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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 Date of Report (Date of
earliest event reported): April 15, 1997
SNYDER OIL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-10509 75-2306158
(State or other jurisdiction Commission File (IRS Employer
of incorporation) Number) Identification No.)
777 Main Street
Fort Worth, Texas 76102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (817) 338-4043
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Item 5. Other Events
On April 16, 1997, Snyder Oil Corporation (the "Company") issued the following
press release relating to the appointment of William G. Hargett as President and
Chief Operating Officer of the Company effective May 2, 1997:
"Fort Worth, Texas, April 16, 1997 - Snyder Oil Corporation
(NYSE- SNY) announced today that William G. Hargett has been named
President, Chief Operating Officer and a Director of the Company. John
C. Snyder will relinquish his position as interim President of the
Company and will continue as Chief Executive Officer and Chairman of
the Board of Directors.
"Hargett, 47, comes to Snyder from Greenhill Petroleum
Corporation, where he was President and Director until yesterday's $270
million sale of that company to Mesa, Inc. Prior to Greenhill, he
served as President of Amax Oil & Gas, Inc. until that company's $820
million sale to Union Pacific Resources Group, Inc. Previously, he
served for 5 years as President and Chief Executive Officer of North
Central Oil Corporation, and was with Tenneco Oil Company for 14 years
in a variety of exploration and management positions. He earned B.S.
and M.S. degrees in geology from the University of Alabama.
"In his new position, Mr. Hargett will be responsible for the
Company's overall exploration and production activities and much of its
daily administration. At year-end 1996, Snyder had proved reserves of
141 million BOE with a pretax value discounted at 10% of $1.2 billion.
During 1996 the Company produced 13.2 million BOE.
"Commenting on the new President, Mr. Snyder said, 'From his
days as a Tenneco exploration manager, through his experiences running
three successful oil and gas companies, Billy Hargett has demonstrated
an ability to make an impact and add significant value. He has a rare
combination of technical, operational and managerial skills that will
help enormously as SOCO continues growing through major development
projects currently underway in the Gulf and the Rockies, through our
exploration targeting Cotton Valley reefs under our large acreage
position in North Louisiana and through acquisitions whose value can be
enhanced by aggressive exploitation. We are striving to reach a new
level of profitability and growth and believe we have found the man who
can best help us get there.'
"Snyder Oil Corporation is engaged in the production,
development, acquisition and exploration of domestic oil and gas
properties. The Company is also engaged in international exploration
and production, directly as well as through affiliates."
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
1. Employment Agreement effective as of May 2, 1997 between Snyder Oil
Corporation and William G. Hargett.
2. Indemnification Agreement dated as of May 2, 1997 between Snyder Oil
Corporation and William G. Hargett.
3. Severance Agreement dated as of April 17, 1997 between Snyder Oil
Corporation and Thomas J. Edelman.
4. Advisory Agreement entered into effective as of May 1, 1997 between
Snyder Oil Corporation and Thomas J. Edelman.
SIGNATURES
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 thereunto duly authorized.
SNYDER OIL CORPORATION
/s/ Peter E. Lorenzen
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By: Peter E. Lorenzen
Vice President
April 24, 1997
EXHIBIT 1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made by and between SNYDER
OIL CORPORATION, a Delaware corporation ("Company"), and WILLIAM G. HARGETT
("Executive").
W I T N E S S E T H:
WHEREAS, Company is desirous of employing Executive in an executive
capacity on the terms and conditions, and for the consideration, hereinafter set
forth and Executive is desirous of being employed by Company on such terms and
conditions and for such consideration;
NOW, THEREFORE, for and in consideration of the mutual promises,
covenants and obligations contained herein, Company and Executive agree as
follows:
ARTICLE 1: EMPLOYMENT AND DUTIES
1.1 Employment; Effective Date. Company agrees to employ Executive and
Executive agrees to be employed by Company, beginning as of the Effective Date
(as hereinafter defined) and continuing for the period of time set forth in
Article 2 of this Agreement, subject to the terms and conditions of this
Agreement. For purposes of this Agreement, the "Effective Date" shall be May 2,
1997.
1.2 Positions. From and after the Effective Date, Company shall employ
Executive in the positions of President and Chief Operating Officer of Company,
or in such other positions as the parties mutually may agree. On the Effective
Date, Company shall cause Executive to be elected to serve on the Board of
Directors of Company (the "Board of Directors") as a full member thereof, and
thereafter Company shall continue to cause Executive to be nominated to serve on
the Board of Directors and will use reasonable efforts to secure Executive's
election to the Board of Directors. It is the intention of the parties that
Executive will be elected to and will serve on the Board of Directors while
serving hereunder as President and Chief Operating Officer of Company.
