 4(b)(viii), Section 4(d) or Section 4(e) shall be conditioned upon the Executive’s execution, delivery to the Company and non-revocation of the general release of claims substantially in the form attached hereto as Exhibit B (the “Release”) (and the expiration of any revocation period contained in such Release) within sixty (60) days following the Termination Date, as well as the Executive’s acknowledgement of, and the Executive’s material compliance with, the Executive’s obligations under Section 6, as further outlined in this paragraph below. If the Executive fails to execute the Release in such a timely manner so as to permit any revocation period to expire prior to the end of such sixty (60)-day period, or timely revokes such release following its execution, the Executive shall not be entitled to any of the Severance Benefits. If the period of time during which the Executive may consider the Release begins in one calendar year and ends in the next calendar year, any amounts payable under this Section 4 for which the payment timing is contingent upon the execution and non-revocation of the Release shall be paid as soon as practicable in the second calendar year (provided, that the Release has become effective and non-revocable), even if the Release first became effective and non-revocable in the first calendar year. Notwithstanding any provision in this Agreement to the contrary, if the Executive materially breaches any of the covenants contained in Section 6 while receiving the Severance Benefits under Section 4(d), the Company shall have the right, but not the obligation, to cease providing such Severance Benefits under Section 4(d); provided, that, such material breach has a substantial detrimental impact on the Company or could reasonably be expected to have a
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substantial detrimental impact on the Company as determined by the Board in good faith; provided, further, that a material breach of Section 6 can only occur for purposes of this Section 4(g) (and otherwise, without limiting any other remedies with respect thereto) if (i) the Company provides the Executive with written notice of the circumstances constituting the alleged material breach of such covenants within ninety (90) days after becoming aware of such circumstances and (ii) the alleged breach, if curable (which includes any commercial relationship resulting from such prohibited conduct), has not been cured within fifteen (15) days after receipt of the written notice described in clause (i) above.
(h) No Offset. In the event of termination of the Executive’s employment for any reason, the Executive shall be under no obligation to seek other employment, and there shall be no offset against amounts due to the Executive on account of any remuneration or benefits provided by any subsequent employment the Executive may obtain. The Company’s obligation to make any payment pursuant to, and otherwise to perform its obligations under, this Agreement shall not be affected by any offset, counterclaim or other right that the Company or any other member of the Company Group may have against the Executive for any reason.
(i) Retirement Matters. Notwithstanding anything to the contrary in this Agreement or any other arrangement between the Executive, on the one hand, and any member of the Company Group, on the other hand, if any other “named executive officer” (as defined in Item 402(a)(3) of Regulation S-K promulgated under the Exchange Act) of Parent is, following the date hereof but prior to the Executive’s Retirement, or has been, in any agreement or arrangement with any member of the Company Group that remains in effect, provided pursuant to authorization by the Board with any retirement-related payments, benefits (including but not limited to health or welfare benefits), vesting treatment, continued vesting, perquisites, rights or protections (but, for clarity, not including any post-retirement consulting arrangements) upon or in connection with such named executive officer’s retirement that are more favorable than those provided to the Executive under this Agreement and the Executive’s applicable equity award agreements and other compensation and benefit arrangements upon his Retirement (the “More Favorable Retirement Terms”), then the Executive shall automatically be entitled to the benefit of the More Favorable Retirement Terms, mutatis mutandis, as if set forth herein (and to the extent applicable in the Executive’s applicable equity award agreements and other compensation and benefit arrangements), without any further action by any person (it being understood that the Executive shall not be entitled to duplicative payments or benefits). Notwithstanding the foregoing, to the extent any More Favorable Retirement Term, when provided to the Executive pursuant to this Section 4(i), would violate Section 409A of the Code, the Executive shall not be entitled to receive such More Favorable Retirement Term.
5. Section 280G of the Code.
(a) Best-Net Cutback. Notwithstanding any other provision of this Agreement or any other plan, arrangement or agreement to the contrary, if any of the payments or benefits provided or to be provided by the Company Group to the Executive or for the Executive’s benefit pursuant to the terms of this Agreement or otherwise (“Covered Payments”) constitute parachute payments within the meaning of Section 280G of the Internal Revenue of Code of 1986, as amended (the “Code”), and would, but for this Section 5, be subject to the excise tax imposed under Section 4999 of the Code (or any successor provision thereto) or any similar tax imposed by state or local law or any interest or penalties with respect to such taxes (collectively, the “Excise Tax”), then prior to making the Covered Payments, a calculation shall be made comparing (i) the
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Net Benefit (as defined below) to the Executive of the Covered Payments after payment of the Excise Tax to (ii) the Net Benefit to the Executive if the Covered Payments are limited to the extent necessary to avoid being subject to the Excise Tax. Only if the amount calculated under subparagraph (i) above is less than the amount under subparagraph (ii) above will the Covered Payments be reduced to the minimum extent necessary to ensure that no portion of the Covered Payments is subject to the Excise Tax. “Net Benefit” shall mean the present value of the Covered Payments net of all federal, state, local and foreign income, employment and excise taxes.
(b) Method of Reduction. The Covered Payments shall be reduced in a manner that maximizes the Executive’s economic position. In applying this principle, the reduction shall be made in a manner consistent with the requirements of Section 409A of the Code; provided, that (i) cash payments shall be reduced before non-cash payments; and (ii) payments to be made on a later payment date shall be reduced before payments to be made on an earlier payment date.
(c) Determination. Any determination required under this Section 5, including whether any payments or benefits are parachute payments, shall be made in the sole discretion of a nationally recognized, independent accounting or consulting firm selected and paid for by the Company using reasonable assumptions on the Executive’s tax rates (as determined by such firm). The Executive shall provide the Company with such information and documents as the Company and such accounting firm may reasonably request in order to make a determination under this Section 5. The parties shall cooperate to the extent necessary to reduce the Excise Tax, including determining “reasonable compensation” under Sections 280G and 4999 of the Code (which may involve the valuation of the Executive’s non-compete obligations). The firm’s determination shall be final and binding on the Executive and the Company absent manifest error.
6. Restrictive Covenants. The Company and the Executive acknowledge and agree that during the Executive’s employment with the Company, the Executive will have access to and may assist in developing Confidential Information and will occupy a position of trust and confidence with respect to the affairs and business of the Company, Parent and their respective Subsidiaries. The Executive further acknowledges that (I) the Executive performs services of a unique nature for the Company that are irreplaceable and that the Executive’s performance of such services to a competing business will result in irreparable harm to the Company, Parent and their respective Subsidiaries; (II) the Executive has had and will continue to have access to Confidential Information which, if disclosed, would unfairly and inappropriately assist in competition against the Company, Parent or their respective Subsidiaries; (III) in the course of the Executive’s employment by a competitor, the Executive inevitably would use or disclose such Confidential Information; (IV) the Company, Parent and their respective Subsidiaries have substantial relationships with their customers, and the Executive has had and will continue to have access to these customers; and (V) the Executive has received and will receive specialized training from the Company, Parent and their respective Subsidiaries. Accordingly, the Executive agrees that the following obligations are necessary to preserve the confidential and proprietary nature of Confidential Information and to protect the Company, Parent and their respective Subsidiaries against harmful solicitation of employees and customers, harmful competition and other actions by the Executive that would result in serious adverse consequences for the Company, Parent and their respective Subsidiaries:
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(a) Confidentiality. Subject to Sections 6(e)(iii) and 8, during the Executive’s employment and at all times thereafter, the Executive shall not, directly or indirectly, use, make available, sell, copy, disseminate, transfer, communicate or otherwise disclose any Confidential Information, other than as authorized in writing by the Company or within the scope of the Executive’s duties with the Company as determined reasonably and in good faith by the Executive. Anything herein to the contrary notwithstanding, the term “Confidential Information” shall not include, and the provisions of this Section 6(a) shall not apply to, information that (i) was known to the public prior to its disclosure to the Executive; (ii) becomes generally known to the public subsequent to disclosure to the Executive through no wrongful act of the Executive or any representative of the Executive; (iii) the Executive is required to disclose by applicable law, regulation or legal process (provided, that to the extent permissible, the Executive provides the Company with prior notice of the contemplated disclosure and cooperates with the Company at its expense in seeking a protective order or other appropriate protection of such information); or (iv) was owned by the Executive and/or any of the Executive’s Affiliates and used by the Company (A) pursuant to the Trademark License Agreement or the Facilities Use Agreement or (B) as listed on Schedule 1 hereto.
(b) Materials. The Executive will use Confidential Information only for normal and customary use in the Company’s business, as determined reasonably and in good faith by the Company. The Executive will return to the Company all Confidential Information and copies thereof and all other property of the Company or any other member of the Company Group at any time upon the request of the Company and in any event immediately after termination of the Executive’s employment. The Executive agrees to identify and return to the Company any copies of any Confidential Information after the Executive ceases to be employed by the Company. Anything to the contrary notwithstanding, nothing in this Section 6 shall prevent the Executive from retaining a home computer (provided all Confidential Information has been removed), papers and other materials of a personal nature, including diaries, calendars and contact lists (excluding customer lists), information relating to the Executive’s compensation or relating to reimbursement of expenses, information obtained in the Executive’s capacity as an investor in the Company or any of its Affiliates, information that may be needed for tax purposes, and copies of plans, programs and agreements relating to the Executive’s employment.
(c) Non-Competition; Non-Solicitation.
(i) During the Restricted Period and within the Restricted Area, the Executive shall not, directly or indirectly: (A) solicit or service, or attempt to solicit or service, any Customer for the purpose of engaging in or assisting any other individual, person, firm or other entity in engaging in a Competitive Enterprise; (B) interfere with or damage any relationship and/or agreement between any member of the Company, Parent or their respective Subsidiaries and any Customer; or (C) act as a sole proprietor, owner, employer, partner, principal, investor, joint venturer, shareholder, associate, employee, member, consultant, contractor, director or otherwise with any Competitive Enterprise; provided, however, that (x) the Executive may own, as a passive investor, securities of any such entity that has outstanding publicly traded securities, so long as the Executive’s direct holdings in any such entity shall not in the aggregate constitute more than 5% of the voting power of such entity, and (y) the exercise of any rights or remedies of the Executive or any of his Affiliates under any other agreements with the Company or any of its Affiliates, including, without limitation, the Trademark License Agreement and the Facilities Use Agreement, will not be deemed to be a breach of this Section 6(c). Further, nothing in this Section 6(c) shall prohibit the Executive from, for that portion of the Restricted Period following the Executive’s Termination Date, being employed or engaged by any
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Competitive Enterprise in a role that does not have responsibility for, or require performance of, any of the same or similar functions, duties or activities that the Executive performed for, or for which the Executive had oversight responsibilities for the Company, Parent, and/or their respective Subsidiaries, unless the Executive’s performance of such role (whether as an employee, contractor, advisor or otherwise) is reasonably likely to result in the Executive’s disclosure and/or use of Confidential Information. The Executive acknowledges that this covenant has a unique, very substantial and immeasurable value to the Company, that the Executive has sufficient assets and skills to provide a livelihood for the Executive while such covenant remains in force, and that, as a result of the foregoing, in the event that the Executive breaches such covenant, monetary damages would be an insufficient remedy for the Company and equitable enforcement of the covenant would be proper.
(ii) During the Restricted Period and within the Restricted Area, the Executive shall not solicit, entice, persuade or induce any individual who is employed or engaged by the Company, Parent or their respective Subsidiaries (or who was so employed or engaged within six (6) months immediately preceding the Executive’s Termination Date) and with whom the Executive had contact during the Executive’s employment with or service to the Company, Parent or their respective Subsidiaries or who otherwise worked in the same department as the Executive, in each case to terminate or refrain from continuing such employment or engagement or to become employed by or enter into contractual relations with any Competitive Enterprise, and the Executive shall not hire, directly or indirectly, on the Executive’s behalf or on behalf of any other person, as an employee, consultant or otherwise, any such person.
(d) Mutual Non-Disparagement. The Executive agrees not to, at any time, make negative comments about or otherwise disparage the Company, Parent or their respective Subsidiaries or any officer, director, employee, shareholder, agent or product of the Company, Parent or their respective Subsidiaries, other than (i) to officers, employees or directors of the Company, Parent or their respective Subsidiaries in the good faith performance of the Executive’s duties to the Company while the Executive is employed by the Company or (ii) as necessary to correct misinformation or misunderstanding with respect to the Executive on the part of others or to address negative statements attributed to the Executive; provided, that this clause (ii) will only permit statements that the Executive has a good faith and reasonable basis, after due inquiry of all facts, for believing are true and accurate. The Company agrees that it will direct the senior officers of Parent, the Company and their respective Subsidiaries as of the Termination Date and the members of the Board as of the Termination Date to refrain from making negative comments about the Executive or otherwise disparaging the Executive in any manner, including by making or issuing any official public statements or press releases disparaging the Executive. The foregoing shall not be violated by any statements covered by Sections 6(e)(iii) and 8 or any truthful statements in response to legal process, required governmental testimony or filings or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings).
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(e) Inventions.
(i) The Executive acknowledges and agrees that all ideas, methods, inventions, discoveries, improvements, work products, developments, software, know-how, processes, techniques, works of authorship and other work product, whether patentable or unpatentable, (A) that are reduced to practice, created, invented, designed, developed, contributed to or improved with the use of any Company Group resources and/or within the scope of the Executive’s work with the Company Group, or that relate to the business, operations or actual or demonstrably anticipated research or development of the Company Group, and that are made or conceived by the Executive, solely or jointly with others, during the Term, or (B) suggested by any work that the Executive performs in connection with the Company Group, either while performing the Executive’s duties with the Company Group or on the Executive’s own time, shall belong exclusively to the Company Group (or its designee), whether or not patent or other applications for intellectual property protection are filed thereon (the “Inventions”). The Executive will keep full and complete written records (the “Records”), in the manner prescribed by the Company, of all Inventions and will promptly disclose all Inventions completely and in writing to the Company. The Records shall be the sole and exclusive property of the Company, and the Executive will surrender them upon the termination of the Term, or upon the Company’s earlier written request. The Executive irrevocably conveys, transfers and assigns to the Company the Inventions and all patents or other intellectual property rights that may issue thereon in any and all countries, whether during or subsequent to the Term, together with the right to file, in the Executive’s name or in the name of the Company (or its designee), applications for patents and equivalent rights (the “Applications”). The Executive will, at any time during and subsequent to the Term, make such applications, sign such papers, take all rightful oaths and perform all other acts as may be requested from time to time by the Company to perfect, record, enforce, protect, patent or register the Company’s rights in the Inventions, all without additional compensation to the Executive from the Company. The Executive will also execute assignments to the Company (or its designee) of the Applications, and give the Company and its attorneys all reasonable assistance (including the giving of testimony) to obtain the Inventions and all patents or other intellectual property rights that may issue thereon for the Company’s benefit, all without additional compensation to the Executive from the Company, but entirely at the Company’s expense.
(ii) In addition, the Inventions will be deemed Work for Hire, as such term is defined under the copyright laws of the United States, on behalf of the Company, and the Executive agrees that the Company will be the sole owner of the Inventions, and all underlying rights therein, in all media now known or hereinafter devised, throughout the universe and in perpetuity without any further obligations to the Executive. If the Inventions, or any portion thereof, are deemed not to be Work for Hire, or the rights in such Inventions do not otherwise automatically vest in the Company, the Executive hereby irrevocably conveys, transfers and assigns to the Company all rights, in all media now known or hereinafter devised, throughout the universe and in perpetuity, in and to the Inventions, including, without limitation, all of the Executive’s right, title and interest in the copyrights (and all renewals, revivals and extensions thereof) to the Inventions, including, without limitation, all rights of any kind or any nature now or hereafter recognized, including, without limitation, the unrestricted right to make modifications, adaptations and revisions to the Inventions, to exploit and allow others to exploit the Inventions and all rights to sue at law or in equity for any infringement, or other unauthorized use or conduct in derogation of the Inventions, known or unknown, prior to the date hereof, including, without limitation, the right to receive all proceeds and damages therefrom. In addition, the Executive hereby waives any so-called “moral rights” with
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respect to the Inventions. To the extent that the Executive has any rights in the results and proceeds of the Executive’s service to the Company that cannot be assigned in the manner described herein, the Executive agrees to unconditionally waive the enforcement of such rights. The Executive hereby waives any and all currently existing and future monetary rights in and to the Inventions and all patents and other registrations for intellectual property that may issue thereon, including, without limitation, any rights that would otherwise accrue to the Executive’s benefit by virtue of the Executive being an employee of or other service provider to the Company.
(iii) 18 U.S.C. Section 1833(b) provides: “An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that—(A) is made—(i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.” Nothing in this Agreement is intended to conflict with 18 U.S.C. Section 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. Section 1833(b). Accordingly, the parties to this Agreement have the right to disclose in confidence trade secrets to federal, state and local government officials or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. The parties also have the right to disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure.
(iv) For the avoidance of doubt, this Section 6(e), does not require Executive to assign to the Company the trade names and trademarks owned by HFR that are licensed to the Company pursuant to the Trademark License Agreement.
(f) Conflicting Obligations and Rights. The Executive agrees to inform the Company of any apparent conflicts between the Executive’s work for the Company and any obligations the Executive may have to preserve the confidentiality of another’s proprietary information or related materials before using the same on the Company’s behalf. The Company shall receive such disclosures in confidence and consistent with the objectives of avoiding any conflict of obligations and rights or the appearance of any conflict of interest.
(g) Reasonableness of Restrictive Covenants. In signing this Agreement, the Executive gives the Company assurance that the Executive has carefully read and considered all of the terms and conditions of this Agreement, including the restraints imposed under this Section 6 hereof. The Executive agrees that these restraints are necessary for the reasonable and proper protection of the Company, Parent and their respective Subsidiaries and their Confidential Information, and that each and every one of the restraints is reasonable in respect to subject matter, length of time and geographic area, and that these restraints, individually or in the aggregate, will not prevent the Executive from obtaining other suitable employment during the period in which the Executive is bound by the restraints. The Executive acknowledges that each of these covenants has a unique, very substantial and immeasurable value to the Company, Parent and their respective Subsidiaries, and that the Executive has sufficient assets and skills to provide a livelihood while such covenants remain in force. The Executive further covenants that the Executive will not challenge the reasonableness or enforceability of any of the covenants set forth in this Section 6. It is also agreed that the Company, Parent and their respective Subsidiaries will have the right to enforce all of the Executive’s obligations to the Company, Parent and their respective Subsidiaries under this Agreement, including, without limitation, pursuant to this Section 6.
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(h) Reformation. If it is determined by a court of competent jurisdiction in any state that any restriction in this Section 6 is excessive in duration or scope or is unreasonable or unenforceable under applicable law, it is the intention of the parties that such restriction shall be modified or amended by the court to render it enforceable to the maximum extent permitted by the laws of that state. Without limiting the foregoing, the Company may amend any restrictive covenant provisions or obligations without the consent or approval of the Executive to provide for less restrictive limitations as to duration, geographical area, scope of activity to be restrained, or to incorporate legal developments that do not impose additional or greater restrictions on the Executive. Any such less restrictive limitations may, in the Company’s sole discretion, apply only with respect to the enforcement of this Agreement in certain jurisdictions specified in any such amendment.
(i) Enforcement. The Executive acknowledges that, in the event of any breach or threatened breach of this Section 6, the business interests of the Company, Parent and their respective Subsidiaries might be irreparably injured, the full extent of the damages to the Company, Parent and their respective Subsidiaries might be impossible to ascertain, monetary damages might not be an adequate remedy for the Company, Parent and their respective Subsidiaries, and therefore, in addition to any other remedies available at law or in equity, the Company will be entitled to seek to enforce this Agreement by a temporary, preliminary and/or permanent injunction or other equitable relief without the need to post a bond or prove actual monetary damages. The Executive understands that the Company may waive some of the requirements expressed in this Agreement, but that such a waiver to be effective must be made in writing and should not in any way be deemed a waiver of the Company’s right to enforce any other requirements or provisions of this Agreement. The Executive agrees that each of the Executive’s obligations specified in this Agreement is a separate and independent covenant and that the unenforceability of any of them shall not preclude the enforcement of any other covenants in this Agreement.
7. Cooperation. Upon the receipt of reasonable notice from the Company (including through outside counsel), the Executive agrees that, while employed by the Company and thereafter, the Executive will respond and provide information with regard to matters in which the Executive has knowledge as a result of the Executive’s employment with the Company, and will provide reasonable assistance to the Company, Parent, their respective Subsidiaries and their respective representatives, in defense of any claims that may be made against the Company, Parent or their respective Subsidiaries, and will assist the Company, Parent and their respective Subsidiaries in the prosecution of any claims that may be made by the Company, Parent or their respective Subsidiaries, to the extent that such claims are based on facts occurring during the Executive’s employment with the Company (collectively, the “Claims”). During the pendency of any litigation or other proceeding involving Claims, subject to Sections 6(e)(iii) and 8, the Executive shall not communicate with anyone (other than the Executive’s attorneys and tax and/or financial advisors, and except to the extent that the Executive determines in good faith is necessary in connection with the performance of the Executive’s duties hereunder) with respect to the facts or subject matter of any pending or potential litigation or regulatory or administrative proceeding involving the Company, Parent or their respective Subsidiaries without, to the extent legally permitted to do so, giving prior written notice to the Company or the Company’s counsel. Upon
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presentation of appropriate documentation, the Company shall pay or reimburse the Executive for all reasonable out-of-pocket travel, duplicating or telephonic expenses incurred by the Executive in complying with this Section 7. The Company shall cooperate with the Executive on the timing and location of the Executive’s cooperation and use its good faith efforts to limit any travel or interference with the Executive’s other professional commitments. In addition, following the Executive’s termination of employment, to the extent the Executive is not receiving any Severance Benefits in respect of such post-termination period, the Executive shall be compensated for the time spent for such cooperation at an hourly rate determined based on the Executive’s Base Salary at the rate in effect as of the Termination Date.
8. Whistleblower Protection; Protected Activity.
(a) Notwithstanding anything to the contrary contained herein, no provision of this Agreement shall be interpreted so as to impede the Executive (or any other individual) from (i) reporting possible violations of law or regulation to any governmental agency or entity, including, but not limited to, the Department of Justice, the Securities and Exchange Commission, the Congress and any agency Inspector General (collectively, “Governmental Authorities”), (ii) initiating communications directly with, cooperating with, providing information to, causing information to be provided to, or otherwise assisting in an investigation by any Governmental Authority regarding a possible violation of any law, (iii) responding to any inquiry or legal process from any such Governmental Authorities, (iv) testifying, participating or otherwise assisting in an action or proceeding by any such Governmental Authorities relating to a possible violation of law, (v) seeking or accepting any U.S. Securities and Exchange Commission awards or other relief in connection with protected whistleblower activity, or (vi) making other disclosures under the whistleblower provisions of applicable law, rule or regulation. The Executive does not need the prior authorization of the Company to make any such reports or disclosures, and the Executive shall not be required to notify the Company that such reports or disclosures have been made.
(b) The Executive hereby acknowledges and agrees that nothing in this Agreement shall in any way limit or prohibit the Executive from engaging for a lawful purpose in any Protected Activity. For purposes of this Agreement, “Protected Activity” shall mean (i) filing a charge, complaint or report with, or otherwise communicating with, cooperating with or participating in any investigation or proceeding that may be conducted by, any federal, state or local government agency or commission, including the Equal Employment Opportunity Commission, the Department of Labor, the Occupational Safety and Health Administration and the National Labor Relations Board (the “Government Agencies”); (ii) disclosing an act of, or facts related to acts of, sexual harassment or abuse committed against any person; (iii) voluntarily communicating with an attorney retained by the Executive, or (iv) any rights the Executive may have under Section 7 of the National Labor Relations Act or equivalent state law to engage in concerted protected activity or to discuss the terms of employment or working conditions with or on behalf of coworkers, or to bring such issues to the attention of the Board at any time. The Executive understands that, in connection with such Protected Activity, the Executive is permitted to disclose documents or other information as permitted by law, and without giving notice to, or receiving authorization from, the Company. Notwithstanding the foregoing, the Executive agrees to take all reasonable precautions to prevent any unauthorized use or disclosure of any information that may constitute Confidential Information to any parties other than the relevant Government Agencies. The Executive further understands that Protected Activity does not include the disclosure of any Company Group attorney-client privileged communications, and that any such disclosure without the Company’s written consent shall constitute a material breach of this Agreement.
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9. Notices. All notices, demands, requests or other communications, which may be or are required to be given or made by any party to any other party pursuant to this Agreement, shall be in writing and shall be hand delivered, mailed by first-class registered or certified mail, return receipt requested, postage prepaid, delivered by overnight air courier, or transmitted by e-mail or facsimile transmission, addressed as follows:
| (a) | If to Parent or the Company: |
103 Northpark Blvd., Suite 300
Covington, LA 70433
Attention: [____________]
E-Mail: [____________]
with a copy (which shall not constitute notice) to:
Kirkland & Ellis LLP
609 Main Street
Houston, Texas 77002
Attn: [____________]
Email: [____________]
| (b) | If to the Executive: |
Address last shown on the Company’s books and records
with a copy (which shall not constitute notice) to:
Herrick, Feinstein LLP
2 Park Avenue
New York, NY 10016
Attn: [____________].
Email: [____________]
Each party may designate by notice in writing a new address to which any notice, demand, request or communication may thereafter be so given, served or sent. Each notice, demand, request or communication that shall be given or made in the manner described above shall be deemed sufficiently given or made for all purposes at such time as it is delivered to the addressee (with the return receipt, the delivery receipt, confirmation of facsimile transmission or the affidavit of messenger being deemed conclusive but not exclusive evidence of such delivery) or at such time as delivery is refused by the addressee upon presentation.
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10. Severability. The provisions of this Agreement shall be deemed severable. The invalidity or unenforceability of any provision of this Agreement in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by applicable law. If any term or provision of this Agreement is found to be invalid or unenforceable by a final determination of a court of competent jurisdiction, the invalid or unenforceable term or provision hereof shall be deemed replaced by a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision hereof.
11. Survival. It is the express intention and agreement of the parties hereto that the provisions of Sections 5 through 23 shall survive the termination of employment of the Executive. In addition, all obligations of the Company to make payments hereunder shall survive any termination of this Agreement on the terms and conditions set forth herein.
12. No Assignments. The rights and obligations of the parties to this Agreement shall not be assignable or delegable, except that (a) in the event of the Executive’s death, the personal representative or legatees or distributees of the Executive’s estate, as the case may be, shall have the right to receive any amount owing and unpaid to the Executive hereunder; and (b) the rights and obligations of Parent and the Company hereunder shall be assignable and delegable to an Affiliate or in connection with any subsequent merger, consolidation, sale of all or substantially all of the assets or equity interests of Parent or the Company, or similar transaction involving Parent or the Company or a successor corporation. Parent and the Company shall require any successor to Parent or the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that Parent or the Company would be required to perform it if no such succession had taken place.
13. Binding Effect. Subject to any provisions hereof restricting assignment, this Agreement shall be binding upon the parties hereto and shall inure to the benefit of the parties and their respective heirs, devisees, executors, administrators, legal representatives, successors and assigns.
14. Amendments; Modifications; Waivers. No provision of this Agreement may be amended, modified, waived or discharged, unless such amendment, modification, waiver or discharge is agreed to in writing and signed by the Executive and such officer or director of each of Parent and the Company as may be designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time unless such waiver specifically states that it is to be construed as a continuing waiver.
15. Section Headings; Inconsistency. Section and subsection headings contained in this Agreement are inserted for convenience of reference only, shall not be deemed to be a part of this Agreement for any purpose, and shall not in any way define or affect the meaning, construction or scope of any of the provisions hereof. In the event of any inconsistency between the terms of this Agreement and any form, award, plan or policy of the Company Group, the terms of this Agreement shall govern and control, unless otherwise expressly provided.
16. Governing Law. This Agreement, the rights and obligations of the parties hereto, and any claims or disputes relating thereto, shall be governed by and construed in accordance with the laws of the State of Texas (but not including any choice of law rule that would cause the laws of another jurisdiction to apply).
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17. Dispute Resolution. Each of the parties hereto irrevocably and unconditionally (a) WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING RELATING TO THIS AGREEMENT OR THE EXECUTIVE’S EMPLOYMENT BY THE COMPANY OR ANY OTHER MEMBER OF THE COMPANY GROUP, or for the recognition and enforcement of any judgment in respect thereof (a “Proceeding”), whether such Proceeding is based on contract, tort or otherwise; (b) agrees that service of process in any such Proceeding may be effected by mailing a copy of such process by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such party at the Executive’s or its address as provided in Section 9; and (c) agrees that nothing in this Agreement shall affect the right to effect service of process in any other manner permitted by applicable law.
18. Indemnification. The parties acknowledge that the Executive is eligible to receive the benefits of a separate Indemnification Agreement, entered on or around the Effective Date in connection with the Transaction.
19. Entire Agreement; Advice of Counsel. This Agreement constitutes the entire agreement between the parties respecting the employment of the Executive, there being no representations, warranties or commitments except as set forth herein, and supersedes and replaces all other agreements related to the subject matter hereof, including, without limitation, the Original Agreement and the Term Sheet; provided, however, that the provisions of this Agreement are in addition to and complement (and do not replace or supersede) any other written agreement(s) or parts thereof between the Executive and any member of the Company Group that create restrictions on the Executive with respect to confidentiality, assignment of inventions, non-disclosure, non-competition, non-solicitation or non-disparagement or include any other restrictive covenants with respect to the Executive. Without limiting the scope of the preceding sentence, except as otherwise expressly provided in this Section 19, all understandings and agreements preceding the Effective Date and relating to the subject matter hereof (including the Original Agreement and the Term Sheet) are hereby null and void and of no further force or effect, and this Agreement shall supersede all other agreements, written or oral, that purport to govern the terms of the Executive’s employment (including the Executive’s compensation) with any member of the Company Group. The Executive acknowledges and agrees that the Original Agreement is hereby terminated and has been satisfied in full, as has any other employment agreement between the Executive and any member of the Company Group. In entering into this Agreement, the Executive expressly acknowledges and agrees that the Executive has received all sums and compensation that the Executive has been owed, is owed or ever could be owed pursuant to the agreement(s) referenced in the previous sentence and for services provided to any member of the Company Group through the date that the Executive signs this Agreement, with the exception of any unpaid base salary for the pay period that includes the date on which the Executive signs this Agreement, any unpaid bonus and any incentive compensation for the portion of the current year before the execution and delivery of this Agreement. The Executive acknowledges that, in connection with the Executive’s entry into this Agreement, the Executive was advised, or had the opportunity to be advised, by an attorney of the Executive’s choice on the terms and conditions of this Agreement, including, without limitation, on the application of Section 409A of the Code on the payments and benefits payable or to be paid to the Executive hereunder.
20. Counterparts. This Agreement may be executed (including by email with scan attachment) in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.
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21. Withholding. The Company may withhold from any and all amounts payable under this Agreement or otherwise such federal, state and local taxes as may be required to be withheld pursuant to any applicable law or regulation.
22. Section 409A of the Code.
(a) The intent of the parties is that payments and benefits under this Agreement comply with Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively, “Section 409A of the Code”) or an exemption therefrom, and accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith or exempt therefrom. If the Executive notifies the Company (with specificity as to the reason therefor) that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Section 409A of the Code and the Company concurs with such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the Company shall, after consulting with the Executive, reform such provision to attempt to comply with or be exempt from Section 409A of the Code through good faith modifications to the minimum extent reasonably appropriate to conform with Section 409A of the Code. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A of the Code, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A of the Code. For the sake of clarity, the Company Group shall have no obligation to indemnify the Executive for liabilities incurred as a result of Section 409A of the Code.
(b) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits that are “nonqualified deferred compensation” within the meaning of Section 409A of the Code upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Section 409A of the Code, and for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If the Executive is deemed on the Termination Date to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B) of the Code, then with regard to any payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Section 409A of the Code payable on account of a “separation from service,” such payment or benefit shall be made or provided at the date which is the earlier of (i) the expiration of the six (6) month period measured from the date of such “separation from service” of the Executive, and (ii) the date of the Executive’s death, to the extent required under Section 409A of the Code (such earlier date, the “Delayed Payment Date”). Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 22(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum with interest at the prime rate as published in The Wall Street Journal on the first business day following the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
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(c) To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Section 409A of the Code, (i) all expenses or other reimbursements hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by the Executive; (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit; and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(d) For purposes of Section 409A of the Code, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(e) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Section 409A of the Code be subject to offset by any other amount unless otherwise permitted by Section 409A of the Code.
23. Definitions.
(a) “Affiliate” means, with respect to any person or entity, any entity controlled by, in control of or under common control with, such person or entity.
(b) “Cause” shall be limited to the following events: (i) the Executive’s conviction of either (A) a felony involving moral turpitude or (B) any crime in connection with the Executive’s employment that causes the Company Group a substantial detriment (in each case, excluding traffic offenses); (ii) actions or inactions by the Executive that clearly are contrary to the best interests of the Company Group and the express directives of the Board; provided, that, such actions or inactions by the Executive cause the Company Group a substantial detriment or could reasonably be expected to cause a substantial detriment to the Company Group as determined by the Board in good faith; (iii) the Executive’s willful failure to take actions permitted by law and necessary to implement policies of the Board that the Board has communicated to him in writing; provided, that, such policies that are reflected in minutes of a Board meeting attended in its entirety by the Executive shall be deemed communicated to the Executive to the extent the Executive received a copy of such minutes from the Secretary or the General Counsel of the Company promptly following approval by the Board; (iv) the Executive’s continued failure to attend to his material duties as an executive officer of the Company Group following the Executive’s receipt of written notice from the Board of such failure; provided, that, such failure by the Executive causes the Company Group a substantial detriment or could reasonably be expected to cause a substantial detriment to the Company Group as determined by the Board in good faith; (v) the Executive’s commission of an act of fraud or material act of dishonesty or misappropriation involving the Company Group; (vi) the Executive’s willful violation of law or gross negligence that is substantially detrimental to the Company Group; (vii) the material breach or material violation by the Executive of this Agreement or any other written agreement with a member of the Company Group, or any material violation of any written policy of the Company Group; provided, that, such material breach or material violation by the Executive causes the Company Group a substantial detriment or could reasonably be expected to cause a substantial detriment to the Company Group as determined by the Board in good faith; or (viii) the Executive’s habitual use of illicit drugs or habitual abuse of alcohol that, in the reasonable good faith opinion of the Board, renders the Executive unfit to serve as an officer of the Company Group. If any
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determination of habitual use or substantial dependence under clause (viii) is disputed by the Executive, the parties hereto agree to abide by the decision of a panel of three (3) physicians appointed in the manner specified in Section 23(h) of the Agreement. For purposes of this “Cause” definition, no action or inaction will be considered “willful” or will constitute “gross negligence”, if the Executive had a reasonable, good faith belief that such action or inaction was in the best interests of the Company Group. Anything herein to the contrary notwithstanding, the Executive shall not be terminated for “Cause” hereunder, unless (A) written notice stating the basis for the termination is provided to the Executive, and (B) with the exception of clause (i) of this paragraph, the Executive is given thirty (30) calendar days to cure the neglect or conduct that is the basis of such claim, to the extent curable.
(c) “Change of Control” means and includes each of the following:
(i) any Person (other than Parent, any trustee or other fiduciary holding securities under any employee benefit plan of Parent, or any company owned, directly or indirectly, by the stockholders of Parent in substantially the same proportions as their ownership of Parent), becoming the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of Parent representing 50% or more of the combined voting power of Parent’s then outstanding securities, excluding any acquisition of securities directly from the Company or pursuant to a Business Combination (as defined below) that satisfies the conditions set forth in the proviso in Section 23(c)(ii);
(ii) a merger, reorganization, or consolidation of Parent or in which equity securities of Parent are issued (each, a “Business Combination”), other than a merger, reorganization or consolidation which would result in the voting securities of Parent outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its direct or indirect parent) more than 50% of the combined voting power of the voting securities of Parent or such surviving entity (or, as applicable, a direct or indirect parent of Parent or such surviving entity) outstanding immediately after such merger, reorganization or consolidation; provided, however, that a merger, reorganization or consolidation effected solely to implement a recapitalization of Parent (or similar transaction) in which no Person (other than those covered by the exceptions in Section 23(c)(i)) acquires more than 50% of the combined voting power of Parent’s then outstanding securities shall not constitute a Change of Control;
(iii) during the period of two consecutive years, individuals who, at the beginning of such period, constitute the Board together with any new director(s) (other than a director designated by a Person who has entered into an agreement with Parent to effect a transaction described in Sections 23(c)(i) or (ii)) whose election by the Board or nomination for election by Parent’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or
(iv) a complete liquidation or dissolution of Parent or the consummation of a sale or disposition by Parent of all or substantially all of Parent’s assets other than the sale or disposition of all or substantially all of the assets of Parent to a Person or Persons who beneficially own, directly or indirectly, 50% or more of the combined voting power of the outstanding voting securities of Parent at the time of the sale.
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Notwithstanding the foregoing, with respect to any payment or benefit that is characterized as “nonqualified deferred compensation” within the meaning of Section 409A of the Code, an event shall not be considered to be a Change of Control under this Agreement for purposes of payment of such payment or benefit unless such event is also a “change in ownership,” a “change in effective control,” or a “change in the ownership of a substantial portion of the assets” of Parent within the meaning of Section 409A of the Code. For clarity, the Transaction shall be treated as a Change of Control.
(d) “Company Group” means Parent and each of its Subsidiaries and Affiliates, including the Company.
(e) “Competitive Enterprise” means any business engaged in offshore marine transportation, supply, supply vessel, service vessel, logistics, subsea, well intervention, production, decommissioning, construction, renewable energy, defense or other specialty marine services of the type conducted by the Company, Parent or any of their respective Subsidiaries in the Restricted Area, including offshore transportation of petroleum products, equipment, supplies, cargo or personnel; offshore towing; offshore service vessel, offshore supply vessel, multi-purpose support vessel, well intervention vessel, dive support vessel, crew transfer and related marine logistics services (including, without limitation, crew boats, liftboats, fast supply vessels, multi-purpose support vessels, flotels, services to Military Sealift Command, construction vessels, anchor handling towing supply vessels, tugs, double hulled tank barges and double hulled tankers, heavy lift derrick barges, or other complementary offshore marine vessels); anchor handling and towing services; well stimulation, well testing, well intervention and production enhancement services; drilling support, inspection, repair, and maintenance services; reservoir management services; life of field services; full field abandonment and decommissioning, plugging and abandonment, well abandonment, wellhead removal, production tubing recovery, pipeline abandonment, pipeline remediation, reclamation and other offshore decommissioning services; ROV, subsea robotics, trenching, seabed clearance and related subsea tooling services; cable lay and repair services; offshore and subsea construction, installation, inspection, repair and maintenance services; floating production, production facility and well control response services; shallow water abandonment, plug and abandonment, and coiled tubing system services; subsea pressure control equipment services; offshore renewable energy development, construction, installation, maintenance and support services; defense and military support services; aerospace, humanitarian, emergency response and disaster relief marine services; and other specialty offshore, subsea, marine transportation, logistics, production, decommissioning, emergency response and technical services utilizing offshore supply vessels, multi-purpose support vessels, well intervention vessels, robotics support vessels, dive support vessels, crew boats, floating production vessels, small tankers or other specialty marine assets in the offshore construction, energy exploration and production, renewable energy, defense, aerospace, humanitarian and disaster relief industries.
(f) “Confidential Information” means all non-public information concerning trade secrets, know-how, software, developments, inventions, processes, technology, designs, financial data, strategic business plans or any proprietary or confidential information, documents or materials in any form or media, including any of the foregoing relating to research, operations, finances, current and proposed products and services, vendors, customers, advertising and
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marketing, and other non-public, proprietary and confidential information of the Company Group. Notwithstanding anything to the contrary contained herein, the general skills, knowledge and experience gained during the Executive’s employment with the Company, information publicly available or generally known within the industry or trade in which the Company competes, and information or knowledge possessed by the Executive prior to the Executive’s employment by the Company shall not be considered Confidential Information.
(g) “Customer” means any person, firm, corporation or other entity whatsoever to whom the Company, Parent or their respective Subsidiaries provided or actively sought to provide services or sold or actively sought to sell any products within a twelve (12)-month period on or before the Executive’s Termination Date, and with whom Executive had business-related contact or about whom Executive received or accessed Confidential Information.
(h) “Disability” means that the Executive is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of at least three (3) months under any long term disability plan maintained by the Company that covers the Executive. In the absence of such a long term disability plan, “Disability” means the inability of the Executive, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, to perform the duties required of him under this Agreement for a period of at least ninety (90) days in any one (1)-year period. Upon such determination, the Board may terminate the Executive’s employment under this Agreement, subject to providing ten (10) days’ prior written notice. In the event of any dispute hereunder as to whether a Disability exists, the parties hereto agree to abide by the decision of a panel of three (3) physicians. The Executive and the Board shall each appoint one member to the panel, and the third member of the panel shall be appointed by the other two members. The Executive agrees to make himself available for, and submit to examinations by, such physicians as may be directed by the Board. Failure to submit to any such examination shall constitute a breach of a material part of this Agreement. This Section 23(h) shall be interpreted and applied so as to comply with the provisions of the Americans with Disabilities Act and any applicable state or local laws.
(i) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time. Reference to a specific section of the Exchange Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing, or superseding such section or regulation.
(j) “Good Reason” means, unless otherwise agreed to in writing by the Executive, (i) any material diminution in the Executive’s titles, duties, responsibilities, status or authorities with Parent, the Company or any of their respective material operating Subsidiaries (other than as permitted by this Agreement); (ii) any material reduction in the Executive’s Base Salary or Target Bonus; (iii) a relocation of the Executive’s primary place of employment to a location more than thirty-five (35) miles farther from the Executive’s primary residence than the current location of the Company’s offices in Texas as of the Effective Date; (iv) a material breach by the Company or Parent of this Agreement or any other written agreement between the Company and the Executive; or (v) (1) Parent ceases to use “Hornbeck” as its primary corporate identity, (2) Parent ceases to use a Licensed Mark or Trade Name (each as defined in the License Agreement) as its primary corporate identifier for the Business (as defined in the License Agreement); (3)
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Parent ceases to trade under the ticker symbol “HOS”; provided, that Parent may cease to trade under the ticker symbol “HOS” if required by applicable law, the rules or regulations of the Securities and Exchange Commission, or the rules or regulations of the stock exchange where the shares are listed; provided further that, Parent will use commercially reasonable efforts to incorporate a Licensed Mark or Trade Name into its ticker symbol, or (4) Parent ceases to use a Licensed Mark or Trade Name (each as defined in the License Agreement) in the corporate entity name of Parent or otherwise adopts at the Parent level any d/b/a name, trade name, fictitious name or similar designation that does not use a Licensed Mark or Trade Name (provided that any New Business (as defined in the License Agreement) and any other existing business of Parent as of the date hereof shall not be subject to this clause (4)). In order to invoke a termination for Good Reason, (A) the Executive must provide written notice within forty-five (45) days of the Executive becoming aware of the occurrence of any event of “Good Reason,” (B) the Company Group must fail to cure such event within thirty (30) days of the giving of such notice, and (C) the Executive must terminate employment within forty-five (45) days following the expiration of the Company Group’s cure period.
(k) “Person” means any “person” as such term is used in Sections 13(d) and 14(d) of the Exchange Act.
(l) “Restricted Area” means each county, city, state, municipality, locale, governmental subdivision or jurisdiction in the United States, Mexico, Trinidad and Tobago, Brazil, Colombia, the United Kingdom, Singapore, Australia, Guyana, Romania, and West Africa in which the Competitive Enterprise is conducted by the Company, Parent or any of their respective Subsidiaries or any other jurisdiction (and the state and federal waters offshore the same) in which the Company, Parent or any of their respective Subsidiaries conducts or takes concrete, active steps to conduct the Competitive Enterprise during the Executive’s employment or service with the Company, Parent or any of their respective Subsidiaries, as evidenced by existing memoranda, Board minutes or other written correspondence, and in which the Executive provided services or had a material presence or influence, or about which the Executive received Confidential Information, in connection with the Executive’s employment with or service to the Company, Parent or any of their respective Subsidiaries.
(m) “Restricted Period” means the period commencing on the Effective Date and ending twenty-four (24) months following the Executive’s Termination Date.
(n) “Retirement” means the Executive’s retirement from employment with Parent, the Company and all of their respective Subsidiaries (other than at a time when grounds to terminate the Executive’s employment for Cause exist) on or after the date on which the Executive attains age sixty (60); provided, that the Executive (A) has completed at least ten (10) years of service with Parent, the Company or any of their respective Subsidiaries as of such time (which for avoidance of doubt shall include service prior to the date of this Agreement) and (B) does not and does not intend or have any plans to provide services in any capacity to a Competitive Enterprise and certifies the same in writing if requested by the Company.
(o) “Severance Benefits” means the payments described in Section 4(b)(vi) (but only upon the Executive’s Retirement and not upon the Executive’s death or Disability), Section 4(b)(viii), Section 4(d), or Section 4(e), in each case, other than the Accrued Benefits.
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(p) “Subsidiary” means, with respect to any entity, any subsidiary corporation of such entity within the meaning of Section 424(f) of the Code or any company (whether a corporation, partnership, joint venture, or other form of entity) in which the entity has a direct or indirect “controlling interest,” within the meaning of Treas. Reg. Section 1.409A-1(b)(5)(iii)(E)(1).
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the undersigned have duly executed and delivered this Agreement or have caused this Agreement to be duly executed and delivered on their behalf.
| HORNBECK OFFSHORE OPERATORS, LLC | ||
| By: | /s/ Samuel A. Giberga | |
| Name: Samuel A. Giberga | ||
| Title: Executive Vice President, General Counsel and Corporate Secretary | ||
| HORNBECK OFFSHORE SERVICES, INC. | ||
| By: | /s /Samuel A. Giberga | |
| Name: Samuel A. Giberga | ||
| Title: Executive Vice President, General Counsel and Corporate Secretary | ||
| EXECUTIVE | ||
| /s/ Todd M. Hornbeck | ||
| Todd M. Hornbeck | ||
SCHEDULE 1
CONFIDENTIAL INFORMATION
EXHIBIT A
OUTSIDE BOARD MEMBERSHIP
EXHIBIT B
GENERAL RELEASE1
I, Todd M. Hornbeck, in consideration of payment by Hornbeck Offshore Operators, LLC (together with its Parent and Subsidiaries, the “Company”) of the amounts set forth in Section 4[(b)(vi)][(b)(viii)][(d)][(e)]2 of the Second Amended and Restated Employment Agreement, dated as of September 1, 2026 (the “Agreement”), do hereby release and forever discharge, as of the date hereof, the Company and its Affiliates and all of the respective present, former and future managers, directors, officers, employees, successors and assigns of the Company and its Affiliates and direct or indirect owners[, (which, for the avoidance of doubt, shall include the Specified Investors (as defined in the Hornbeck Offshore Services, Inc. 2024 Omnibus Incentive Plan (as may be amended from time to time) and any successor plan thereto))]3 (collectively, the “Released Parties”) to the extent provided below (this “General Release”). The Released Parties are intended to be third-party beneficiaries of this General Release, and this General Release may be enforced by each of them in accordance with the terms hereof in respect of the rights granted to such Released Parties hereunder. Terms used herein but not otherwise defined shall have the meanings given to them in the Agreement.
| 1. | My employment with the Company terminated as of [Date], and I hereby resign from any position as an officer, member of the board of managers or directors (as applicable) or fiduciary of the Company or any other member of the Company Group (or reaffirm any such resignation that may have already occurred). I understand that any payments or benefits paid or granted to me under Section 4 of the Agreement represent, in part, consideration for signing this General Release and are not salary, wages or benefits to which I was already entitled. I understand and agree that I will not receive certain of the payments and benefits specified in Section 4 of the Agreement, unless I execute this General Release and do not revoke this General Release within the time period permitted hereafter. I understand and agree that such payments and benefits are subject to my continued material compliance with Section 6 of the Agreement (as more fully set forth in the Agreement) during the period in which I am paid the Severance Benefits pursuant to Section 4[(b)(vi)][(b)(viii)][(d)][(e)]4 of the Agreement, which (as noted below) expressly survive my termination of employment and the execution of this General Release. Such payments and benefits will not be considered compensation for purposes of any employee benefit plan, program, policy or arrangement maintained or hereafter established by the Company or its Affiliates. |
| 2. | Except as provided in paragraphs 4, 5 and 11 below and except for the provisions of the Agreement which expressly survive the termination of my employment with the Company, I knowingly and voluntarily (for myself and my heirs, executors, administrators and assigns) release and forever discharge the Company and the other Released Parties from any and all claims, suits, controversies, actions, causes of action, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees or liabilities of any nature whatsoever in law and |
| 1 | Note to Release: To be updated with any updates deemed reasonably necessary by the Company to comply with applicable laws as of the Executive’s termination date. |
| 2 | Note to Release: To specify applicable termination section. |
| 3 | Note to Release: To include if any Specified Investors own equity interests of Parent as of the Executive’s termination date. |
| 4 | Note to Release: To specify applicable termination section. |
| in equity, both past and present (through the date on which I execute this General Release) and whether known or unknown, suspected or claimed against the Company or any of the Released Parties, which I, my spouse or any of my heirs, executors, administrators or assigns may have, which arise out of or are connected with my employment with, or my separation or termination from, the Company (including, but not limited to, any allegation, claim or violation, arising under: Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended (including the Older Workers Benefit Protection Act); the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of 1990; the Family and Medical Leave Act of 1993; the Worker Adjustment Retraining and Notification Act; the Employee Retirement Income Security Act of 1974; Sections 23:301 to 23:369 of the Louisiana Revised Statutes; Article 2315 of the Louisiana Civil Code; the Louisiana Workers’ Compensation Act; the Louisiana Employment Discrimination Law; the Louisiana Military Service Relief Act; any applicable Executive Order Programs; the Fair Labor Standards Act; the Texas Labor Code, the Texas Payday Act, the Texas Anti-Retaliation Act, Chapter 21 of the Texas Labor Code, the Texas Whistleblower Act; or their state or local counterparts; or under any other federal, state or local civil or human rights law, or under any other local, state or federal law, regulation or ordinance; or under any public policy, contract or tort, or under common law; or arising under any policies, practices or procedures of the Company or any of the Released Parties; or any claim for wrongful discharge, breach of contract, infliction of emotional distress or defamation; or any claim for costs, fees or other expenses, including attorneys’ fees, incurred in these matters), or which arise from or in any way relate to awards, policies, plans, programs or practices of any of the Released Parties that may apply to me or in which I may participate (all of the foregoing collectively referred to herein as the “Claims”). |
| 3. | I represent that I have made no assignment or transfer of any right, claim, demand, cause of action or other matter covered by paragraph 2 above. |
| 4. | I agree that this General Release does not waive or release any rights or claims that I may have under the Age Discrimination in Employment Act of 1967 which arise after the date I execute this General Release. I acknowledge and agree that my separation from employment with the Company in compliance with the terms of the Agreement shall not serve as the basis for any claim or action (including, without limitation, any claim under the Age Discrimination in Employment Act of 1967). |
| 5. | I agree that I hereby waive all rights to sue or obtain equitable, remedial or punitive relief from any or all Released Parties of any kind whatsoever in respect of any Claim, including, without limitation, reinstatement, back pay, front pay and any form of injunctive relief. Notwithstanding the above, I further acknowledge that I am not waiving and am not being required to waive any right that cannot be waived under law, including the right to file an administrative charge or participate in an administrative investigation or proceeding; provided, however, that I disclaim and waive any right to share or participate in any monetary award resulting from the prosecution of such charge or investigation or proceeding, subject to paragraph 11 of this General Release. Additionally, I am not waiving (a) any right to the Accrued Benefits or any Severance Benefits to which I am entitled under Section 4[(b)(vi)][(b)(viii)][(d)][(e)]5 of the Agreement, [(b) any rights I have under Section 4(e) of the Agreement in the event a Qualifying Termination becomes a Change of Control Qualifying Termination,]6 ([c]) any claim relating to directors’ and officers’ liability insurance coverage or any right of indemnification under the Company’s organizational documents or otherwise, or ([d]) my rights as an equity or security holder in the Company or its Affiliates. |
| 5 | Note to Release: To specify applicable termination section. |
| 6 | Note to Release: To include only if the Executive will be receiving Severance Benefits under Section 4(d). If this is deleted, then clauses (c) and (d) will be re-lettered to be clauses (b) and (c). |
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| 6. | In signing this General Release, I acknowledge and intend that it shall be effective as a bar to each and every one of the Claims hereinabove mentioned or implied. I expressly consent that this General Release shall be given full force and effect according to each and all of its express terms and provisions, including those relating to unknown and unsuspected Claims (notwithstanding any state or local statute that expressly limits the effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any, as well as those relating to any other Claims hereinabove mentioned or implied. I acknowledge and agree that this waiver is an essential and material term of this General Release and that without such waiver the Company would not have agreed to the terms of the Agreement. I further agree that in the event I should bring a Claim seeking damages against the Company, or in the event I should seek to recover against the Company in any Claim brought by a governmental agency on my behalf, this General Release shall serve as a complete defense to such Claims to the maximum extent permitted by law. I further agree that I am not aware of any pending claim of the type described in paragraph 2 above as of the execution of this General Release. |
| 7. | I agree that neither this General Release, nor the furnishing of the consideration for this General Release, shall be deemed or construed at any time to be an admission by the Company, any Released Party or myself of any improper or unlawful conduct. |
| 8. | I agree that I will forfeit all amounts payable by the Company pursuant to the Agreement if I challenge the validity of this General Release. I also agree that if I violate this General Release by suing the Company or the other Released Parties, I will pay all costs and expenses of defending against the suit incurred by the Released Parties, including reasonable attorneys’ fees, and return all payments received by me pursuant to the Agreement on or after the termination of my employment. |
| 9. | I agree that this General Release and the Agreement are confidential and agree not to disclose any information regarding the terms of this General Release or the Agreement, except to my immediate family and any tax, legal or other counsel I have consulted regarding the meaning or effect hereof or as required by law, and I will instruct each of the foregoing not to disclose the same to anyone. The Company agrees to disclose any such information only to any tax, legal or other counsel of the Company and, to the extent reasonably necessary in connection with any potential or actual Claim against any Released Party, such Released Party and their tax, legal or other counsel, or as required by law. |
| 10. | Any non-disclosure provision in this General Release does not prohibit or restrict me (or my attorney) from responding to any inquiry about this General Release or its underlying facts and circumstances by the Securities and Exchange Commission (SEC), the National Association of Securities Dealers, Inc. (NASD), and any other self-regulatory organization or governmental entity. |
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| 11. | Nothing in this General Release prevents me from filing a charge with the Equal Employment Opportunity Commission, the National Labor Relations Board or other governmental agency or commission (collectively, the “EEOC”) or participating in any EEOC investigation; provided that I may not receive any relief (including, without limitation, compensation, reinstatement, back pay, front pay, damages, attorneys’ or experts’ fees, costs and/or disbursements) as a consequence of any charge filed with the EEOC and/or any litigation arising out of an EEOC charge to the fullest extent permitted by law. Further, nothing contained in this General Release (including the immediately preceding sentence) limits, restricts or in any way affects my right to (a) communicate with any governmental agency or entity or regulatory or any law enforcement authority or make other disclosures under the whistleblower provisions of any applicable law, rule or regulation or (b) seek or receive any monetary damages, awards or other relief in connection with protected whistleblower activity. |
| 12. | I hereby acknowledge that Sections 5 through 23 of the Agreement shall survive my execution of this General Release. |
| 13. | I represent that I am not aware of any claim by me other than the claims that are released by this General Release. I acknowledge that I may hereafter discover claims or facts in addition to or different than those which I now know or believe to exist with respect to the subject matter of the release set forth in paragraph 2 above and which, if known or suspected at the time of entering into this General Release, may have materially affected this General Release and my decision to enter into it, but I nonetheless shall continue to be bound by this General Release in all respects. |
| 14. | Notwithstanding anything in this General Release to the contrary, this General Release shall not relinquish, diminish or in any way affect any rights or claims arising out of any breach by the Company or by any Released Party of the Agreement after the date hereof. |
| 15. | Whenever possible, each provision of this General Release shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this General Release is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this General Release shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein. |
BY SIGNING THIS GENERAL RELEASE, I REPRESENT AND AGREE THAT:
| (i) | I HAVE READ IT CAREFULLY; |
| (ii) | I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT RIGHTS, INCLUDING, BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED; TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963; THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED; |
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| (iii) | I VOLUNTARILY CONSENT TO EVERYTHING IN IT; |
| (iv) | I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I HAVE DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION, I HAVE CHOSEN NOT TO DO SO OF MY OWN VOLITION; |
| (v) | I HAVE HAD AT LEAST [TWENTY-ONE (21)]/[FORTY-FIVE (45)]7 DAYS FROM THE DATE OF MY RECEIPT OF THIS GENERAL RELEASE TO CONSIDER IT AND THE CHANGES MADE SINCE MY RECEIPT OF THIS GENERAL RELEASE ARE NOT MATERIAL OR WERE MADE AT MY REQUEST AND WILL NOT RESTART THE REQUIRED [TWENTY-ONE (21)-DAY]/[FORTY-FIVE (45)-DAY] PERIOD; |
| (vi) | I UNDERSTAND THAT I HAVE SEVEN (7) DAYS AFTER THE EXECUTION OF THIS GENERAL RELEASE TO REVOKE IT AND THAT THIS GENERAL RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD HAS EXPIRED; |
| (vii) | I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND |
| (viii) | I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME. |
| SIGNED: | DATED: |
| 7 | Note to Release: Forty-five (45) days to be included in the event of a group termination. |
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Exhibit 10.2
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of [__________] (the “Effective Date”), by and among Hornbeck Offshore Operators, LLC, a Delaware limited liability company (the “Company”), Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (“Parent”), and [__________], an individual (the “Executive”). Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to such terms in Section 23.
WHEREAS, the Executive and [__________] are party to [__________] (the “Original Agreement”), which this Agreement will replace and supersede in its entirety, effective as of the Effective Date;
WHEREAS, the Executive will be employed by the Company and will serve as the [__________] of Parent; and
WHEREAS, the Company and the Executive desire to enter into this Agreement to set out the terms and conditions for the employment relationship of the Executive with the Company and that this Agreement replace and supersede the Original Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties hereto agree as follows:
1. Term. The Company agrees to employ the Executive pursuant to the terms of this Agreement, and the Executive agrees to be so employed, commencing as of the Effective Date and ending on [__________] (the “Initial Term”). On the last day of the Initial Term and on each one (1)-year anniversary thereof, the term of this Agreement shall be automatically extended for an additional one (1)-year period, unless either party hereto elects not to extend this Agreement by giving written notice to the other party at least ninety (90) days prior to any such renewal date. Notwithstanding the foregoing, the Executive’s employment hereunder may be earlier terminated in accordance with Section 4 hereof. The period of time between the Effective Date and the termination of the Executive’s employment hereunder is referred to herein as the “Term.” Upon any termination of the Executive’s employment with the Company, the Executive shall be deemed to have resigned from all positions with any member of the Company Group.
2. Positions and Duties.
(a) During the Term, the Executive shall serve as the [__________] of Parent. In these capacities, the Executive shall have the duties, authorities and responsibilities generally commensurate with the duties, authorities and responsibilities of persons serving in similar capacities in similarly sized and situated companies, and such other duties, authorities and responsibilities as the Chief Executive Officer of Parent (the “CEO”) shall designate from time to time that are not inconsistent with the Executive’s positions, which duties, authorities and responsibilities will include reviewing Confidential Information and providing services to Parent’s direct and indirect Subsidiaries. The Executive shall report directly to the CEO.
(b) The Executive shall devote substantially all of the Executive’s business time to the performance of the Executive’s duties hereunder and the advancement of the business and affairs of Parent and the Company; provided, that the Executive shall be entitled to: (i) serve as a member of the board of directors (or equivalent governing body) of, or advisor to, (A) the entities listed on Exhibit A attached hereto and (B) such other entities that are not Competitive Enterprises, subject to the Executive providing prior written notice to the Board of Directors of Parent (the “Board”), (ii) serve on civic, charitable, educational, religious, public interest or public service boards, and (iii) manage the Executive’s personal and family investments, in each case, to the extent such activities do not interfere, individually or in the aggregate, with the performance of the Executive’s duties and responsibilities hereunder or create a business or fiduciary conflict.
(c) The Executive’s principal place of employment will be in [Covington, Louisiana] // [Houston, Texas]; provided, that the Executive may be required to travel from time to time for business purposes.
3. Compensation and Benefits.
(a) Base Salary. During the Term, the Company shall pay to the Executive a base salary at an annual rate of not less than $[__________], in substantially equal installments in accordance with the regular payroll practices of the Company, but not less frequently than monthly. The Executive’s base salary shall be subject to annual review by the Compensation Committee of the Board (the “Committee”) taking into account the Company’s compensation philosophy as in effect from time to time and market and peer group data and may be increased, but not decreased, from time to time by the Committee. The base salary as determined herein and adjusted from time to time shall constitute “Base Salary” for purposes of this Agreement.
(b) Annual Bonus. During each fiscal year during the Term, the Executive shall be eligible to participate in the Company’s annual bonus plan, as established by the Committee and in effect from time to time for its senior executives, and will be paid a cash annual bonus under such plan (the “Annual Bonus”), to the extent earned based on performance against reasonably obtainable objective performance criteria. The performance criteria for each fiscal year shall be determined by the Committee, after consultation with the CEO, no later than ninety (90) days following the commencement of the applicable fiscal year. The Executive’s target Annual Bonus opportunity for each fiscal year shall equal [__________]% of the Executive’s annualized Base Salary for that fiscal year (the “Target Bonus”). The Executive’s actual Annual Bonus for each fiscal year will equal a percentage of the Target Bonus, determined as follows: (i) 100% of the Target Bonus, if target levels of performance for that fiscal year are achieved; (ii) 50% of the Target Bonus, if threshold levels of performance for that fiscal year are achieved; (iii) 200% of the Target Bonus, if maximum levels of performance for that fiscal year are achieved; and (iv) a percentage of the Target Bonus determined in accordance with the plan, if performance for that fiscal year is in between threshold, target and maximum levels of performance. Unless otherwise determined by the Committee, the Executive will not earn an Annual Bonus if threshold levels of performance are not achieved. The Executive’s Annual Bonus for each fiscal year shall be determined by the Committee after the end of the applicable fiscal year and shall be paid to the Executive when bonuses for such fiscal year are paid to other senior executives of the Company generally, but in no event later than seventy-four (74) days following the end of such fiscal year, subject to the Executive’s continued employment with the Company through the end of the fiscal year with respect to which such Annual Bonus was earned. In carrying out its functions under this Section 3(b), the Committee shall at all times act reasonably and in good faith.
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(c) Long-Term Incentive Awards. During the Term, the Executive will be eligible to participate in Parent’s equity incentive plan, subject to approval by the Board.
(d) Benefit Plans. During the Term, the Executive shall be eligible to participate in any employee benefit plan that Parent or the Company has adopted or may adopt, maintain or contribute to for the benefit of its employees generally and/or for the benefit of its senior executives as in effect from time to time, subject to satisfying the applicable eligibility requirements, except to the extent such plans are duplicative of the benefits otherwise provided hereunder; provided, however, that Parent or the Company, as applicable, shall make commercially reasonable efforts to ensure that any health insurance benefit plan will not provide for a preexisting condition limitation. The Executive’s participation will be subject to the terms of the applicable plan documents and generally applicable Parent and Company policies. Notwithstanding the foregoing, Parent and the Company may modify or terminate any employee benefit plan at any time.
(e) Business Expenses. The Executive is authorized to incur reasonable business expenses in carrying out the Executive’s duties and responsibilities under this Agreement. The Executive shall be promptly reimbursed for all reasonable out-of-pocket business expenses incurred and paid by the Executive during the Term, subject to and in accordance with the Company’s expense reimbursement policy as in effect from time to time.
(f) [Automobile. During the Term, the Company shall provide the Executive with an automobile and pay for such automobile’s auto insurance, maintenance and fuel; provided, that the automobile shall be substantially equivalent to the highest value automobile provided to any other officer of the Company or Parent; provided, further, that the Executive shall pay all taxes related to the Executive’s personal use of the automobile.]
4. Termination of Employment; Severance.
(a) General. The Executive’s employment and the Term shall terminate upon the earliest to occur of (i) the Executive’s death, (ii) a termination by the Company due to the Executive’s Disability, (iii) a termination by the Company with or without Cause, (iv) a termination by the Executive with or without Good Reason or due to Retirement, and (v) the expiration of the Term (the date of such termination, the “Termination Date”). On the Termination Date, the Executive’s role as (A) an officer of any member of the Company Group, (B) a member of the Board or similar body of any member of the Company Group and (C) a fiduciary of any Company Group benefit plan shall be deemed to have terminated, in each case, to the extent applicable and the Executive shall confirm the foregoing by submitting to the Company a written confirmation of such resignations upon request by the Board; provided, that the foregoing shall not modify or diminish in any way the rights and/or remedies otherwise available to the Executive in connection with such termination.
(b) Termination Due to the Executive’s Death or Disability or Retirement. The Executive’s employment and the Term shall terminate automatically upon the Executive’s death or Retirement. The Company may terminate the Executive’s employment and the Term upon a final determination as to the occurrence of the Executive’s Disability (with such determination made, for the avoidance of doubt, in accordance with the definition of Disability set forth below), with such termination to be effective ten (10) days following the date on which the Company provides written notice to the Executive of such determination in accordance with this Agreement and of such termination. Upon a termination of the Executive’s employment and the Term due to the Executive’s death or Disability or Retirement, the Executive’s estate or the Executive, as applicable, shall be entitled to the following:
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(i) payment of any earned but unpaid Base Salary through the Termination Date, no later than sixty (60) days following the Termination Date (or such earlier date as may be required by applicable law);
(ii) payment of any earned but unpaid Annual Bonus for the fiscal year preceding the fiscal year in which the Termination Date occurs, to be paid in accordance with Section 3(b) (the “Prior Year Bonus”);
(iii) payment in lieu of any earned but unused vacation time in accordance with Company policy as in effect from time to time;
(iv) all other payments, benefits or fringe benefits to which the Executive shall be entitled under the terms of any applicable compensation arrangement or benefit, equity or fringe benefit plan or program or grant or this Agreement, payable in accordance therewith;
(v) reimbursement for any unreimbursed business expenses incurred through the Termination Date, in accordance with Section 3(e) (with the payments and benefits described in subparagraphs (i), (ii), (iii), (iv) and (v) hereof, collectively, the “Accrued Benefits”);
(vi) a pro-rata portion of the Annual Bonus for the fiscal year in which the Termination Date occurs, determined by multiplying (A) the Annual Bonus that the Executive would have received for such fiscal year, based on actual performance (provided, that, any subjective performance goals will be deemed satisfied at target levels), by (B) a fraction, (I) the numerator of which is the number of calendar days that the Executive was employed with the Company during the fiscal year in which the Termination Date occurs, and (II) the denominator of which is the total number of calendar days in the fiscal year in which the Termination Date occurs, which amount shall be paid in accordance with Section 3(b); provided, however, that, for the avoidance of doubt, the requirement in Section 3(b) that payment of the Annual Bonus be subject to the Executive’s continued employment with the Company through the end of the fiscal year with respect to which such Annual Bonus was earned shall not apply (the “Pro-Rata Bonus”); and
(vii) solely upon a termination of the Executive’s employment and the Term due to the Executive’s death or Disability (and not due to the Executive’s Retirement) and subject to the Executive timely electing to continue the Executive’s coverage, reimbursement for the employer portion of the monthly cost of maintaining medical, dental and/or vision benefits for the Executive and the Executive’s covered dependents under a group health plan of the Company for purposes of the Consolidated Omnibus Budget Reconciliation Act of 1985 (as amended, “COBRA”), based on the premium rate applicable to similarly situated active employees of the Company (the “Benefit Payment”), until the earlier to occur of (A) twelve (12) months following the Termination Date and (B) the date the Executive ceases to be eligible for such COBRA coverage under applicable law or plan terms. The first installment of the Benefit Payment shall be paid on the sixtieth (60th) day following the Termination Date and shall include all amounts that would otherwise have been paid prior thereto absent the delay.
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For the avoidance of doubt, any equity awards outstanding as of the Termination Date will receive the treatment set forth in the applicable award agreement. Following a termination of the Executive’s employment due to death or Disability, except as set forth in this Section 4(b), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(c) Termination by the Company for Cause. The Company may terminate the Executive’s employment at any time for Cause, effective upon delivery to the Executive of written notice of such termination. If the Executive’s employment is terminated by the Company for Cause, the Executive shall be entitled only to the Accrued Benefits other than the Prior Year Bonus (if any), which shall be forfeited upon a termination for Cause.
Following the termination of the Executive’s employment by the Company for Cause, except as set forth in this Section 4(c), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(d) Termination by the Company Without Cause, Termination by the Executive for Good Reason or Termination Due to the Company’s Non-Renewal of the Term. The Company may terminate the Executive’s employment at any time without Cause, effective upon delivery to the Executive of written notice of such termination. The Executive may terminate the Executive’s employment for Good Reason by providing the Company written notice in the manner set forth below. In the event that the Executive’s employment is terminated by the Company without Cause (other than due to the Executive’s death or Disability), by the Executive for Good Reason or due to the Company’s non-renewal of the Term (each, a “Qualifying Termination”), in each case, subject to Section 4(g) below, the Executive shall be entitled to:
(i) the Accrued Benefits;
(ii) the Pro-Rata Bonus;
(iii) an amount equal to two (2) times the sum of the Executive’s (A) Base Salary, at the rate in effect as of the Termination Date, and (B) Target Bonus, at the rate in effect as of the Termination Date (provided, that if the Qualifying Termination is due to the Executive’s termination of employment for Good Reason caused, in whole or in part, by a reduction in the Executive’s Base Salary and/or Target Bonus, or if the Executive would have had grounds to terminate the Executive’s employment for Good Reason on such basis at the time of a Qualifying Termination, each such amount shall be included in the foregoing calculation at the rate in effect prior to any decrease thereof) (the “Cash Severance”), which amount shall be payable in equal monthly installments over the twenty-four (24) month period following the Termination Date, provided, that, the first installment shall be paid on the sixtieth (60th) day following the Termination Date and shall include all amounts that would otherwise have been paid prior thereto absent the delay; and
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(iv) the Benefit Payment for the twenty-four (24)-month period following the Termination Date, or, if earlier, until the date on which the Executive ceases to be eligible for such COBRA coverage under applicable law or plan terms. The first installment of the Benefit Payment shall be paid on the sixtieth (60th) day following the Termination Date and shall include all amounts that would otherwise have been paid prior thereto absent the delay.
For the avoidance of doubt, any equity awards outstanding as of the Termination Date will receive the treatment set forth in the applicable award agreement. Payments and benefits provided in this Section 4(d) shall be in lieu of any termination or severance payments or benefits for which the Executive may be eligible under any of the plans, policies or programs of the Company Group or under the Worker Adjustment Retraining Notification Act of 1988 or any similar state statute or regulation.
Following the termination of the Executive’s employment due to a Qualifying Termination, except as set forth in this Section 4(d), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(e) Change of Control Qualifying Termination. This Section 4(e) shall apply if (i) the Executive’s Qualifying Termination occurs during the two (2)-year period immediately following a Change of Control, or (ii) the Executive is terminated by the Company without Cause within the six (6)-month period immediately prior to a Change of Control (each, a “Change of Control Qualifying Termination”). To the extent a Change of Control Qualifying Termination occurs and the Executive is already receiving the benefits described in Section 4(d) in accordance with the terms thereof, the Executive shall no longer be eligible for the benefits described in Section 4(d) and instead shall be entitled exclusively to all of the benefits provided in this Section 4(e); provided, that the benefits set forth under this Section 4(e) shall be reduced by any payments and benefits that the Executive already received in accordance with the terms of Section 4(d). For the avoidance of doubt, there shall be no duplication of the benefits under Section 4(d). If any such Change of Control Qualifying Termination occurs, the Executive (or the Executive’s estate, if the Executive dies after such termination and execution of the Release (as defined in Section 4(g)) but before receiving such amount) shall receive the benefits set forth in Section 4(d), except that (A) the amount of the Pro-Rata Bonus shall be determined based on deemed achievement of all performance criteria at target levels; and (B) the Pro-Rata Bonus, Cash Severance and Benefit Payment will be payable in a lump sum.
(f) Termination by the Executive Without Good Reason or Due to the Executive’s Non-Renewal of the Term. The Executive may terminate the Executive’s employment without Good Reason by providing sixty (60) days’ prior written notice to the Company or by electing not to renew the Term in accordance with Section 1 hereof. Upon receipt of such notice, the Company may, in its sole discretion, remove the Executive’s title and require that the Executive not attend the workplace, perform any duties or contact any clients, suppliers or employees of the Company or any associated persons through the Termination Date (the “Garden Leave Period”); provided, that, for the avoidance of doubt, the foregoing restriction shall not prohibit the Executive from contacting employees for logistical or human resources purposes, in each case relating to the transition of the Executive’s duties and/or termination of his employment, attending the workplace for purposes of removing the Executive’s personal effects from the workplace (as reasonably permitted by the Company) or performing other ministerial tasks as required by the Company; and provided, further, that during the Garden Leave Period, the Company shall continue to (i) pay to the Executive the Base Salary and (ii) provide to the Executive the existing benefits in accordance with the terms of the applicable plans. Upon the Executive’s voluntary termination of employment
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without Good Reason, the Executive shall be entitled only to the Accrued Benefits. For the avoidance of doubt, any equity awards outstanding as of the Termination Date will receive the treatment set forth in the applicable award agreement. Following any such termination of the Executive’s employment, except as set forth in this Section 4(f), the Executive shall have no further rights to any compensation or any other benefits under this Agreement.
(g) Release of Claims, Continued Compliance. Notwithstanding any provision herein to the contrary, the payment and provision of the Severance Benefits pursuant to Section 4(b) (but only upon the Executive’s Retirement and not upon the Executive’s death or Disability), Section 4(d) or Section 4(e) shall be conditioned upon the Executive’s execution, delivery to the Company and non-revocation of the general release of claims substantially in the form attached hereto as Exhibit B (the “Release”) (and the expiration of any revocation period contained in such Release) within sixty (60) days following the Termination Date, as well as the Executive’s acknowledgement of, and the Executive’s material compliance with, the Executive’s obligations under Section 6, as further outlined in this paragraph below. If the Executive fails to execute the Release in such a timely manner so as to permit any revocation period to expire prior to the end of such sixty (60)-day period, or timely revokes such release following its execution, the Executive shall not be entitled to any of the Severance Benefits. If the period of time during which the Executive may consider the Release begins in one calendar year and ends in the next calendar year, any amounts payable under this Section 4 for which the payment timing is contingent upon the execution and non-revocation of the Release shall be paid as soon as practicable in the second calendar year (provided, that the Release has become effective and non-revocable), even if the Release first became effective and non-revocable in the first calendar year. Notwithstanding any provision in this Agreement to the contrary, if the Executive materially breaches any of the covenants contained in Section 6 while receiving the Severance Benefits under Section 4(d), the Company shall have the right, but not the obligation, to cease providing such Severance Benefits under Section 4(d); provided, that, a material breach of Section 6 can only occur for purposes of this Section 4(g) (and otherwise, without limiting any other remedies with respect thereto) if (i) the Company provides the Executive with written notice of the circumstances constituting the alleged material breach of such covenants within ninety (90) days after becoming aware of such circumstances and (ii) the alleged breach, if curable (which includes any commercial relationship resulting from such prohibited conduct), has not been cured within fifteen (15) days after receipt of the written notice described in clause (i) above.
(h) No Offset. In the event of termination of the Executive’s employment for any reason, the Executive shall be under no obligation to seek other employment, and there shall be no offset against amounts due to the Executive on account of any remuneration or benefits provided by any subsequent employment the Executive may obtain. The Company’s obligation to make any payment pursuant to, and otherwise to perform its obligations under, this Agreement shall not be affected by any offset, counterclaim or other right that the Company or any other member of the Company Group may have against the Executive for any reason.
5. Section 280G of the Code.
(a) Best-Net Cutback. Notwithstanding any other provision of this Agreement or any other plan, arrangement or agreement to the contrary, if any of the payments or benefits provided or to be provided by the Company Group to the Executive or for the Executive’s benefit pursuant to the terms of this Agreement or otherwise (“Covered Payments”) constitute parachute payments within the meaning of Section 280G of the Internal Revenue of Code of 1986, as
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amended (the “Code”), and would, but for this Section 5, be subject to the excise tax imposed under Section 4999 of the Code (or any successor provision thereto) or any similar tax imposed by state or local law or any interest or penalties with respect to such taxes (collectively, the “Excise Tax”), then prior to making the Covered Payments, a calculation shall be made comparing (i) the Net Benefit (as defined below) to the Executive of the Covered Payments after payment of the Excise Tax to (ii) the Net Benefit to the Executive if the Covered Payments are limited to the extent necessary to avoid being subject to the Excise Tax. Only if the amount calculated under subparagraph (i) above is less than the amount under subparagraph (ii) above will the Covered Payments be reduced to the minimum extent necessary to ensure that no portion of the Covered Payments is subject to the Excise Tax. “Net Benefit” shall mean the present value of the Covered Payments net of all federal, state, local and foreign income, employment and excise taxes.
(b) Method of Reduction. The Covered Payments shall be reduced in a manner that maximizes the Executive’s economic position. In applying this principle, the reduction shall be made in a manner consistent with the requirements of Section 409A of the Code; provided, that (i) cash payments shall be reduced before non-cash payments; and (ii) payments to be made on a later payment date shall be reduced before payments to be made on an earlier payment date.
(c) Determination. Any determination required under this Section 5, including whether any payments or benefits are parachute payments, shall be made in the sole discretion of a nationally recognized, independent accounting or consulting firm selected and paid for by the Company using reasonable assumptions on the Executive’s tax rates (as determined by such firm). The Executive shall provide the Company with such information and documents as the Company and such accounting firm may reasonably request in order to make a determination under this Section 5. The parties shall cooperate to the extent necessary to reduce the Excise Tax, including determining “reasonable compensation” under Sections 280G and 4999 of the Code (which may involve the valuation of the Executive’s non-compete obligations). The firm’s determination shall be final and binding on the Executive and the Company absent manifest error.
6. Restrictive Covenants. The Company and the Executive acknowledge and agree that during the Executive’s employment with the Company, the Executive will have access to and may assist in developing Confidential Information and will occupy a position of trust and confidence with respect to the affairs and business of the Company, Parent and their respective Subsidiaries. The Executive further acknowledges that (I) the Executive performs services of a unique nature for the Company that are irreplaceable and that the Executive’s performance of such services to a competing business will result in irreparable harm to the Company, Parent and their respective Subsidiaries; (II) the Executive has had and will continue to have access to Confidential Information which, if disclosed, would unfairly and inappropriately assist in competition against the Company, Parent or their respective Subsidiaries; (III) in the course of the Executive’s employment by a competitor, the Executive inevitably would use or disclose such Confidential Information; (IV) the Company, Parent and their respective Subsidiaries have substantial relationships with their customers, and the Executive has had and will continue to have access to these customers; and (V) the Executive has received and will receive specialized training from the Company, Parent and their respective Subsidiaries. Accordingly, the Executive agrees that the following obligations are necessary to preserve the confidential and proprietary nature of Confidential Information and to protect the Company, Parent and their respective Subsidiaries against harmful solicitation of employees and customers, harmful competition and other actions by the Executive that would result in serious adverse consequences for the Company, Parent and their respective Subsidiaries:
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(a) Confidentiality. Subject to Sections 6(e)(iii) and 8, during the Executive’s employment and at all times thereafter, the Executive shall not, directly or indirectly, use, make available, sell, copy, disseminate, transfer, communicate or otherwise disclose any Confidential Information, other than as authorized in writing by the Company or within the scope of the Executive’s duties with the Company as determined reasonably and in good faith by the Executive. Anything herein to the contrary notwithstanding, the term “Confidential Information” shall not include, and the provisions of this Section 6(a) shall not apply to, information that (i) was known to the public prior to its disclosure to the Executive; (ii) becomes generally known to the public subsequent to disclosure to the Executive through no wrongful act of the Executive or any representative of the Executive; or (iii) the Executive is required to disclose by applicable law, regulation or legal process (provided, that to the extent permissible, the Executive provides the Company with prior notice of the contemplated disclosure and cooperates with the Company at its expense in seeking a protective order or other appropriate protection of such information).
(b) Materials. The Executive will use Confidential Information only for normal and customary use in the Company’s business, as determined reasonably and in good faith by the Company. The Executive will return to the Company all Confidential Information and copies thereof and all other property of the Company or any other member of the Company Group at any time upon the request of the Company and in any event immediately after termination of the Executive’s employment. The Executive agrees to identify and return to the Company any copies of any Confidential Information after the Executive ceases to be employed by the Company. Anything to the contrary notwithstanding, nothing in this Section 6 shall prevent the Executive from retaining a home computer (provided all Confidential Information has been removed), papers and other materials of a personal nature, including diaries, calendars and contact lists (excluding customer lists), information relating to the Executive’s compensation or relating to reimbursement of expenses, information that may be needed for tax purposes, and copies of plans, programs and agreements relating to the Executive’s employment.
(c) Non-Competition; Non-Solicitation.