1.3 Duties and Services. Executive agrees to serve in the positions
referred to in paragraph 1.2 and to perform diligently and to the best of his
abilities the duties and services appertaining to such offices, as well as such
additional duties and services appropriate to such offices which the parties
mutually may agree upon from time to time. Executive's employment shall also be
subject to the policies maintained and established by Company that are of
general applicability to Company's executive employees, as such policies may be
amended from time to time.
1.4 Other Interests. Executive agrees, during the period of his
employment by Company, to devote his primary business time, energy and best
efforts to the business and affairs of Company and its affiliates and not to
engage, directly or indirectly, in any other business or businesses, whether or
not similar to that of Company, except with the consent of the Board of
Directors. The foregoing notwithstanding, the parties recognize and agree that
Executive may engage in passive personal investments (including, without
limitation, commodity trading of oil and gas for Executive's own
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account) and other business activities that do not conflict with the business
and affairs of Company or interfere with Executive's performance of his duties
hereunder.
1.5 Duty of Loyalty. Executive acknowledges and agrees that Executive
owes a fiduciary duty of loyalty to act at all times in the best interests of
Company. In keeping with such duty, Executive shall make full disclosure to
Company of all business opportunities pertaining to Company's business and shall
not appropriate for Executive's own benefit business opportunities concerning
Company's business.
ARTICLE 2: TERM AND TERMINATION OF EMPLOYMENT
2.1 Term. Unless sooner terminated pursuant to other provisions hereof,
Company agrees to employ Executive for the period beginning on the Effective
Date and ending on the fourth anniversary of the Effective Date; provided,
however, that beginning with the second anniversary of the Effective Date, said
term of employment shall be extended automatically for an additional successive
one-year period as of each anniversary date of the Effective Date that occurs
while this Agreement is in effect; and provided further, however, that if, at
any time prior to any such anniversary date of the Effective Date, either party
shall give written notice to the other that no such automatic extension shall
occur, then Executive's employment shall terminate on the last day of the
two-year period beginning on the anniversary date of the Effective Date that
next occurs after such notice is given.
2.2 Company's Right to Terminate. Notwithstanding the provisions of
paragraph 2.1, Company shall have the right to terminate Executive's employment
under this Agreement at any time for any of the following reasons:
(i) upon Executive's death;
(ii) upon Executive's becoming incapacitated by accident,
sickness or other circumstance which renders him mentally or physically
incapable of performing the duties and services required of him
hereunder on a full-time basis for a period of at least 180 consecutive
days;
(iii) for cause, which for purposes of this Agreement shall
mean Executive (A) has engaged in gross negligence or willful
misconduct in the performance of the duties required of him hereunder,
(B) has willfully refused without proper legal reason to perform the
duties and responsibilities required of him hereunder, (C) has
materially breached any material provision of this Agreement or any
material corporate policy maintained and established by Company that is
of general applicability to Company's executive employees, (D) has
willfully engaged in conduct that he knows or should know is materially
injurious to Company or any of its affiliates, or (E) has engaged in
illegal conduct or any act of serious dishonesty which adversely
affects, or reasonably could in the future adversely affect, the value,
reliability, or performance of Executive in a material manner;
provided, however, that Executive's employment may be terminated
pursuant to this paragraph 2.2(iii) only if such termination is
approved by at least two-thirds of the members of the Board of
Directors after Executive has been given written
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notice by Company of the specific reason for such termination and an
opportunity for Executive, together with his counsel, to be heard
before the Board of Directors; or
(iv) for any other reason whatsoever, in the sole discretion
of the Board of Directors.
Members of the Board of Directors may participate in any hearing that is
required pursuant to paragraph 2.2(iii) by means of conference telephone or
similar communications equipment by means of which all persons participating in
the hearing can hear and speak to each other; provided, however, that at least
one-half of the members of the Board of Directors shall attend the hearing in
person.
2.3 Executive's Right to Terminate. Notwithstanding the provisions of
paragraph 2.1, Executive shall have the right to terminate his employment under
this Agreement for any of the following reasons:
(i) within 60 days of and in connection with or based upon (A)
a material breach by Company of any material provision of this
Agreement, (B) an overall substantial and material reduction in the
nature or scope of Executive's duties and responsibilities, or (C) the
assignment to Executive of duties and responsibilities that are
materially inconsistent with the positions referred to in paragraph
1.2; provided, however, that, prior to Executive's termination of
employment under this paragraph 2.3(i), Executive must give written
notice to Company of any such breach, reduction or assignment and such
breach, reduction or assignment must remain uncorrected for 30 days
following such written notice; or
(ii) at any time for any other reason whatsoever, in the sole
discretion of Executive.