(i) During the Restricted Period and within the Restricted Area, the Executive shall not, directly or indirectly: (A) solicit or service, or attempt to solicit or service, any Customer for the purpose of engaging in or assisting any other individual, person, firm or other entity in engaging in a Competitive Enterprise; (B) interfere with or damage any relationship and/or agreement between any member of the Company, Parent or their respective Subsidiaries and any Customer; or (C) act as a sole proprietor, owner, employer, partner, principal, investor, joint venturer, shareholder, associate, employee, member, consultant, contractor, director or otherwise with any Competitive Enterprise; provided, however, that the Executive may own, as a passive investor, securities of any such entity that has outstanding publicly traded securities, so long as the Executive’s direct holdings in any such entity shall not in the aggregate constitute more than 5% of the voting power of such entity. [Further, nothing in this Section 6(c) shall prohibit the Executive from, for that portion of the Restricted Period following the Executive’s Termination Date, being employed or engaged by any Competitive Enterprise in a role that does not have responsibility for, or require performance of, any of the same or similar functions, duties or activities that the Executive performed for, or for which the Executive had oversight
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responsibilities for the Company, Parent, and/or their respective Subsidiaries, unless the Executive’s performance of such role (whether as an employee, contractor, advisor or otherwise) is reasonably likely to risk the Executive’s disclosure and/or use of Confidential Information.]1 The Executive acknowledges that this covenant has a unique, very substantial and immeasurable value to the Company, that the Executive has sufficient assets and skills to provide a livelihood for the Executive while such covenant remains in force, and that, as a result of the foregoing, in the event that the Executive breaches such covenant, monetary damages would be an insufficient remedy for the Company and equitable enforcement of the covenant would be proper.
(ii) During the Restricted Period and within the Restricted Area, the Executive shall not solicit, entice, persuade or induce any individual who is employed or engaged by the Company, Parent or their respective Subsidiaries (or who was so employed or engaged within six (6) months immediately preceding the Executive’s Termination Date) [and with whom the Executive had contact during the Executive’s employment with or service to the Company, Parent or their respective Subsidiaries or who otherwise worked in the same department as the Executive, in each case]2 to terminate or refrain from continuing such employment or engagement or to become employed by or enter into contractual relations with any Competitive Enterprise, and the Executive shall not hire, directly or indirectly, on the Executive’s behalf or on behalf of any other person, as an employee, consultant or otherwise, any such person.
(d) Mutual Non-Disparagement. The Executive agrees not to, at any time, make negative comments about or otherwise disparage the Company, Parent or their respective Subsidiaries or any officer, director, employee, shareholder, agent or product of the Company, Parent or their respective Subsidiaries, other than (i) to officers, employees or directors of the Company, Parent or their respective Subsidiaries in the good faith performance of the Executive’s duties to the Company while the Executive is employed by the Company or (ii) as necessary to correct misinformation or misunderstanding with respect to the Executive on the part of others or to address negative statements attributed to the Executive; provided, that this clause (ii) will only permit statements that the Executive has a good faith and reasonable basis, after due inquiry of all facts, for believing are true and accurate. The Company agrees that it will direct the senior officers of Parent, the Company and their respective Subsidiaries as of the Termination Date and the members of the Board as of the Termination Date to refrain from making negative comments about the Executive or otherwise disparaging the Executive in any manner, including by making or issuing any official public statements or press releases disparaging the Executive. The foregoing shall not be violated by any statements covered by Sections 6(e)(iii) and 8 or any truthful statements in response to legal process, required governmental testimony or filings or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings).
| 1 | Note to Form: To include for Texas-based executives. |
| 2 | Note to Form: To include for Texas-based executives. |
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(e) Inventions.
(i) The Executive acknowledges and agrees that all ideas, methods, inventions, discoveries, improvements, work products, developments, software, know-how, processes, techniques, works of authorship and other work product, whether patentable or unpatentable, (A) that are reduced to practice, created, invented, designed, developed, contributed to or improved with the use of any Company Group resources and/or within the scope of the Executive’s work with the Company Group, or that relate to the business, operations or actual or demonstrably anticipated research or development of the Company Group, and that are made or conceived by the Executive, solely or jointly with others, during the Term, or (B) suggested by any work that the Executive performs in connection with the Company Group, either while performing the Executive’s duties with the Company Group or on the Executive’s own time, shall belong exclusively to the Company Group (or its designee), whether or not patent or other applications for intellectual property protection are filed thereon (the “Inventions”). The Executive will keep full and complete written records (the “Records”), in the manner prescribed by the Company, of all Inventions and will promptly disclose all Inventions completely and in writing to the Company. The Records shall be the sole and exclusive property of the Company, and the Executive will surrender them upon the termination of the Term, or upon the Company’s earlier written request. The Executive irrevocably conveys, transfers and assigns to the Company the Inventions and all patents or other intellectual property rights that may issue thereon in any and all countries, whether during or subsequent to the Term, together with the right to file, in the Executive’s name or in the name of the Company (or its designee), applications for patents and equivalent rights (the “Applications”). The Executive will, at any time during and subsequent to the Term, make such applications, sign such papers, take all rightful oaths and perform all other acts as may be requested from time to time by the Company to perfect, record, enforce, protect, patent or register the Company’s rights in the Inventions, all without additional compensation to the Executive from the Company. The Executive will also execute assignments to the Company (or its designee) of the Applications, and give the Company and its attorneys all reasonable assistance (including the giving of testimony) to obtain the Inventions and all patents or other intellectual property rights that may issue thereon for the Company’s benefit, all without additional compensation to the Executive from the Company, but entirely at the Company’s expense.
(ii) In addition, the Inventions will be deemed Work for Hire, as such term is defined under the copyright laws of the United States, on behalf of the Company, and the Executive agrees that the Company will be the sole owner of the Inventions, and all underlying rights therein, in all media now known or hereinafter devised, throughout the universe and in perpetuity without any further obligations to the Executive. If the Inventions, or any portion thereof, are deemed not to be Work for Hire, or the rights in such Inventions do not otherwise automatically vest in the Company, the Executive hereby irrevocably conveys, transfers and assigns to the Company all rights, in all media now known or hereinafter devised, throughout the universe and in perpetuity, in and to the Inventions, including, without limitation, all of the Executive’s right, title and interest in the copyrights (and all renewals, revivals and extensions thereof) to the Inventions, including, without limitation, all rights of any kind or any nature now or hereafter recognized, including, without limitation, the unrestricted right to make modifications,
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adaptations and revisions to the Inventions, to exploit and allow others to exploit the Inventions and all rights to sue at law or in equity for any infringement, or other unauthorized use or conduct in derogation of the Inventions, known or unknown, prior to the date hereof, including, without limitation, the right to receive all proceeds and damages therefrom. In addition, the Executive hereby waives any so-called “moral rights” with respect to the Inventions. To the extent that the Executive has any rights in the results and proceeds of the Executive’s service to the Company that cannot be assigned in the manner described herein, the Executive agrees to unconditionally waive the enforcement of such rights. The Executive hereby waives any and all currently existing and future monetary rights in and to the Inventions and all patents and other registrations for intellectual property that may issue thereon, including, without limitation, any rights that would otherwise accrue to the Executive’s benefit by virtue of the Executive being an employee of or other service provider to the Company.
(iii) 18 U.S.C. Section 1833(b) provides: “An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that—(A) is made—(i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.” Nothing in this Agreement is intended to conflict with 18 U.S.C. Section 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. Section 1833(b). Accordingly, the parties to this Agreement have the right to disclose in confidence trade secrets to federal, state and local government officials or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. The parties also have the right to disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure.
(f) Conflicting Obligations and Rights. The Executive agrees to inform the Company of any apparent conflicts between the Executive’s work for the Company and any obligations the Executive may have to preserve the confidentiality of another’s proprietary information or related materials before using the same on the Company’s behalf. The Company shall receive such disclosures in confidence and consistent with the objectives of avoiding any conflict of obligations and rights or the appearance of any conflict of interest.
(g) Reasonableness of Restrictive Covenants. In signing this Agreement, the Executive gives the Company assurance that the Executive has carefully read and considered all of the terms and conditions of this Agreement, including the restraints imposed under this Section 6 hereof. The Executive agrees that these restraints are necessary for the reasonable and proper protection of the Company, Parent and their respective Subsidiaries and their Confidential Information, and that each and every one of the restraints is reasonable in respect to subject matter, length of time and geographic area, and that these restraints, individually or in the aggregate, will not prevent the Executive from obtaining other suitable employment during the period in which the Executive is bound by the restraints. The Executive acknowledges that each of these covenants has a unique, very substantial and immeasurable value to the Company, Parent and their respective Subsidiaries, and that the Executive has sufficient assets and skills to provide a livelihood while such covenants remain in force. The Executive further covenants that the Executive will not
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challenge the reasonableness or enforceability of any of the covenants set forth in this Section 6. It is also agreed that the Company, Parent and their respective Subsidiaries will have the right to enforce all of the Executive’s obligations to the Company, Parent and their respective Subsidiaries under this Agreement, including, without limitation, pursuant to this Section 6.
(h) Reformation. If it is determined by a court of competent jurisdiction in any state that any restriction in this Section 6 is excessive in duration or scope or is unreasonable or unenforceable under applicable law, it is the intention of the parties that such restriction shall be modified or amended by the court to render it enforceable to the maximum extent permitted by the laws of that state. Notwithstanding anything to the contrary in this Agreement, an authorized officer of Parent or the Company has the discretion to amend the provisions of this Agreement upon notice to the Executive without the consent or approval of the Executive (or any other person) in any manner that would not impose additional or greater restrictions on the Executive. Without limiting the foregoing, Parent and the Company may amend any restrictive covenant provisions or obligations without the consent or approval of the Executive to provide for less restrictive limitations as to duration, geographical area, scope of activity to be restrained, or to incorporate legal developments. Any such less restrictive limitations may, in Parent’s or the Company’s sole discretion, apply only with respect to the enforcement of this Agreement in certain jurisdictions specified in any such amendment.
(i) Enforcement. The Executive acknowledges that, in the event of any breach or threatened breach of this Section 6, the business interests of the Company, Parent and their respective Subsidiaries might be irreparably injured, the full extent of the damages to the Company, Parent and their respective Subsidiaries might be impossible to ascertain, monetary damages might not be an adequate remedy for the Company, Parent and their respective Subsidiaries, and therefore, in addition to any other remedies available at law or in equity, the Company will be entitled to seek to enforce this Agreement by a temporary, preliminary and/or permanent injunction or other equitable relief without the need to post a bond or prove actual monetary damages. The Executive understands that the Company may waive some of the requirements expressed in this Agreement, but that such a waiver to be effective must be made in writing and should not in any way be deemed a waiver of the Company’s right to enforce any other requirements or provisions of this Agreement. The Executive agrees that each of the Executive’s obligations specified in this Agreement is a separate and independent covenant and that the unenforceability of any of them shall not preclude the enforcement of any other covenants in this Agreement.
(j) [Practice of Law. Notwithstanding the foregoing, none of the restrictions set forth in this Section 6 shall be interpreted or applied in a manner to prevent or restrict the Executive from practicing law, as it is the intent of this Section 6 to create certain limitations on the Executive’s business activities only, and not to create limitations that would restrict the Executive from practicing law. For clarity, and without limiting the foregoing, nothing in this Section 6 shall prohibit the Executive from engaging in the private practice of law as a sole practitioner or member of a law firm, irrespective of whether members of a law firm with whom the Executive is affiliated or whether the Executive, in such capacity, represents businesses that are engaged in a Competitive Enterprise. The Executive acknowledges and agrees that, both before and after the Termination Date, the Executive shall be bound by all ethical and professional obligations (including those with respect to conflicts and confidentiality) that arise from the Executive’s provision of legal services to, and acting as legal counsel for, Parent, the Company or any of their respective Subsidiaries (as applicable).]
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7. Cooperation. Upon the receipt of reasonable notice from the Company (including through outside counsel), the Executive agrees that, while employed by the Company and thereafter, the Executive will respond and provide information with regard to matters in which the Executive has knowledge as a result of the Executive’s employment with the Company, and will provide reasonable assistance to the Company, Parent, their respective Subsidiaries and their respective representatives, in defense of any claims that may be made against the Company, Parent or their respective Subsidiaries, and will assist the Company, Parent and their respective Subsidiaries in the prosecution of any claims that may be made by the Company, Parent or their respective Subsidiaries, to the extent that such claims are based on facts occurring during the Executive’s employment with the Company (collectively, the “Claims”). During the pendency of any litigation or other proceeding involving Claims, subject to Sections 6(e)(iii) and 8, the Executive shall not communicate with anyone (other than the Executive’s attorneys and tax and/or financial advisors, and except to the extent that the Executive determines in good faith is necessary in connection with the performance of the Executive’s duties hereunder) with respect to the facts or subject matter of any pending or potential litigation or regulatory or administrative proceeding involving the Company, Parent or their respective Subsidiaries without, to the extent legally permitted to do so, giving prior written notice to the Company or the Company’s counsel. Upon presentation of appropriate documentation, the Company shall pay or reimburse the Executive for all reasonable out-of-pocket travel, duplicating or telephonic expenses incurred by the Executive in complying with this Section 7. The Company shall cooperate with the Executive on the timing and location of the Executive’s cooperation and use its good faith efforts to limit any travel or interference with the Executive’s other professional commitments. In addition, following the Executive’s termination of employment, to the extent the Executive is not receiving any Severance Benefits in respect of such post-termination period, the Executive shall be compensated for the time spent for such cooperation at an hourly rate determined based on the Executive’s Base Salary at the rate in effect as of the Termination Date.
8. Whistleblower Protection; Protected Activity.
(a) Notwithstanding anything to the contrary contained herein, no provision of this Agreement shall be interpreted so as to impede the Executive (or any other individual) from (i) reporting possible violations of law or regulation to any governmental agency or entity, including, but not limited to, the Department of Justice, the Securities and Exchange Commission, the Congress and any agency Inspector General (collectively, “Governmental Authorities”), (ii) initiating communications directly with, cooperating with, providing information to, causing information to be provided to, or otherwise assisting in an investigation by any Governmental Authority regarding a possible violation of any law, (iii) responding to any inquiry or legal process from any such Governmental Authorities, (iv) testifying, participating or otherwise assisting in an action or proceeding by any such Governmental Authorities relating to a possible violation of law, (v) seeking or accepting any U.S. Securities and Exchange Commission awards or other relief in connection with protected whistleblower activity, or (vi) making other disclosures under the whistleblower provisions of applicable law, rule or regulation. The Executive does not need the prior authorization of the Company to make any such reports or disclosures, and the Executive shall not be required to notify the Company that such reports or disclosures have been made.
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(b) The Executive hereby acknowledges and agrees that nothing in this Agreement shall in any way limit or prohibit the Executive from engaging for a lawful purpose in any Protected Activity. For purposes of this Agreement, “Protected Activity” shall mean (i) filing a charge, complaint or report with, or otherwise communicating with, cooperating with or participating in any investigation or proceeding that may be conducted by, any federal, state or local government agency or commission, including the Equal Employment Opportunity Commission, the Department of Labor, the Occupational Safety and Health Administration and the National Labor Relations Board (the “Government Agencies”); (ii) disclosing an act of, or facts related to acts of, sexual harassment or abuse committed against any person; (iii) voluntarily communicating with an attorney retained by the Executive, or (iv) any rights the Executive may have under Section 7 of the National Labor Relations Act or equivalent state law to engage in concerted protected activity or to discuss the terms of employment or working conditions with or on behalf of coworkers, or to bring such issues to the attention of the Board at any time. The Executive understands that, in connection with such Protected Activity, the Executive is permitted to disclose documents or other information as permitted by law, and without giving notice to, or receiving authorization from, the Company. Notwithstanding the foregoing, the Executive agrees to take all reasonable precautions to prevent any unauthorized use or disclosure of any information that may constitute Confidential Information to any parties other than the relevant Government Agencies. The Executive further understands that Protected Activity does not include the disclosure of any Company Group attorney-client privileged communications, and that any such disclosure without the Company’s written consent shall constitute a material breach of this Agreement.
9. Notices. All notices, demands, requests or other communications, which may be or are required to be given or made by any party to any other party pursuant to this Agreement, shall be in writing and shall be hand delivered, mailed by first-class registered or certified mail, return receipt requested, postage prepaid, delivered by overnight air courier, or transmitted by e-mail or facsimile transmission, addressed as follows:
| (a) | If to Parent or the Company: |
103 Northpark Blvd., Suite 300
Covington, LA 70433
Attention: [__________]
E-Mail: [__________]
with a copy (which shall not constitute notice) to:
Kirkland & Ellis LLP
609 Main Street
Houston, Texas 77002
Attn: [__________]
Email: [__________]
| (b) | If to the Executive: |
Address last shown on the Company’s books and records
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Each party may designate by notice in writing a new address to which any notice, demand, request or communication may thereafter be so given, served or sent. Each notice, demand, request or communication that shall be given or made in the manner described above shall be deemed sufficiently given or made for all purposes at such time as it is delivered to the addressee (with the return receipt, the delivery receipt, confirmation of facsimile transmission or the affidavit of messenger being deemed conclusive but not exclusive evidence of such delivery) or at such time as delivery is refused by the addressee upon presentation.
10. Severability. The provisions of this Agreement shall be deemed severable. The invalidity or unenforceability of any provision of this Agreement in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by applicable law. If any term or provision of this Agreement is found to be invalid or unenforceable by a final determination of a court of competent jurisdiction, the invalid or unenforceable term or provision hereof shall be deemed replaced by a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision hereof.
11. Survival. It is the express intention and agreement of the parties hereto that the provisions of Sections 5 through 23 shall survive the termination of employment of the Executive. In addition, all obligations of the Company to make payments hereunder shall survive any termination of this Agreement on the terms and conditions set forth herein.
12. No Assignments. The rights and obligations of the parties to this Agreement shall not be assignable or delegable, except that (a) in the event of the Executive’s death, the personal representative or legatees or distributees of the Executive’s estate, as the case may be, shall have the right to receive any amount owing and unpaid to the Executive hereunder; and (b) the rights and obligations of Parent and the Company hereunder shall be assignable and delegable to an Affiliate or in connection with any subsequent merger, consolidation, sale of all or substantially all of the assets or equity interests of Parent or the Company, or similar transaction involving Parent or the Company or a successor corporation. Parent and the Company shall require any successor to Parent or the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that Parent or the Company would be required to perform it if no such succession had taken place.
13. Binding Effect. Subject to any provisions hereof restricting assignment, this Agreement shall be binding upon the parties hereto and shall inure to the benefit of the parties and their respective heirs, devisees, executors, administrators, legal representatives, successors and assigns.
14. Amendments; Modifications; Waivers. No provision of this Agreement may be amended, modified, waived or discharged, unless such amendment, modification, waiver or discharge is agreed to in writing and signed by the Executive and such officer or director of each of Parent and the Company as may be designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time unless such waiver specifically states that it is to be construed as a continuing waiver.
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15. Section Headings; Inconsistency. Section and subsection headings contained in this Agreement are inserted for convenience of reference only, shall not be deemed to be a part of this Agreement for any purpose, and shall not in any way define or affect the meaning, construction or scope of any of the provisions hereof. In the event of any inconsistency between the terms of this Agreement and any form, award, plan or policy of the Company Group, the terms of this Agreement shall govern and control, unless otherwise expressly provided.
16. Governing Law. This Agreement, the rights and obligations of the parties hereto, and any claims or disputes relating thereto, shall be governed by and construed in accordance with the laws of the State of [Louisiana] // [Texas] (but not including any choice of law rule that would cause the laws of another jurisdiction to apply).
17. Dispute Resolution. Each of the parties hereto irrevocably and unconditionally (a) WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING RELATING TO THIS AGREEMENT OR THE EXECUTIVE’S EMPLOYMENT BY THE COMPANY OR ANY OTHER MEMBER OF THE COMPANY GROUP, or for the recognition and enforcement of any judgment in respect thereof (a “Proceeding”), whether such Proceeding is based on contract, tort or otherwise; (b) agrees that service of process in any such Proceeding may be effected by mailing a copy of such process by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such party at such party’s address as provided in Section 9; and (c) agrees that nothing in this Agreement shall affect the right to effect service of process in any other manner permitted by applicable law.
18. Indemnification. The parties acknowledge that the Executive is eligible to receive the benefits of a separate Indemnification Agreement, entered on or around the Effective Date [in connection with the Transaction].
19. Entire Agreement; Advice of Counsel. This Agreement constitutes the entire agreement between the parties respecting the employment of the Executive, there being no representations, warranties or commitments except as set forth herein, and supersedes and replaces all other agreements related to the subject matter hereof, including, without limitation, the Original Agreement; provided, however, that the provisions of this Agreement are in addition to and complement (and do not replace or supersede) any other written agreement(s) or parts thereof between the Executive and any member of the Company Group that create restrictions on the Executive with respect to confidentiality, assignment of inventions, non-disclosure, non-competition, non-solicitation or non-disparagement or include any other restrictive covenants with respect to the Executive. Without limiting the scope of the preceding sentence, except as otherwise expressly provided in this Section 19, all understandings and agreements preceding the Effective Date and relating to the subject matter hereof (including the Original Agreement) are hereby null and void and of no further force or effect, and this Agreement shall supersede all other agreements, written or oral, that purport to govern the terms of the Executive’s employment (including the Executive’s compensation) with any member of the Company Group. The Executive acknowledges and agrees that the Original Agreement is hereby terminated and has been satisfied in full, as has any other employment agreement between the Executive and any member of the Company Group. In entering into this Agreement, the Executive expressly acknowledges and agrees that the Executive has received all sums and compensation that the Executive has been owed, is owed or ever could be owed pursuant to the agreement(s) referenced in the previous sentence and for services provided to any member of the Company Group through the date that the Executive signs this Agreement, with the exception of any unpaid base salary for the pay period
17
that includes the date on which the Executive signs this Agreement, any unpaid bonus and any incentive compensation for the portion of the current year before the execution and delivery of this Agreement. The Executive acknowledges that, in connection with the Executive’s entry into this Agreement, the Executive was advised, or had the opportunity to be advised, by an attorney of the Executive’s choice on the terms and conditions of this Agreement, including, without limitation, on the application of Section 409A of the Code on the payments and benefits payable or to be paid to the Executive hereunder.
20. Counterparts. This Agreement may be executed (including by email with scan attachment) in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.
21. Withholding. The Company may withhold from any and all amounts payable under this Agreement or otherwise such federal, state and local taxes as may be required to be withheld pursuant to any applicable law or regulation.
22. Section 409A of the Code.
(a) The intent of the parties is that payments and benefits under this Agreement comply with Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively, “Section 409A of the Code”) or an exemption therefrom, and accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith or exempt therefrom. If the Executive notifies the Company (with specificity as to the reason therefor) that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Section 409A of the Code and the Company concurs with such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the Company shall, after consulting with the Executive, reform such provision to attempt to comply with or be exempt from Section 409A of the Code through good faith modifications to the minimum extent reasonably appropriate to conform with Section 409A of the Code. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A of the Code, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A of the Code. For the sake of clarity, the Company Group shall have no obligation to indemnify the Executive for liabilities incurred as a result of Section 409A of the Code.
(b) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits that are “nonqualified deferred compensation” within the meaning of Section 409A of the Code upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Section 409A of the Code, and for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If the Executive is deemed on the Termination Date to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B) of the Code, then with regard to any payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Section 409A of the Code payable on account of a “separation from service,” such payment or benefit shall be made or provided at the date which is the earlier of (i) the expiration of the six (6) month period measured from the date of such “separation from service”
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of the Executive, and (ii) the date of the Executive’s death, to the extent required under Section 409A of the Code (such earlier date, the “Delayed Payment Date”). Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 22(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum with interest at the prime rate as published in The Wall Street Journal on the first business day following the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(c) To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Section 409A of the Code, (i) all expenses or other reimbursements hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by the Executive; (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit; and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(d) For purposes of Section 409A of the Code, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(e) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Section 409A of the Code be subject to offset by any other amount unless otherwise permitted by Section 409A of the Code.
23. Definitions.
(a) “Affiliate” means, with respect to any person or entity, any entity controlled by, in control of or under common control with, such person or entity.
(b) “Cause” shall be limited to the following events: (i) the Executive’s conviction of either (A) a felony involving moral turpitude or (B) any crime in connection with the Executive’s employment that causes the Company Group a substantial detriment (in each case, excluding traffic offenses); (ii) actions or inactions by the Executive that clearly are contrary to the best interests of the Company Group and the express directives of the Board; provided, that, such actions or inactions by the Executive cause the Company Group a substantial detriment or could reasonably be expected to cause a substantial detriment to the Company Group as determined by the Board in good faith; (iii) the Executive’s willful failure to take actions permitted by law and necessary to implement policies of the Board that the Board has communicated to him in writing; provided, that, such policies that are reflected in minutes of a Board meeting attended in its entirety by the Executive shall be deemed communicated to the Executive to the extent the Executive received a copy of such minutes from the Secretary or the General Counsel of the Company promptly following approval by the Board; (iv) the Executive’s continued failure to attend to his material duties as an executive officer of the Company Group following the Executive’s receipt of written notice from the Board of such failure; provided, that, such failure
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by the Executive causes the Company Group a substantial detriment or could reasonably be expected to cause a substantial detriment to the Company Group as determined by the Board in good faith; (v) the Executive’s commission of an act of fraud or material act of dishonesty or misappropriation involving the Company Group; (vi) the Executive’s willful violation of law or gross negligence that is substantially detrimental to the Company Group; (vii) the material breach or material violation by the Executive of this Agreement or any other written agreement with a member of the Company Group, or any material violation of any written policy of the Company Group; provided, that, such material breach or material violation by the Executive causes the Company Group a substantial detriment or could reasonably be expected to cause a substantial detriment to the Company Group as determined by the Board in good faith; or (viii) the Executive’s habitual use of illicit drugs or habitual abuse of alcohol that, in the reasonable good faith opinion of the Board, renders the Executive unfit to serve as an officer of the Company Group. If any determination of habitual use or substantial dependence under clause (viii) is disputed by the Executive, the parties hereto agree to abide by the decision of a panel of three (3) physicians appointed in the manner specified in Section 23(h) of the Agreement. For purposes of this “Cause” definition, no action or inaction will be considered “willful” or will constitute “gross negligence”, if the Executive had a reasonable, good faith belief that such action or inaction was in the best interests of the Company Group. Anything herein to the contrary notwithstanding, the Executive shall not be terminated for “Cause” hereunder, unless (A) written notice stating the basis for the termination is provided to the Executive, and (B) with the exception of clause (i) of this paragraph, the Executive is given thirty (30) calendar days to cure the neglect or conduct that is the basis of such claim, to the extent curable.
(c) “Change of Control” means and includes each of the following:
(i) any Person (other than Parent, any trustee or other fiduciary holding securities under any employee benefit plan of Parent, or any company owned, directly or indirectly, by the stockholders of Parent in substantially the same proportions as their ownership of Parent), becoming the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of Parent representing 50% or more of the combined voting power of Parent’s then outstanding securities, excluding any acquisition of securities directly from the Company or pursuant to a Business Combination (as defined below) that satisfies the conditions set forth in the proviso in Section 23(c)(ii);
(ii) a merger, reorganization, or consolidation of Parent or in which equity securities of Parent are issued (each, a “Business Combination”), other than a merger, reorganization or consolidation which would result in the voting securities of Parent outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its direct or indirect parent) more than 50% of the combined voting power of the voting securities of Parent or such surviving entity (or, as applicable, a direct or indirect parent of Parent or such surviving entity) outstanding immediately after such merger, reorganization or consolidation; provided, however, that a merger, reorganization or consolidation effected solely to implement a recapitalization of Parent (or similar transaction) in which no Person (other than those covered by the exceptions in Section 23(c)(i)) acquires more than 50% of the combined voting power of Parent’s then outstanding securities shall not constitute a Change of Control;
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(iii) during the period of two consecutive years, individuals who, at the beginning of such period, constitute the Board together with any new director(s) (other than a director designated by a Person who has entered into an agreement with Parent to effect a transaction described in Sections 23(c)(i) or (ii)) whose election by the Board or nomination for election by Parent’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or
(iv) a complete liquidation or dissolution of Parent or the consummation of a sale or disposition by Parent of all or substantially all of Parent’s assets other than the sale or disposition of all or substantially all of the assets of Parent to a Person or Persons who beneficially own, directly or indirectly, 50% or more of the combined voting power of the outstanding voting securities of Parent at the time of the sale.
Notwithstanding the foregoing, with respect to any payment or benefit that is characterized as “nonqualified deferred compensation” within the meaning of Section 409A of the Code, an event shall not be considered to be a Change of Control under this Agreement for purposes of payment of such payment or benefit unless such event is also a “change in ownership,” a “change in effective control,” or a “change in the ownership of a substantial portion of the assets” of Parent within the meaning of Section 409A of the Code. [For clarity, the Transaction shall be treated as a Change of Control.]
(d) “Company Group” means Parent and each of its Subsidiaries and Affiliates, including the Company.
(e) “Competitive Enterprise” means any business engaged in offshore marine transportation, supply, supply vessel, service vessel, logistics, subsea, well intervention, production, decommissioning, construction, renewable energy, defense or other specialty marine services of the type conducted by the Company, Parent or any of their respective Subsidiaries in the Restricted Area, including offshore transportation of petroleum products, equipment, supplies, cargo or personnel; offshore towing; offshore service vessel, offshore supply vessel, multi-purpose support vessel, well intervention vessel, dive support vessel, crew transfer and related marine logistics services (including, without limitation, crew boats, liftboats, fast supply vessels, multi-purpose support vessels, flotels, services to Military Sealift Command, construction vessels, anchor handling towing supply vessels, tugs, double hulled tank barges and double hulled tankers, heavy lift derrick barges, or other complementary offshore marine vessels); anchor handling and towing services; well stimulation, well testing, well intervention and production enhancement services; drilling support, inspection, repair, and maintenance services; reservoir management services; life of field services; full field abandonment and decommissioning, plugging and abandonment, well abandonment, wellhead removal, production tubing recovery, pipeline abandonment, pipeline remediation, reclamation and other offshore decommissioning services; ROV, subsea robotics, trenching, seabed clearance and related subsea tooling services; cable lay and repair services; offshore and subsea construction, installation, inspection, repair and maintenance services; floating production, production facility and well control response services; shallow water abandonment, plug and abandonment, and coiled tubing system services; subsea pressure control equipment services; offshore renewable energy development, construction, installation, maintenance and support services; defense and military support services; aerospace, humanitarian, emergency response and disaster relief marine services; and other specialty offshore,
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subsea, marine transportation, logistics, production, decommissioning, emergency response and technical services utilizing offshore supply vessels, multi-purpose support vessels, well intervention vessels, robotics support vessels, dive support vessels, crew boats, floating production vessels, small tankers or other specialty marine assets in the offshore construction, energy exploration and production, renewable energy, defense, aerospace, humanitarian and disaster relief industries.
(f) “Confidential Information” means all non-public information concerning trade secrets, know-how, software, developments, inventions, processes, technology, designs, financial data, strategic business plans or any proprietary or confidential information, documents or materials in any form or media, including any of the foregoing relating to research, operations, finances, current and proposed products and services, vendors, customers, advertising and marketing, and other non-public, proprietary and confidential information of the Company Group. Notwithstanding anything to the contrary contained herein, the general skills, knowledge and experience gained during the Executive’s employment with the Company, information publicly available or generally known within the industry or trade in which the Company competes, and information or knowledge possessed by the Executive prior to the Executive’s employment by the Company shall not be considered Confidential Information.
(g) “Customer” means any person, firm, corporation or other entity whatsoever to whom the Company, Parent or their respective Subsidiaries provided or actively sought to provide services or sold or actively sought to sell any products within a twelve (12)-month period on or before the Executive’s Termination Date[, and with whom Executive had business-related contact or about whom Executive received or accessed Confidential Information]3.
(h) “Disability” means that the Executive is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of at least three (3) months under any long term disability plan maintained by the Company that covers the Executive. In the absence of such a long term disability plan, “Disability” means the inability of the Executive, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, to perform the duties required of him under this Agreement for a period of at least ninety (90) days in any one (1)-year period. Upon such determination, the Board may terminate the Executive’s employment under this Agreement, subject to providing ten (10) days’ prior written notice. In the event of any dispute hereunder as to whether a Disability exists, the parties hereto agree to abide by the decision of a panel of three (3) physicians. The Executive and the Board shall each appoint one member to the panel, and the third member of the panel shall be appointed by the other two members. The Executive agrees to make himself available for, and submit to examinations by, such physicians as may be directed by the Board. Failure to submit to any such examination shall constitute a breach of a material part of this Agreement. This Section 23(h) shall be interpreted and applied so as to comply with the provisions of the Americans with Disabilities Act and any applicable state or local laws.
| 3 | Note to Form: To include for Texas-based executives. |
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(i) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time. Reference to a specific section of the Exchange Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing, or superseding such section or regulation.
(j) “Good Reason” means, unless otherwise agreed to in writing by the Executive, (i) any material diminution in the Executive’s titles, duties, responsibilities, status or authorities with Parent, the Company or any of their respective material operating Subsidiaries (other than as permitted by this Agreement); (ii) any material reduction in the Executive’s Base Salary or Target Bonus; (iii) a relocation of the Executive’s primary place of employment to a location more than thirty-five (35) miles farther from the Executive’s primary residence than the current location of the Company’s offices in [Louisiana] // [Texas] as of the Effective Date; or (iv) a material breach by the Company or Parent of this Agreement or any other written agreement between the Company and the Executive. In order to invoke a termination for Good Reason, (A) the Executive must provide written notice within forty-five (45) days of the Executive becoming aware of the occurrence of any event of “Good Reason,” (B) the Company Group must fail to cure such event within thirty (30) days of the giving of such notice, and (C) the Executive must terminate employment within forty-five (45) days following the expiration of the Company Group’s cure period.
(k) “Person” means any “person” as such term is used in Sections 13(d) and 14(d) of the Exchange Act.
(l) [“Restricted Area” means each county, city, state, municipality, locale, governmental subdivision or jurisdiction in the United States, Mexico, Trinidad and Tobago, Brazil, Colombia, the United Kingdom, Singapore, Australia, Guyana, Romania, and West Africa in which the Competitive Enterprise is conducted by the Company, Parent or any of their respective Subsidiaries or any other jurisdiction (and the state and federal waters offshore the same) in which the Company, Parent or any of their respective Subsidiaries conducts or takes concrete, active steps to conduct the Competitive Enterprise during the Executive’s employment or service with the Company, Parent or any of their respective Subsidiaries, as evidenced by existing memoranda, Board minutes or other written correspondence, and in which the Executive provided services or had a material presence or influence, or about which the Executive received Confidential Information, in connection with the Executive’s employment with or service to the Company, Parent or any of their respective Subsidiaries.]4 // [“Restricted Area” means each of the following in which the Competitive Enterprise is conducted by the Company, Parent or any of their respective Subsidiaries or any other parish, county or government subdivision and the state and federal waters offshore the same in which the Company, Parent or any of their respective Subsidiaries conducts or takes concrete, active steps to conduct the Competitive Enterprise during the Executive’s employment or service with the Company, Parent or any of their respective Subsidiaries, as evidenced by existing memoranda, Board minutes or other written correspondence:
(i) the following parishes of the State of Louisiana in which Employer carries on and is engaged in Parent’s business: Acadia, Allen, Ascension, Assumption, Beauregard, Calcasieu, Cameron, East Baton Rouge, East Feliciana, Evangeline, Iberia, Iberville, Jefferson, Jefferson Davis, Lafayette, Lafourche, Livingston, Orleans, Plaquemines, Pointe Coupee, St. Bernard, St. Charles, St. Helena, St. James, St. John, St. Landry, St. Martin, St. Mary, St. Tammany, Tangipahoa, Terrebonne, Vermilion, Washington, West Baton Rouge, and West Feliciana and the state and federal waters offshore such parishes;
| 4 | Note to Form: To include for Texas-based executives. |
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(ii) the following counties of the State of Texas in which Employer carries on and is engaged in Parent’s business: Aransas, Brazoria, Calhoun, Cameron, Chambers, Fort Bend, Galveston, Harris, Houston, Jackson, Jefferson, Kenedy, Kleberg, Liberty, Matagorda, Montgomery, Nueces, Orange, Refugio, San Jacinto, San Patricio, Waller and Willacy and the state and federal waters offshore such counties;
(iii) the following government subdivisions in the country of Trinidad and Tobago: San Fernando, Galeota and Chagaramas and the state and federal waters offshore the same;
(iv) the following government subdivisions of Mexico: Ciudad del Carmen, Mexico D.F., Poza Rica, Tampico and Dos Bocas, la Ciudad de Mexico and the state and federal waters offshore the same;
(v) the following government subdivisions of Brazil: State of Rio de Janeiro;
(vi) the following government subdivisions of Colombia: Bogota, Magdalena Department including Santa Marta, Cartagena and the offshore state and federal waters adjacent to Colombia;
(vii) the following government subdivisions in the United Kingdom: Aberdeen;
(viii) the following government subdivisions in Singapore: Changi; and
(ix) the following government subdivisions in Australia: Perth.]5
(m) “Restricted Period” means the period commencing on the Effective Date and ending twenty-four (24) months following the Executive’s Termination Date.
(n) “Retirement” means the Executive’s retirement from employment with Parent, the Company and all of their respective Subsidiaries (other than at a time when grounds to terminate the Executive’s employment for Cause exist) on or after the date on which the Executive attains age sixty (60); provided, that the Executive (A) has completed at least ten (10) years of service with Parent, the Company or any of their respective Subsidiaries as of such time and (B) does not and does not intend or have any plans to provide services in any capacity to a Competitive Enterprise and certifies the same in writing if requested by the Company.
(o) “Severance Benefits” means the payments described in Sections 4(b) (but only upon the Executive’s Retirement and not upon the Executive’s death or Disability), 4(d) or 4(e), in each case, other than the Accrued Benefits.
| 5 | Note to Form: To include for Louisiana-based executives. |
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(p) “Subsidiary” means, with respect to any entity, any subsidiary corporation of such entity within the meaning of Section 424(f) of the Code or any company (whether a corporation, partnership, joint venture, or other form of entity) in which the entity has a direct or indirect “controlling interest,” within the meaning of Treas. Reg. Section 1.409A1(b)(5)(iii)(E)(1).
(q) [“Transaction” means the transaction consummated on or about the Effective Date pursuant to that certain Agreement and Plan of Merger, dated as of April 22, 2026, by and among Parent, Hornbeck Offshore Services, Inc., and the other parties thereto.]
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the undersigned have duly executed and delivered this Agreement or have caused this Agreement to be duly executed and delivered on their behalf.
| HORNBECK OFFSHORE OPERATORS, LLC | ||
| By: |
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| Name: |
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| Title: |
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| HORNBECK OFFSHORE SERVICES, INC. | ||
| By: |
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| Name: |
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| Title: |
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| EXECUTIVE | ||
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| [__________] | ||
EXHIBIT A
OUTSIDE BOARD MEMBERSHIP
EXHIBIT B
GENERAL RELEASE6
I, [__________], in consideration of payment by Hornbeck Offshore Operators, LLC (together with its Parent and Subsidiaries, the “Company”) of the amounts set forth in Section 4[(b)][(d)][(e)]7 of the Employment Agreement, dated as of [__________] (the “Agreement”), do hereby release and forever discharge, as of the date hereof, the Company and its Affiliates and all of the respective present, former and future managers, directors, officers, employees, successors and assigns of the Company and its Affiliates and direct or indirect owners[, (which, for the avoidance of doubt, shall include the Specified Investors (as defined in the Hornbeck Offshore Services, Inc. 2024 Omnibus Incentive Plan (as may be amended from time to time) and any successor plan thereto))]8 (collectively, the “Released Parties”) to the extent provided below (this “General Release”). The Released Parties are intended to be third-party beneficiaries of this General Release, and this General Release may be enforced by each of them in accordance with the terms hereof in respect of the rights granted to such Released Parties hereunder. Terms used herein but not otherwise defined shall have the meanings given to them in the Agreement.
| 1. | My employment with the Company terminated as of [Date], and I hereby resign from any position as an officer, member of the board of managers or directors (as applicable) or fiduciary of the Company or any other member of the Company Group (or reaffirm any such resignation that may have already occurred). I understand that any payments or benefits paid or granted to me under Section 4 of the Agreement represent, in part, consideration for signing this General Release and are not salary, wages or benefits to which I was already entitled. I understand and agree that I will not receive certain of the payments and benefits specified in Section 4 of the Agreement, unless I execute this General Release and do not revoke this General Release within the time period permitted hereafter. I understand and agree that such payments and benefits are subject to my continued material compliance with Section 6 of the Agreement (as more fully set forth in the Agreement) during the period in which I am paid the Severance Benefits pursuant to Section 4[(b)][(d)][(e)]9 of the Agreement, which (as noted below) expressly survive my termination of employment and the execution of this General Release. Such payments and benefits will not be considered compensation for purposes of any employee benefit plan, program, policy or arrangement maintained or hereafter established by the Company or its Affiliates. |
| 2. | Except as provided in paragraphs 4, 5 and 11 below and except for the provisions of the Agreement which expressly survive the termination of my employment with the Company, I knowingly and voluntarily (for myself and my heirs, executors, administrators and assigns) release and forever discharge the Company and the other Released Parties from any and all claims, suits, controversies, actions, causes of action, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees or liabilities of any nature whatsoever in law and in equity, both past and present (through the date on which I execute this General Release) and |
| 6 | Note to Release: To be updated with any updates deemed reasonably necessary by the Company to comply with applicable laws as of the Executive’s termination date. |
| 7 | Note to Release: To specify applicable termination section. |
| 8 | Note to Release: To include if any Specified Investors own equity interests of Parent as of the Executive’s termination date. |
| 9 | Note to Release: To specify applicable termination section. |
| whether known or unknown, suspected or claimed against the Company or any of the Released Parties, which I, my spouse or any of my heirs, executors, administrators or assigns may have, which arise out of or are connected with my employment with, or my separation or termination from, the Company (including, but not limited to, any allegation, claim or violation, arising under: Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended (including the Older Workers Benefit Protection Act); the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of 1990; the Family and Medical Leave Act of 1993; the Worker Adjustment Retraining and Notification Act; the Employee Retirement Income Security Act of 1974; Sections 23:301 to 23:369 of the Louisiana Revised Statutes; Article 2315 of the Louisiana Civil Code; the Louisiana Workers’ Compensation Act; the Louisiana Employment Discrimination Law; the Louisiana Military Service Relief Act; any applicable Executive Order Programs; the Fair Labor Standards Act; the Texas Labor Code, the Texas Payday Act, the Texas Anti-Retaliation Act, Chapter 21 of the Texas Labor Code, the Texas Whistleblower Act; or their state or local counterparts; or under any other federal, state or local civil or human rights law, or under any other local, state or federal law, regulation or ordinance; or under any public policy, contract or tort, or under common law; or arising under any policies, practices or procedures of the Company or any of the Released Parties; or any claim for wrongful discharge, breach of contract, infliction of emotional distress or defamation; or any claim for costs, fees or other expenses, including attorneys’ fees, incurred in these matters), or which arise from or in any way relate to awards, policies, plans, programs or practices of any of the Released Parties that may apply to me or in which I may participate (all of the foregoing collectively referred to herein as the “Claims”). |
| 3. | I represent that I have made no assignment or transfer of any right, claim, demand, cause of action or other matter covered by paragraph 2 above. |
| 4. | I agree that this General Release does not waive or release any rights or claims that I may have under the Age Discrimination in Employment Act of 1967 which arise after the date I execute this General Release. I acknowledge and agree that my separation from employment with the Company in compliance with the terms of the Agreement shall not serve as the basis for any claim or action (including, without limitation, any claim under the Age Discrimination in Employment Act of 1967). |
| 5. | I agree that I hereby waive all rights to sue or obtain equitable, remedial or punitive relief from any or all Released Parties of any kind whatsoever in respect of any Claim, including, without limitation, reinstatement, back pay, front pay and any form of injunctive relief. Notwithstanding the above, I further acknowledge that I am not waiving and am not being required to waive any right that cannot be waived under law, including the right to file an administrative charge or participate in an administrative investigation or proceeding; provided, however, that I disclaim and waive any right to share or participate in any monetary award resulting from the prosecution of such charge or investigation or proceeding, subject to paragraph 11 of this General Release. Additionally, I am not waiving (a) any right to the Accrued Benefits or any Severance Benefits to which I am entitled under Section 4[(b)][(d)][(e)]10 of the Agreement, [(b) any rights I have under Section 4(e) of the Agreement in the event a Qualifying Termination becomes a Change of Control Qualifying Termination,]11 ([c]) any claim relating to directors’ and officers’ liability insurance coverage or any right of indemnification under the Company’s organizational documents or otherwise, or ([d]) my rights as an equity or security holder in the Company or its Affiliates. |
| 10 | Note to Release: To specify applicable termination section. |
| 11 | Note to Release: To include only if the Executive will be receiving Severance Benefits under Section 4(d). If this is deleted, then clauses (c) and (d) will be re-lettered to be clauses (b) and (c). |
B-2
| 6. | In signing this General Release, I acknowledge and intend that it shall be effective as a bar to each and every one of the Claims hereinabove mentioned or implied. I expressly consent that this General Release shall be given full force and effect according to each and all of its express terms and provisions, including those relating to unknown and unsuspected Claims (notwithstanding any state or local statute that expressly limits the effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any, as well as those relating to any other Claims hereinabove mentioned or implied. I acknowledge and agree that this waiver is an essential and material term of this General Release and that without such waiver the Company would not have agreed to the terms of the Agreement. I further agree that in the event I should bring a Claim seeking damages against the Company, or in the event I should seek to recover against the Company in any Claim brought by a governmental agency on my behalf, this General Release shall serve as a complete defense to such Claims to the maximum extent permitted by law. I further agree that I am not aware of any pending claim of the type described in paragraph 2 above as of the execution of this General Release. |
| 7. | I agree that neither this General Release, nor the furnishing of the consideration for this General Release, shall be deemed or construed at any time to be an admission by the Company, any Released Party or myself of any improper or unlawful conduct. |
| 8. | I agree that I will forfeit all amounts payable by the Company pursuant to the Agreement if I challenge the validity of this General Release. I also agree that if I violate this General Release by suing the Company or the other Released Parties, I will pay all costs and expenses of defending against the suit incurred by the Released Parties, including reasonable attorneys’ fees, and return all payments received by me pursuant to the Agreement on or after the termination of my employment. |
| 9. | I agree that this General Release and the Agreement are confidential and agree not to disclose any information regarding the terms of this General Release or the Agreement, except to my immediate family and any tax, legal or other counsel I have consulted regarding the meaning or effect hereof or as required by law, and I will instruct each of the foregoing not to disclose the same to anyone. The Company agrees to disclose any such information only to any tax, legal or other counsel of the Company and, to the extent reasonably necessary in connection with any potential or actual Claim against any Released Party, such Released Party and their tax, legal or other counsel, or as required by law. |
| 10. | Any non-disclosure provision in this General Release does not prohibit or restrict me (or my attorney) from responding to any inquiry about this General Release or its underlying facts and circumstances by the Securities and Exchange Commission (SEC), the National Association of Securities Dealers, Inc. (NASD), and any other self-regulatory organization or governmental entity. |
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| 11. | Nothing in this General Release prevents me from filing a charge with the Equal Employment Opportunity Commission, the National Labor Relations Board or other governmental agency or commission (collectively, the “EEOC”) or participating in any EEOC investigation; provided that I may not receive any relief (including, without limitation, compensation, reinstatement, back pay, front pay, damages, attorneys’ or experts’ fees, costs and/or disbursements) as a consequence of any charge filed with the EEOC and/or any litigation arising out of an EEOC charge to the fullest extent permitted by law. Further, nothing contained in this General Release (including the immediately preceding sentence) limits, restricts or in any way affects my right to (a) communicate with any governmental agency or entity or regulatory or any law enforcement authority or make other disclosures under the whistleblower provisions of any applicable law, rule or regulation or (b) seek or receive any monetary damages, awards or other relief in connection with protected whistleblower activity. |
| 12. | I hereby acknowledge that Sections 5 through 23 of the Agreement shall survive my execution of this General Release. |
| 13. | I represent that I am not aware of any claim by me other than the claims that are released by this General Release. I acknowledge that I may hereafter discover claims or facts in addition to or different than those which I now know or believe to exist with respect to the subject matter of the release set forth in paragraph 2 above and which, if known or suspected at the time of entering into this General Release, may have materially affected this General Release and my decision to enter into it, but I nonetheless shall continue to be bound by this General Release in all respects. |
| 14. | Notwithstanding anything in this General Release to the contrary, this General Release shall not relinquish, diminish or in any way affect any rights or claims arising out of any breach by the Company or by any Released Party of the Agreement after the date hereof. |
| 15. | Whenever possible, each provision of this General Release shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this General Release is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this General Release shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein. |
BY SIGNING THIS GENERAL RELEASE, I REPRESENT AND AGREE THAT:
| 1. | I HAVE READ IT CAREFULLY; |
| 2. | I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT RIGHTS, INCLUDING, BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED; TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963; THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED; |
| 3. | I VOLUNTARILY CONSENT TO EVERYTHING IN IT; |
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| 4. | I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I HAVE DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION, I HAVE CHOSEN NOT TO DO SO OF MY OWN VOLITION; |
| 5. | I HAVE HAD AT LEAST [TWENTY-ONE (21)]/[FORTY-FIVE (45)]12 DAYS FROM THE DATE OF MY RECEIPT OF THIS GENERAL RELEASE TO CONSIDER IT AND THE CHANGES MADE SINCE MY RECEIPT OF THIS GENERAL RELEASE ARE NOT MATERIAL OR WERE MADE AT MY REQUEST AND WILL NOT RESTART THE REQUIRED [TWENTY-ONE (21)-DAY]/[FORTY-FIVE (45)-DAY] PERIOD; |
| 6. | I UNDERSTAND THAT I HAVE SEVEN (7) DAYS AFTER THE EXECUTION OF THIS GENERAL RELEASE TO REVOKE IT AND THAT THIS GENERAL RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD HAS EXPIRED; |
| 7. | I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND |
| 8. | I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME. |
| SIGNED: |
|
DATED: |
| 12 | Note to Release: Forty-five (45) days to be included in the event of a group termination. |
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Exhibit 10.3
HORNBECK OFFSHORE SERVICES, INC.
2026 OMNIBUS INDUCEMENT INCENTIVE PLAN
ARTICLE I
PURPOSE
The purpose of this Hornbeck Offshore Services, Inc. 2026 Omnibus Inducement Incentive Plan (this “Plan”) is to assist the Company and its Subsidiaries in attracting select individuals who are expected to contribute to the Company’s success as employees by providing an inducement award that is material for such individuals to enter into employment with the Company or any of its Subsidiaries. All Awards under the Plan are intended to qualify as “employment inducement awards” as described in Rule 303A.08 or any successor provision of the NYSE Listing Rules.
ARTICLE II
DEFINITIONS
For purposes of this Plan, the following terms shall have the following meanings:
2.1 “Affiliate” means a corporation or other entity controlled by, controlling, or under common control with the Company. The term “control” (including, with correlative meaning, the terms “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of such Person, whether through the ownership of voting or other securities, by contract or otherwise.
2.2 “Applicable Law” means the requirements relating to the administration of equity-based awards and the related shares under U.S. state corporate law, U.S. federal and state securities laws, the rules or requirements of any stock exchange or quotation system on which the shares are listed or quoted, and any other applicable laws, including tax laws, of any U.S. or non-U.S. jurisdictions where Awards are, or will be, granted under this Plan.
2.3 “Award” means any award under this Plan of any Stock Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Units, Performance Award, Other Stock-Based Award, or Cash Award. All Awards shall be evidenced by and subject to the terms of an Award Agreement.
2.4 “Award Agreement” means the written or electronic agreement, contract, certificate, or other instrument or document evidencing the terms and conditions of an individual Award. Each Award Agreement shall be subject to the terms and conditions of this Plan.
2.5 “Board” means the Board of Directors of the Company.
2.6 “Cash Award” means an Award granted to a Participant pursuant to Section 9.3 and payable in cash at such time or times and subject to such terms and conditions as determined by the Committee in its sole discretion.
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2.7 “Cause” means, unless otherwise determined by the Committee in the applicable Award Agreement, with respect to a Participant’s Termination of Service, the following: (a) in the case where there is no employment agreement, offer letter, consulting agreement, change in control agreement, or similar agreement in effect between the Company or an Affiliate and the Participant at the time of the grant of the Award (or where there is such agreement in effect but it does not define “cause” (or words of like import)), the Participant’s (i) commission of, or plea of guilty or no contest to, a felony or a crime involving moral turpitude or the commission of any other act involving embezzlement, fraud, material dishonesty, willful malfeasance or material fiduciary breach with respect to the Company or an Affiliate; (ii) substantial and repeated failure to perform duties as reasonably directed by the person to whom the Participant reports; (iii) conduct that brings or is reasonably likely to bring the Company or an Affiliate negative publicity or into public disgrace, embarrassment, or disrepute; (iv) gross negligence or willful misconduct with respect to the Company or an Affiliate; (v) material violation of the Company’s policies or codes of conduct, including policies related to discrimination, harassment, performance of illegal or unethical activities, or ethical misconduct; (vi) failure to cooperate with a bona fide internal investigation or an investigation by regulatory or law enforcement authorities, after being instructed by the Company or an Affiliate to cooperate, or willful destruction of or failure to preserve documents or other materials known to be relevant to such investigation or inducement of others to fail to cooperate or to produce documents or other materials in connection with such investigation; or (vii) any breach of any non-competition, non-solicitation, no-hire, or confidentiality covenant or any other restrictive covenant between the Participant and the Company or an Affiliate; or (b) in the case where there is an employment agreement, offer letter, consulting agreement, change in control agreement, or similar agreement in effect between the Company or an Affiliate and the Participant at the time of the grant of the Award that defines “cause” (or words of like import), “cause” as defined under such agreement; provided, however, that with regard to any agreement under which the definition of “cause” only applies on occurrence of a change in control, such definition of “cause” shall not apply until a change in control (as defined in such agreement) actually takes place and then only with regard to a termination thereafter.
2.8 “Change in Control” means and includes each of the following that occurs following the grant date of an Award, unless otherwise determined by the Committee in the applicable Award Agreement or other written agreement with a Participant approved by the Committee:
(a) any Person (other than the Company, any trustee or other fiduciary holding securities under any employee benefit plan of the Company, or any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of the Company), becoming the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the combined voting power of the Company’s then outstanding securities, excluding any acquisition of securities directly from the Company or pursuant to a Business Combination (as defined below) that satisfies the conditions set forth in the proviso in Section 2.8(b);
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(b) a merger, reorganization, or consolidation of the Company or in which equity securities of the Company are issued (each, a “Business Combination”), other than a merger, reorganization or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its direct or indirect parent) more than 50% of the combined voting power of the voting securities of the Company or such surviving entity (or, as applicable, a direct or indirect parent of the Company or such surviving entity) outstanding immediately after such merger, reorganization or consolidation; provided, however, that a merger, reorganization or consolidation effected solely to implement a recapitalization of the Company (or similar transaction) in which no Person (other than those covered by the exceptions in Section 2.8(a)) acquires more than 50% of the combined voting power of the Company’s then outstanding securities shall not constitute a Change in Control;
(c) during the period of two consecutive years, individuals who, at the beginning of such period, constitute the Board together with any new director(s) (other than a director designated by a Person who has entered into an agreement with the Company to effect a transaction described in Sections 2.8(a) or (b)) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or
(d) a complete liquidation or dissolution of the Company or the consummation of a sale or disposition by the Company of all or substantially all of the Company’s assets other than the sale or disposition of all or substantially all of the assets of the Company to a Person or Persons who beneficially own, directly or indirectly, 50% or more of the combined voting power of the outstanding voting securities of the Company at the time of the sale.
Notwithstanding the foregoing, with respect to any Award that is characterized as “nonqualified deferred compensation” within the meaning of Section 409A of the Code, an event shall not be considered to be a Change in Control under this Plan for purposes of payment of such Award unless such event is also a “change in ownership,” a “change in effective control,” or a “change in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code.
2.9 “Change in Control Price” means the highest price per Share paid in any transaction related to a Change in Control as determined by the Committee in its discretion.
2.10 “Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time. Any reference to any section of the Code shall also be a reference to any successor provision and any guidance and treasury regulation promulgated thereunder.
2.11 “Committee” means the Compensation Committee of the Board. The Board may re-vest in itself any previously delegated authority from time to time, and will retain the right to exercise the authority of the Committee to the extent consistent with Applicable Law.
2.12 “Common Stock” means the common stock, par value $0.00001 per share, of the Company.
2.13 “Company” means Hornbeck Offshore Services, Inc., a Delaware corporation, and its successors by operation of law.
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2.14 “Disability” means, unless otherwise determined by the Committee in the applicable Award Agreement, with respect to a Participant’s Termination of Service, that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment, after accounting for reasonable accommodations (if applicable and required by Applicable Law). The determination of whether an individual has a Disability shall be determined by the Committee, and the Committee may rely on any determination that a Participant is disabled for purposes of benefits under any long-term disability plan in which a Participant participates that is maintained by the Company or any Affiliate.
2.15 “Dividend Equivalent Rights” means a right granted to a Participant under this Plan to receive the equivalent value (in cash or Shares) of dividends paid on Shares.
2.16 “Effective Date” means the effective date of this Plan as defined in Article XIV.
2.17 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time. Reference to a specific section of the Exchange Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing, or superseding such section or regulation.
2.18 “Fair Market Value” means, for purposes of this Plan, unless otherwise required by any applicable provision of the Code or any regulations issued thereunder, as of any date and except as provided below, the last sales price reported for the Common Stock on the applicable date: (a) as reported on the principal national securities exchange in the United States on which it is then traded, listed or otherwise reported or quoted or (b) if the Common Stock is not traded, listed, or otherwise reported or quoted, the Committee shall determine in good faith the Fair Market Value in whatever manner it considers appropriate, taking into account the requirements of Section 409A of the Code. For purposes of the grant of any Award, the applicable date shall be the trading day immediately prior to the date on which the Award is granted. For purposes of the exercise of any Award, the applicable date shall be the date a notice of exercise is received by the Committee or, if not a date on which the applicable market is open, the next day that it is open.
2.19 “Family Member” means “family member” as defined in Section A.1.(a)(5) of the general instructions of Form S-8.
2.20 “Incentive Stock Option” means any Stock Option that is intended to be, and is designated as, an “Incentive Stock Option” within the meaning of Section 422 of the Code.
2.21 “Non-Qualified Stock Option” means any Stock Option granted under this Plan that is not an Incentive Stock Option.
2.22 “NYSE Listing Rules” means the applicable rules and standards contained in the NYSE Listed Company Manual.
2.23 “Other Stock-Based Award” means an Award granted under Article IX of this Plan that is valued in whole or in part by reference to, or is payable in or otherwise based on, Shares, but may be settled in the form of Shares or cash.
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2.24 “Participant” means a prospective employee of the Company or any of its Subsidiaries (a) who has not previously been an employee or a director of the Company or any of its Subsidiaries, or (b) who is commencing employment with the Company or any of its Subsidiaries following a bona fide period of non-employment by the Company or any of its Subsidiaries, and in each case is selected by the Committee to receive an Award as an inducement material to such individual’s entry into employment with the Company or any of its Subsidiaries, intended to qualify as an “employment inducement award” under Section 303A.08 or any successor provision of the NYSE Listing Rules.
2.25 “Performance Award” means an Award granted under Article VIII of this Plan.
2.26 “Performance Goals” means goals established by the Committee as contingencies for Awards to vest and/or become exercisable or distributable.
2.27 “Performance Period” means the designated period during which the Performance Goals must be satisfied with respect to the Award to which the Performance Goals relate.
2.28 “Person” means any “person” as such term is used in Sections 13(d) and 14(d) of the Exchange Act.
2.29 “Restricted Stock” means an Award of Shares granted under Article VII of this Plan.
2.30 “Restricted Stock Unit” means an unfunded, unsecured right to receive, on the applicable settlement date, one Share or an amount in cash or other consideration determined by the Committee to be of equal value as of such settlement date, subject to certain vesting conditions and other restrictions.
2.31 “Rule 16b-3” means Rule 16b-3 under Section 16(b) of the Exchange Act as then in effect or any successor provision.
2.32 “Section 409A of the Code” means the nonqualified deferred compensation rules under Section 409A of the Code and any applicable treasury regulations and other official guidance thereunder.
2.33 “Securities Act” means the Securities Act of 1933, as amended, and all rules and regulations promulgated thereunder. Reference to a specific section of the Securities Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing, or superseding such section or regulation.
2.34 “Shares” means shares of Common Stock.
2.35 “Stock Appreciation Right” means a stock appreciation right granted under Article VI of this Plan.
2.36 “Stock Option” or “Option” means any option to purchase Shares granted pursuant to Article VI of this Plan.
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2.37 “Subsidiary” means any subsidiary corporation of the Company within the meaning of Section 424(f) of the Code.
2.38 “Termination of Service” means the termination of the applicable Participant’s employment with, or performance of services for, the Company and its Affiliates. Unless otherwise determined by the Committee, (a) if a Participant’s employment or services with the Company and its Affiliates terminates but such Participant continues to provide services to the Company and its Affiliates in a non-employee capacity, such change in status shall not be deemed a Termination of Service with the Company and its Affiliates and (b) a Participant employed by, or performing services for an Affiliate that ceases to be an Affiliate shall also be deemed to have incurred a Termination of Service provided the Participant does not immediately thereafter become an employee of the Company or another Affiliate. Notwithstanding the foregoing provisions of this definition, with respect to any Award that constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code, a Participant shall not be considered to have experienced a “Termination of Service” unless the Participant has experienced a “separation from service” within the meaning of Section 409A of the Code.
ARTICLE III
ADMINISTRATION
3.1 Authority of the Committee. This Plan shall be administered by the Committee. Subject to the terms of this Plan and Applicable Law, the Committee shall have full authority to grant Awards to Participants under this Plan. In particular, the Committee shall have the authority to:
(a) determine whether and to what extent Awards, or any combination thereof, are to be granted hereunder to one or more Participants;
(b) determine the number of Shares to be covered by each Award granted hereunder;
(c) determine the terms and conditions, not inconsistent with the terms of this Plan, of any Award granted hereunder (including, but not limited to, the exercise or purchase price (if any), any restriction or limitation, any vesting schedule or acceleration thereof, or any forfeiture restrictions or waiver thereof, regarding any Award and the Shares, if any, relating thereto, based on such factors, if any, as the Committee shall determine, in its sole discretion);
(d) determine the amount of cash to be covered by each Award granted hereunder;
(e) determine whether, to what extent, and under what circumstances grants of Options and other Awards under this Plan are to operate on a tandem basis and/or in conjunction with or apart from other awards made by the Company outside of this Plan;
(f) determine whether and under what circumstances an Award may be settled in cash, Shares, other property, or a combination of the foregoing;
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(g) determine whether, to what extent and under what circumstances cash, Shares, or other property and other amounts payable with respect to an Award under this Plan shall be deferred either automatically or at the election of the Participant;
(h) modify, waive, amend, or adjust the terms and conditions of any Award, at any time or from time to time, including but not limited to Performance Goals;
(i) determine whether to require a Participant, as a condition of the granting of any Award, to not sell or otherwise dispose of Shares acquired pursuant to the exercise or vesting of an Award for a period of time as determined by the Committee, in its sole discretion, following the date of the acquisition of such Award or Shares;
(j) modify, extend, or renew an Award, subject to Article XI and Section 6.8(f) of this Plan;
(k) determine how the Disability, death, retirement, authorized leave of absence or any other change or purported change in a Participant’s status affects an Award and the extent to which, and the period during which, the Participant, the Participant’s legal representative, conservator, guardian or beneficiary may exercise rights under the Award, if applicable; and
(l) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan, including to comply with the “employment inducement award” exception under Rule 303A.08 or any successor provision of the NYSE Listing Rules.
3.2 Guidelines. Subject to Article XI of this Plan, the Committee shall have the authority to adopt, alter, and repeal such administrative rules, guidelines, and practices governing this Plan and perform all acts, including the delegation of its responsibilities (to the extent permitted by Applicable Law and applicable stock exchange rules), as it shall, from time to time, deem advisable; to construe and interpret the terms and provisions of this Plan and any Award issued under this Plan (and any agreements or sub-plans relating thereto); and to otherwise supervise the administration of this Plan. The Committee may correct any defect, supply any omission, or reconcile any inconsistency in this Plan or in any agreement relating thereto in the manner and to the extent it shall deem necessary to effectuate the purpose and intent of this Plan. The Committee may adopt special rules, sub-plans, guidelines, and provisions for persons who are residing in or employed in, or subject to, the taxes of any domestic or foreign jurisdictions to satisfy or accommodate applicable foreign laws or to qualify for preferred tax treatment of such domestic or foreign jurisdictions.
3.3 Decisions Final. Any decision, interpretation, or other action made or taken in good faith by or at the direction of the Company, the Board, or the Committee (or any of its members) arising out of or in connection with this Plan shall be within the absolute discretion of all and each of them, as the case may be, and shall be final, binding, and conclusive on the Company and all employees and Participants and their respective heirs, executors, administrators, successors, and assigns.
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3.4 Designation of Consultants/Liability; Delegation of Authority.
(a) The Committee may employ such legal counsel, consultants, and agents as it may deem desirable for the administration of this Plan and may rely upon any opinion received from any such counsel or consultant and any computation received from any such consultant or agent. Expenses incurred by the Committee or the Board in the engagement of any such counsel, consultant, or agent shall be paid by the Company. The Committee, its members, and any person designated pursuant to this Section 3.4 shall not be liable for any action or determination made in good faith with respect to this Plan. To the maximum extent permitted by Applicable Law, no officer of the Company or member or former member of the Committee or of the Board shall be liable for any action or determination made in good faith with respect to this Plan or any Award granted under it.
(b) The Committee may delegate any or all of its powers and duties under this Plan to a subcommittee of directors or to any officer of the Company, including the power to perform administrative functions (including executing agreements or other documents on behalf of the Committee) and grant Awards; provided, that such delegation does not (i) violate Applicable Law (including Rule 303A.08 or any successor provision of the NYSE Listing Rules), or (ii) result in the loss of an exemption under Rule 16b-3(d)(1) for Awards granted to Participants subject to Section 16 of the Exchange Act in respect of the Company. Upon any such delegation, all references in this Plan to the “Committee,” shall be deemed to include any subcommittee or officer of the Company to whom such powers have been delegated by the Committee. Any such delegation shall not limit the right of such subcommittee members or such an officer to receive Awards; provided, however, that such subcommittee members and any such officer may not grant Awards to himself or herself, a member of the Board, or any executive officer of the Company or an Affiliate, or take any action with respect to any Award previously granted to himself or herself, a member of the Board, or any executive officer of the Company or an Affiliate. The Committee may also designate employees or professional advisors who are not executive officers of the Company or members of the Board to assist in administering this Plan, provided, however, that such individuals may not be delegated the authority to grant or modify any Awards that will, or may, be settled in Shares.
3.5 Indemnification. To the maximum extent permitted by Applicable Law and to the extent not covered by insurance directly insuring such person, each current and former officer or employee of the Company or any of its Affiliates and member or former member of the Committee or the Board shall be indemnified and held harmless by the Company against any cost or expense (including reasonable fees of counsel acceptable to the Committee) or liability (including any sum paid in settlement of a claim with the approval of the Committee), and advanced amounts necessary to pay the foregoing at the earliest time and to the fullest extent permitted, arising out of any act or omission to act in connection with the administration of this Plan, except to the extent arising out of such officer’s, employee’s, member’s, or former member’s own fraud or bad faith. Such indemnification shall be in addition to any right of indemnification that the current or former employee, officer or member may have under Applicable Law or under the by-laws of the Company or any of its Affiliates. Notwithstanding anything else herein, this indemnification will not apply to the actions or determinations made by an individual with regard to Awards granted to such individual under this Plan.
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ARTICLE IV
SHARE LIMITATION
4.1 Shares. Subject to any increase or decrease pursuant to this Article IV, a total of 1,500,000 Shares shall be authorized for Awards granted under this Plan, which may be either authorized and unissued Shares or Shares held in or acquired for the treasury of the Company or both. No Shares may be issued or used with respect to Incentive Stock Options. Any Award under this Plan settled in cash shall not be counted against the foregoing maximum share limitations. Notwithstanding anything to the contrary contained herein, Shares subject to an Award under this Plan shall again be made available for issuance or delivery under this Plan if such Shares are (i) Shares delivered, withheld or surrendered in payment of the exercise or purchase price of an Award, (ii) Shares delivered, withheld, or surrendered to satisfy any tax withholding obligation or (iii) Shares subject to a stock-settled Award that expires or is canceled, forfeited, or terminated without issuance of the full number of Shares to which the Award related.
4.2 Adjustments.
(a) The existence of this Plan and the Awards granted hereunder shall not affect in any way the right or power of the Board or the stockholders of the Company to make or authorize (i) any adjustment, recapitalization, reorganization, or other change in the Company’s capital structure or its business, (ii) any merger or consolidation of the Company or any Affiliate, (iii) any issuance of bonds, debentures, or preferred or prior preference stock ahead of or affecting the Shares, (iv) the dissolution or liquidation of the Company or any Affiliate, (v) any sale or transfer of all or part of the assets or business of the Company or any Affiliate, or (vi) any other corporate act or proceeding.
(b) Subject to the provisions of Section 10.1:
(i) If the Company at any time subdivides (by any split, recapitalization or otherwise) the outstanding Shares into a greater number of Shares, or combines (by reverse split, combination, or otherwise) its outstanding Shares into a lesser number of Shares, then the respective exercise prices for outstanding Awards that provide for a Participant-elected exercise and the number of Shares covered by outstanding Awards shall be appropriately adjusted by the Committee to prevent dilution or enlargement of the rights granted to, or available for, Participants under this Plan; provided, that the Committee in its sole discretion shall determine whether an adjustment is appropriate.
(ii) Excepting transactions covered by Section 4.2(b)(i), if the Company effects any merger, consolidation, statutory exchange, spin-off, reorganization, sale or transfer of all or substantially all the Company’s assets or business, or other corporate transaction or event in such a manner that the Company’s outstanding Shares are converted into the right to receive (or the holders of Common Stock are entitled to receive in exchange therefor), either immediately or upon liquidation of the Company, securities or other property of the Company or other entity, then, subject to the provisions of Section 10.1, (A) the aggregate number or kind of securities that thereafter may be issued under this Plan, (B) the number or kind of securities or other property (including cash) to be issued pursuant to Awards granted under this Plan (including as a result of the assumption of this Plan and the obligations hereunder by a successor entity, as applicable), or (C) the exercise or purchase price thereof, shall be appropriately adjusted by the Committee to prevent dilution or enlargement of the rights granted to, or available for, Participants under this Plan.
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(iii) If there shall occur any change in the capital structure of the Company other than those covered by Section 4.2(b)(i) or 4.2(b)(ii), any conversion, any adjustment, or any issuance of any class of securities convertible or exercisable into, or exercisable for, any class of equity securities of the Company, then the Committee shall adjust any Award and make such other adjustments to this Plan to prevent dilution or enlargement of the rights granted to, or available for, Participants under this Plan.
(iv) In the event of any pending stock dividend, stock split, combination or exchange of shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other extraordinary transaction or change affecting the Shares or the Share price, including any securities offering or other similar transaction, for administrative convenience, the Committee may refuse to permit the exercise of any Award for up to 60 days before or after such transaction.
(v) The Committee may adjust the Performance Goals applicable to any Awards to reflect any unusual or non-recurring events and other extraordinary items, impact of charges for restructurings, discontinued operations, and the cumulative effects of accounting or tax changes, each as defined by generally accepted accounting principles or as identified in the Company’s financial statements, notes to the financial statements, management’s discussion and analysis, or other Company public filing.
(vi) Any such adjustment determined by the Committee pursuant to this Section 4.2(b) shall be final, binding, and conclusive on the Company and all Participants and their respective heirs, executors, administrators, successors, and permitted assigns. Any adjustment to, or assumption or substitution of, an Award under this Section 4.2(b) shall be intended to comply with the requirements of Section 409A of the Code and Treasury Regulation Section 1.424-1 (and any amendments thereto), to the extent applicable. Except as expressly provided in this Section 4.2 or in the applicable Award Agreement, a Participant shall have no additional rights under this Plan by reason of any transaction or event described in this Section 4.2.
ARTICLE V
ELIGIBILITY
5.1 General Eligibility. Eligibility for the grant of Awards and actual participation in this Plan shall be determined by the Committee in its sole discretion in accordance with, and subject to, the “employment inducement award” exemption set forth in Section 303A.08 of the NYSE Listing Rules.
5.2 Incentive Stock Options. Participants under the Plan are not eligible to receive Incentive Stock Options.
5.3 General Requirement. The grant of Awards under the Plan is conditioned upon the recipient of such Award actually becoming an employee of the Company or any of its Subsidiaries.
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5.4 Disclosure. The Company shall issue a press release promptly following each grant of Awards under this Plan, disclosing the material terms of such Awards in accordance with the requirements of Rule 303A.08 of the NYSE Listing Rules.
ARTICLE VI
STOCK OPTIONS; STOCK APPRECIATION RIGHTS
6.1 General. Stock Options or Stock Appreciation Rights may be granted alone or in addition to other Awards granted under this Plan. Each Stock Option granted under this Plan shall be a Non-Qualified Stock Option. Stock Options and Stock Appreciation Rights granted under this Plan shall be evidenced by an Award Agreement and subject to the terms, conditions and limitations in this Plan.
6.2 Grants. The Committee shall have the authority to grant to any Participant one or more Non-Qualified Stock Options and/or Stock Appreciation Rights.
6.3 Exercise Price. The exercise price per Share subject to a Stock Option or Stock Appreciation Right shall be determined by the Committee at the time of grant, provided that the per share exercise price of a Stock Option or Stock Appreciation Right shall not be less than 100% of the Fair Market Value at the time of grant.
6.4 Term. The term of each Stock Option or Stock Appreciation Right shall be fixed by the Committee, provided that no Stock Option or Stock Appreciation Right shall be exercisable more than 10 years after the date on which the Stock Option or Stock Appreciation Right, as applicable, is granted.
6.5 Exercisability. Unless otherwise provided by the Committee in accordance with the provisions of this Section 6.5, Stock Options and Stock Appreciation Rights granted under this Plan shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Committee at the time of grant. The Committee may, but shall not be required to, provide for an acceleration of vesting and exercisability upon the occurrence of a specified event. Unless otherwise determined by the Committee, if the exercise of a Non-Qualified Stock Option or Stock Appreciation Right within the permitted time periods is prohibited because such exercise would violate the registration requirements under the Securities Act or any other Applicable Law or the rules of any securities exchange or interdealer quotation system, the Company’s insider trading policy (including any blackout periods) or a “lock-up” agreement entered into in connection with the issuance of securities by the Company, then the expiration of such Non-Qualified Stock Option or Stock Appreciation Right shall be extended until the date that is 30 days after the end of the period during which the exercise of the Non-Qualified Stock Option or Stock Appreciation Right would be in violation of such registration requirement or other Applicable Law or rules, blackout period or lock-up agreement, as determined by the Committee; provided, however, that in no event shall any such extension result in any Non-Qualified Stock Option or Stock Appreciation Right remaining exercisable after the 10-year term of the applicable Non-Qualified Stock Option or Stock Appreciation Right.
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6.6 Method of Exercise. Subject to any applicable waiting period or exercisability provisions under Section 6.5, to the extent vested, Stock Options and Stock Appreciation Rights may be exercised in whole or in part at any time during the term of the applicable Stock Option or Stock Appreciation Right, by giving written notice of exercise (which may be electronic) to the Company specifying the number of Stock Options or Stock Appreciation Rights, as applicable, being exercised. Such notice shall be accompanied by payment in full of the exercise price (which shall equal the product of such number of Shares to be purchased multiplied by the applicable exercise price). The exercise price for the Stock Options may be paid upon such terms and conditions as shall be established by the Committee and set forth in the applicable Award Agreement. Without limiting the foregoing, the Committee may establish payment terms for the exercise of Stock Options pursuant to which the Company may withhold a number of Shares that otherwise would be issued to the Participant in connection with the exercise of the Stock Option having a Fair Market Value on the date of exercise equal to the exercise price, or that permit the Participant to deliver cash or Shares with a Fair Market Value equal to the exercise price on the date of payment, or through a simultaneous sale through a broker of Shares acquired on exercise, all as permitted by Applicable Law. No Shares shall be issued until payment therefor, as provided herein, has been made or provided for. Upon the exercise of a Stock Appreciation Right a Participant shall be entitled to receive, for each right exercised, up to, but no more than, an amount in cash and/or Shares (as chosen by the Committee in its sole discretion) equal in value to the excess of the Fair Market Value of one Share on the date that the right is exercised over the Fair Market Value of one Share on the date that the right was awarded to the Participant.
6.7 Non-Transferability. No Stock Option or Stock Appreciation Right shall be transferable by the Participant other than by will or by the laws of descent and distribution, and all Stock Options and Stock Appreciation Rights shall be exercisable, during the Participant’s lifetime, only by the Participant. Notwithstanding the foregoing, the Committee may determine, in its sole discretion, at the time of grant or thereafter that a Non-Qualified Stock Option that is otherwise not transferable pursuant to this Section 6.7 is transferable to a Family Member of the Participant in whole or in part and in such circumstances, and under such conditions, as specified by the Committee. A Non-Qualified Stock Option that is transferred to a Family Member pursuant to the preceding sentence (a) may not be subsequently transferred other than by will or by the laws of descent and distribution and (b) remains subject to the terms of this Plan and the applicable Award Agreement. Any Shares acquired upon the exercise of a Non-Qualified Stock Option by a permissible transferee of a Non-Qualified Stock Option or a permissible transferee pursuant to a transfer after the exercise of the Non-Qualified Stock Option shall be subject to the terms of this Plan and the applicable Award Agreement.
6.8 Termination. Unless otherwise determined by the Committee at grant or, if no rights of the Participant are reduced, thereafter, subject to the provisions of the applicable Award Agreement and this Plan, upon a Participant’s Termination of Service for any reason, Stock Options and Stock Appreciation Rights may remain exercisable following a Participant’s Termination of Service as follows:
(a) Termination by Death or Disability. Unless otherwise provided in the applicable Award Agreement, or otherwise determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service is by reason of death or Disability, all Stock Options and Stock Appreciation Rights that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination of Service may be exercised by the Participant (or in the case of the Participant’s death, by the legal
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representative of the Participant’s estate) at any time within a period of one year from the date of such Termination of Service, but in no event beyond the expiration of the stated term of such Stock Options and Stock Appreciation Rights; provided, however, that, in the event of a Participant’s Termination of Service by reason of Disability, if the Participant dies within such exercise period, all unexercised Stock Options and Stock Appreciation Rights held by such Participant shall thereafter be exercisable, to the extent to which they were exercisable at the time of death, for a period of one year from the date of such death, but in no event beyond the expiration of the stated term of such Stock Options and/or Stock Appreciation Rights.
(b) Involuntary Termination Without Cause. Unless otherwise provided in the applicable Award Agreement or otherwise determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service is by involuntary termination by the Company without Cause, all Stock Options and Stock Appreciation Rights that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination of Service may be exercised by the Participant at any time within a period of 90 days from the date of such Termination of Service, but in no event beyond the expiration of the stated term of such Stock Options or Stock Appreciation Rights.
(c) Voluntary Resignation. Unless otherwise provided in the applicable Award Agreement or otherwise determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service is voluntary (other than a voluntary termination described in Section 6.8(d) hereof), all Stock Options and Stock Appreciation Rights that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination of Service may be exercised by the Participant at any time within a period of 30 days from the date of such Termination of Service, but in no event beyond the expiration of the stated term of such Stock Options or Stock Appreciation Rights.
(d) Termination for Cause. Unless otherwise provided in the applicable Award Agreement or determined by the Committee at the time of grant, or if no rights of the Participant are reduced, thereafter, if a Participant’s Termination of Service (i) is for Cause or (ii) is a voluntary Termination of Service (as provided in Section 6.8(c)) after the occurrence of an event that would be grounds for a Termination of Service for Cause, all Stock Options and Stock Appreciation Rights, whether vested or not vested, that are held by such Participant shall thereupon immediately terminate and expire as of the date of such Termination of Service.
(e) Unvested Stock Options and Stock Appreciation Rights. Unless otherwise provided in the applicable Award Agreement or determined by the Committee at the time of grant or, if no rights of the Participant are reduced, thereafter, Stock Options and Stock Appreciation Rights that are not vested as of the date of a Participant’s Termination of Service for any reason shall terminate and expire as of the date of such Termination of Service.
(f) Modification, Extension and Renewal of Stock Options. The Committee may (i) modify, extend, or renew outstanding Stock Options granted under this Plan (provided that the rights of a Participant are not reduced without such Participant’s consent and provided, further that such action does not subject the Stock Options to Section 409A of the Code without the consent of the Participant), and (ii) accept the surrender of outstanding Stock Options (to the extent not theretofore exercised) and authorize the granting of new Stock Options in substitution therefor (to the extent not theretofore exercised).
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6.9 Automatic Exercise. The Committee may include a provision in an Award Agreement providing for the automatic exercise of a Non-Qualified Stock Option or Stock Appreciation Right on a cashless basis on the last day of the term of such Option or Stock Appreciation Right if the Participant has failed to exercise the Non-Qualified Stock Option or Stock Appreciation Right as of such date, with respect to which the Fair Market Value of the Shares underlying the Non-Qualified Stock Option or Stock Appreciation Right exceeds the exercise price of such Non-Qualified Stock Option or Stock Appreciation Right on the date of expiration of such Option or Stock Appreciation Right, subject to Section 13.5.
6.10 Dividends. No dividends or Dividend Equivalent Rights shall be granted with respect to Stock Options or Stock Appreciation Rights.
6.11 Other Terms and Conditions. As the Committee shall deem appropriate, Stock Options and Stock Appreciation Rights may be subject to additional terms and conditions or other provisions, which shall not be inconsistent with any of the terms of this Plan.
ARTICLE VII
RESTRICTED STOCK; RESTRICTED STOCK UNITS
7.1 Awards of Restricted Stock and Restricted Stock Units. Shares of Restricted Stock and Restricted Stock Units may be granted alone or in addition to other Awards granted under this Plan. The Committee shall determine to whom, and the time or times at which, grants of Restricted Stock and/or Restricted Stock Units shall be made, the number of shares of Restricted Stock or Restricted Stock Units to be awarded, the price (if any) to be paid by the Participant (subject to Section 7.2), the time or times within which such Awards may be subject to forfeiture, the vesting schedule and rights to acceleration thereof, and all other terms and conditions of the Awards. The Committee shall determine and set forth in the Award Agreement the terms and conditions for each Award of Restricted Stock and Restricted Stock Units, subject to the conditions and limitations contained in this Plan, including any vesting or forfeiture conditions.