2.4 Notice of Termination. If Company or Executive desires to terminate
Executive's employment hereunder at any time prior to expiration of the term of
employment as provided in paragraph 2.1, it or he shall do so by giving written
notice to the other party that it or he has elected to terminate Executive's
employment hereunder and stating the effective date and reason for such
termination, provided that no such action shall alter or amend any other
provisions hereof or rights arising hereunder, including, without limitation,
the provisions of Article 4 hereof.
ARTICLE 3: COMPENSATION AND BENEFITS
3.1 Base Salary. During the period of this Agreement, Executive shall
receive a minimum annual base salary of $325,000. Executive's annual base salary
shall be reviewed by the Board of Directors (or a committee thereof) on an
annual basis, and, in the sole discretion of the Board of Directors (or such
committee), such annual base salary may be increased, but not decreased,
effective as of March 1 of each year. Executive's annual base salary shall be
paid in equal installments in accordance with the Company's standard policy
regarding payment of compensation to executives but no less frequently than
monthly.
3.2 Bonuses. Executive shall be eligible to receive an annual bonus of
up to 100% of Executive's annual base salary with the amount of such bonus to be
determined by the Compensation Committee of the Board of Directors (the
"Committee") based upon criteria established from time to
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time by the Committee; provided, however, that for the period beginning on the
Effective Date and ending on December 31, 1997, such bonus shall not be less
than $90,277.78.
3.3 Initial Stock Option. On the Effective Date, Company shall grant to
Executive an option (the "Initial Option") to purchase 200,000 shares of
Company's common stock ("Stock") pursuant to the Snyder Oil Corporation Restated
1989 Stock Option Plan, as amended (the "Plan"). The purchase price for each
share of Stock subject to the Initial Option shall be equal to the Fair Market
Value (as such term is defined in the Plan) of a share of Stock as of the
Effective Date. Subject to the terms of the Plan and the agreement to be
executed by Company and Executive evidencing the Initial Option, the Initial
Option shall (i) have a term of five years (which term shall begin on the
Effective Date), (ii) vest and become exercisable with respect to (A) 30% of the
shares covered thereby on the first anniversary of the Effective Date, (B) an
additional 30 % of the shares covered thereby on the second anniversary of the
Effective Date, and (C) an additional 40 % of the shares covered thereby on the
third anniversary of the Effective Date, and (iii) constitute an incentive stock
option (within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended) to the maximum extent permitted by law.
3.4 Living Expenses and Moving Allowance. Upon Executive's request at
any time after he has, during the term of his employment hereunder, relocated
his principal residence to the Fort Worth, Texas metropolitan area, Company
shall pay to Executive a lump sum amount of $50,000 to compensate Executive for
such relocation. No other amounts, except as expressly provided herein, shall be
paid to or on behalf of Executive for moving costs or other expenses associated
with the relocation of Executive's residence to the Fort Worth, Texas
metropolitan area. For the period (the "Commuting Period") beginning on the
Effective Date and ending on the earlier of (i) the date Executive relocates his
principal residence to the Fort Worth, Texas metropolitan area or (ii) the
second anniversary of the Effective Date, Company shall, at its sole cost and
expense, provide Executive with a furnished apartment in the Fort Worth, Texas
metropolitan area, which apartment shall be mutually agreeable to Company and
Executive and shall have electricity, local phone service, basic cable
television service, and weekly maid service. Further, during the Commuting
Period, Company shall (A) reimburse Executive for the reasonable costs of his
transportation between Fort Worth and Houston and (B) reimburse Executive for
his transportation expenses incurred within Fort Worth or, at the request of
Executive, provide him with an automobile for his use within Fort Worth.
3.5 Other Perquisites. During his employment hereunder, Executive
shall be afforded the following benefits as incidences of his employment:
(i) Business and Entertainment Expenses - Subject to Company's
standard policies and procedures with respect to expense reimbursement
as applied to its executive employees generally, Company shall
reimburse Executive for, or pay on behalf of Executive, reasonable and
appropriate expenses incurred by Executive for business related
purposes, including dues and fees to industry and professional
organizations and costs of entertainment and business development.
(ii) Annual Stock Options - Executive shall be entitled to
receive, on an annual basis, an option to purchase shares of Stock
pursuant to a stock option plan maintained by Company. The terms of
each such option and the number of shares of Stock subject to each
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such option shall be determined by the Committee based upon criteria
established from time to time by the Committee.