The Committee may condition the grant or vesting of Restricted Stock and Restricted Stock Units upon the attainment of specified Performance Goals or such other factor as the Committee may determine in its sole discretion.
7.2 Awards and Certificates. Restricted Stock and Restricted Stock Units granted under this Plan shall be evidenced by an Award Agreement and subject to the following terms and conditions and shall be in such form and contain such additional terms and conditions not inconsistent with the terms of this Plan, as the Committee shall deem desirable:
(a) Restricted Stock.
(i) Purchase Price. The purchase price of Restricted Stock shall be fixed by the Committee. The purchase price for shares of Restricted Stock may be zero to the extent permitted by Applicable Law, and, to the extent not so permitted, such purchase price may not be less than par value.
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(ii) Legend. Each Participant receiving Restricted Stock shall be issued a stock certificate in respect of such shares of Restricted Stock, unless the Committee elects to use another system, such as book entries by the Company’s transfer agent, as evidencing ownership of shares of Restricted Stock. Such certificate shall be registered in the name of such Participant, and shall, in addition to such legends required by Applicable Law, bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Stock.
(iii) Custody. If stock certificates are issued in respect of shares of Restricted Stock, the Committee may require that any stock certificates evidencing such shares be held in custody by the Company until the restrictions thereon shall have lapsed, and that, as a condition of any grant of Restricted Stock, the Participant shall have delivered a duly signed stock power or other instruments of assignment (including a power of attorney), each endorsed in blank with a guarantee of signature if deemed necessary or appropriate by the Company, which would permit transfer to the Company of all or a portion of the shares subject to the Award of Restricted Stock in the event that such Award is forfeited in whole or part.
(iv) Rights as a Stockholder. Except as provided in Section 7.3(a) and this Section 7.2(a) or as otherwise determined by the Committee in an Award Agreement, the Participant shall have, with respect to the shares of Restricted Stock, all of the rights of a holder of Shares, including, without limitation, the right to receive dividends, the right to vote such shares, and, subject to and conditioned upon the full vesting of shares of Restricted Stock, the right to tender such shares; provided that the Award Agreement shall specify on what terms and conditions the applicable Participant shall be entitled to dividends payable on the Shares.
(v) Lapse of Restrictions. If and when the Restriction Period (as defined below) expires without a prior forfeiture of the Restricted Stock, the certificates for such Shares shall be delivered to the Participant. All legends shall be removed from said certificates at the time of delivery to the Participant, except as otherwise required by Applicable Law or other limitations imposed by the Committee.
(b) Restricted Stock Units.
(i) Settlement. The Committee may provide that settlement of Restricted Stock Units will occur upon or as soon as reasonably practical after the Restricted Stock Units vest or will instead be deferred, on a mandatory basis or at the Participant’s election, in a manner intended to comply with Section 409A of the Code.
(ii) Rights as a Stockholder. A Participant will have no rights of a stockholder with respect to Shares subject to any Restricted Stock Unit unless and until Shares are delivered in settlement of the Restricted Stock Units.
(iii) Dividend Equivalent Rights. If the Committee so provides, a grant of Restricted Stock Units may provide a Participant with the right to receive Dividend Equivalent Rights. Dividend Equivalent Rights may be paid currently or credited to an account for the Participant, settled in cash or Shares, and subject to the same restrictions on transferability and forfeitability as the Restricted Stock Units with respect to which the Dividend Equivalent Rights are granted and subject to other terms and conditions as set forth in the Award Agreement.
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7.3 Restrictions and Conditions.
(a) Restriction Period.
(i) The Participant shall not be permitted to transfer shares of Restricted Stock awarded under this Plan or vest in Restricted Stock Units during the period or periods set by the Committee (the “Restriction Period”) commencing on the date of such Award, as set forth in the applicable Award Agreement and such agreement shall set forth a vesting schedule and any event that would accelerate vesting of the Restricted Stock and/or Restricted Stock Units. Within these limits, based on service, attainment of Performance Goals pursuant to Section 7.3(a)(ii), and/or such other factors or criteria as the Committee may determine in its sole discretion, the Committee may condition the grant or provide for the lapse of such restrictions in installments in whole or in part, or may accelerate the vesting of all or any part of any Award of Restricted Stock or Restricted Stock Units and/or waive the deferral limitations for all or any part of any Award of Restricted Stock or Restricted Stock Units.
(ii) If the grant of shares of Restricted Stock or Restricted Stock Units or the lapse of restrictions or vesting schedule is based on the attainment of Performance Goals, the Committee shall establish the objective Performance Goals and the applicable vesting percentage applicable to each Participant or class of Participants in the applicable Award Agreement prior to the beginning of the applicable fiscal year or at such later date as otherwise determined by the Committee and while the outcome of the Performance Goals are substantially uncertain. Such Performance Goals may incorporate provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions), and other similar types of events or circumstances.
(b) Termination. Unless otherwise provided in the applicable Award Agreement or determined by the Committee at grant or, if no rights of the Participant are reduced, thereafter, upon a Participant’s Termination of Service for any reason during the relevant Restriction Period, all Restricted Stock or Restricted Stock Units still subject to restriction will be forfeited in accordance with the terms and conditions established by the Committee at grant or thereafter.
ARTICLE VIII
PERFORMANCE AWARDS
8.1 The Committee may grant a Performance Award to a Participant payable upon the attainment of specific Performance Goals either alone or in addition to other Awards granted under this Plan. The Performance Goals to be achieved during the Performance Period and the length of the Performance Period shall be determined by the Committee upon the grant of each Performance Award. The conditions for grant or vesting and the other provisions of Performance Awards (including, without limitation, any applicable Performance Goals) need not be the same with respect to each Participant. Performance Awards may be paid in cash, Shares, other property, or any combination thereof, in the sole discretion of the Committee as set forth in the applicable Award Agreement.
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ARTICLE IX
OTHER STOCK-BASED AND CASH AWARDS
9.1 Other Stock-Based Awards. The Committee is authorized to grant to Participants Other Stock-Based Awards that are payable in, valued in whole or in part by reference to, or otherwise based on or related to Shares, including but not limited to, Shares awarded purely as a bonus and not subject to restrictions or conditions, Shares in payment of the amounts due under an incentive or performance plan sponsored or maintained by the Company, stock equivalent units, and Awards valued by reference to the book value of Shares. Other Stock-Based Awards may be granted either alone or in addition to or in tandem with other Awards granted under this Plan.
Subject to the provisions of this Plan, the Committee shall have authority to determine to whom, and the time or times at which, such Other Stock-Based Awards shall be made, the number of Shares to be awarded pursuant to such Awards, and all other conditions of the Awards. The Committee may also provide for the grant of Shares under such Awards upon the completion of a specified Performance Period. The Committee may condition the grant or vesting of Other Stock-Based Awards upon the attainment of specified Performance Goals as the Committee may determine, in its sole discretion.
9.2 Terms and Conditions. Other Stock-Based Awards made pursuant to this Article IX shall be evidenced by an Award Agreement and subject to the following terms and conditions and shall be in such form and contain such additional terms and conditions not inconsistent with the terms of this Plan, as the Committee shall deem desirable:
(a) Non-Transferability. Subject to the applicable provisions of the Award Agreement and this Plan, Shares subject to Other Stock-Based Awards may not be transferred prior to the date on which the Shares are issued or, if later, the date on which any applicable restriction, performance, or deferral period lapses.
(b) Dividends. Unless otherwise determined by the Committee at the time of the grant of an Other Stock-Based Award, subject to the provisions of the Award Agreement and this Plan, the recipient of an Other Stock-Based Award shall not be entitled to receive, currently or on a deferred basis, dividends or Dividend Equivalent Rights in respect of the number of Shares covered by the Other Stock-Based Award.
(c) Vesting. Any Other Stock-Based Award and any Shares covered by any such Other Stock-Based Award shall vest or be forfeited to the extent so provided in the Award Agreement, as determined by the Committee, in its sole discretion.
(d) Price. Shares under this Article IX may be issued for no cash consideration. Shares purchased pursuant to a purchase right awarded pursuant to an Other Stock-Based Award shall be priced, as determined by the Committee in its sole discretion.
9.3 Cash Awards. The Committee may from time to time grant Cash Awards to Participants in such amounts, on such terms and conditions, and for such consideration, including no consideration or such minimum consideration as may be required by Applicable Law, as it shall determine in its sole discretion. Cash Awards may be granted subject to the satisfaction of vesting conditions or may be awarded purely as a bonus and not subject to restrictions or conditions, and if subject to vesting conditions, the Committee may accelerate the vesting of such Awards at any time in its sole discretion. The grant of a Cash Award shall not require a segregation of any of the Company’s assets for satisfaction of the Company’s payment obligation thereunder.
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ARTICLE X
CHANGE IN CONTROL PROVISIONS
10.1 Benefits. In the event of a Change in Control of the Company, and except as otherwise provided by the Committee in an Award Agreement or any applicable employment agreement, offer letter, consulting agreement, change in control agreement, or similar agreement in effect between the Company or an Affiliate and the Participant, a Participant’s unvested Awards shall not vest automatically and a Participant’s Awards shall be treated in accordance with one or more of the following methods as determined by the Committee:
(a) Awards, whether or not then vested, shall be continued, be assumed, or have new rights substituted therefor, as determined by the Committee in a manner consistent with the requirements of Section 409A of the Code, and restrictions to which shares of Restricted Stock or any other Award granted prior to the Change in Control are subject shall not lapse upon a Change in Control and the Restricted Stock or other Award shall, where appropriate in the sole discretion of the Committee, receive the same distribution as other Shares on such terms as determined by the Committee; provided that the Committee may decide to award additional Restricted Stock or other Awards in lieu of any cash distribution.
(b) The Committee, in its sole discretion, may provide for the purchase of any Awards by the Company for an amount of cash equal to the excess (if any) of the Change in Control Price of the Shares covered by such Awards, over the aggregate exercise price of such Awards; provided, however, that if the exercise price of an Option or Stock Appreciation Right exceeds the Change in Control Price, such Award may be cancelled for no consideration.
(c) The Committee may, in its sole discretion, terminate all outstanding and unexercised Stock Options, Stock Appreciation Rights, or any Other Stock-Based Award that provides for a Participant-elected exercise, effective as of the date of the Change in Control, by delivering notice of termination to each Participant at least 20 days prior to the date of consummation of the Change in Control, in which case during the period from the date on which such notice of termination is delivered to the consummation of the Change in Control, each such Participant shall have the right to exercise in full all of such Participant’s Awards that are then outstanding (without regard to any limitations on exercisability otherwise contained in the Award Agreements), but any such exercise shall be contingent on the occurrence of the Change in Control, and, provided that, if the Change in Control does not take place within a specified period after giving such notice for any reason whatsoever, the notice and exercise pursuant thereto shall be null and void.
(d) Notwithstanding any other provision herein to the contrary, the Committee may, in its sole discretion, provide for accelerated vesting or lapse of restrictions, of an Award at any time.
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ARTICLE XI
TERMINATION OR AMENDMENT OF PLAN
Notwithstanding any other provision of this Plan, the Board or the Committee may at any time, and from time to time, amend, in whole or in part, any or all of the provisions of this Plan (including any amendment deemed necessary to ensure that the Company may comply with any Applicable Law), or suspend or terminate it entirely, retroactively or otherwise; provided, however, that, unless otherwise required by Applicable Law or specifically provided herein, the rights of a Participant with respect to Awards granted prior to such amendment, suspension, or termination may not be materially impaired without the consent of such Participant and, provided, further, that without the approval of the holders of the Shares entitled to vote in accordance with Applicable Law, no amendment may be made that would (a) increase the aggregate number of Shares that may be issued under this Plan (except by operation of Section 4.1); or (b) change the classification of individuals eligible to receive Awards under this Plan. In addition, the Board or the Committee shall, without the approval of the holders of the Shares entitled to vote in accordance with Applicable Law, have the authority to (i) amend any outstanding Option or Stock Appreciation Right to reduce its exercise price per Share or (ii) cancel any Option or Stock Appreciation Right in exchange for cash or another Award. Notwithstanding anything herein to the contrary, the Board or the Committee may amend this Plan or any Award Agreement at any time without a Participant’s consent to comply with Applicable Law, including Section 409A of the Code. The Committee may amend the terms of any Award theretofore granted, prospectively or retroactively, but, subject to Article IV or as otherwise specifically provided herein, no such amendment or other action by the Committee shall materially impair the rights of any Participant without the Participant’s consent.
ARTICLE XII
UNFUNDED STATUS OF PLAN
This Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payment as to which a Participant has a fixed and vested interest but which is not yet made to a Participant by the Company, nothing contained herein shall give any such Participant any right that is greater than those of a general unsecured creditor of the Company.
ARTICLE XIII
GENERAL PROVISIONS
13.1 Lock-Up; Legend. The Committee may require each person receiving Shares pursuant to a Stock Option or other Award under this Plan to represent to and agree with the Company in writing that the Participant is acquiring the Shares without a view to distribution thereof. The Company may, in connection with registering the offering of any Company securities under the Securities Act, prohibit Participants from, directly or indirectly, selling or otherwise transferring any Shares or other Company securities during any period determined by the underwriter or the Company. In addition to any legend required by this Plan, the certificates for such Shares may include any legend that the Committee deems appropriate to reflect any restrictions on transfer. All certificates for Shares delivered under this Plan shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Common Stock is then listed or any national securities exchange system upon whose system the Common Stock is then quoted, and any Applicable Law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions. If the Shares are held in book-entry form, then the book-entry will indicate any restrictions on such Shares.
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13.2 Other Plans. Nothing contained in this Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to stockholder approval if such approval is required, and such arrangements may be either generally applicable or applicable only in specific cases.
13.3 No Right to Employment. Neither this Plan nor the grant of any Award hereunder shall give any Participant or other employee any right with respect to continuance of employment or service with the Company or any Affiliate, nor shall there be a limitation in any way on the right of the Company or any Affiliate by which an employee is employed to terminate such employment at any time.
13.4 Withholding of Taxes. A Participant shall be required to pay to the Company or one of its Affiliates, as applicable, or make arrangements satisfactory to the Company regarding the payment of, any income tax, social insurance contribution or other applicable taxes that are required to be withheld in respect of an Award. The Committee may (but is not obligated to), in its sole discretion, permit or require a Participant to satisfy all or any portion of the applicable taxes that are required to be withheld with respect to an Award by (a) the delivery of Shares (which are not subject to any pledge or other security interest) that have been both held by the Participant and vested for at least six months (or such other period as established from time to time by the Committee in order to avoid adverse accounting treatment under applicable accounting standards) having an aggregate Fair Market Value equal to such withholding liability (or portion thereof); (b) having the Company withhold from the Shares otherwise issuable or deliverable to, or that would otherwise be retained by, the Participant upon the grant, exercise, vesting, or settlement of the Award, as applicable, a number of Shares with an aggregate Fair Market Value equal to the amount of such withholding liability; or (c) by any other means specified in the applicable Award Agreement or otherwise determined by the Committee.
13.5 Fractional Shares. No fractional Shares shall be issued or delivered pursuant to this Plan. The Committee shall determine whether cash, additional Awards, or other securities or property shall be used or paid in lieu of fractional Shares or whether any fractional shares should be rounded, forfeited, or otherwise eliminated.
13.6 No Assignment of Benefits. No Award or other benefit payable under this Plan shall, except as otherwise specifically provided in this Plan or under Applicable Law or permitted by the Committee, be transferable in any manner, and any attempt to transfer any such benefit shall be void, and any such benefit shall not in any manner be liable for or subject to the debts, contracts, liabilities, engagements, or torts of any person who shall be entitled to such benefit, nor shall it be subject to attachment or legal process for or against such person.
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13.7 Clawbacks. All awards, amounts, or benefits received or outstanding under this Plan will be subject to clawback, cancellation, recoupment, rescission, payback, reduction, or other similar action in accordance with any Company clawback or similar policy or any Applicable Law related to such actions. A Participant’s acceptance of an Award will constitute the Participant’s acknowledgement of and consent to the Company’s application, implementation, and enforcement of any applicable Company clawback or similar policy that may apply to the Participant, whether adopted before or after the Effective Date, and any Applicable Law relating to clawback, cancellation, recoupment, rescission, payback, or reduction of compensation, and the Participant’s agreement that the Company may take any actions that may be necessary to effectuate any such policy or Applicable Law, without further consideration or action.
13.8 Listing and Other Conditions.
(a) Unless otherwise determined by the Committee, as long as the Common Stock is listed on a national securities exchange or system sponsored by a national securities association, the issuance of Shares pursuant to an Award shall be conditioned upon such Shares being listed on such exchange or system. The Company shall have no obligation to issue such Shares unless and until such Shares are so listed, and the right to exercise any Option or other Award with respect to such Shares shall be suspended until such listing has been effected.
(b) If at any time counsel to the Company advises the Company that any sale or delivery of Shares pursuant to an Award is or may in the circumstances be unlawful or result in the imposition of excise taxes on the Company under Applicable Law, the Company shall have no obligation to make such sale or delivery, or to make any application or to effect or to maintain any qualification or registration under the Securities Act or otherwise, with respect to Shares or Awards, and the right to exercise any Option or other Award shall be suspended until, based on the advice of said counsel, such sale or delivery shall be lawful or will not result in the imposition of excise taxes on the Company.
(c) Upon termination of any period of suspension under this Section 13.8, any Award affected by such suspension which shall not then have expired or terminated shall be reinstated as to all Shares available before such suspension and as to Shares which would otherwise have become available during the period of such suspension, but no such suspension shall extend the term of any Award.
(d) A Participant shall be required to supply the Company with certificates, representations, and information that the Company requests and otherwise cooperate with the Company in obtaining any listing, registration, qualification, exemption, consent, or approval that the Company deems necessary or appropriate.
13.9 Governing Law. This Plan and actions taken in connection herewith shall be governed and construed in accordance with the laws of the State of Delaware, without reference to principles of conflict of laws.
13.10 Construction. Wherever any words are used in this Plan in the masculine gender they shall be construed as though they were also used in the feminine gender in all cases where they would so apply, and wherever words are used herein in the singular form they shall be construed as though they were also used in the plural form in all cases where they would so apply.
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13.11 Other Benefits. No Award granted or paid out under this Plan shall be deemed compensation for purposes of computing benefits under any retirement plan of the Company or its Affiliates or affect any benefit or compensation under any other plan now or subsequently in effect under which the availability or amount of benefits is related to the level of compensation.
13.12 Costs. The Company shall bear all expenses associated with administering this Plan, including expenses of issuing Shares pursuant to Awards hereunder.
13.13 No Right to Same Benefits. The provisions of Awards need not be the same with respect to each Participant, and such Awards to individual Participants need not be the same in subsequent years.
13.14 Death/Disability. The Committee may in its discretion require the transferee of a Participant to supply it with written notice of the Participant’s death or Disability and to supply it with a copy of the will (in the case of the Participant’s death) or such other evidence as the Committee deems necessary to establish the validity of the transfer of an Award. The Committee may also require the agreement of the transferee to be bound by all of the terms and conditions of this Plan.
13.15 Section 16(b) of the Exchange Act. It is the intent of the Company that this Plan satisfy, and be interpreted in a manner that satisfies, the applicable requirements of Rule 16b-3 as promulgated under Section 16 of the Exchange Act so that Participants will be entitled to the benefit of Rule 16b-3, or any other rule promulgated under Section 16 of the Exchange Act, and will not be subject to short-swing liability under Section 16 of the Exchange Act. Accordingly, if the operation of any provision of this Plan would conflict with the intent expressed in this Section 13.15, such provision to the extent possible shall be interpreted and/or deemed amended so as to avoid such conflict.
13.16 Deferral of Awards. The Committee may establish one or more programs under this Plan to permit selected Participants the opportunity to elect to defer receipt of consideration upon exercise of an Award, satisfaction of performance criteria, or other event that absent the election would entitle the Participant to payment or receipt of Shares or other consideration under an Award. The Committee may establish the election procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts, Shares or other consideration so deferred, and such other terms, conditions, rules, and procedures that the Committee deems advisable for the administration of any such deferral program.
13.17 Section 409A of the Code. This Plan and Awards are intended to comply with or be exempt from the applicable requirements of Section 409A of the Code and shall be limited, construed, and interpreted in accordance with such intent. To the extent that any Award is subject to Section 409A of the Code, it shall be paid in a manner that will comply with Section 409A of the Code. Notwithstanding anything herein to the contrary, any provision in this Plan that is inconsistent with Section 409A of the Code shall be deemed to be amended to comply with or be exempt from Section 409A of the Code and, to the extent such provision cannot be amended to comply therewith or be exempt therefrom, such provision shall be null and void. The Company shall have no liability to a Participant, or any other party, if an Award that is intended to be exempt from, or compliant with, Section 409A of the Code is not so exempt or compliant or for any action taken by the Committee or the Company and, in the event that any amount or benefit under this Plan becomes subject to penalties under Section 409A of the Code, responsibility for payment of such penalties
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shall rest solely with the affected Participants and not with the Company. Notwithstanding any contrary provision in this Plan or Award Agreement, any payment(s) of “nonqualified deferred compensation” (within the meaning of Section 409A of the Code) that are otherwise required to be made under this Plan to a “specified employee” (as defined under Section 409A of the Code) as a result of such employee’s separation from service (other than a payment that is not subject to Section 409A of the Code) shall be delayed for the first six months following such separation from service (or, if earlier, until the date of death of the specified employee) and shall instead be paid (in a manner set forth in the Award Agreement) upon expiration of such delay period.
13.18 Data Privacy. As a condition of receipt of any Award, each Participant explicitly and unambiguously consents to the collection, use, and transfer, in electronic or other form, of personal data as described in this Section 13.18 by and among, as applicable, the Company and its Affiliates, for the exclusive purpose of implementing, administering, and managing this Plan and Awards and the Participant’s participation in this Plan. In furtherance of such implementation, administration, and management, the Company and its Affiliates may hold certain personal information about a Participant, including, but not limited to, the Participant’s name, home address, telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, job title(s), information regarding any securities of the Company or any of its Affiliates, and details of all Awards (the “Data”). In addition to transferring the Data amongst themselves as necessary for the purpose of implementation, administration, and management of this Plan and Awards and the Participant’s participation in this Plan, the Company and its Affiliates may each transfer the Data to any third parties assisting the Company in the implementation, administration, and management of this Plan and Awards and the Participant’s participation in this Plan. Recipients of the Data may be located in the Participant’s country or elsewhere, and the Participant’s country and any given recipient’s country may have different data privacy laws and protections. By accepting an Award, each Participant authorizes such recipients to receive, possess, use, retain, and transfer the Data, in electronic or other form, for the purposes of assisting the Company in the implementation, administration, and management of this Plan and Awards and the Participant’s participation in this Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Company or the Participant may elect to deposit any shares of Common Stock. The Data related to a Participant will be held only as long as is necessary to implement, administer, and manage this Plan and Awards and the Participant’s participation in this Plan. A Participant may, at any time, view the Data held by the Company with respect to such Participant, request additional information about the storage and processing of the Data with respect to such Participant, recommend any necessary corrections to the Data with respect to the Participant, or refuse or withdraw the consents herein in writing, in any case without cost, by contacting his or her local human resources representative. The Company may cancel the Participant’s eligibility to participate in this Plan, and in the Committee’s discretion, the Participant may forfeit any outstanding Awards if the Participant refuses or withdraws the consents described herein. For more information on the consequences of refusal to consent or withdrawal of consent, Participants may contact their local human resources representative.
13.19 Successor and Assigns. This Plan shall be binding on all successors and permitted assigns of a Participant, including, without limitation, the estate of such Participant and the executor, administrator, or trustee of such estate.
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13.20 Severability of Provisions. If any provision of this Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof, and this Plan shall be construed and enforced as if such provisions had not been included.
13.21 Headings and Captions. The headings and captions herein are provided for reference and convenience only, shall not be considered part of this Plan, and shall not be employed in the construction of this Plan.
ARTICLE XIV
EFFECTIVE DATE OF PLAN
This Plan shall become effective on September 2, 2026, which is the date of its adoption by the Board.
ARTICLE XV
TERM OF PLAN
No Award shall be granted pursuant to this Plan on or after the 10th anniversary of the date that this Plan is adopted by the Board, but Awards granted prior to such 10th anniversary may extend beyond that date.
* * * * *
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Exhibit 10.4
HORNBECK OFFSHORE SERVICES, INC.
2026 OMNIBUS INDUCEMENT INCENTIVE PLAN
PERFORMANCE-BASED RESTRICTED STOCK UNIT GRANT NOTICE
Pursuant to the terms and conditions of the Hornbeck Offshore Services, Inc. 2026 Omnibus Inducement Incentive Plan, as amended, amended and restated, supplemented or otherwise modified from time to time (the “Plan”), Hornbeck Offshore Services, Inc., a Delaware corporation (the “Company”), hereby grants to the individual listed below (“you” or the “Participant”) the number of performance-based Restricted Stock Units (the “PSUs”) set forth below. This award of PSUs (this “Award”) is subject to the terms and conditions set forth herein and in the Performance-Based Restricted Stock Unit Award Agreement attached hereto as Exhibit A (the “Agreement”) and the Plan, each of which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.
| Type of Award: | Restricted Stock Units, granted pursuant to Article VII of the Plan, which vest subject to both time-based and performance-based vesting conditions, as set forth below | |
| Participant: | Todd M. Hornbeck | |
| Date of Grant: | September 4, 2026 | |
| Total Number of PSUs: | 1,000,000 PSUs (with an opportunity to earn a maximum of 1,500,000 Shares) | |
| Vesting Schedule: | Subject to the terms set forth herein and in the Agreement and the Plan, the PSUs shall vest based on achievement of the performance-vesting conditions set forth on Annexes A and B, as applicable, attached to the Agreement, so long as you remain continuously employed by the Company or an Affiliate from the Date of Grant through December 31, 2029 | |
By your signature below, you agree to be bound by the terms and conditions of the Plan, the Agreement and this Performance-Based Restricted Stock Unit Grant Notice (this “Grant Notice”). You acknowledge that you have reviewed the Agreement, the Plan and this Grant Notice in their entirety and fully understand all provisions of the Agreement, the Plan and this Grant Notice and have had an opportunity to obtain the advice of counsel prior to executing this Grant Notice. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee regarding any questions or determinations arising under the Agreement, the Plan or this Grant Notice. This Grant Notice may be executed in one or more counterparts (including portable document format (.pdf) and facsimile counterparts), each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement.
Notwithstanding any provision of this Grant Notice or the Agreement, if you have not executed this Grant Notice within 90 days following the Date of Grant set forth above, you will be deemed to have accepted this Award, subject to all of the terms and conditions of this Grant Notice, the Agreement and the Plan.
[Signature Page Follows]
IN WITNESS WHEREOF, the Company has caused this Grant Notice to be executed by an officer thereunto duly authorized, and the Participant has executed this Grant Notice, effective for all purposes as provided above.
| HORNBECK OFFSHORE SERVICES, INC. | ||
| By: | /s/ Samuel A. Giberga | |
| Name: Samuel A. Giberga | ||
| Title: Executive Vice President, General Counsel and Secretary | ||
| PARTICIPANT |
| /s/ Todd M. Hornbeck |
| Name: Todd M. Hornbeck |
SIGNATURE PAGE TO
PERFORMANCE-BASED RESTRICTED STOCK UNIT GRANT NOTICE
EXHIBIT A
PERFORMANCE-BASED RESTRICTED STOCK UNIT AWARD AGREEMENT
This Performance-Based Restricted Stock Unit Award Agreement (together with the Performance-Based Restricted Stock Unit Grant Notice (the “Grant Notice”) to which this Performance-Based Restricted Stock Unit Award Agreement is attached, this “Agreement”) is made as of the Date of Grant set forth in the Grant Notice (the “Date of Grant”), by and between Hornbeck Offshore Services, Inc., a Delaware corporation (the “Company”), and Todd M. Hornbeck (the “Participant”). Capitalized terms used but not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice. This grant of PSUs constitutes an “Employment Inducement Award” under Section 303A.08 of the NYSE Listing Rules. Any Shares issued in connection with the PSUs shall be issued under the Plan and shall not be issued under the Hornbeck Offshore Services, Inc. 2005 Long-Term Incentive Plan (As Amended and Restated Effective May 15, 2024) or any other stockholder-approved equity compensation plan of the Company.
1. Award. In consideration of the Participant’s employment with the Company or a Subsidiary following the Transaction and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, effective as of the Date of Grant, the Company hereby grants to the Participant 1,000,000 PSUs on the terms and conditions set forth in the Grant Notice, this Agreement and the Plan, which is incorporated herein by reference as a part of this Agreement. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control. The PSUs are comprised of two tranches: (a) 500,000 PSUs that are subject to the performance-vesting conditions set forth in Section 2(b)(i) (the “Synergy PSUs”) and (ii) 500,000 PSUs that are subject to the performance-vesting conditions set forth in Section 2(b)(ii) (the “Stock Price PSUs”). The Participant has the opportunity to earn up to 100% of the Synergy PSUs and up to 200% of the Stock Price PSUs. In addition, the PSUs are subject to the time-vesting conditions set forth in Section 2(a), and, except as otherwise expressly provided herein, the PSUs will not be considered to be vested (and the Participant will have no right to receive any Shares or other payments in respect of the PSUs) unless both the time-vesting conditions and the applicable performance-vesting conditions are satisfied. PSUs that have performance-vested but have not time-vested are referred to herein as “Performance-Vested PSUs”. PSUs that have both performance-vested and time-vested are referred to herein as “Fully Vested PSUs”. To the extent vested, each PSU represents the right to receive one Share, subject to the terms and conditions set forth in the Grant Notice, this Agreement and the Plan. Prior to settlement of the PSUs, the PSUs and this Award represent an unsecured obligation of the Company, payable only from the general assets of the Company.
2. Vesting of PSUs.
(a) Time-Vesting Condition. Except as otherwise expressly provided in Section 3, 100% of the PSUs shall time vest only if the Participant remains actively employed with the Company and/or its Affiliate(s) through December 31, 2029.
(b) Performance-Vesting Conditions. Except as otherwise expressly provided in Section 3, the PSUs shall performance vest in accordance with this Section 2(b).
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(i) Synergy PSUs. The Synergy PSUs shall performance vest based on the performance criteria set forth on Annex A (the “Synergy Performance Criteria”).
(ii) Stock Price PSUs. The Stock Price PSUs shall performance vest based on the performance criteria set forth on Annex B (the “Stock Price Performance Criteria”).
(iii) Determinations by Committee. The Committee shall determine and certify whether the Synergy Performance Criteria and the Stock Price Performance Criteria have been satisfied, acting reasonably and in good faith. The Committee’s certification shall be final, conclusive and binding on the Participant and on all other persons, provided that such certification is made reasonably and in good faith, and is not the result of manifest error.
3. Early Termination; Change in Control.
(a) Good Leaver Termination On or Prior to December 31, 2027. In the event of the Participant’s termination of employment (i) due to a Qualifying Termination (as defined in the Employment Agreement) or (ii) due to the Participant’s death or Disability (as defined in the Employment Agreement) (each, a “Good Leaver Termination” and the date of any termination of employment for any reason, the “Termination Date”) on or prior to December 31, 2027, (i) any unvested Synergy PSUs and unvested Stock Price PSUs that are outstanding as of the Termination Date shall immediately vest in full at the target performance level and become Fully Vested PSUs and (ii) any Restricted Stock that is outstanding as of the Termination Date shall immediately vest in full.
(b) Good Leaver Termination Following December 31, 2027 but Prior to December 31, 2029. In the event of a Good Leaver Termination following December 31, 2027 but prior to December 31, 2029, (i) any unvested Synergy PSUs that are outstanding as of the Termination Date shall immediately vest in full based on actual performance as of the Termination Date, (ii) any unvested Stock Price PSUs that are outstanding as of the Termination Date shall immediately vest in full based on actual performance as of the most recent Stock Price Measurement Date that occurred prior to the Termination Date (or, if no Stock Price Measurement Date has occurred, based on actual performance as of the Termination Date), and (iii) any Restricted Stock that is outstanding as of the Termination Date shall immediately vest in full.
(c) Failure to be Elected as Chairman at Second Annual Meeting. If, as of the Company’s second annual meeting of stockholders following consummation of the Transaction (currently anticipated to occur in May or June 2028) (the “Second Annual Meeting”), the Participant is serving as Chief Executive Officer of the Company, is willing to serve as Chairman of the Board, and no grounds for a Cause termination exist, but the Participant is not elected as Chairman, (i) any unvested Synergy PSUs and unvested Stock Price PSUs that are outstanding as of the date of the Second Annual Meeting shall immediately vest in full at the target performance level and become Fully Vested PSUs and (ii) any Restricted Stock that is outstanding as of the date of the Second Annual Meeting shall immediately vest in full.
(d) Change in Control Prior to December 31, 2029. In the event of a Change in Control prior to December 31, 2029, (i) any unvested Synergy PSUs and unvested Stock Price PSUs that are outstanding as of the date of the Change in Control shall immediately vest in full based on the greater of (A) target performance level and (B) actual performance as of the date of the Change in Control, and (ii) any Restricted Stock that is outstanding as of the date of the Change in Control shall vest in full.
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(e) General. For clarity, for each of Sections 3(a)-(d), any PSUs that performance vest in accordance with such Section will become Fully Vested PSUs, and any PSUs that do not performance vest in accordance with such Section (and all rights arising from such PSUs and from being a holder thereof) will be automatically and immediately forfeited without any consideration as of the Termination Date (for Sections 3(a) and (b)), the date of the Second Annual Meeting (for Section 3(c)), or the date of the Change in Control (for Section 3(d)), as applicable.
(f) Forfeiture. Notwithstanding anything to the contrary in this Agreement, in the event of the termination of the Participant’s employment prior to December 31, 2029 (i) at a time when grounds for a Cause termination exist or (ii) by the Participant without Good Reason (as defined in the Employment Agreement), (A) all PSUs and Restricted Stock that are outstanding as of the Termination Date (and all rights arising from such PSUs and Restricted Stock and from being a holder thereof) will be automatically and immediately forfeited without any consideration as of the Termination Date and (B) the Participant will immediately, and no later than 30 days following the Termination Date, disgorge to the Company all unvested Restricted Stock previously issued to the Participant upon settlement of the PSUs (other than any Restricted Stock sold in a broker-assisted sale to satisfy tax withholding obligations pursuant to Section 7(a)(i)) (clauses (A) and (B), the “Forfeiture Consequences”).
4. Dividend Equivalent Rights and Dividends.
(a) Dividend Equivalent Rights on PSUs. In the event that the Company declares and pays a regular cash dividend in respect of its outstanding Shares (which, for clarity, does not include any extraordinary cash dividend) and, on the record date for such dividend, the Participant holds PSUs granted pursuant to this Agreement that have not been settled, the Company shall record in a bookkeeping account an amount equal to the cash dividends the Participant would have received if the Participant was the holder of record, as of such record date, of a number of Shares equal to the number of PSUs held by the Participant that have not been settled as of such record date (the “Dividend Equivalent Rights”), and such Dividend Equivalent Rights shall be subject to the same terms and conditions, including with respect to vesting, forfeitability and transferability, as the underlying PSUs. All amounts, if any, payable as a result of such Dividend Equivalent Rights shall be paid to the Participant in cash (or, at the discretion of the Company, in Shares) on or following, but no later than 60 days after, the date that the underlying PSU becomes a Fully Vested PSU or, if the PSU was settled into Restricted Stock, the date that the Restricted Stock for which the underlying PSU was settled vests. For purposes of clarity, if any of the PSUs (or the Restricted Stock for which the PSUs were settled) are forfeited by the Participant pursuant to the terms of this Agreement, then the Participant shall also forfeit the Dividend Equivalent Rights, if any, accrued with respect to such forfeited PSUs. No interest will accrue on the Dividend Equivalent Rights between the declaration and payment of the applicable dividends and the settlement of the Dividend Equivalent Rights.
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(b) Dividends on Restricted Stock. With respect to any Restricted Stock issued in settlement of Performance-Vested PSUs, the Participant shall be entitled to receive all dividends and other distributions that the Company declares and pays in respect of its outstanding Shares; provided that any dividends or other distributions payable with respect to the Restricted Stock shall be subject to the same terms and conditions, including with respect to vesting, forfeitability and transferability, as the underlying Restricted Stock and shall be payable to the Participant on or following, but no later than 60 days after, the date that the underlying Restricted Stock vests. The dividends or other distributions payable with respect to Restricted Stock that do not vest shall be forfeited. No interest will accrue on the dividends or other distributions payable with respect to Restricted Stock between the declaration and payment of the applicable dividends or other distributions and the payment of such amount to the Participant upon the vesting of the Restricted Stock.
5. Settlement of PSUs.
(a) Performance-Vested PSUs. As soon as administratively practicable following the date that a PSU becomes a Performance-Vested PSU, but in no event later than 60 days thereafter, the Company shall settle the Performance-Vested PSUs by issuing a number of Restricted Stock equal to the number of Performance-Vested PSUs that vested on such date. For clarity, Article VII of the Plan shall apply to the Restricted Stock, mutatis mutandis, even though the Restricted Stock is being issued in settlement of Performance-Vested PSUs and not as a separate Award. The Restricted Stock will not be subject to any performance-vesting conditions, but will be subject to the time-vesting conditions set forth in Section 2(a) and the termination, Change in Control, and other provisions set forth in Section 3, mutatis mutandis. Notwithstanding the foregoing, if the Performance-Vested PSUs become Fully Vested PSUs prior to being settled, then this Section 5(a) shall no longer apply, and the Fully Vested PSUs will be settled pursuant to Section 5(b).
(b) Fully Vested PSUs. As soon as reasonably practicable following the date that a PSU becomes a Fully Vested PSU, but in no event later than 60 days thereafter, the Company shall settle the Fully Vested PSUs by issuing a number of Shares equal to the number of outstanding Fully Vested PSUs.
(c) General. All Restricted Stock and Shares issued hereunder shall be delivered either by delivering one or more certificates for such Restricted Stock or Shares to the Participant or by entering such Restricted Stock or Shares in book-entry form, as determined by the Committee in its sole discretion. The value of Restricted Stock and Shares shall not bear any interest owing to the passage of time. Neither this Section 5(c) nor any action taken pursuant to or in accordance with this Agreement shall be construed to create a trust or a funded or secured obligation of any kind. No fraction of a Restricted Stock or Share shall be issued by the Company upon settlement of the PSUs. Instead, in the event that there is a fraction of a Performance-Vested PSU or Fully Vested PSU, the number of Performance-Vested PSUs or Fully Vested PSUs, respectively, shall be rounded up or down to the nearest whole number; provided that in no event shall the Company issue more than 500,000 Restricted Stock or Shares in settlement of the Synergy PSUs or 1,000,000 Restricted Stock or Shares in settlement of the Stock Price PSUs.
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6. Restrictive Covenants.
(a) Restrictive Covenants. The Participant acknowledges and agrees that the grant of the PSUs further aligns the Participant’s interests with the Company’s long-term business interests, and as a condition to the Company’s willingness to enter into this Agreement, the Participant agrees to abide by the terms of any and all restrictive covenant agreements and obligations to which the Participant is subject in respect of the Company and its Affiliates, including, but not limited to, any confidentiality, non-disclosure, non-competition, non-solicitation, non-disparagement, assignment of inventions or other restrictive covenants in any Service Arrangement (as defined below) or other agreement by and between the Company or any Affiliate and the Participant, including those set forth in the Employment Agreement (the “Restrictive Covenants”).
(b) Forfeiture. Notwithstanding any provision in this Agreement or the Plan to the contrary, in the event the Committee determines that the Participant has materially breached any of the Restrictive Covenants; provided that such material breach has a substantial detrimental impact on the Company or could reasonably be expected to have a substantial detrimental impact on the Company as determined by the Board in good faith; provided, further, that, solely for purposes of this Agreement (and without affecting the determination of whether a breach of the Restrictive Covenants has occurred for any other purpose or limiting any other remedies with respect thereto), a material breach of the Restrictive Covenants can only occur if (x) the Company provides the Participant with written notice of the circumstances constituting the alleged material breach of the Restrictive Covenants within 90 days after becoming aware of such circumstances and (y) the alleged breach, if curable (which includes any commercial relationship resulting from such prohibited conduct), has not been cured within 15 days after receipt of the written notice described in clause (x) (any such breach, a “Restrictive Covenant Violation”), then the Forfeiture Consequences will apply.
7. Tax Withholding.
(a) Performance-Vested PSUs.
(i) Broker-Assisted Sale. The tax withholding obligation in connection with the settlement of the Performance-Vested PSUs into Restricted Stock (the “Withholding Obligation”) shall be satisfied in accordance with this Section 7(a)(i). By accepting this Agreement, the Participant hereby elects, effective on the Date of Grant, to sell a whole number of Restricted Stock from the Restricted Stock then issuable to the Participant pursuant to the Performance-Vested PSUs in an amount and at such time as is determined in accordance with this Section 7(a)(i), and to allow the Agent (as defined below) to remit the cash proceeds of such sales to the Company as more specifically set forth below (a “Sell to Cover”) to permit the Participant to satisfy the Withholding Obligation and further acknowledges and agrees to the following provisions.
(1) The Participant hereby irrevocably appoints the Company’s designated broker Fidelity, or such other broker as the Company may select, as the Participant’s agent (the “Agent”), and authorizes and directs the Agent to:
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(A) Subject to Section 7(a)(i)(6), sell on the open market at the then prevailing market price(s), on the Participant’s behalf, as soon as practicable on or after the delivery of Restricted Stock in settlement of the Performance-Vested PSUs, the number (rounded up to the next whole number) of Restricted Stock (which, for clarity, shall vest upon such sale in accordance with Section 7(a)(ii)) sufficient to generate proceeds to cover (I) the satisfaction of the Withholding Obligation arising from the settlement of the Performance-Vested PSUs and (II) all applicable, reasonable and documented fees and commissions due to, or required to be collected by, the Agent with respect thereto, provided that at least 15 days prior to any vesting date and at a time when the Participant does not possess material nonpublic information concerning the Company the Participant may provide written notice to the Agent electing to directly pay such reasonable and documented fees and commissions due to the Agent in cash (following the receipt by Participant of an invoice therefor); provided, further, that such election must be made in accordance with the Company’s Insider Trading Policy in effect as of the time of such election;
(B) Remit directly to the Company the proceeds necessary to satisfy the Withholding Obligation;
(C) If applicable, retain the amount required to cover all applicable fees and commissions due to, or required to be collected by, the Agent relating directly to the sale; and
(D) Deposit any remaining funds in the Participant’s account.
(2) The Participant acknowledges that the Participant’s election to Sell to Cover and the corresponding authorization and instruction to the Agent set forth in this Section 7(a)(i) is intended to comply with the requirements of Rule 10b5-1(c)(1) under the Exchange Act, and to be interpreted to comply with the requirements of Rule 10b5-1(c) under the Exchange Act (Participant’s election to Sell to Cover and the provisions of this Section 7(a)(i), collectively, the “10b5-1 Plan”). The Participant acknowledges that by accepting this Award, the Participant is adopting the 10b5-1 Plan to permit the Participant to satisfy the Withholding Obligation. The Participant hereby authorizes the Company and the Agent to cooperate and communicate with one another to determine the number of Restricted Stock that must be sold pursuant to this Section 7(a)(i) to satisfy the Withholding Obligation.
(3) The Participant acknowledges that the Agent is under no obligation to arrange for the sale of Restricted Stock at any particular price under this 10b5-1 Plan and that the Agent may effect sales as provided in this 10b5-1 Plan in one or more sales and that the average price for executions resulting from bunched orders may be assigned to the Participant’s account. In addition, the Participant acknowledges that it may not be possible to sell Restricted Stock as provided for in this 10b5-1 Plan and in the event of the Agent’s inability to sell Restricted Stock, the Participant will continue to be responsible for the Withholding Obligation.
(4) The Participant hereby agrees to execute and deliver to the Agent any other agreements or documents as the Agent reasonably deems necessary or appropriate to carry out the purposes and intent of this 10b5-1 Plan. The Agent is a third-party beneficiary of this Section 7(a)(i) and the terms of this 10b5-1 Plan.
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(5) The Participant’s election to Sell to Cover and to enter into this 10b5-1 Plan is irrevocable. This 10b5-1 Plan shall terminate not later than the date on which both (A) the Withholding Obligation arising from the settlement of any Performance-Vested PSUs held by the Participant is satisfied and (B) there are no remaining outstanding unvested PSUs or Performance-Vested PSUs held by the Participant.
(6) Notwithstanding the terms of Section 7(a)(i)(1)(A), at least 15 days prior to any vesting date and at a time when the Participant does not possess material nonpublic information concerning the Company, the Participant may elect to have the Withholding Obligation calculated and satisfied at a rate up to the maximum combined federal, state and local individual marginal statutory income tax rate applicable to supplemental wage income in the Participant’s jurisdiction of residence and work (the “Maximum Rate”); provided that such election must be made in accordance with the Company’s Insider Trading Policy in effect as of the time of such election. If the Participant does not make a Maximum Rate election, the Withholding Obligation shall be calculated under Section 7(a)(i)(1)(A).
(ii) Treatment of Restricted Stock Upon Broker-Assisted Sale. Notwithstanding anything to the contrary in this Agreement, any Restricted Stock that is sold in a broker-assisted sale pursuant to Section 7(a)(i) shall immediately vest upon such sale.
(iii) Section 83(b) Election. Within 30 days following the issuance of any Restricted Stock to the Participant, the Participant may make an election with the Internal Revenue Service under Section 83(b) of the Code in the form attached hereto as Annex C in respect of the Restricted Stock. If the Participant does make such election, the Participant shall provide a copy of such filed election to the Company. The Participant acknowledges and understands that, if the Participant desires to make a Code Section 83(b) election, it is the Participant’s sole obligation and responsibility to timely file each such election, and neither the Company or any of its affiliates nor the Company’s legal or financial advisors shall have (A) any obligation or responsibility with respect to such filing or (B) any liability resulting or arising from the failure to timely file such election.
(b) Fully Vested PSUs. The Company is authorized to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy any federal, state, local, and foreign taxes of any kind that the Company, in its sole discretion, deems necessary to be withheld or remitted to comply with the Code and/or any other applicable law, rule, or regulation with respect to the PSUs and, if the Participant fails to do so, the Company may otherwise refuse to issue or transfer any Shares otherwise required to be issued pursuant to this Agreement. For clarity, the Company is authorized to withhold a net number of Shares issuable upon settlement of Fully Vested PSUs that is sufficient to satisfy the tax withholding obligation based on the closing Share price on the trading day immediately preceding the date that the withholding obligation arises.
(c) No Company Liability or Tax Advice. The Participant is ultimately liable and responsible for all taxes owed in connection with the PSUs, regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the PSUs. The Company makes no representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or settlement of the PSUs or the subsequent
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vesting of Restricted Stock or sale of Restricted Stock or Shares. The Company does not commit and is under no obligation to structure the PSUs to reduce or eliminate the Participant’s tax liability. The Participant acknowledges that there may be adverse tax consequences upon the receipt, vesting or settlement of this Award, vesting of the Restricted Stock, or disposition of the underlying Shares and that the Participant has been advised, and hereby is advised, to consult a tax advisor. The Participant represents that the Participant is in no manner relying on the Board, the Committee, the Company or an Affiliate or any of their respective managers, directors, officers, employees or authorized representatives (including attorneys, accountants, consultants, bankers, lenders, prospective lenders and financial representatives) for tax advice or an assessment of such tax consequences.
(d) No Fractions. Notwithstanding anything to the contrary in this Agreement, no fraction of a Restricted Stock or Share shall be issued by the Company upon settlement of the PSUs, sold in any broker-assisted sale, or accepted by the Company in payment of any withholding obligation; rather, the Participant shall provide a cash payment for any withholding amount as is necessary to effect the issuance and acceptance (or the sale in a broker-assisted sale) of only whole Restricted Stock or Shares.
8. Non-Transferability. During the lifetime of the Participant, the PSUs and Restricted Stock may not be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution, unless and until the Shares underlying the PSUs have been issued, and all restrictions applicable to such Shares and such Restricted Stock have lapsed. Neither the PSUs, the Restricted Stock, nor any interest or right therein shall be liable for the debts, contracts or engagements of the Participant or the Participant’s successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence. Notwithstanding anything to the contrary herein, any Shares (including any Restricted Stock) issued upon settlement of the PSUs shall be subject to the same transfer restrictions applicable to the Participant’s other equity holdings in the Company following the Transaction, including without limitation any lock-up period ending on the date that is 180 days following the consummation of the Transaction (or such earlier date as may be determined by the Board in connection with secondary sales).
9. Compliance with Applicable Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of Restricted Stock or Shares hereunder will be subject to compliance with all applicable requirements of Applicable Law with respect to such securities. No Restricted Stock or Shares will be issued hereunder if such issuance would constitute a violation of any Applicable Law. In addition, Restricted Stock or Shares will not be issued hereunder unless (a) a registration statement under the Securities Act is in effect at the time of such issuance with respect to the Restricted Stock or Shares to be issued or (b) in the opinion of legal counsel to the Company, the Restricted Stock or Shares to be issued are permitted to be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary for the lawful issuance and sale of any Restricted Stock or Shares hereunder will relieve the Company of
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any liability in respect of the failure to issue such Restricted Stock or Shares as to which such requisite authority has not been obtained. As a condition to any issuance of Restricted Stock or Shares hereunder, the Company may require the Participant to satisfy any requirements that may be necessary or appropriate to evidence compliance with any Applicable Law and to make any representation or warranty with respect to such compliance as may be requested by the Company.
10. Rights as a Stockholder. The Participant shall have no rights or privileges of a stockholder of the Company with respect to any Restricted Stock or Shares that may become deliverable hereunder unless and until the Participant has become the holder of record of such Restricted Stock or Shares and such Restricted Stock or Shares have been delivered to the Participant (including through electronic delivery to a brokerage account). No adjustments shall be made for dividends in cash or other property, distributions or other rights for which the record date is prior to the date of such issuance, recordation and delivery, except as otherwise specifically provided for in the Plan or this Agreement. Except as otherwise provided in the Plan or this Agreement (including Section 4(b)), after such issuance, recordation and delivery, the Participant will have all the rights of a stockholder of the Company with respect to such Restricted Stock or Shares.
11. Execution of Receipts and Releases. Any issuance or transfer of Restricted Stock, Shares or other property to the Participant or the Participant’s legal representative, heir, legatee or distributee, in accordance with this Agreement shall be in full satisfaction of all claims of such Person hereunder. As a condition precedent to such payment or issuance, the Company may require the Participant or the Participant’s legal representative, heir, legatee or distributee to execute (and not revoke within any time provided to do so) a release and receipt therefor in such form as it shall determine appropriate; provided that any review period under such release will not modify the date of settlement with respect to vested PSUs.
12. No Right to Continued Employment, Service or Awards. Nothing in the adoption of the Plan, nor the award of the PSUs thereunder pursuant to the Grant Notice and this Agreement, shall confer upon the Participant the right to continued employment by, or a continued service relationship with, the Company or any Affiliate, or any other entity, or affect in any way the right of the Company or any such Affiliate, or any other entity to terminate such employment or other service relationship at any time. Unless otherwise provided in a Service Arrangement or by applicable law, the Participant’s employment by the Company, or any such Affiliate, or any other entity shall be on an at-will basis, and the employment relationship may be terminated at any time by either the Participant or the Company, or any such Affiliate, or other entity for any reason whatsoever, with or without cause or notice. Any question as to whether and when there has been a termination of such employment, and the cause of such termination, shall be determined by the Committee or its delegate, and such determination shall be final, conclusive and binding for all purposes. The grant of the PSUs is a one-time benefit that was made at the sole discretion of the Company and does not create any contractual or other right to receive a grant of Awards or benefits in the future in lieu of Awards in the future, including any adjustment to wages, overtime, benefits or other compensation. Any future Awards will be granted at the sole discretion of the Company.
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13. Notices. All notices and other communications under this Agreement shall be in writing and shall be delivered to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):
If to the Company, unless otherwise designated by the Company in a written notice to the Participant (or other holder):
Hornbeck Offshore Services, Inc.
103 Northpark Blvd., Suite 300
Covington, LA 70433
Attention: [___________]
E-Mail: [___________]
If to the Participant, at the Participant’s last known address on file with the Company.
Notice shall be deemed to have been duly delivered (a) when delivered in person, (b) when sent by email (provided that the sender has not received any “bounce-back,” “out of office,” or similar message indicating that the email was not sent or received by the recipient) on a business day; provided that if a notice is sent by email after normal business hours of the recipient or on a non-business day, then it shall be deemed to have been received on the next business day after it is sent, (c) on the first business day after such notice is sent by express overnight courier service or (d) on the second business day following deposit with an internationally-recognized second-day courier service with proof of receipt maintained.
14. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, the Participant agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports and all other forms of communications) in connection with this and any other Award made or offered by the Company. Electronic delivery may be via a Company electronic mail system, by reference to a location on a Company intranet to which the Participant has access, or to the Participant’s account with the Company’s equity plan administrator. The Participant hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that the Participant’s electronic signature is the same as, and shall have the same force and effect as, the Participant’s manual signature.
15. Agreement to Furnish Information. The Participant agrees to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirement imposed upon the Company by or under any Applicable Law.
16. Entire Agreement; Amendment. This Agreement (which, for clarity, includes the Grant Notice and the Plan) constitutes the entire agreement of the parties with regard to the subject matter hereof, and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the PSUs granted hereby; provided that (a) the terms of this Agreement shall not modify and shall be subject to the terms and conditions of any employment agreement, offer letter, consulting agreement, change-in-control agreement, severance agreement or similar agreement between the Company or an Affiliate and the Participant or any severance plan, change-in-control plan or similar plan of the Company or an Affiliate in which the Participant participates (any such arrangement, a “Service Arrangement”), including
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the Employment Agreement, in each case, in effect as of the date a determination is to be made under this Agreement; and (b) the consequences for a material breach of the Restrictive Covenants set forth herein are in addition to and complement (and do not replace or supersede) any other consequences set forth in the Employment Agreement or otherwise for a breach of the Restrictive Covenants. Without limiting the scope of the preceding sentence, except as provided therein, the non-binding term sheet included in the Merger Agreement and all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. The Committee may, in its sole discretion, amend this Agreement from time to time in any manner that is not inconsistent with the Plan; provided that except as otherwise provided in the Plan or this Agreement, any such amendment that materially impairs the rights of the Participant shall be effective only if it is in writing and signed by both the Participant and an authorized officer of the Company.
17. Severability and Waiver. If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of such provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect. Waiver by any party of any breach of this Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such right continues.
18. Company Recoupment of Awards. The Participant’s rights with respect to this Award shall in all events be subject to (a) any right that the Company may have under any Company recoupment or clawback policy or other agreement or arrangement with the Participant, and (b) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission or any other Applicable Law. The Participant’s acceptance of this Award will constitute the Participant’s acknowledgment of and consent to the Company’s application, implementation and enforcement of any Company recoupment, clawback or similar policy that may apply to the Participant and this Award, whether adopted before or after the Effective Date or Date of Grant (whether through clawback, cancellation, recoupment, rescission, payback, reduction or other similar action in accordance therewith) and any Applicable Law relating to clawback, cancellation, recoupment, rescission, payback or reduction of compensation or other similar action, and the Participant’s agreement that the Company may take any actions that may be necessary to effectuate any such policy or Applicable Law, without further consideration or action.
19. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED THEREIN, EXCLUSIVE OF THE CONFLICT OF LAWS PROVISIONS OF DELAWARE LAW.
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20. Venue. The Company, the Participant and any of the Participant’s permitted transferees, agree that any suit, action or proceeding arising out of or related to this Agreement shall be brought in the United States District Court for the District of Delaware (or should such court lack jurisdiction to hear such action, suit or proceeding, in the courts of the State of Delaware) and that all parties shall submit to the jurisdiction of such court. The parties irrevocably waive, to the fullest extent permitted by applicable law, any objection the party may have to the laying of venue for any such suit, action or proceeding brought in such court. Without limiting the generality of Section 17, if any one or more provisions of this Section 20 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable.
21. Conformity to Securities Laws. The Participant acknowledges that this Agreement is intended to conform to the extent necessary with all Applicable Laws, including, without limitation, the provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission and state securities laws and regulations. Notwithstanding anything herein to the contrary, this Award shall be administered, granted and settled only in such a manner as to conform to Applicable Law. To the extent permitted by Applicable Law and the Plan, this Agreement shall be deemed amended to the extent necessary to conform to Applicable Law.
22. Successors and Assigns. The Company may assign any of its rights under this Agreement without the Participant’s consent. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein and in the Plan, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the Person(s) to whom the PSUs or Restricted Stock may be transferred by will or the laws of descent or distribution.
23. Headings; References; Interpretation. Headings are for convenience only and are not deemed to be part of this Agreement. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All references herein to Sections shall, unless the context requires a different construction, be deemed to be references to the Sections of this Agreement. The word “or” as used herein is not exclusive and is deemed to have the meaning “and/or.” All references to “including” shall be construed as meaning “including without limitation.” Unless the context requires otherwise, all references herein to a law, agreement, instrument or other document shall be deemed to refer to such law, agreement, instrument or other document as amended, supplemented, modified and restated from time to time to the extent permitted by the provisions thereof. All references to “dollars” or “$” in this Agreement refer to United States dollars. Whenever the context may require, the singular form of nouns and pronouns shall include the plural and vice versa. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against any party hereto, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by each of the parties hereto and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the parties hereto.
24. Counterparts. The Grant Notice may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Delivery of an executed counterpart of the Grant Notice by facsimile or portable document format (.pdf) attachment to electronic mail or via electronic acceptance in accordance with Section 14 shall be effective as delivery of a manually executed counterpart of the Grant Notice.
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25. Section 409A. The Plan, this Agreement and Awards are intended to comply with or be exempt from the applicable requirements of Section 409A of the Code and shall be limited, construed and interpreted in accordance with such intent. To the extent that any Award is subject to Section 409A of the Code, it shall be paid in a manner that will comply with Section 409A of the Code, including proposed, temporary or final regulations or any other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto. Notwithstanding anything herein to the contrary, any provision in the Plan or this Agreement that is inconsistent with Section 409A of the Code shall be deemed to be amended to comply with or be exempt from Section 409A of the Code and, to the extent such provision cannot be amended to comply therewith or be exempt therefrom, such provision shall be null and void. Notwithstanding any contrary provision in the Plan or this Agreement, any payment(s) of “nonqualified deferred compensation” (within the meaning of Section 409A of the Code) that are otherwise required to be made under the Plan or this Agreement to a “specified employee” (as defined under Section 409A of the Code) as a result of such employee’s separation from service (other than a payment that is not subject to Section 409A of the Code) shall be delayed for the first six (6) months following such separation from service (or, if earlier, until the date of death of the specified employee) and shall instead be paid (in a manner set forth in this Agreement) upon expiration of such delay period. If the Award includes a “series of installment payments” (within the meaning of Section 1.409A-2(b)(2)(iii) of the Treasury Regulations), the Participant’s right to the series of installment payments shall be treated as a right to a series of separate payments and not as a right to a single payment, and if the Award includes “dividend equivalents” (within the meaning of Section 1.409A-3(e) of the Treasury Regulations), the Participant’s payments pursuant to the Dividend Equivalent Rights shall be treated separately from the right to other amounts under the Award. Notwithstanding the foregoing, the Company and its Affiliates make no representations that the PSUs provided under this Agreement are exempt from or compliant with Section 409A of the Code and in no event shall the Company or any Affiliate be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A of the Code.
26. Definitions.
(a) “Cause” has the meaning ascribed to such term in the Employment Agreement.
(b) “Employment Agreement” means that certain Second Amended and Restated Employment Agreement, dated as of September 1, 2026, by and among Hornbeck Offshore Operators, LLC, the Company and the Participant, as amended, amended and restated, supplemented or otherwise modified from time to time.
(c) “Merger Agreement” means that certain Agreement and Plan of Merger, dated as of April 22, 2026, by and among the Company, Hornbeck Offshore Services, Inc., and the other parties thereto.
(d) “Transaction” means the transactions contemplated by the Merger Agreement.
[Remainder of Page Intentionally Blank]
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Annex A
Synergy Performance Criteria
ANNEX A
Annex B
Stock Price Performance Criteria
ANNEX B
Annex C
Election to Include Property in Gross Income Pursuant to
Section 83(b) of the Internal Revenue Code
The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the property described below over the amount paid for that property.
| 1. | The name, social security number, address of the undersigned, and the taxable year for which this election is being made are: |
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| Taxable Year: |
Calendar Year 202[●] | |||
| 2. | The property that is the subject of this election is [●] restricted shares of common stock (the “Shares”) of Hornbeck Offshore Services, Inc., a Delaware corporation (the “Company”). |
| 3. | The property was transferred to the undersigned on [●], 202[●]. |
| 4. | The property is subject to the following restrictions: the Shares are subject to vesting conditions, transfer restrictions and forfeiture conditions as set forth in the Performance-Based Restricted Stock Unit Award Agreement, dated as of September 4, 2026, by and between the Company and the undersigned. |
| 5. | The fair market value of the property at the time of transfer (determined without regard to any restriction other than a nonlapse restriction as defined in Treasury Regulations § 1.83-3(h)) is: $[●] per Share. |
| 6. | For the property transferred, the undersigned paid: $0.00 per Share. |
| 7. | The amount to include in gross income is $[●]. |
The undersigned taxpayer will file this election with the Internal Revenue Service office with which taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property. A copy of the election also will be furnished to the person for whom the services were performed. The undersigned is the person performing the services in connection with which the property was transferred.
A copy of this election is being furnished to the Company pursuant to Treasury Regulations § 1.83-2(d). This election is dated as of [●], 202[●].
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| Todd M. Hornbeck |
ANNEX C
Exhibit 10.5
Executive Officer Form
HORNBECK OFFSHORE SERVICES, INC.
2005 LONG TERM INCENTIVE PLAN
(AS AMENDED AND RESTATED EFFECTIVE SEPTEMBER 1, 2026)
RESTRICTED STOCK UNIT GRANT NOTICE
Pursuant to the terms and conditions of the Hornbeck Offshore Services, Inc. 2005 Long Term Incentive Plan (as amended and restated effective September 1, 2026) (f/k/a Helix Energy Solutions Group, Inc. 2005 Long Term Incentive Plan) (as may be further amended, amended and restated, supplemented or otherwise modified from time to time, the “Plan”), Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (the “Company”), hereby grants to the individual listed below (“you” or the “Participant”) the number of Restricted Stock Units (the “RSUs”) set forth below. This award of RSUs (this “Award”) is subject to the terms and conditions set forth herein and in the Restricted Stock Unit Award Agreement attached hereto as Exhibit A (the “Agreement”) and the Plan, each of which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.
| Type of Award: | Restricted Stock Units | |
| Participant: | [__________] | |
| Date of Grant: | [__________] | |
| Total Number of Restricted Stock Units: | [__________] | |
| Vesting Schedule: | [__________] | |
By your signature below, you agree to be bound by the terms and conditions of the Plan, the Agreement and this Restricted Stock Unit Grant Notice (this “Grant Notice”). You acknowledge that you have reviewed the Agreement, the Plan and this Grant Notice in their entirety and fully understand all provisions of the Agreement, the Plan and this Grant Notice and have had an opportunity to obtain the advice of counsel prior to executing this Grant Notice. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee regarding any questions or determinations arising under the Agreement, the Plan or this Grant Notice. This Grant Notice may be executed in one or more counterparts (including portable document format (.pdf) and facsimile counterparts), each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement.
Notwithstanding any provision of this Grant Notice or the Agreement, if you have not executed this Grant Notice within 90 days following the Date of Grant set forth above, you will be deemed to have accepted this Award, subject to all of the terms and conditions of this Grant Notice, the Agreement and the Plan.
[Signature Page Follows]
IN WITNESS WHEREOF, the Company has caused this Grant Notice to be executed by an officer thereunto duly authorized, and the Participant has executed this Grant Notice, effective for all purposes as provided above.
| HORNBECK OFFSHORE SERVICES, INC. | ||||
| By: |
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| Name: | [__________] | |||
| Title: | [__________] | |||
| PARTICIPANT | ||||
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| Name: [__________] | ||||
SIGNATURE PAGE TO
RESTRICTED STOCK UNIT GRANT NOTICE
EXHIBIT A
RESTRICTED STOCK UNIT AWARD AGREEMENT
This Restricted Stock Unit Award Agreement (together with the Restricted Stock Unit Grant Notice (the “Grant Notice”) to which this Restricted Stock Unit Award Agreement is attached, this “Agreement”) is made as of the Date of Grant set forth in the Grant Notice (the “Date of Grant”), by and between Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (the “Company”), and [__________] (the “Participant”). Capitalized terms used but not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice.
1. Award. In consideration of the Participant’s past and/or continued employment with, or service to, the Company or an Affiliate and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, effective as of the Date of Grant, the Company hereby grants to the Participant the number of RSUs set forth in the Grant Notice on the terms and conditions set forth in the Grant Notice, this Agreement and the Plan, which is incorporated herein by reference as a part of this Agreement. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control. To the extent vested, each RSU represents the right to receive one share of Stock (a “Share”), subject to the terms and conditions set forth in the Grant Notice, this Agreement and the Plan. Unless and until the RSUs have become vested in the manner set forth in the Grant Notice and Section 2, the Participant will have no right to receive any Shares or other payments in respect of the RSUs. Prior to settlement of this Award, the RSUs and this Award represent an unsecured obligation of the Company, payable only from the general assets of the Company.
2. Vesting of RSUs.
(a) General. Except as otherwise set forth in Sections 2 and 5, the RSUs shall vest in accordance with the vesting schedule set forth in the Grant Notice. Upon the Participant’s Termination of Service prior to the vesting of all of the RSUs (but after giving effect to any accelerated vesting pursuant to this Section 2), any unvested RSUs (and all rights arising from such RSUs and from being a holder thereof, including any Dividend Equivalent Rights) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
(b) 1[Termination of Service. Notwithstanding anything in the Grant Notice, this Agreement or the Plan to the contrary, subject to Section 10 (as applicable):
(i) upon the Participant’s Termination of Service due to the Participant’s death, Disability or a Qualifying Termination (including, for clarity, a Change of Control Qualifying Termination), all RSUs, if any, that remain unvested shall immediately become vested as of the date of such Termination of Service;
| 1 | Note to Draft: To include for Todd M. Hornbeck. |
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(ii) upon the Participant’s Termination of Service for Cause, all outstanding RSUs, whether or not vested (and all rights arising from such RSUs and from being a holder thereof, including any Dividend Equivalent Rights) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company; or
(iii) upon the Participant’s Termination of Service due to the Participant’s Retirement that occurs on or after the one-year anniversary of the Date of Grant, all RSUs shall remain outstanding and eligible to vest in accordance with this Agreement without regard to any requirement of continued employment through the vesting date (but still subject to all the other terms and conditions herein, including Section 5). Except as otherwise determined by the Committee, the Participant shall certify in writing prior to each applicable vesting date that no Restrictive Covenant Violation has occurred.]
(b) 2[Termination of Service. Notwithstanding anything in the Grant Notice, this Agreement or the Plan to the contrary, subject to Section 10 (as applicable):
(i) upon the Participant’s Termination of Service due to the Participant’s death or Disability, all RSUs, if any, that remain unvested shall immediately become vested as of the date of such Termination of Service;
(ii) upon the Participant’s Termination of Service due to a Qualifying Termination (except as set forth in Section 2(b)(iii) following a Change in Control), a Pro-Rated Amount of any RSUs that remain unvested shall immediately become vested as of the date of such Qualifying Termination, and any RSUs that remain unvested after the Pro-Rated Amount of RSUs vests (the “Contingent RSUs”) will remain outstanding and eligible to vest during the six-month period immediately following such Qualifying Termination (the “Vesting Tail Period”), solely in the event a Change in Control occurs during the Vesting Tail Period such that such Qualifying Termination becomes a Change of Control Qualifying Termination, and if a Change in Control does not occur within the Vesting Tail Period, the Contingent RSUs will be forfeited immediately upon the expiration of the Vesting Tail Period without further notice and at no cost to the Company;
(iii) upon the Participant’s Termination of Service due to a Change of Control Qualifying Termination that occurs on or following a Change in Control, all RSUs, if any, that remain unvested shall immediately become vested as of the date of such Change of Control Qualifying Termination;
(iv) upon the Participant’s Termination of Service for Cause, all outstanding RSUs, whether or not vested (and all rights arising from such RSUs and from being a holder thereof, including any Dividend Equivalent Rights) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company; or
| 2 | Note to Draft: To include for all executive officers other than Todd M. Hornbeck. |
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(v) upon the Participant’s Termination of Service due to the Participant’s Retirement that occurs on or after the one-year anniversary of the Date of Grant, all RSUs shall remain outstanding and eligible to vest in accordance with this Agreement without regard to any requirement of continued employment or service through the vesting date (but still subject to all the other terms and conditions herein, including Section 5). Except as otherwise determined by the Committee, the Participant shall certify in writing prior to each applicable vesting date that no Restrictive Covenant Violation has occurred.]
(c) Change in Control. Notwithstanding anything in the Grant Notice, this Agreement or the Plan to the contrary, in the event of a Change in Control, to the extent the RSUs are not Assumed by the surviving entity in connection with such Change in Control, all RSUs, if any, that remain unvested shall vest in full immediately prior to such Change in Control. For the purposes of this Agreement, the RSUs shall be considered “Assumed” by the surviving entity in a Change in Control if following the Change in Control this Award (i) relates to publicly traded equity securities of the Company or successor company or an affiliate thereof and (ii) confers the right to purchase or receive, for each Share subject to this Award immediately prior to the Change in Control, on substantially the same vesting and other terms and conditions as were applicable to this Award immediately prior to the Change in Control, the consideration (whether stock, cash or other securities or property) received in the Change in Control by holders of Shares for each Share held on the effective date of the Change in Control (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in Control is not solely common stock of the successor company or its affiliate, the Committee may, with the consent of the successor company or its affiliate, provide that the consideration to be received upon the vesting of this Award, for each Share subject thereto, will be solely common stock of the successor company or its affiliate substantially equal in fair market value to the per share consideration received by holders of Shares in the applicable transaction. The determination of such substantial equality of value of consideration shall be made by the Committee in its sole discretion and its determination shall be conclusive and binding.
(d) Definitions. For purposes of this Agreement:
(i) “Cause” shall have the meaning ascribed to such term in the Employment Agreement.
(ii) “Change of Control Qualifying Termination” shall have the meaning ascribed to such term in the Employment Agreement.
(iii) “Disability” shall have the meaning ascribed to such term in the Employment Agreement.
(iv) “Employment Agreement” means the [Second Amended and Restated] Employment Agreement, dated as of [___________], by and among the Participant, the Company and Hornbeck Offshore Operators, LLC, as amended from time to time.
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(v) [“Pro-Rated Amount” means the product, rounded up to the nearest whole number, of (A) the total number of unvested RSUs as of such Termination of Service and (B) a fraction, (I) the numerator of which is the total number of calendar days that have elapsed from the most recent vesting date set forth in the Grant Notice (or, if a vesting date has not occurred, the Date of Grant) through the date of the Participant’s Termination of Service and (II) the denominator of which is the total number of calendar days between the most recent vesting date set forth in the Grant Notice (or, if a vesting date has not occurred, the Date of Grant) and the final vesting date set forth in the Grant Notice.]3
(vi) “Qualifying Termination” shall have the meaning ascribed to such term in the Employment Agreement.
(vii) “Retirement” shall have the meaning ascribed to such term in the Employment Agreement.
(viii) “Termination of Service” means the termination of the Participant’s employment with, or performance of services for, the Company and its Affiliates. Unless otherwise determined by the Committee, (a) if the Participant’s employment or services with the Company and its Affiliates terminates but the Participant continues to provide services to the Company and its Affiliates in a non-employee capacity, such change in status shall not be deemed a Termination of Service with the Company and its Affiliates and (b) if the Participant is employed by, or performing services for an Affiliate that ceases to be an Affiliate, the Participant shall be deemed to have incurred a Termination of Service provided the Participant does not immediately thereafter become an employee of the Company or another Affiliate. Notwithstanding the foregoing provisions of this definition, to the extent this Award constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A, the Participant shall not be considered to have experienced a “Termination of Service” unless the Participant has experienced a “separation from service” within the meaning of Section 409A.
3. Dividend Equivalent Rights. In the event that the Company declares and pays a regular cash dividend in respect of its outstanding Shares (which, for clarity, does not include any extraordinary cash dividend) and, on the record date for such dividend, the Participant holds RSUs granted pursuant to this Agreement that have not been settled, the Company shall record in a bookkeeping account an amount equal to the cash dividends the Participant would have received if the Participant was the holder of record, as of such record date, of a number of Shares equal to the number of RSUs held by the Participant that have not been settled as of such record date (the “Dividend Equivalent Rights”), and such Dividend Equivalent Rights shall be subject to the same terms and conditions, including with respect to vesting, forfeitability and transferability, as the underlying RSUs. All amounts, if any, payable as a result of such Dividend Equivalents Rights shall be paid to the Participant in cash (or, at the discretion of the Company, in Shares) on or following, but no later than 60 days after, the date that the underlying RSU vests. For purposes of clarity, if any of the RSUs are forfeited by the Participant pursuant to the terms of this Agreement, then the Participant shall also forfeit the Dividend Equivalent Rights, if any, accrued with respect to such forfeited RSUs. No interest will accrue on the Dividend Equivalent Rights between the declaration and payment of the applicable dividends and the settlement of the Dividend Equivalent Rights.
| 3 | Note to Draft: To include for all executive officers other than Todd M. Hornbeck. |
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4. Settlement of RSUs. As soon as administratively practicable following the vesting of RSUs pursuant to Section 2, but in no event later than 60 days after such vesting date, the Company shall deliver to the Participant a number of Shares equal to the number of RSUs that vested on such vesting date. All Shares issued hereunder shall be delivered either by delivering one or more certificates for such Shares to the Participant or by entering such Shares in book-entry form, as determined by the Committee in its sole discretion. The value of Shares shall not bear any interest owing to the passage of time. Neither this Section 4 nor any action taken pursuant to or in accordance with this Agreement shall be construed to create a trust or a funded or secured obligation of any kind. No fraction of a Share shall be issued by the Company upon settlement of the RSUs. Instead, in the event that there is a fraction of an RSU that is vested, the number of vested RSUs shall be rounded up to the nearest whole number.
5. Restrictive Covenants.
(a) The Participant acknowledges and agrees that the grant of the RSUs further aligns the Participant’s interests with the Company’s long-term business interests, and as a condition to the Company’s willingness to enter into this Agreement, the Participant agrees to abide by the terms of any and all restrictive covenant agreements and obligations to which the Participant is subject in respect of the Company and its Affiliates, including, but not limited to, any confidentiality, non-disclosure, non-competition, non-solicitation, non-disparagement, assignment of inventions or other restrictive covenants in any Service Arrangement (as defined below) or other agreement by and between the Company or any Affiliate and the Participant, including those set forth in the Employment Agreement (the “Restrictive Covenants”).
(b) Notwithstanding any provision in this Agreement or the Plan to the contrary, in the event the Committee determines that the Participant has materially breached any of the Restrictive Covenants[; provided that such material breach has a substantial detrimental impact on the Company or could reasonably be expected to have a substantial detrimental impact on the Company as determined by the Board in good faith]4; provided[, further,]5 that, solely for purposes of Sections 2 and 5 (and without affecting the determination of whether a breach of the Restrictive Covenants has occurred for any other purpose or limiting any other remedies with respect thereto), a material breach of the Restrictive Covenants can only occur if (x) the Company provides the Participant with written notice of the circumstances constituting the alleged material breach of the Restrictive Covenants within 90 days after becoming aware of such circumstances and (y) the alleged breach, if curable (which includes any commercial relationship resulting from such prohibited conduct), has not been cured within 15 days after receipt of the written notice described in clause (x) (any such breach, a “Restrictive Covenant Violation”), then all RSUs (whether or not vested) that are outstanding as of the date of such determination (and all rights arising from such RSUs and from being a holder thereof, including any Dividend Equivalent Rights) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
| 4 | Note to Draft: To include for Todd M. Hornbeck. |
| 5 | Note to Draft: To include for Todd M. Hornbeck. |
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6. Tax Withholding. Notwithstanding any other provision of this Agreement:
(a) The Company has the authority to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by applicable law to be withheld with respect to any taxable event arising pursuant to this Agreement. The Company may withhold or the Participant may make such payment in accordance with Section 13.3 of the Plan.
(b) The Company shall not be obligated to deliver any certificate representing Shares issuable with respect to the RSUs to, or to cause any such Shares to be held in book-entry form by, the Participant or the Participant’s legal representative unless and until the Participant or the Participant’s legal representative shall have paid or otherwise satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of the Participant resulting from the vesting or settlement of the RSUs or any other taxable event related to the RSUs.
(c) The Participant is ultimately liable and responsible for all taxes owed in connection with the RSUs, regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the RSUs. The Company makes no representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or settlement of the RSUs or the subsequent sale of Shares. The Company does not commit and is under no obligation to structure the RSUs to reduce or eliminate the Participant’s tax liability.
(d) The Participant acknowledges that there may be adverse tax consequences upon the receipt, vesting or settlement of this Award or disposition of the underlying Shares and that the Participant has been advised, and hereby is advised, to consult a tax advisor. The Participant represents that the Participant is in no manner relying on the Board, the Committee, the Company or an Affiliate or any of their respective managers, directors, officers, employees or authorized representatives (including attorneys, accountants, consultants, bankers, lenders, prospective lenders and financial representatives) for tax advice or an assessment of such tax consequences.
(e) No fraction of a Share shall be issued by the Company upon settlement of the RSUs or accepted by the Company in payment of any withholding obligation; rather, the Participant shall provide a cash payment for any withholding amount as is necessary to effect the issuance and acceptance of only whole Shares.
7. Non-Transferability. During the lifetime of the Participant, the RSUs may not be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution, unless and until the Shares underlying the RSUs have been issued, and all restrictions applicable to such Shares have lapsed. Neither the RSUs nor any interest or right therein shall be liable for the debts, contracts or engagements of the Participant or the Participant’s successors in
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interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence.
8. Compliance with Applicable Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of Shares hereunder will be subject to compliance with all applicable requirements of applicable law with respect to such securities. No Shares will be issued hereunder if such issuance would constitute a violation of any applicable law. In addition, Shares will not be issued hereunder unless (a) a registration statement under the Securities Act of 1933, as amended (together with all rules and regulations promulgated thereunder, the “Securities Act”) is in effect at the time of such issuance with respect to the Shares to be issued or (b) in the opinion of legal counsel to the Company, the Shares to be issued are permitted to be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary for the lawful issuance and sale of any Shares hereunder will relieve the Company of any liability in respect of the failure to issue such Shares as to which such requisite authority has not been obtained. As a condition to any issuance of Shares hereunder, the Company may require the Participant to satisfy any requirements that may be necessary or appropriate to evidence compliance with any applicable law and to make any representation or warranty with respect to such compliance as may be requested by the Company.
9. Rights as a Stockholder. The Participant shall have no rights or privileges of a stockholder of the Company with respect to any Shares that may become deliverable hereunder unless and until the Participant has become the holder of record of such Shares and such Shares have been delivered to the Participant (including through electronic delivery to a brokerage account). No adjustments shall be made for dividends in cash or other property, distributions or other rights for which the record date is prior to the date of such issuance, recordation and delivery, except as otherwise specifically provided for in the Plan or this Agreement. Except as otherwise provided herein, after such issuance, recordation and delivery, the Participant will have all the rights of a stockholder of the Company with respect to such Shares, including, without limitation, the right to receipt of dividends and distributions on such Shares.
10. Execution of Receipts and Releases. Any issuance or transfer of Shares or other property to the Participant or the Participant’s legal representative, heir, legatee or distributee, in accordance with this Agreement shall be in full satisfaction of all claims of such Person hereunder. As a condition precedent to such payment or issuance, the Company may require the Participant or the Participant’s legal representative, heir, legatee or distributee to execute (and not revoke within any time provided to do so) a release and receipt therefor in such form as it shall determine appropriate; provided that any review period under such release will not modify the date of settlement with respect to vested RSUs.
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11. No Right to Continued Employment, Service or Awards. Nothing in the adoption of the Plan, nor the award of the RSUs thereunder pursuant to the Grant Notice and this Agreement, shall confer upon the Participant the right to continued employment by, or a continued service relationship with, the Company or any Affiliate, or any other entity, or affect in any way the right of the Company or any such Affiliate, or any other entity to terminate such employment or other service relationship at any time. Unless otherwise provided in a Service Arrangement or by applicable law, the Participant’s employment by the Company, or any such Affiliate, or any other entity shall be on an at-will basis, and the employment relationship may be terminated at any time by either the Participant or the Company, or any such Affiliate, or other entity for any reason whatsoever, with or without cause or notice. Any question as to whether and when there has been a termination of such employment, and the cause of such termination, shall be determined by the Committee or its delegate, and such determination shall be final, conclusive and binding for all purposes. The grant of the RSUs is a one-time benefit that was made at the sole discretion of the Company and does not create any contractual or other right to receive a grant of Awards or benefits in the future in lieu of Awards in the future, including any adjustment to wages, overtime, benefits or other compensation. Any future Awards will be granted at the sole discretion of the Company.
12. Notices. All notices and other communications under this Agreement shall be in writing and shall be delivered to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):
If to the Company, unless otherwise designated by the Company in a written notice to the Participant (or other holder):
Hornbeck Offshore Services, Inc.
103 Northpark Blvd., Suite 300
Covington, LA 70433
Attention: [__________]
E-Mail: [__________]
If to the Participant, at the Participant’s last known address on file with the Company.