(iii) Club Membership - During Executive's employment
hereunder prior to the relocation of his principal residence to the
Fort Worth, Texas metropolitan area, Company shall pay the monthly dues
associated with Executive's existing membership in the Houston
Petroleum Club. Upon such relocation, Company shall obtain membership
for Executive in the Fort Worth Petroleum Club and Company shall pay
the initiation fees and monthly dues associated with such membership.
Executive's membership in the Fort Worth Petroleum Club shall cease
upon Executive's termination of employment hereunder, and such
membership shall be transferred to Company (or its designee) upon such
termination.
(iv) Other Company Benefits - Executive and, to the extent
applicable, Executive's spouse, dependents and beneficiaries, shall be
allowed to participate in all benefits, plans and programs, including
improvements or modifications of the same, which are now, or may
hereafter be, available to other executive employees of Company. Such
benefits, plans and programs shall include, without limitation,
Company's Deferred Compensation Plan for Select Employees and any
profit sharing plan, thrift plan, health insurance or health care plan,
life insurance, disability insurance, pension plan, supplemental
retirement plan, vacation and sick leave plan, and the like which may
be maintained by Company. Company shall not, however, by reason of this
paragraph be obligated to institute, maintain, or refrain from
changing, amending, or discontinuing, any such benefit plan or program,
so long as such changes are similarly applicable to executive employees
generally.
(v) Vacation - During his employment hereunder, Executive
shall be entitled to four weeks of paid vacation each calendar year
(including 1997).
(vi) Indemnification Agreement - Contemporaneously with the
execution of this Agreement, Company and Executive shall execute and
enter into an indemnification agreement in the form previously approved
by the Board of Directors and the stockholders of Company and attached
to this Agreement as Exhibit A.
ARTICLE 4: PROTECTION OF INFORMATION
4.1 Disclosure to Executive. Company shall disclose to Executive, or
place Executive in a position to have access to or develop, trade secrets or
confidential information of Company or its affiliates; and/or shall entrust
Executive with business opportunities of Company or its affiliates; and/or shall
place Executive in a position to develop business good will on behalf of Company
or its affiliates.
4.2 Property of Company. All documents, drawings, memoranda, notes,
records, files, correspondence, manuals, models, specifications, computer
programs, E-mail, voice mail, electronic databases, maps, and all other writings
or materials of any type embodying any information relating to Company or its
business are and shall be the sole and exclusive property of Company. Upon
termination of Executive's employment by Company, for any reason, Executive
promptly shall deliver the same, and all copies thereof, to Company.
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4.3 No Unauthorized Use or Disclosure. Executive will not, at any time
during or after Executive's employment by Company, make any unauthorized
disclosure of any confidential business information or trade secrets of Company
or its affiliates, or make any use thereof, except in the carrying out of
Executive's employment responsibilities hereunder. Affiliates of the Company
shall be third party beneficiaries of Executive's obligations under this
paragraph. As a result of Executive's employment by Company, Executive may also
from time to time have access to, or knowledge of, confidential business
information or trade secrets of third parties, such as customers, suppliers,
partners, joint venturers, and the like, of Company and its affiliates.
Executive also agrees to preserve and protect the confidentiality of such third
party confidential information and trade secrets to the same extent, and on the
same basis, as Company's confidential business information and trade secrets.
4.4 Remedies. Executive acknowledges that money damages would not be
sufficient remedy for any breach of this Article by Executive, and Company shall
be entitled to enforce the provisions of this Article by terminating payments
then owing to Executive under this Agreement and/or to specific performance and
injunctive relief as remedies for such breach or any threatened breach. Such
remedies shall not be deemed the exclusive remedies for a breach of this
Article, but shall be in addition to all remedies available at law or in equity
to Company, including the recovery of damages from Executive and his agents
involved in such breach and remedies available to Company pursuant to other
agreements with Executive.
ARTICLE 5: NONCOMPETITION OBLIGATIONS
5.1 In General. As part of the consideration for the compensation and
benefits to be paid to Executive hereunder; to protect the trade secrets and
confidential information of Company and its affiliates that have been and will
in the future be disclosed or entrusted to Executive, the business good will of
Company and its affiliates that has been and will in the future be developed in
Executive, or the business opportunities that have been and will in the future
be disclosed or entrusted to Executive by Company and its affiliates; and as an
additional incentive for Company to enter into this Agreement, Company and
Executive agree to the noncompetition obligations hereunder. Executive shall
not, directly or indirectly for Executive or for others, in any geographic area
or market where Company or any of its affiliates are conducting any business or
have during the previous twelve months conducted such business:
(i) engage in any business competitive with the business
conducted by Company; or
(ii) render advice or services to, or otherwise assist, any
other person, association, or entity who is engaged, directly or
indirectly, in any business competitive with the business conducted by
Company with respect to such competitive business.