Notice shall be deemed to have been duly delivered (a) when delivered in person, (b) when sent by email (provided that the sender has not received any “bounce-back,” “out of office,” or similar message indicating that the email was not sent or received by the recipient) on a business day; provided that if a notice is sent by email after normal business hours of the recipient or on a non-business day, then it shall be deemed to have been received on the next business day after it is sent, (c) on the first business day after such notice is sent by express overnight courier service or (d) on the second business day following deposit with an internationally-recognized second-day courier service with proof of receipt maintained.
13. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, the Participant agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports and all other forms of communications) in connection with this and any other Award made or offered by the Company. Electronic delivery may be via a Company electronic mail system, by reference to a location on a Company intranet to which the Participant has access, or to the Participant’s account with the Company’s equity plan administrator. The Participant hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that the Participant’s electronic signature is the same as, and shall have the same force and effect as, the Participant’s manual signature.
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14. Agreement to Furnish Information. The Participant agrees to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirement imposed upon the Company by or under any applicable law.
15. Entire Agreement; Amendment. This Agreement (which, for clarity, includes the Grant Notice and the Plan) constitutes the entire agreement of the parties with regard to the subject matter hereof, and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the RSUs granted hereby; provided that (a) the terms of this Agreement shall not modify and shall be subject to the terms and conditions of any employment agreement, offer letter, consulting agreement, change-in-control agreement, severance agreement or similar agreement between the Company or an Affiliate and the Participant or any severance plan, change-in-control plan or similar plan of the Company or an Affiliate in which the Participant participates (any such arrangement, a “Service Arrangement”), including the Employment Agreement, in each case, in effect as of the date a determination is to be made under this Agreement; and (b) the consequences for a material breach of the Restrictive Covenants set forth herein are in addition to and complement (and do not replace or supersede) any other consequences set forth in the Employment Agreement or otherwise for a breach of the Restrictive Covenants. Without limiting the scope of the preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. The Committee may, in its sole discretion, amend this Agreement from time to time in any manner that is not inconsistent with the Plan; provided that except as otherwise provided in the Plan or this Agreement, any such amendment that materially impairs the rights of the Participant shall be effective only if it is in writing and signed by both the Participant and an authorized officer of the Company.
16. Severability and Waiver. If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of such provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect. Waiver by any party of any breach of this Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such right continues.
17. Company Recoupment of Awards. The Participant’s rights with respect to this Award shall in all events be subject to (a) any right that the Company may have under any Company recoupment or clawback policy or other agreement or arrangement with the Participant, and (b) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission or any other applicable law. The Participant’s acceptance of this Award will constitute the Participant’s acknowledgment of and consent to the Company’s application,
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implementation and enforcement of any Company recoupment, clawback or similar policy that may apply to the Participant and this Award, whether adopted before or after the Date of Grant (whether through clawback, cancellation, recoupment, rescission, payback, reduction or other similar action in accordance therewith) and any applicable law relating to clawback, cancellation, recoupment, rescission, payback or reduction of compensation or other similar action, and the Participant’s agreement that the Company may take any actions that may be necessary to effectuate any such policy or applicable law, without further consideration or action.
18. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED THEREIN, EXCLUSIVE OF THE CONFLICT OF LAWS PROVISIONS OF DELAWARE LAW.
19. Venue. The Company, the Participant and any of the Participant’s permitted transferees, agree that any suit, action or proceeding arising out of or related to this Agreement shall be brought in the United States District Court for the District of Delaware (or should such court lack jurisdiction to hear such action, suit or proceeding, in the courts of the State of Delaware) and that all parties shall submit to the jurisdiction of such court. The parties irrevocably waive, to the fullest extent permitted by applicable law, any objection the party may have to the laying of venue for any such suit, action or proceeding brought in such court. Without limiting the generality of Section 16, if any one or more provisions of this Section 19 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable.
20. Conformity to Securities Laws. The Participant acknowledges that this Agreement is intended to conform to the extent necessary with all applicable laws, including, without limitation, the provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission and state securities laws and regulations. Notwithstanding anything herein to the contrary, the RSUs shall be administered, granted and settled only in such a manner as to conform to applicable law. To the extent permitted by applicable law and the Plan, this Agreement shall be deemed amended to the extent necessary to conform to applicable law.
21. Successors and Assigns. The Company may assign any of its rights under this Agreement without the Participant’s consent. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein and in the Plan, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the Person(s) to whom the RSUs may be transferred by will or the laws of descent or distribution.
22. Headings; References; Interpretation. Headings are for convenience only and are not deemed to be part of this Agreement. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All references herein to Sections shall, unless the context requires a different construction, be deemed to be references to the Sections of this Agreement. The word “or” as used herein is not exclusive and is deemed to have the meaning “and/or.” All references to “including” shall be construed as meaning “including without
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limitation.” Unless the context requires otherwise, all references herein to a law, agreement, instrument or other document shall be deemed to refer to such law, agreement, instrument or other document as amended, supplemented, modified and restated from time to time to the extent permitted by the provisions thereof. All references to “dollars” or “$” in this Agreement refer to United States dollars. Whenever the context may require, the singular form of nouns and pronouns shall include the plural and vice versa. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against any party hereto, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by each of the parties hereto and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the parties hereto.
23. Counterparts. The Grant Notice may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Delivery of an executed counterpart of the Grant Notice by facsimile or portable document format (.pdf) attachment to electronic mail or via electronic acceptance in accordance with Section 13 shall be effective as delivery of a manually executed counterpart of the Grant Notice.
24. Section 409A. The Plan, this Agreement and Awards are intended to comply with or be exempt from the applicable requirements of Section 409A and shall be limited, construed and interpreted in accordance with such intent. To the extent that any Award is subject to Section 409A, it shall be paid in a manner that will comply with Section 409A, including proposed, temporary or final regulations or any other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto. Notwithstanding anything herein to the contrary, any provision in the Plan or this Agreement that is inconsistent with Section 409A shall be deemed to be amended to comply with or be exempt from Section 409A and, to the extent such provision cannot be amended to comply therewith or be exempt therefrom, such provision shall be null and void. Notwithstanding any contrary provision in the Plan or this Agreement, any payment(s) of “nonqualified deferred compensation” (within the meaning of Section 409A) that are otherwise required to be made under the Plan or this Agreement to a “specified employee” (as defined under Section 409A) as a result of such employee’s separation from service (other than a payment that is not subject to Section 409A) shall be delayed for the first six (6) months following such separation from service (or, if earlier, until the date of death of the specified employee) and shall instead be paid (in a manner set forth in this Agreement) upon expiration of such delay period. If the Award includes a “series of installment payments” (within the meaning of Section 1.409A-2(b)(2)(iii) of the Treasury Regulations), the Participant’s right to the series of installment payments shall be treated as a right to a series of separate payments and not as a right to a single payment, and if the Award includes “dividend equivalents” (within the meaning of Section 1.409A-3(e) of the Treasury Regulations), the Participant’s payments pursuant to the Dividend Equivalent Rights shall be treated separately from the right to other amounts under the Award. Notwithstanding the foregoing, the Company and its Affiliates make no representations that the RSUs provided under this Agreement are exempt from or compliant with Section 409A and in no event shall the Company or any Affiliate be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A.
[Remainder of Page Intentionally Blank]
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Exhibit 10.6
Executive Officer Form
HORNBECK OFFSHORE SERVICES, INC.
2005 LONG TERM INCENTIVE PLAN
(AS AMENDED AND RESTATED EFFECTIVE SEPTEMBER 1, 2026)
NON-QUALIFIED STOCK OPTION GRANT NOTICE
Pursuant to the terms and conditions of the Hornbeck Offshore Services, Inc. 2005 Long Term Incentive Plan (as amended and restated effective September 1, 2026) (f/k/a Helix Energy Solutions Group, Inc. 2005 Long Term Incentive Plan) (as may be further amended, amended and restated, supplemented or otherwise modified from time to time, the “Plan”), Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (the “Company”), hereby grants to the individual listed below (“you” or the “Participant”) the right and option to purchase all or any part of the number of shares of Stock (“Shares”) set forth below (the “Option”). This Option award (this “Award”) is subject to the terms and conditions set forth herein and in the Non-Qualified Stock Option Award Agreement attached hereto as Exhibit A (the “Agreement”) and the Plan, each of which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.
| Type of Option: | Non-Qualified Stock Option | |
| Participant: | [__________] | |
| Date of Grant: | [__________] | |
| Total Number of Shares Subject to this Option: | [__________] Shares | |
| Option Price: | $[__________] per Share | |
| Expiration Date: | [__________] | |
| Vesting Schedule: | [__________] | |
By your signature below, you agree to be bound by the terms and conditions of the Plan, the Agreement and this Non-Qualified Stock Option Grant Notice (this “Grant Notice”). You acknowledge that you have reviewed the Agreement, the Plan and this Grant Notice in their entirety and fully understand all provisions of the Agreement, the Plan and this Grant Notice and have had an opportunity to obtain the advice of counsel prior to executing this Grant Notice. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee regarding any questions or determinations arising under the Agreement, the Plan or this Grant Notice. This Grant Notice may be executed in one or more counterparts (including portable document format (.pdf) and facsimile counterparts), each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement.
Notwithstanding any provision of this Grant Notice or the Agreement, if you have not executed this Grant Notice within 90 days following the Date of Grant set forth above, you will be deemed to have accepted this Award, subject to all of the terms and conditions of this Grant Notice, the Agreement and the Plan.
[Signature Page Follows]
IN WITNESS WHEREOF, the Company has caused this Grant Notice to be executed by an officer thereunto duly authorized, and the Participant has executed this Grant Notice, effective for all purposes as provided above.
| HORNBECK OFFSHORE SERVICES, INC. | ||||
| By: |
| |||
| Name: | [__________] | |||
| Title: | [__________] | |||
| PARTICIPANT | ||||
|
| ||||
| Name: [__________] | ||||
SIGNATURE PAGE TO
NON-QUALIFIED STOCK OPTION GRANT NOTICE
EXHIBIT A
NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
This Non-Qualified Stock Option Award Agreement (together with the Non-Qualified Stock Option Grant Notice (the “Grant Notice”) to which this Non-Qualified Stock Option Award Agreement is attached, this “Agreement”) is made as of the Date of Grant set forth in the Grant Notice (the “Date of Grant”), by and between Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (the “Company”), and [__________] (the “Participant”). Capitalized terms used but not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice.
1. Award. In consideration of the Participant’s past and/or continued employment with, or service to, the Company or an Affiliate and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, effective as of the Date of Grant, the Company hereby grants to the Participant the right and option to purchase all or any part of the number of Shares set forth in the Grant Notice on the terms and conditions set forth in the Grant Notice, this Agreement and the Plan, which is incorporated herein by reference as a part of this Agreement. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control.
2. Option Price. The Option Price of each Share subject to this Option shall be the Option Price set forth in the Grant Notice, which has been determined to be not less than the Fair Market Value of a Share on the Date of Grant.
3. Vesting of Option.
(a) General. Except as otherwise set forth in Sections 3 and 5, this Option shall vest in accordance with the vesting schedule set forth in the Grant Notice. Upon the Participant’s Termination of Service prior to this Option vesting in full (but after giving effect to any accelerated vesting pursuant to this Section 3), the unvested portion of this Option (and all rights arising from such portion and from being a holder thereof) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
(b) 1[Termination of Service. Notwithstanding anything in the Grant Notice, this Agreement or the Plan to the contrary, subject to Section 10 (as applicable):
(i) upon the Participant’s Termination of Service due to the Participant’s death, Disability or a Qualifying Termination (including, for clarity, a Change of Control Qualifying Termination), any portion of this Option that remains unvested shall immediately become vested as of the date of such Termination of Service;
| 1 | Note to Form: To include for Todd M. Hornbeck. |
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(ii) upon the Participant’s Termination of Service for Cause, the unexercised portion of this Option, whether or not vested (and all rights arising from such portion and from being a holder thereof) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company; or
(iii) upon the Participant’s Termination of Service due to the Participant’s Retirement that occurs on or after the one-year anniversary of the Date of Grant, any portion of this Option that remains unvested shall remain outstanding and eligible to vest in accordance with this Agreement without regard to any requirement of continued employment through the vesting date (but still subject to all the other terms and conditions herein, including Section 5). Except as otherwise determined by the Committee, the Participant shall certify in writing prior to each applicable vesting date that no Restrictive Covenant Violation has occurred.]
(b) 2[Termination of Service. Notwithstanding anything in the Grant Notice, this Agreement or the Plan to the contrary, subject to Section 10 (as applicable):
(i) upon the Participant’s Termination of Service due to the Participant’s death or Disability, any portion of this Option that remains unvested shall immediately become vested as of the date of such Termination of Service;
(ii) upon the Participant’s Termination of Service due to a Qualifying Termination (except as set forth in Section 3(b)(iii) following a Change in Control), a Pro-Rated Amount of any portion of this Option that remains unvested shall immediately become vested as of the date of such Qualifying Termination, and any portion of this Option that remains unvested after the Pro-Rated Amount of this Option vests (the “Contingent Portion”) will remain outstanding and eligible to vest during the six-month period immediately following such Qualifying Termination (the “Vesting Tail Period”), solely in the event a Change in Control occurs during the Vesting Tail Period such that such Qualifying Termination becomes a Change of Control Qualifying Termination, and if a Change in Control does not occur within the Vesting Tail Period, the Contingent Portion of this Option will be forfeited immediately upon the expiration of the Vesting Tail Period without further notice and at no cost to the Company;
(iii) upon the Participant’s Termination of Service due to a Change of Control Qualifying Termination that occurs on or following a Change in Control, any portion of this Option that remains unvested shall immediately become vested as of the date of such Change of Control Qualifying Termination;
(iv) upon the Participant’s Termination of Service for Cause, the unexercised portion of this Option, whether or not vested (and all rights arising from such portion and from being a holder thereof) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company; or
(v) upon the Participant’s Termination of Service due to the Participant’s Retirement that occurs on or after the one-year anniversary of the Date of Grant, any portion of this Option that remains unvested shall remain outstanding and eligible to vest in accordance with this Agreement without regard to any requirement of continued employment or service through the vesting date (but still subject to all the other terms and conditions herein, including Section 5). Except as otherwise determined by the Committee, the Participant shall certify in writing prior to each applicable vesting date that no Restrictive Covenant Violation has occurred.]
| 2 | Note to Form: To include for all executive officers other than Todd M. Hornbeck. |
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(c) Change in Control. Notwithstanding anything in the Grant Notice, this Agreement or the Plan to the contrary, in the event of a Change in Control, to the extent this Option is not Assumed by the surviving entity in connection with such Change in Control, any portion of this Option that remains unvested shall become vested and exercisable immediately prior to such Change in Control. For the purposes of this Agreement, this Option shall be considered “Assumed” by the surviving entity in a Change in Control if following the Change in Control this Award (i) relates to publicly traded equity securities of the Company or successor company or an affiliate thereof and (ii) confers the right to purchase or receive, for each Share subject to this Award immediately prior to the Change in Control, on substantially the same vesting and other terms and conditions as were applicable to this Award immediately prior to the Change in Control, the consideration (whether stock, cash or other securities or property) received in the Change in Control by holders of Shares for each Share held on the effective date of the Change in Control (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in Control is not solely common stock of the successor company or its affiliate, the Committee may, with the consent of the successor company or its affiliate, provide that the consideration to be received upon the exercise of this Award, for each Share subject thereto, will be solely common stock of the successor company or its affiliate substantially equal in fair market value to the per share consideration received by holders of Shares in the applicable transaction. The determination of such substantial equality of value of consideration shall be made by the Committee in its sole discretion and its determination shall be conclusive and binding.
(d) Definitions. For purposes of this Agreement:
(i) “Cause” shall have the meaning ascribed to such term in the Employment Agreement.
(ii) “Change of Control Qualifying Termination” shall have the meaning ascribed to such term in the Employment Agreement.
(iii) “Disability” shall have the meaning ascribed to such term in the Employment Agreement.
(iv) “Employment Agreement” means the [Second Amended and Restated] Employment Agreement, dated as of [__________], by and among the Participant, the Company and Hornbeck Offshore Operators, LLC, as amended from time to time.
(v) [“Pro-Rated Amount” means the product, rounded up to the nearest whole number, of (A) the total number of unvested Shares subject to this Option as of such Termination of Service and (B) a fraction, (I) the numerator of which is the total number of calendar days that have elapsed from the most recent vesting date set forth in the Grant Notice (or, if a vesting date has not occurred, the Date of Grant) through the date of the Participant’s Termination of Service and (II) the denominator of which is the total number of calendar days between the most recent vesting date set forth in the Grant Notice (or, if a vesting date has not occurred, the Date of Grant) and the final vesting date set forth in the Grant Notice.]3
| 3 | Note to Form: To include for all executive officers other than Todd M. Hornbeck. |
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(vi) “Qualifying Termination” shall have the meaning ascribed to such term in the Employment Agreement.
(vii) “Retirement” shall have the meaning ascribed to such term in the Employment Agreement.
(viii) “Termination of Service” means the termination of the Participant’s employment with, or performance of services for, the Company and its Affiliates. Unless otherwise determined by the Committee, (a) if the Participant’s employment or services with the Company and its Affiliates terminates but the Participant continues to provide services to the Company and its Affiliates in a non-employee capacity, such change in status shall not be deemed a Termination of Service with the Company and its Affiliates and (b) if the Participant is employed by, or performing services for an Affiliate that ceases to be an Affiliate, the Participant shall be deemed to have incurred a Termination of Service provided the Participant does not immediately thereafter become an employee of the Company or another Affiliate. Notwithstanding the foregoing provisions of this definition, to the extent this Award constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A, the Participant shall not be considered to have experienced a “Termination of Service” unless the Participant has experienced a “separation from service” within the meaning of Section 409A.
4. Exercise of Option.
(a) Subject to the earlier expiration of this Option as provided herein, this Option or any portion thereof, to the extent vested pursuant to Section 3 and subject to Section 4(e), may be exercised by the Participant providing to the Company all of the following prior to the time when this Option or such portion thereof becomes unexercisable:
(i) written notice to the Company, which notice shall be delivered to the Company in the form, and in the manner, designated by the Committee from time to time (which, for clarity, may be different than as provided in Section 12);
(ii) the payment of the Option Price in full in accordance with Section 4(d);
(iii) the payment of any applicable withholding tax in accordance with Section 6;
(iv) any other written representation or documents as may be required in the Committee’s sole discretion to effect compliance with applicable law; and
(v) in the event this Option or portion thereof shall be exercised by the Participant’s estate or the person who acquires this Option by will or the laws of descent and distribution or otherwise by reason of the death of the Participant, appropriate proof of the right of such Person to exercise this Option or portion thereof.
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Notwithstanding any of the foregoing, the Committee shall have the right to specify all conditions of the manner of exercise, which conditions may be subject to change from time to time.
(b) This Option may be exercised only while the Participant remains an employee or other service provider of the Company or an Affiliate and will terminate and cease to be exercisable upon the Participant’s Termination of Service, except as otherwise provided in this Section 4(b) below:
(i) Upon the Participant’s Termination of Service due to the Participant’s death or Disability, the portion of this Option that is vested as of such Termination of Service (after giving effect to any accelerated vesting pursuant to Section 3(b)) may be exercised by the Participant (or the Participant’s estate or the person who acquires this Option by will or the laws of descent and distribution or otherwise by reason of the death of the Participant) at any time during the period ending on the earlier to occur of (A) the date that is one year following the date of such Termination of Service and (B) the Expiration Date.
(ii) Upon the Participant’s Termination of Service due to a Qualifying Termination, the portion of this Option that is vested as of such Termination of Service (after giving effect to any accelerated vesting pursuant to Section 3(b)) may be exercised by the Participant (or the Participant’s estate or the person who acquires this Option by will or the laws of descent and distribution or otherwise by reason of the death of the Participant) at any time during the period ending on the earlier to occur of (A) the date that is one year following the date of such Termination of Service and (B) the Expiration Date.
(iii) Upon the Participant’s Termination of Service due to a resignation by the Participant without Good Reason (that does not constitute a Retirement and that occurs other than at a time when grounds to terminate the Participant’s employment for Cause exist), the portion of this Option that is vested as of such Termination of Service (after giving effect to any accelerated vesting pursuant to Section 3(b)) may be exercised by the Participant (or the Participant’s estate or the person who acquires this Option by will or the laws of descent and distribution or otherwise by reason of the death of the Participant) at any time during the period ending on the earlier to occur of (A) the date that is 90 days following the date of such Termination of Service and (B) the Expiration Date.
(iv) Upon the Participant’s Termination of Service due to the Participant’s Retirement, the portion of this Option that is vested as of such Termination of Service or may become vested in accordance with Section 3(b) may be exercised by the Participant (or the Participant’s estate or the person who acquires this Option by will or the laws of descent and distribution or otherwise by reason of the death of the Participant) at any time during the period ending on the earlier to occur of (A) the date that is five years following the date of such Termination of Service and (B) the Expiration Date; provided, however, that if the Committee determines that a Restrictive Covenant Violation has occurred, then the exercise period pursuant to this Section 4(b)(iv) shall immediately terminate as of the date of such determination.
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(c) This Option shall not be exercisable in any event after the Expiration Date set forth in the Grant Notice.
(d) The Option Price for the Shares as to which this Option is exercised shall be paid in full by any of the following, subject to Section 4(e):
(i) by cash or check made payable to the Company;
(ii) with the consent of the Committee, by requesting that the Company withhold a net number of vested Shares otherwise issuable upon the exercise of this Option having an aggregate Fair Market Value equal to the aggregate Option Price at the time of exercise;
(iii) with the consent of the Committee, by tendering to the Company vested Shares held for such period of time as may be required by the Committee in order to avoid adverse accounting consequences and having an aggregate Fair Market Value at the time of exercise equal to the aggregate Option Price;
(iv) with the consent of the Committee, through the delivery of a notice that the Participant has placed a market sell order with a broker acceptable to the Company with respect to Shares then issuable to the Participant upon the exercise of this Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Option Price; provided that payment of such proceeds is then made to the Company at such time as may be required by the Committee, but in any event not later than the settlement of such sale; or
(v) in any combination of the foregoing.
(e) No fraction of a Share shall be issued by the Company upon exercise of this Option or any portion thereof. Instead, in the event that there is a fraction of a Share underlying the Option that is vested, the number of vested Shares shall be rounded up to the nearest whole number. In addition, no fraction of a Share shall be accepted by the Company in payment of the Option Price thereof; rather, the Participant shall provide a cash payment for such amount of the Option Price as is necessary to effect the issuance and acceptance of only whole Shares.
5. Restrictive Covenants.
(a) The Participant acknowledges and agrees that the grant of this Option further aligns the Participant’s interests with the Company’s long-term business interests, and as a condition to the Company’s willingness to enter into this Agreement, the Participant agrees to abide by the terms of any and all restrictive covenant agreements and obligations to which the Participant is subject in respect of the Company and its Affiliates, including, but not limited to, any confidentiality, non-disclosure, non-competition, non-solicitation, non-disparagement, assignment of inventions or other restrictive covenants in any Service Arrangement (as defined below) or other agreement by and between the Company or any Affiliate and the Participant, including those set forth in the Employment Agreement (the “Restrictive Covenants”).
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(b) Notwithstanding any provision in this Agreement or the Plan to the contrary, in the event the Committee determines that the Participant has materially breached any of the Restrictive Covenants[; provided that such material breach has a substantial detrimental impact on the Company or could reasonably be expected to have a substantial detrimental impact on the Company as determined by the Board in good faith]4; provided[, further,]5 that, solely for purposes of Sections 3, 4 and 5 (and without affecting the determination of whether a breach of the Restrictive Covenants has occurred for any other purpose or limiting any other remedies with respect thereto), a material breach of the Restrictive Covenants can only occur if (x) the Company provides the Participant with written notice of the circumstances constituting the alleged material breach of the Restrictive Covenants within 90 days after becoming aware of such circumstances and (y) the alleged breach, if curable (which includes any commercial relationship resulting from such prohibited conduct), has not been cured within 15 days after receipt of the written notice described in clause (x) (any such breach, a “Restrictive Covenant Violation”), then any portion of this Option (whether or not vested) that remains unexercised as of the date of such determination (and all rights arising from such portion and from being a holder thereof) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
6. Tax Withholding. Notwithstanding any other provision of this Agreement:
(a) The Company has the authority to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by applicable law to be withheld with respect to any taxable event arising pursuant to this Agreement. The Company may withhold or the Participant may make such payment in accordance with Section 13.3 of the Plan.
(b) The Company shall not be obligated to deliver any certificate representing Shares issuable with respect to the exercise of this Option to, or to cause any such Shares to be held in book-entry form by, the Participant or the Participant’s legal representative unless and until the Participant or the Participant’s legal representative shall have paid or otherwise satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of the Participant resulting from the exercise of this Option or any other taxable event related to this Option.
(c) The Participant is ultimately liable and responsible for all taxes owed in connection with this Option, regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with this Option. The Company makes no representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or exercise of this Option or the subsequent sale of Shares. The Company does not commit and is under no obligation to structure this Option to reduce or eliminate the Participant’s tax liability.
| 4 | Note to Form: To include for Todd M. Hornbeck. |
| 5 | Note to Form: To include for Todd M. Hornbeck. |
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(d) The Participant acknowledges that there may be adverse tax consequences upon the receipt, vesting or exercise of this Award or disposition of the underlying Shares and that the Participant has been advised, and hereby is advised, to consult a tax advisor. The Participant represents that the Participant is in no manner relying on the Board, the Committee, the Company or an Affiliate or any of their respective managers, directors, officers, employees or authorized representatives (including attorneys, accountants, consultants, bankers, lenders, prospective lenders and financial representatives) for tax advice or an assessment of such tax consequences.
(e) No fraction of a Share shall be issued by the Company upon exercise of this Option or any portion thereof or accepted by the Company in payment of any withholding obligation; rather, the Participant shall provide a cash payment for any withholding amount as is necessary to effect the issuance and acceptance of only whole Shares.
7. Non-Transferability. During the lifetime of the Participant, this Option may not be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution, unless and until the Shares underlying this Option have been issued, and all restrictions applicable to such Shares have lapsed, and this Option shall be exercisable, during the Participant’s lifetime, only by the Participant. Neither this Option nor any interest or right therein shall be liable for the debts, contracts or engagements of the Participant or the Participant’s successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence.
8. Compliance with Applicable Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of Shares hereunder will be subject to compliance with all applicable requirements of applicable law with respect to such securities. No Shares will be issued hereunder if such issuance would constitute a violation of any applicable law. In addition, Shares will not be issued hereunder unless (a) a registration statement under the Securities Act of 1933, as amended (together with all rules and regulations promulgated thereunder, the “Securities Act”) is in effect at the time of such issuance with respect to the Shares to be issued or (b) in the opinion of legal counsel to the Company, the Shares to be issued are permitted to be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary for the lawful issuance and sale of any Shares hereunder will relieve the Company of any liability in respect of the failure to issue such Shares as to which such requisite authority has not been obtained. As a condition to any issuance of Shares hereunder, the Company may require the Participant to satisfy any requirements that may be necessary or appropriate to evidence compliance with any applicable law and to make any representation or warranty with respect to such compliance as may be requested by the Company.
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9. Rights as a Stockholder. The Participant shall have no rights or privileges of a stockholder of the Company with respect to any Shares purchasable upon the exercise of any part of this Option unless and until the Participant has become the holder of record of such Shares and such Shares have been delivered to the Participant (including through electronic delivery to a brokerage account). No adjustments shall be made for dividends in cash or other property, distributions or other rights for which the record date is prior to the date of such issuance, recordation and delivery, except as otherwise specifically provided for in the Plan or this Agreement. Except as otherwise provided herein, after such issuance, recordation and delivery, the Participant will have all the rights of a stockholder of the Company with respect to such Shares, including, without limitation, the right to receipt of dividends and distributions on such Shares.
10. Execution of Receipts and Releases. Any issuance or transfer of Shares or other property to the Participant or the Participant’s legal representative, heir, legatee or distributee, in accordance with this Agreement shall be in full satisfaction of all claims of such Person hereunder. As a condition precedent to such payment or issuance, the Company may require the Participant or the Participant’s legal representative, heir, legatee or distributee to execute (and not revoke within any time provided to do so) a release and receipt therefor in such form as it shall determine appropriate; provided that any review period under such release will not modify the exercise period with respect to the vested portion of this Option.
11. No Right to Continued Employment, Service or Awards. Nothing in the adoption of the Plan, nor the award of this Option thereunder pursuant to the Grant Notice and this Agreement, shall confer upon the Participant the right to continued employment by, or a continued service relationship with, the Company or any Affiliate, or any other entity, or affect in any way the right of the Company or any such Affiliate, or any other entity to terminate such employment or other service relationship at any time. Unless otherwise provided in a Service Arrangement or by applicable law, the Participant’s employment by the Company, or any such Affiliate, or any other entity shall be on an at-will basis, and the employment relationship may be terminated at any time by either the Participant or the Company, or any such Affiliate, or other entity for any reason whatsoever, with or without cause or notice. Any question as to whether and when there has been a termination of such employment, and the cause of such termination, shall be determined by the Committee or its delegate, and such determination shall be final, conclusive and binding for all purposes. The grant of this Option is a one-time benefit that was made at the sole discretion of the Company and does not create any contractual or other right to receive a grant of Awards or benefits in the future in lieu of Awards in the future, including any adjustment to wages, overtime, benefits or other compensation. Any future Awards will be granted at the sole discretion of the Company.
12. Notices. Subject to the Committee’s discretion to designate the form and manner of exercise notices in accordance with Section 4(a), all notices and other communications under this Agreement shall be in writing and shall be delivered to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):
If to the Company, unless otherwise designated by the Company in a written notice to the Participant (or other holder):
Hornbeck Offshore Services, Inc.
103 Northpark Blvd., Suite 300
Covington, LA 70433
Attention: [__________]
E-Mail: [__________]
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If to the Participant, at the Participant’s last known address on file with the Company.
Notice shall be deemed to have been duly delivered (a) when delivered in person, (b) when sent by email (provided that the sender has not received any “bounce-back,” “out of office,” or similar message indicating that the email was not sent or received by the recipient) on a business day; provided that if a notice is sent by email after normal business hours of the recipient or on a non-business day, then it shall be deemed to have been received on the next business day after it is sent, (c) on the first business day after such notice is sent by express overnight courier service or (d) on the second business day following deposit with an internationally-recognized second-day courier service with proof of receipt maintained.
13. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, the Participant agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports and all other forms of communications) in connection with this and any other Award made or offered by the Company. Electronic delivery may be via a Company electronic mail system, by reference to a location on a Company intranet to which the Participant has access, or to the Participant’s account with the Company’s equity plan administrator. The Participant hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that the Participant’s electronic signature is the same as, and shall have the same force and effect as, the Participant’s manual signature.
14. Agreement to Furnish Information. The Participant agrees to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirement imposed upon the Company by or under any applicable law.
15. Entire Agreement; Amendment. This Agreement (which, for clarity, includes the Grant Notice and the Plan) constitutes the entire agreement of the parties with regard to the subject matter hereof, and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the Option granted hereby; provided that (a) the terms of this Agreement shall not modify and shall be subject to the terms and conditions of any employment agreement, offer letter, consulting agreement, change-in-control agreement, severance agreement or similar agreement between the Company or an Affiliate and the Participant or any severance plan, change-in-control plan or similar plan of the Company or an Affiliate in which the Participant participates (any such arrangement, a “Service Arrangement”), including the Employment Agreement, in each case, in effect as of the date a determination is to be made under this Agreement; and (b) the consequences for a material breach of the Restrictive Covenants set forth herein are in addition to and complement (and do not replace or supersede) any other consequences set forth in the Employment Agreement or otherwise for a breach of the Restrictive Covenants. Without limiting the scope of the preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. The Committee may, in its sole discretion, amend this Agreement from time to time in any manner that is not inconsistent with the Plan; provided that except as otherwise provided in the Plan or this Agreement, any such amendment that materially impairs the rights of the Participant shall be effective only if it is in writing and signed by both the Participant and an authorized officer of the Company.
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16. Severability and Waiver. If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of such provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect. Waiver by any party of any breach of this Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such right continues.
17. Company Recoupment of Awards. The Participant’s rights with respect to this Award shall in all events be subject to (a) any right that the Company may have under any Company recoupment or clawback policy or other agreement or arrangement with the Participant, and (b) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission or any other applicable law. The Participant’s acceptance of this Award will constitute the Participant’s acknowledgment of and consent to the Company’s application, implementation and enforcement of any Company recoupment, clawback or similar policy that may apply to the Participant and this Award, whether adopted before or after the Date of Grant (whether though clawback, cancellation, recoupment, rescission, payback, reduction or other similar action in accordance therewith) and any applicable law relating to clawback, cancellation, recoupment, rescission, payback or reduction of compensation or other similar action, and the Participant’s agreement that the Company may take any actions that may be necessary to effectuate any such policy or applicable law, without further consideration or action.
18. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED THEREIN, EXCLUSIVE OF THE CONFLICT OF LAWS PROVISIONS OF DELAWARE LAW.
19. Venue. The Company, the Participant and any of the Participant’s permitted transferees, agree that any suit, action or proceeding arising out of or related to this Agreement shall be brought in the United States District Court for the District of Delaware (or should such court lack jurisdiction to hear such action, suit or proceeding, in the courts of the State of Delaware) and that all parties shall submit to the jurisdiction of such court. The parties irrevocably waive, to the fullest extent permitted by applicable law, any objection the party may have to the laying of venue for any such suit, action or proceeding brought in such court. Without limiting the generality of Section 16, if any one or more provisions of this Section 19 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable.
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20. Conformity to Securities Laws. The Participant acknowledges that this Agreement is intended to conform to the extent necessary with all applicable laws, including, without limitation, the provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission and state securities laws and regulations. Notwithstanding anything herein to the contrary, this Option shall be administered, granted and exercised only in such a manner as to conform to applicable law. To the extent permitted by applicable law and the Plan, this Agreement shall be deemed amended to the extent necessary to conform to applicable law.
21. Successors and Assigns. The Company may assign any of its rights under this Agreement without the Participant’s consent. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein and in the Plan, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the Person(s) to whom this Option may be transferred by will or the laws of descent or distribution.
22. Headings; References; Interpretation. Headings are for convenience only and are not deemed to be part of this Agreement. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All references herein to Sections shall, unless the context requires a different construction, be deemed to be references to the Sections of this Agreement. The word “or” as used herein is not exclusive and is deemed to have the meaning “and/or.” All references to “including” shall be construed as meaning “including without limitation.” Unless the context requires otherwise, all references herein to a law, agreement, instrument or other document shall be deemed to refer to such law, agreement, instrument or other document as amended, supplemented, modified and restated from time to time to the extent permitted by the provisions thereof. All references to “dollars” or “$” in this Agreement refer to United States dollars. Whenever the context may require, the singular form of nouns and pronouns shall include the plural and vice versa. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against any party hereto, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by each of the parties hereto and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the parties hereto.
23. Counterparts. The Grant Notice may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Delivery of an executed counterpart of the Grant Notice by facsimile or portable document format (.pdf) attachment to electronic mail or via electronic acceptance in accordance with Section 13 shall be effective as delivery of a manually executed counterpart of the Grant Notice.
24. Section 409A. Notwithstanding anything in this Agreement, the Grant Notice or the Plan to the contrary, the Option granted pursuant to this Agreement is intended to be exempt from the applicable requirements of Section 409A and shall be limited, construed and interpreted in accordance with such intent. Notwithstanding the foregoing, the Company and its Affiliates make no representations that the Option provided under this Agreement is exempt from or compliant with Section 409A and in no event shall the Company or any Affiliate be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A.
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Exhibit 10.7
HORNBECK OFFSHORE SERVICES, INC.
2005 LONG TERM INCENTIVE PLAN
(AS AMENDED AND RESTATED EFFECTIVE SEPTEMBER 1, 2026)
CASH AWARD NOTICE
Pursuant to the terms and conditions of the Hornbeck Offshore Services, Inc. 2005 Long Term Incentive Plan (as amended and restated effective September 1, 2026) (f/k/a Helix Energy Solutions Group, Inc. 2005 Long Term Incentive Plan) (as may be further amended, amended and restated, supplemented or otherwise modified from time to time, the “Plan”), Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (the “Company”), hereby grants to the individual listed below (“you” or the “Participant”) a Cash Award in the amount set forth below. This Cash Award (this “Award”) is subject to the terms and conditions set forth herein and in the Cash Award Agreement attached hereto as Exhibit A (the “Agreement”) and the Plan, each of which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.
| Type of Award: | Cash Award | |
| Participant: | [__________] | |
| Date of Grant: | [__________] | |
| Amount of Cash Award: | $[__________] | |
| Vesting Schedule: | [__________] | |
By your signature below, you agree to be bound by the terms and conditions of the Plan, the Agreement and this Cash Award Notice (this “Award Notice”). You acknowledge that you have reviewed the Agreement, the Plan and this Award Notice in their entirety and fully understand all provisions of the Agreement, the Plan and this Award Notice and have had an opportunity to obtain the advice of counsel prior to executing this Award Notice. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee regarding any questions or determinations arising under the Agreement, the Plan or this Award Notice. This Award Notice may be executed in one or more counterparts (including portable document format (.pdf) and facsimile counterparts), each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement.
Notwithstanding any provision of this Award Notice or the Agreement, if you have not executed this Award Notice within 90 days following the Date of Grant set forth above, you will be deemed to have accepted this Award, subject to all of the terms and conditions of this Award Notice, the Agreement and the Plan.
[Signature Page Follows]
IN WITNESS WHEREOF, the Company has caused this Award Notice to be executed by an officer thereunto duly authorized, and the Participant has executed this Award Notice, effective for all purposes as provided above.
| HORNBECK OFFSHORE SERVICES, INC. | ||
| By: |
| |
| Name: [__________] | ||
| Title: [__________] | ||
| PARTICIPANT |
Name: [__________] |
SIGNATURE PAGE TO
CASH AWARD NOTICE
EXHIBIT A
CASH AWARD AGREEMENT
This Cash Award Agreement (together with the Cash Award Notice (the “Award Notice”) to which this Cash Award Agreement is attached, this “Agreement”) is made as of the Date of Grant set forth in the Award Notice (the “Date of Grant”), by and between Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (the “Company”), and [__________] (the “Participant”). Capitalized terms used but not specifically defined herein shall have the meanings specified in the Plan or the Award Notice.
1. Award. In consideration of the Participant’s past and/or continued employment with, or service to, the Company or an Affiliate and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, effective as of the Date of Grant, the Company hereby awards to the Participant a Cash Award in the amount set forth in the Award Notice on the terms and conditions set forth in the Award Notice, this Agreement and the Plan, which is incorporated herein by reference as a part of this Agreement. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control. Unless and until this Award has become vested in the manner set forth in the Award Notice and Section 2, the Participant will have no right to receive any payment in respect of this Award. Prior to settlement of this Award, this Award represent an unsecured obligation of the Company, payable only from the general assets of the Company.
2. Vesting.
(a) General. Except as otherwise set forth in Sections 2 and 4, this Award shall vest in accordance with the vesting schedule set forth in the Award Notice. Upon the Participant’s Termination of Service prior to the vesting of this Award (but after giving effect to any accelerated vesting pursuant to this Section 2), any unvested portion of this Award will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
(b) Termination of Service. Notwithstanding anything in the Award Notice, this Agreement or the Plan to the contrary, subject to Section 8 (as applicable):
(i) upon the Participant’s Termination of Service due to the Participant’s death or Disability, this Award shall immediately become vested as of the date of such Termination of Service;
(ii) upon the Participant’s Termination of Service due to a Qualifying Termination (except as set forth in Section 2(b)(iii) following a Change in Control), a Pro-Rated Amount of this Award shall immediately become vested as of the date of such Qualifying Termination, and any portion of this Award that remains unvested after the Pro-Rated Amount of this Award vests (the “Contingent Amount”) will remain outstanding and eligible to vest during the six-month period immediately following such Qualifying Termination (the “Vesting Tail Period”), solely in the event a Change in Control occurs during the Vesting Tail Period such that such Qualifying Termination becomes a Change of Control Qualifying Termination, and if a Change in Control does not occur within the Vesting Tail Period, the Contingent Amount will be forfeited immediately upon the expiration of the Vesting Tail Period without further notice and at no cost to the Company;
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(iii) upon the Participant’s Termination of Service due to a Change of Control Qualifying Termination that occurs on or following a Change in Control, this Award shall immediately become fully vested as of the date of such Change of Control Qualifying Termination; or
(iv) upon the Participant’s Termination of Service for Cause, this Award, whether or not vested, will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
(c) Change in Control. Notwithstanding anything in the Award Notice, this Agreement or the Plan to the contrary, in the event of a Change in Control, to the extent this Award is not assumed by the surviving entity in connection with such Change in Control, this Award shall vest in full immediately prior to such Change in Control.
(d) Definitions. For purposes of this Agreement:
(i) “Cause” shall have the meaning ascribed to such term in the Employment Agreement.
(ii) “Change of Control Qualifying Termination” shall have the meaning ascribed to such term in the Employment Agreement.
(iii) “Disability” shall have the meaning ascribed to such term in the Employment Agreement.
(iv) “Employment Agreement” means the Employment Agreement, dated as of [__________], by and among the Participant, the Company and Hornbeck Offshore Operators, LLC, as amended from time to time.
(v) “Pro-Rated Amount” means the product, rounded up to the nearest whole number, of (A) the unvested amount of this Award as of such Termination of Service and (B) a fraction, (I) the numerator of which is the total number of calendar days that have elapsed from the most recent vesting date set forth in the Grant Notice (or, if a vesting date has not occurred, the Date of Grant) through the date of the Participant’s Termination of Service and (II) the denominator of which is the total number of calendar days between the most recent vesting date set forth in the Grant Notice (or, if a vesting date has not occurred, the Date of Grant) and the final vesting date set forth in the Award Notice.
(vi) “Qualifying Termination” shall have the meaning ascribed to such term in the Employment Agreement.
(vii) “Termination of Service” means the termination of the Participant’s employment with, or performance of services for, the Company and its Affiliates. Unless otherwise determined by the Committee, (a) if the Participant’s employment or services with the Company and its Affiliates terminates but the Participant continues to provide services to
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the Company and its Affiliates in a non-employee capacity, such change in status shall not be deemed a Termination of Service with the Company and its Affiliates and (b) if the Participant is employed by, or performing services for an Affiliate that ceases to be an Affiliate, the Participant shall be deemed to have incurred a Termination of Service provided the Participant does not immediately thereafter become an employee of the Company or another Affiliate. Notwithstanding the foregoing provisions of this definition, to the extent this Award constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A, the Participant shall not be considered to have experienced a “Termination of Service” unless the Participant has experienced a “separation from service” within the meaning of Section 409A.
3. Payment. As soon as administratively practicable following the vesting of this Award pursuant to Section 2, but in no event later than 60 days after such vesting date, the Company shall pay to the Participant the amount of the vested portion of this Award. Neither this Section 3 nor any action taken pursuant to or in accordance with this Agreement shall be construed to create a trust or a funded or secured obligation of any kind.
4. Restrictive Covenants.
(a) The Participant acknowledges and agrees that this Award further aligns the Participant’s interests with the Company’s long-term business interests, and as a condition to the Company’s willingness to enter into this Agreement, the Participant agrees to abide by the terms of any and all restrictive covenant agreements and obligations to which the Participant is subject in respect of the Company and its Affiliates, including, but not limited to, any confidentiality, non-disclosure, non-competition, non-solicitation, non-disparagement, assignment of inventions or other restrictive covenants in any Service Arrangement (as defined below) or other agreement by and between the Company or any Affiliate and the Participant, including those set forth in the Employment Agreement (the “Restrictive Covenants”).
(b) Notwithstanding any provision in this Agreement or the Plan to the contrary, in the event the Committee determines that the Participant has materially breached any of the Restrictive Covenants; provided that, solely for purposes of Sections 2 and 4 (and without affecting the determination of whether a breach of the Restrictive Covenants has occurred for any other purpose or limiting any other remedies with respect thereto), a material breach of the Restrictive Covenants can only occur if (x) the Company provides the Participant with written notice of the circumstances constituting the alleged material breach of the Restrictive Covenants within 90 days after becoming aware of such circumstances and (y) the alleged breach, if curable (which includes any commercial relationship resulting from such prohibited conduct), has not been cured within 15 days after receipt of the written notice described in clause (x), then any portion this Award (whether or not vested) that has not yet been paid as of the date of such determination will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
5. Tax Withholding. Notwithstanding any other provision of this Agreement, the Company has the authority to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by applicable law to be withheld with respect to any taxable event arising pursuant to this Agreement. The Company may withhold or the Participant may make such payment in accordance with Section 13.3 of the Plan.
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6. Non-Transferability. During the lifetime of the Participant, this Award may not be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution, unless and until this Award has been paid to the Participant. Neither this Award nor any interest or right therein shall be liable for the debts, contracts or engagements of the Participant or the Participant’s successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence.
7. Rights as a Stockholder. The Participant shall have no rights or privileges of a stockholder of the Company with respect to this Award.
8. Execution of Receipts and Releases. Any payment in respect of this Award to the Participant or the Participant’s legal representative, heir, legatee or distributee, in accordance with this Agreement shall be in full satisfaction of all claims of such Person hereunder. As a condition precedent to such payment, the Company may require the Participant or the Participant’s legal representative, heir, legatee or distributee to execute (and not revoke within any time provided to do so) a release and receipt therefor in such form as it shall determine appropriate; provided that any review period under such release will not modify the date of payment with respect to the vested portion of this Award.
9. No Right to Continued Employment, Service or Awards. Nothing in the adoption of the Plan, nor the award of this Award thereunder pursuant to the Award Notice and this Agreement, shall confer upon the Participant the right to continued employment by, or a continued service relationship with, the Company or any Affiliate, or any other entity, or affect in any way the right of the Company or any such Affiliate, or any other entity to terminate such employment or other service relationship at any time. Unless otherwise provided in a Service Arrangement or by applicable law, the Participant’s employment by the Company, or any such Affiliate, or any other entity shall be on an at-will basis, and the employment relationship may be terminated at any time by either the Participant or the Company, or any such Affiliate, or other entity for any reason whatsoever, with or without cause or notice. Any question as to whether and when there has been a termination of such employment, and the cause of such termination, shall be determined by the Committee or its delegate, and such determination shall be final, conclusive and binding for all purposes. The grant of this Award is a one-time benefit that was made at the sole discretion of the Company and does not create any contractual or other right to receive a grant of Awards or benefits in the future in lieu of Awards in the future, including any adjustment to wages, overtime, benefits or other compensation. Any future Awards will be granted at the sole discretion of the Company.
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10. Notices. All notices and other communications under this Agreement shall be in writing and shall be delivered to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):
If to the Company, unless otherwise designated by the Company in a written notice to the Participant (or other holder):
Hornbeck Offshore Services, Inc.
103 Northpark Blvd., Suite 300
Covington, LA 70433
Attention: [__________]
E-Mail: [__________]
If to the Participant, at the Participant’s last known address on file with the Company.
Notice shall be deemed to have been duly delivered (a) when delivered in person, (b) when sent by email (provided that the sender has not received any “bounce-back,” “out of office,” or similar message indicating that the email was not sent or received by the recipient) on a business day; provided that if a notice is sent by email after normal business hours of the recipient or on a non-business day, then it shall be deemed to have been received on the next business day after it is sent, (c) on the first business day after such notice is sent by express overnight courier service or (d) on the second business day following deposit with an internationally-recognized second-day courier service with proof of receipt maintained.
11. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, the Participant agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports and all other forms of communications) in connection with this and any other Award made or offered by the Company. Electronic delivery may be via a Company electronic mail system, by reference to a location on a Company intranet to which the Participant has access, or to the Participant’s account with the Company’s equity plan administrator. The Participant hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that the Participant’s electronic signature is the same as, and shall have the same force and effect as, the Participant’s manual signature.
12. Agreement to Furnish Information. The Participant agrees to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirement imposed upon the Company by or under any applicable law.
13. Entire Agreement; Amendment. This Agreement (which, for clarity, includes the Award Notice and the Plan) constitutes the entire agreement of the parties with regard to the subject matter hereof, and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the Award granted hereby; provided that (a) the terms of this Agreement shall not modify and shall be subject to the terms and conditions of any employment agreement, offer letter, consulting agreement, change-in-control agreement, severance agreement or similar agreement between the Company or an Affiliate and the Participant or any severance plan, change-in-control plan or similar plan of the Company or an Affiliate in which the Participant participates (any such arrangement, a “Service Arrangement”), including
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the Employment Agreement, in each case, in effect as of the date a determination is to be made under this Agreement; and (b) the consequences for a material breach of the Restrictive Covenants set forth herein are in addition to and complement (and do not replace or supersede) any other consequences set forth in the Employment Agreement or otherwise for a breach of the Restrictive Covenants. Without limiting the scope of the preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. The Committee may, in its sole discretion, amend this Agreement from time to time in any manner that is not inconsistent with the Plan; provided that except as otherwise provided in the Plan or this Agreement, any such amendment that materially impairs the rights of the Participant shall be effective only if it is in writing and signed by both the Participant and an authorized officer of the Company.
14. Severability and Waiver. If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of such provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect. Waiver by any party of any breach of this Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such right continues.
15. Company Recoupment of Awards. The Participant’s rights with respect to this Award shall in all events be subject to (a) any right that the Company may have under any Company recoupment or clawback policy or other agreement or arrangement with the Participant, and (b) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission or any other applicable law. The Participant’s acceptance of this Award will constitute the Participant’s acknowledgment of and consent to the Company’s application, implementation and enforcement of any Company recoupment, clawback or similar policy that may apply to the Participant and this Award, whether adopted before or after the Date of Grant (whether through clawback, cancellation, recoupment, rescission, payback, reduction or other similar action in accordance therewith) and any applicable law relating to clawback, cancellation, recoupment, rescission, payback or reduction of compensation or other similar action, and the Participant’s agreement that the Company may take any actions that may be necessary to effectuate any such policy or applicable law, without further consideration or action.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED THEREIN, EXCLUSIVE OF THE CONFLICT OF LAWS PROVISIONS OF DELAWARE LAW.
17. Venue. The Company, the Participant and any of the Participant’s permitted transferees, agree that any suit, action or proceeding arising out of or related to this Agreement shall be brought in the United States District Court for the District of Delaware (or should such court lack jurisdiction to hear such action, suit or proceeding, in the courts of the State of Delaware) and that all parties shall submit to the jurisdiction of such court. The parties irrevocably waive, to
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the fullest extent permitted by applicable law, any objection the party may have to the laying of venue for any such suit, action or proceeding brought in such court. Without limiting the generality of Section 14, if any one or more provisions of this Section 17 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable.
18. Successors and Assigns. The Company may assign any of its rights under this Agreement without the Participant’s consent. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein and in the Plan, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the Person(s) to whom this Award may be transferred by will or the laws of descent or distribution.
19. Headings; References; Interpretation. Headings are for convenience only and are not deemed to be part of this Agreement. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All references herein to Sections shall, unless the context requires a different construction, be deemed to be references to the Sections of this Agreement. The word “or” as used herein is not exclusive and is deemed to have the meaning “and/or.” All references to “including” shall be construed as meaning “including without limitation.” Unless the context requires otherwise, all references herein to a law, agreement, instrument or other document shall be deemed to refer to such law, agreement, instrument or other document as amended, supplemented, modified and restated from time to time to the extent permitted by the provisions thereof. All references to “dollars” or “$” in this Agreement refer to United States dollars. Whenever the context may require, the singular form of nouns and pronouns shall include the plural and vice versa. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against any party hereto, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by each of the parties hereto and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the parties hereto.
20. Counterparts. The Award Notice may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Delivery of an executed counterpart of the Award Notice by facsimile or portable document format (.pdf) attachment to electronic mail or via electronic acceptance in accordance with Section 10 shall be effective as delivery of a manually executed counterpart of the Award Notice.
21. Section 409A. The Plan, this Agreement and Awards are intended to comply with or be exempt from the applicable requirements of Section 409A and shall be limited, construed and interpreted in accordance with such intent. To the extent that any Award is subject to Section 409A, it shall be paid in a manner that will comply with Section 409A, including proposed, temporary or final regulations or any other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto. Notwithstanding anything herein to the contrary, any provision in the Plan or this Agreement that is inconsistent with Section 409A shall be deemed to be amended to comply with or be exempt from Section 409A and, to the extent such provision cannot be amended to comply therewith or be exempt therefrom, such provision shall be null and void. Notwithstanding any contrary provision in the Plan or this Agreement, any
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payment(s) of “nonqualified deferred compensation” (within the meaning of Section 409A) that are otherwise required to be made under the Plan or this Agreement to a “specified employee” (as defined under Section 409A) as a result of such employee’s separation from service (other than a payment that is not subject to Section 409A) shall be delayed for the first six (6) months following such separation from service (or, if earlier, until the date of death of the specified employee) and shall instead be paid (in a manner set forth in this Agreement) upon expiration of such delay period. If the Award includes a “series of installment payments” (within the meaning of Section 1.409A-2(b)(2)(iii) of the Treasury Regulations), the Participant’s right to the series of installment payments shall be treated as a right to a series of separate payments and not as a right to a single payment. Notwithstanding the foregoing, the Company and its Affiliates make no representations that the Cash Award provided under this Agreement are exempt from or compliant with Section 409A and in no event shall the Company or any Affiliate be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A.
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Exhibit 10.8
HORNBECK OFFSHORE SERVICES, INC.
Service with Energy
DIRECTOR
COMPENSATION POLICY
Effective Date
This policy is effective as of September 1, 2026.
Cash Compensation Plan
Each Director of Hornbeck Offshore Services, Inc. (the “Company”) that is not an employee of the Company or an employee of any stockholder with the contractual right to designate such director for election or appointment to the Board of Directors (a “Non-Employee Director”) will receive a total annual cash retainer of $100,000. The Non-Executive Chairperson shall receive an additional annual retainer of $135,000, the Chairperson of the Audit Committee shall receive an additional annual retainer of $25,000, the Chairperson of the Compensation Committee shall receive an additional annual retainer of $20,000, and the Chairperson of the Sustainability and Nominating & Governance Committee shall receive an additional annual retainer of $20,000. Each other Non-Employee Director serving on the Audit Committee shall receive an additional annual retainer of $12,500, each other Non-Employee Director serving on the Compensation Committee shall receive an annual retainer of $10,000, and each other Non-Employee Director serving on the Sustainability and Nominating & Governance Committee shall receive an annual retainer of $10,000. Each retainer payment shall be payable quarterly in arrears within 60 days following the completion of each quarter and pro-rated for any partial quarter of service.
Equity Compensation Program
Each Non-Employee Director who (i) serves on the Board as of the date of any annual meeting of the Company’s stockholders (an “Annual Meeting”) and (ii) will continue to serve as a Non-Employee Director immediately following such Annual Meeting shall be automatically granted, on the date of such Annual Meeting, an annual equity retainer in the form of restricted stock units (“RSUs”) with a grant date value of $175,000 (the “Annual RSU Award”). Such dollar amounts may be reviewed annually and adjusted at the discretion of the Compensation Committee. The number of units granted will be equal to the grant date value of the award divided by the Fair Market Value (as defined below) of one share of the Company’s common stock (the “Common Stock”) on the grant date, with any fractional share resulting from such calculation rounded up or down to the nearest whole share.
Except as otherwise determined by the Board, the Annual RSU Award will vest in full on the earlier of (a) the date of the first Annual Meeting following the date of grant and (b) the first anniversary of the date of grant (the “Vesting Date”), in each case, subject to the applicable Non-Employee Director’s continued service on the Board through the Vesting Date, except as provided below:
| • | Death or Disability. Upon a Non-Employee Director’s termination of service on the Board due to the Non-Employee Director’s death or Disability (as such term or term of similar import is defined in the Equity Plan or the award agreement thereunder, as applicable), the Non-Employee Director’s Annual RSU Award shall immediately become vested as of the date of such termination of service. |
| • | Termination Without Cause or Resignation. Upon a Non-Employee Director’s termination of service on the Board due to the Non-Employee Director’s removal from the Board without cause (as determined by the Board in good faith) or the Non-Employee Director’s resignation from the Board (except at a time when grounds for cause exist (as determined by the Board in good faith)), a Pro-Rated Amount (as defined below) of the Non-Employee Director’s Annual RSU Award shall immediately become vested as of the date of such termination of service. “Pro-Rated Amount” means the product of (i) the total number of unvested RSUs as of such termination of service and (ii) a fraction, (x) the numerator of which is the total number of calendar days that have elapsed from the grant date through the date of the Non-Employee Director’s termination of service and (y) the denominator of which is the total number of calendar days between the grant date and the Vesting Date (or, if the Vesting Date is not yet determinable, the first anniversary of the Company’s most recent Annual Meeting). For clarity, if such removal or resignation occurs upon the closing of a Change in Control (as defined below), the Non-Employee Director’s RSUs will be treated as set forth immediately below in the section titled “Change in Control”. |
| • | Change in Control. A Non-Employee Director’s Annual RSU Award shall vest in full immediately prior to the occurrence of a Change in Control (as such term or term of similar import is defined in the Equity Plan or the award agreement thereunder, as applicable) to the extent outstanding at such time. |
Sign-On Equity Award
In connection with a Non-Employee Director’s initial appointment or election to the Board, and in recognition of service through the next annual meeting of stockholders, a Non-Employee Director may be granted a one-time sign-on equity award as determined by the Compensation Committee and subject to the terms of the applicable equity incentive plan.
The Compensation Committee may grant sign-on awards in the form of RSUs, other equity awards, or cash.
In addition to the annual equity awards described above, the Compensation Committee may, in its discretion, approve additional equity awards to Non-Employee Directors in connection with significant events or circumstances, including extraordinary transactions, material changes in Board or committee service, or other event-driven circumstances that the Compensation Committee determines warrant additional compensation, subject in all cases to the terms of the applicable equity incentive plan.
For purposes of this section, “Fair Market Value” shall mean (i) at any time the Common Stock is listed or quoted for trading on the New York Stock Exchange, the NYSE MKT, the NASDAQ Global Select Market, the NASDAQ Global Market, or the NASDAQ Capital Market, the arithmetic average of the daily VWAP of a share or single unit of such Common Stock for the twenty (20) consecutive trading days on which such Common Stock traded immediately preceding the date of measurement; or (ii) otherwise, the value as reasonably determined in good faith by the Board of Directors. Such determination shall be final and binding.
“VWAP” shall mean, for any trading day, the price for securities (including the Common Stock) determined by the daily volume weighted average price per unit of securities for such trading day on the New York Stock Exchange, the NYSE MKT, the NASDAQ Global Select Market, the NASDAQ Global Market, or the NASDAQ Capital Market, as the case may be, in each case, for the regular trading session (including any extensions thereof, without regard to pre-open or after hours trading outside of such regular trading session), on such trading day.
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Stock Option Grants, Stock Awards and Restricted Stock Unit Awards
All options granted, stock awarded and restricted stock units awarded to Non-Employee Directors under this policy will be granted under and issued from the Company’s 2005 Long Term Incentive Plan (as amended and restated September 1, 2026), as such plan may be amended and restated from time to time, or any successor plan (as applicable, the “Equity Plan”).
Expense Reimbursement
All Non-Employee Directors will be eligible to be reimbursed for reasonable expenses incurred in connection with Board service in accordance with the Company’s expense reimbursement policy, subject to the provision by the applicable Non-Employee Director of documentation evidencing such expenses in a form reasonably satisfactory to the Company.
Insider Trading and Stock Ownership Guidelines
All Non-Employee Directors are subject to the Company’s Insider Trading Policy and the Company’s Stock Ownership Guidelines. Non-Employee Directors are prohibited from entering into hedging transactions or similar arrangements regarding their Company securities pursuant to the Company’s Insider Trading Policy.
Section 409A
In no event will cash compensation or expense reimbursement payments hereunder be paid after the later of (a) the 15th day of the third month following the end of the Company’s taxable year in which the compensation is earned or expenses are incurred, as applicable, or (b) the 15th day of the third month following the end of the calendar year in which the compensation is earned or expenses are incurred, as applicable, in compliance with the “short-term deferral” exception under Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”). This policy is intended to be exempt from or comply with Section 409A, and ambiguities will be interpreted accordingly. In no event will the Company have any responsibility, liability, or obligation to reimburse, indemnify, or hold harmless a Non-Employee Director (or any other person) for any taxes imposed, or other costs incurred, as a result of Section 409A.
Interpretation and Administration
The Compensation Committee is authorized to interpret and construe this policy and to make all determinations necessary, appropriate, or advisable for the administration of this policy. Any interpretation made by the Compensation Committee shall be final, conclusive, and binding.
Review and Amendment
The Compensation Committee shall review this policy at least annually and may recommend any modifications to the Board. This policy shall remain in effect until it is amended or rescinded by further action of the Board.
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Exhibit 10.9
Director Form
HORNBECK OFFSHORE SERVICES, INC.
2005 LONG TERM INCENTIVE PLAN
(AS AMENDED AND RESTATED EFFECTIVE SEPTEMBER 1, 2026)
NON-EMPLOYEE DIRECTOR RESTRICTED STOCK UNIT GRANT NOTICE
Pursuant to the terms and conditions of the Hornbeck Offshore Services, Inc. 2005 Long Term Incentive Plan (as amended and restated effective September 1, 2026) (f/k/a Helix Energy Solutions Group, Inc. 2005 Long Term Incentive Plan) (as may be further amended, amended and restated, supplemented or otherwise modified from time to time, the “Plan”), and the Hornbeck Offshore Services, Inc. Director Compensation Policy, as amended, amended and restated, supplemented or otherwise modified from time to time (the “Director Compensation Policy”), Hornbeck Offshore Services, Inc (f/k/a Helix Energy Solutions Group, Inc.)., a Delaware corporation (the “Company”), hereby grants to the individual listed below (“you” or the “Participant”) the number of Restricted Stock Units (the “RSUs”) set forth below. This award of RSUs (this “Award”) is subject to the terms and conditions set forth herein and in the Non-Employee Director Restricted Stock Unit Award Agreement attached hereto as Exhibit A (the “Agreement”), the Plan and the Director Compensation Policy, each of which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.
| Type of Award: | Restricted Stock Units | |
| Participant: | [__________] | |
| Date of Grant: | [__________] | |
| Total Number of Restricted Stock Units: | [__________] | |
| Vesting Schedule: | [__________] | |
By your signature below, you agree to be bound by the terms and conditions of the Plan, the Director Compensation Policy, the Agreement and this Non-Employee Director Restricted Stock Unit Grant Notice (this “Grant Notice”). You acknowledge that you have reviewed the Agreement, the Plan, the Director Compensation Policy and this Grant Notice in their entirety and fully understand all provisions of the Agreement, the Plan, the Director Compensation Policy and this Grant Notice and have had an opportunity to obtain the advice of counsel prior to executing this Grant Notice. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee regarding any questions or determinations arising under the Agreement, the Plan, the Director Compensation Policy or this Grant Notice. This Grant Notice may be executed in one or more counterparts (including portable document format (.pdf) and facsimile counterparts), each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement.
Notwithstanding any provision of this Grant Notice or the Agreement, if you have not executed this Grant Notice within 90 days following the Date of Grant set forth above, you will be deemed to have accepted this Award, subject to all of the terms and conditions of this Grant Notice, the Agreement, the Plan and the Director Compensation Policy.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused this Grant Notice to be executed by an officer thereunto duly authorized, and the Participant has executed this Grant Notice, effective for all purposes as provided above.
| HORNBECK OFFSHORE SERVICES, INC. | ||||
| By: |
| |||
| Name: | [__________] | |||
| Title: | [__________] | |||
| PARTICIPANT |
|
|
| Name: [__________] |
SIGNATURE PAGE TO
NON-EMPLOYEE DIRECTOR RESTRICTED STOCK UNIT GRANT NOTICE
EXHIBIT A
NON-EMPLOYEE DIRECTOR RESTRICTED STOCK UNIT AWARD AGREEMENT
This Non-Employee Director Restricted Stock Unit Award Agreement (together with the Non-Employee Director Restricted Stock Unit Grant Notice (the “Grant Notice”) to which this Non-Employee Director Restricted Stock Unit Award Agreement is attached, this “Agreement”) is made as of the Date of Grant set forth in the Grant Notice (the “Date of Grant”), by and between Hornbeck Offshore Services, Inc. (f/k/a Helix Energy Solutions Group, Inc.), a Delaware corporation (the “Company”), and [__________] (the “Participant”). Capitalized terms used but not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice.
1. Award. In accordance with the Director Compensation Policy, effective as of the Date of Grant, the Company hereby grants to the Participant the number of RSUs set forth in the Grant Notice on the terms and conditions set forth in the Grant Notice, this Agreement, the Plan and the Director Compensation Policy, each of which is incorporated herein by reference as a part of this Agreement. In the event of any inconsistency between the Plan and the Director Compensation Policy, as applicable, and this Agreement, the terms of the Plan or the Director Compensation Policy, as applicable, shall control. To the extent vested, each RSU represents the right to receive one share of Stock (a “Share”), subject to the terms and conditions set forth in the Grant Notice, this Agreement, the Plan and the Director Compensation Policy. Unless and until the RSUs have become vested in the manner set forth in the Grant Notice and Section 2, the Participant will have no right to receive any Shares or other payments in respect of the RSUs. Prior to settlement of this Award, the RSUs and this Award represent an unsecured obligation of the Company, payable only from the general assets of the Company.
2. Vesting of RSUs.
(a) General. Except as otherwise set forth in Section 2, the RSUs shall vest in accordance with the vesting schedule set forth in the Grant Notice. Upon the Participant’s termination of service as a member of the Board (a “Termination of Service”) prior to the vesting of all of the RSUs (but after giving effect to any accelerated vesting pursuant to this Section 2), any unvested RSUs (and all rights arising from such RSUs and from being a holder thereof, including any Dividend Equivalent Rights) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company.
(b) Termination of Service. Notwithstanding anything in the Grant Notice, this Agreement, the Plan or the Director Compensation Policy to the contrary, subject to Section 9 (as applicable):
(i) upon the Participant’s Termination of Service due to the Participant’s death or Disability, all RSUs shall immediately become vested as of the date of such Termination of Service;
(ii) upon the Participant’s Termination of Service due to removal from the Board without cause (as determined by the Board in good faith) or the Participant’s resignation from the Board (except in the event of a Change in Control, in which case the Participant’s RSUs will be treated in accordance with Section 2(c), or at a time when grounds for cause exist (as determined by the Board in good faith)), a Pro-Rated Amount of the RSUs shall immediately become vested as of the date of such Termination of Service;
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(iii) upon the Participant’s Termination of Service for cause (as determined by the Board in good faith), all outstanding RSUs, whether or not vested (and all rights arising from such RSUs and from being a holder thereof, including any Dividend Equivalent Rights) will terminate automatically without any further action by the Company and will be forfeited without further notice and at no cost to the Company; or
(c) Change in Control. Notwithstanding anything in the Grant Notice, this Agreement, the Plan or the Director Compensation Policy to the contrary, in the event of a Change in Control, all RSUs shall vest in full immediately prior to such Change in Control to the extent outstanding at such time.
(d) Definition. For purposes of this Agreement:
(i) “Disability” means that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment, after accounting for reasonable accommodations (if applicable and required by applicable law). The determination of whether an individual has a Disability shall be determined by the Committee, and the Committee may rely on any determination that the Participant is disabled for purposes of benefits under any long-term disability plan in which the Participant participates that is maintained by the Company or any Affiliate.
(ii) “Pro-Rated Amount” means the product, rounded up to the nearest whole number, of (i) the total number of unvested RSUs as of such Termination of Service and (ii) a fraction, (A) the numerator of which is the total number of calendar days that have elapsed from the Date of Grant through the date of the Participant’s Termination of Service and (B) the denominator of which is the total number of calendar days between the Date of Grant and the Vesting Date (or, if the Vesting Date is not yet determinable, the first anniversary of the Company’s most recent annual stockholder meeting).
3. Dividend Equivalent Rights. In the event that the Company declares and pays a regular cash dividend in respect of its outstanding Shares (which, for clarity, does not include any extraordinary cash dividend) and, on the record date for such dividend, the Participant holds RSUs granted pursuant to this Agreement that have not been settled, the Company shall record in a bookkeeping account an amount equal to the cash dividends the Participant would have received if the Participant was the holder of record, as of such record date, of a number of Shares equal to the number of RSUs held by the Participant that have not been settled as of such record date (the “Dividend Equivalent Rights”), and such Dividend Equivalent Rights shall be subject to the same terms and conditions, including with respect to vesting, forfeitability and transferability, as the underlying RSUs. All amounts, if any, payable as a result of such Dividend Equivalents Rights shall be paid to the Participant in cash (or, at the discretion of the Company, in Shares) on or following, but no later than 60 days after, the date that the underlying RSU vests. For purposes of clarity, if any of the RSUs are forfeited by the Participant pursuant to the terms of this Agreement, then the Participant shall also forfeit the Dividend Equivalent Rights, if any, accrued with respect to such forfeited RSUs. No interest will accrue on the Dividend Equivalent Rights between the declaration and payment of the applicable dividends and the settlement of the Dividend Equivalent Rights.
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4. Settlement of RSUs. As soon as administratively practicable following the vesting of RSUs pursuant to Section 2, but in no event later than 60 days after such vesting date, the Company shall deliver to the Participant a number of Shares equal to the number of RSUs that vested on such vesting date. All Shares issued hereunder shall be delivered either by delivering one or more certificates for such Shares to the Participant or by entering such Shares in book-entry form, as determined by the Committee in its sole discretion. The value of Shares shall not bear any interest owing to the passage of time. Neither this Section 4 nor any action taken pursuant to or in accordance with this Agreement shall be construed to create a trust or a funded or secured obligation of any kind. No fraction of a Share shall be issued by the Company upon settlement of the RSUs. Instead, in the event that there is a fraction of an RSU that is vested, the number of vested RSUs shall be rounded up to the nearest whole number.
5. Taxes. Notwithstanding any other provision of this Agreement and to the extent applicable:
(a) The Company has the authority to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by applicable law to be withheld with respect to any taxable event arising pursuant to this Agreement. The Company may withhold or the Participant may make such payment in accordance with Section 13.3 of the Plan.
(b) The Company shall not be obligated to deliver any certificate representing Shares issuable with respect to the RSUs to, or to cause any such Shares to be held in book-entry form by, the Participant or the Participant’s legal representative unless and until the Participant or the Participant’s legal representative shall have paid or otherwise satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of the Participant resulting from the vesting or settlement of the RSUs or any other taxable event related to the RSUs.
(c) The Participant is ultimately liable and responsible for all taxes owed in connection with the RSUs, regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the RSUs. The Company makes no representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or settlement of the RSUs or the subsequent sale of Shares. The Company does not commit and is under no obligation to structure the RSUs to reduce or eliminate the Participant’s tax liability.
(d) The Participant acknowledges that there may be adverse tax consequences upon the receipt, vesting or settlement of this Award or disposition of the underlying Shares and that the Participant has been advised, and hereby is advised, to consult a tax advisor. The Participant represents that the Participant is in no manner relying on the Board, the Committee, the Company or an Affiliate or any of their respective managers, directors, officers, employees or authorized representatives (including attorneys, accountants, consultants, bankers, lenders, prospective lenders and financial representatives) for tax advice or an assessment of such tax consequences.
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(e) No fraction of a Share shall be issued by the Company upon settlement of the RSUs or accepted by the Company in payment of any withholding obligation; rather, the Participant shall provide a cash payment for any withholding amount as is necessary to effect the issuance and acceptance of only whole Shares.
6. Non-Transferability. During the lifetime of the Participant, the RSUs may not be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution, unless and until the Shares underlying the RSUs have been issued, and all restrictions applicable to such Shares have lapsed. Neither the RSUs nor any interest or right therein shall be liable for the debts, contracts or engagements of the Participant or the Participant’s successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence.
7. Compliance with Applicable Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of Shares hereunder will be subject to compliance with all applicable requirements of applicable law with respect to such securities. No Shares will be issued hereunder if such issuance would constitute a violation of any applicable law. In addition, Shares will not be issued hereunder unless (a) a registration statement under the Securities Act of 1933, as amended (together with all rules and regulations promulgated thereunder, the “Securities Act”) is in effect at the time of such issuance with respect to the Shares to be issued or (b) in the opinion of legal counsel to the Company, the Shares to be issued are permitted to be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary for the lawful issuance and sale of any Shares hereunder will relieve the Company of any liability in respect of the failure to issue such Shares as to which such requisite authority has not been obtained. As a condition to any issuance of Shares hereunder, the Company may require the Participant to satisfy any requirements that may be necessary or appropriate to evidence compliance with any applicable law and to make any representation or warranty with respect to such compliance as may be requested by the Company.
8. Rights as a Stockholder. The Participant shall have no rights or privileges of a stockholder of the Company with respect to any Shares that may become deliverable hereunder unless and until the Participant has become the holder of record of such Shares and such Shares have been delivered to the Participant (including through electronic delivery to a brokerage account). No adjustments shall be made for dividends in cash or other property, distributions or other rights for which the record date is prior to the date of such issuance, recordation and delivery, except as otherwise specifically provided for in the Plan or this Agreement. Except as otherwise provided herein, after such issuance, recordation and delivery, the Participant will have all the rights of a stockholder of the Company with respect to such Shares, including, without limitation, the right to receipt of dividends and distributions on such Shares.
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9. Execution of Receipts and Releases. Any issuance or transfer of Shares or other property to the Participant or the Participant’s legal representative, heir, legatee or distributee, in accordance with this Agreement shall be in full satisfaction of all claims of such Person hereunder. As a condition precedent to such payment or issuance, the Company may require the Participant or the Participant’s legal representative, heir, legatee or distributee to execute (and not revoke within any time provided to do so) a release and receipt therefor in such form as it shall determine appropriate; provided that any review period under such release will not modify the date of settlement with respect to vested RSUs.
10. No Right to Continued Service or Awards. Nothing in the adoption of the Plan or the Director Compensation Policy, nor the award of the RSUs thereunder pursuant to the Grant Notice and this Agreement, shall confer upon the Participant the right to a continued service relationship with the Company or any Affiliate, or any other entity, or affect in any way the right of the Company or any such Affiliate, or any other entity to terminate such service relationship at any time. The grant of the RSUs is a one-time benefit that was made in accordance with the Director Compensation Policy and does not create any contractual or other right to receive a grant of Awards or benefits in the future in lieu of Awards in the future. Any future Awards will be granted in accordance with the Director Compensation Policy.
11. Notices. All notices and other communications under this Agreement shall be in writing and shall be delivered to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):
If to the Company, unless otherwise designated by the Company in a written notice to the Participant (or other holder):
Hornbeck Offshore Services, Inc.
103 Northpark Blvd., Suite 300
Covington, LA 70433
Attention: [__________]
E-Mail: [__________]
If to the Participant, at the Participant’s last known address on file with the Company.
Notice shall be deemed to have been duly delivered (a) when delivered in person, (b) when sent by email (provided that the sender has not received any “bounce-back,” “out of office,” or similar message indicating that the email was not sent or received by the recipient) on a business day; provided that if a notice is sent by email after normal business hours of the recipient or on a non-business day, then it shall be deemed to have been received on the next business day after it is sent, (c) on the first business day after such notice is sent by express overnight courier service or (d) on the second business day following deposit with an internationally-recognized second-day courier service with proof of receipt maintained.
12. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, the Participant agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements,
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account statements, annual and quarterly reports and all other forms of communications) in connection with this and any other Award made or offered by the Company. Electronic delivery may be via a Company electronic mail system, by reference to a location on a Company intranet to which the Participant has access, or to the Participant’s account with the Company’s equity plan administrator. The Participant hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that the Participant’s electronic signature is the same as, and shall have the same force and effect as, the Participant’s manual signature.
13. Agreement to Furnish Information. The Participant agrees to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirement imposed upon the Company by or under any applicable law.
14. Entire Agreement; Amendment. This Agreement (which, for clarity, includes the Grant Notice, the Plan and the Director Compensation Policy) constitutes the entire agreement of the parties with regard to the subject matter hereof, and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the RSUs granted hereby. Without limiting the scope of the preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. The Committee may, in its sole discretion, amend this Agreement from time to time in any manner that is not inconsistent with the Plan or the Director Compensation Policy; provided that except as otherwise provided in the Plan or this Agreement, any such amendment that materially impairs the rights of the Participant shall be effective only if it is in writing and signed by both the Participant and an authorized officer of the Company.
15. Severability and Waiver. If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of such provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect. Waiver by any party of any breach of this Agreement or failure to exercise any right hereunder shall not be deemed to be a waiver of any other breach or right. The failure of any party to take action by reason of such breach or to exercise any such right shall not deprive the party of the right to take action at any time while or after such breach or condition giving rise to such right continues.
16. Company Recoupment of Awards. The Participant’s rights with respect to this Award shall in all events be subject to (a) any right that the Company may have under any Company recoupment or clawback policy or other agreement or arrangement with the Participant, and (b) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission or any other applicable law. The Participant’s acceptance of this Award will constitute the Participant’s acknowledgment of and consent to the Company’s application, implementation and enforcement of any Company recoupment, clawback or similar policy that may apply to the Participant and this Award, whether adopted before or after the Date of Grant (whether though clawback, cancellation, recoupment, rescission, payback, reduction or other
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similar action in accordance therewith) and any applicable law relating to clawback, cancellation, recoupment, rescission, payback or reduction of compensation or other similar action, and the Participant’s agreement that the Company may take any actions that may be necessary to effectuate any such policy or applicable law, without further consideration or action.
17. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED THEREIN, EXCLUSIVE OF THE CONFLICT OF LAWS PROVISIONS OF DELAWARE LAW.
18. Venue. The Company, the Participant and any of the Participant’s permitted transferees, agree that any suit, action or proceeding arising out of or related to this Agreement shall be brought in the United States District Court for the District of Delaware (or should such court lack jurisdiction to hear such action, suit or proceeding, in the courts of the State of Delaware) and that all parties shall submit to the jurisdiction of such court. The parties irrevocably waive, to the fullest extent permitted by applicable law, any objection the party may have to the laying of venue for any such suit, action or proceeding brought in such court. Without limiting the generality of Section 15, if any one or more provisions of this Section 18 shall for any reason be held invalid or unenforceable, it is the specific intent of the parties that such provisions shall be modified to the minimum extent necessary to make it or its application valid and enforceable.
19. Conformity to Securities Laws. The Participant acknowledges that this Agreement is intended to conform to the extent necessary with all applicable laws, including, without limitation, the provisions of the Securities Act and the Exchange Act, and any and all regulations and rules promulgated thereunder by the Securities and Exchange Commission and state securities laws and regulations. Notwithstanding anything herein to the contrary, the RSUs shall be administered, granted and settled only in such a manner as to conform to applicable law. To the extent permitted by applicable law, the Plan and the Director Compensation Policy, this Agreement shall be deemed amended to the extent necessary to conform to applicable law.
20. Successors and Assigns. The Company may assign any of its rights under this Agreement without the Participant’s consent. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein and in the Plan, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the Person(s) to whom the RSUs may be transferred by will or the laws of descent or distribution.
21. Headings; References; Interpretation. Headings are for convenience only and are not deemed to be part of this Agreement. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All references herein to Sections shall, unless the context requires a different construction, be deemed to be references to the Sections of this Agreement. The word “or” as used herein is not exclusive and is deemed to have the meaning “and/or.” All references to “including” shall be construed as meaning “including without limitation.” Unless the context requires otherwise, all references herein to a law, agreement, instrument or other document shall be deemed to refer to such law, agreement, instrument or other document as amended, supplemented, modified and restated from time to time to the extent
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permitted by the provisions thereof. All references to “dollars” or “$” in this Agreement refer to United States dollars. Whenever the context may require, the singular form of nouns and pronouns shall include the plural and vice versa. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against any party hereto, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by each of the parties hereto and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the parties hereto.
22. Counterparts. The Grant Notice may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Delivery of an executed counterpart of the Grant Notice by facsimile or portable document format (.pdf) attachment to electronic mail or via electronic acceptance in accordance with Section 12 shall be effective as delivery of a manually executed counterpart of the Grant Notice.
23. Section 409A. Notwithstanding anything in this Agreement, the Grant Notice, the Plan or the Director Compensation Policy to the contrary, the RSUs granted pursuant to this Agreement are intended to be exempt from the applicable requirements of Section 409A and shall be limited, construed and interpreted in accordance with such intent. Notwithstanding the foregoing, the Company and its Affiliates make no representations that the RSUs provided under this Agreement are exempt from or compliant with Section 409A and in no event shall the Company or any Affiliate be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A.
[Remainder of Page Intentionally Blank]
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Exhibit 99.1
Hornbeck Announces New Employee Inducement Grant Under NYSE Rule 303A.08
HOUSTON and COVINGTON, La. – September 4, 2026 – Hornbeck Offshore Services, Inc. (the “Company”) (NYSE: HOS), a premier integrated offshore services company, today announced that in connection with the previously announced merger between the Company and Helix Energy Solutions Group, Inc., the Company granted Todd M. Hornbeck a performance-based equity award covering up to 1,500,000 shares of common stock under the Hornbeck Offshore Services, Inc. 2026 Omnibus Inducement Incentive Plan (the “Inducement Grant”). The Inducement Grant was made as a material inducement to Mr. Hornbeck’s acceptance of employment with the combined company and was approved by the Company’s Board of Directors.
The award will vest in two tranches: 500,000 shares vest based on achievement of target annualized gross synergies, and up to 1,000,000 shares vest based on achievement of certain share price targets, in each case by year-end 2029. The award will be subject to the terms and conditions of the plan and award agreement and Mr. Hornbeck’s continued service.
About Hornbeck Offshore Services
Hornbeck Offshore Services, Inc. is a global offshore services leader, providing innovative and integrated marine and subsea solutions to customers across the deepwater oilfield, defense and renewables industries.
Contacts:
Potter Adams
Executive Vice President and CFO
985-727-6815
Brent Arriaga
Vice President of Finance and Investor Relations
281-618-0460