The noncompetition obligations set forth above shall apply only during the
period that Executive is employed by Company. Further, during the period that
Executive is employed by Company and for one year thereafter, Executive shall
not, directly or indirectly for Executive or for others, induce any employee of
Company or any of its affiliates to terminate his or her employment with Company
or such affiliates, or hire or assist in the hiring of any such employee by any
person, association, or entity not affiliated with Company; provided, however,
that the one-year post-employment period referred to in
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this sentence shall be reduced to 90 days if Executive's employment hereunder
shall be terminated on the date upon which a Change in Control (as defined in
paragraph 7.3) occurs or within 12 months thereafter.
5.2 Enforcement and Remedies. Executive acknowledges that money damages
would not be sufficient remedy for any breach of this Article by Executive, and
Company shall be entitled to enforce the provisions of this Article by
terminating any payments then owing to Executive under this Agreement and/or to
specific performance and injunctive relief as remedies for such breach or any
threatened breach. Such remedies shall not be deemed the exclusive remedies for
a breach of this Article, but shall be in addition to all remedies available at
law or in equity to Company, including without limitation, the recovery of
damages from Executive and Executive's agents involved in such breach and
remedies available to Company pursuant to other agreements with Executive.
5.3 Reformation. It is expressly understood and agreed that Company and
Executive consider the restrictions contained in this Article to be reasonable
and necessary to protect the proprietary information of Company. Nevertheless,
if any of the aforesaid restrictions are found by a court having jurisdiction to
be unreasonable, or overly broad as to geographic area or time, or otherwise
unenforceable, the parties intend for the restrictions therein set forth to be
modified by such court so as to be reasonable and enforceable and, as so
modified by the court, to be fully enforced.
ARTICLE 6: STATEMENTS CONCERNING COMPANY
6.1 In General. Executive shall refrain, both during the employment
relationship and after the employment relationship terminates, from publishing
any oral or written statements, to any person or entity (other than, during the
employment relationship, to Company, any of its affiliates, or any of such
entities' officers, employees, agents, or representatives) that damage or
disparage the reputation of Company, any of its affiliates, or any of such
entities' officers, employees, agents or representatives. A violation or
threatened violation of this prohibition may be enjoined by the courts. The
rights afforded Company and its affiliates under this provision are in addition
to any and all rights and remedies otherwise afforded by law.
ARTICLE 7: EFFECT OF TERMINATION ON COMPENSATION
7.1 By Expiration. If Executive's employment hereunder shall terminate
upon expiration of the term provided in paragraph 2.1 hereof because either
party has provided the notice contemplated in such paragraph, then all
compensation and all benefits to Executive hereunder shall continue to be
provided until the expiration of such term and such compensation and benefits
shall terminate contemporaneously with termination of his employment.
7.2 By Company. If Executive's employment hereunder shall be terminated
by Company prior to expiration of the term provided in paragraph 2.1, then, upon
such termination, regardless of the reason therefor, all compensation and
benefits to Executive hereunder shall terminate contemporaneously with the
termination of such employment; provided, however, that if such termination
shall be for any reason other than those encompassed by paragraphs 2.2(i), (ii),
or (iii), then Company shall provide Executive with the Termination Benefits.
For purposes of this Agreement, the term "Termination Benefits" shall mean the
following: (i) Company shall pay to Executive, within 15
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days after Executive's termination of employment, a single lump sum cash payment
in an amount equal to the aggregate base salary that would have been paid to
Executive (based upon his base salary in effect pursuant to paragraph 3.1 at the
time of Executive's termination of employment) during the unexpired portion of
the term set forth in paragraph 2.1; (ii) the Initial Option shall become
immediately exercisable in full upon Executive's termination of employment and
for a period of six months thereafter (but in no event shall the Initial Option
be exercisable after the expiration of its original term); (iii) all other
outstanding stock options granted by Company to Executive shall become
immediately exercisable in full upon Executive's termination of employment and
for a period of three months thereafter or for such greater period as may be
provided in the plan or plans pursuant to which such stock options were granted
(but in no event shall any such stock option be exercisable after the expiration
of the original term of such stock option); and (iv) during the period, if any
(but in no event for more than 18 months after the date of Executive's
termination of employment), that Executive elects to continue coverage for
himself and any of his eligible dependents under Company's group health plans
pursuant to the continuation of coverage provisions contained in Sections 601
through 608 of the Employee Retirement Income Security Act of 1974, as amended,
Executive's premiums for such coverage shall be no greater than that charged by
Company generally to its active executive employees for coverage under such
plans.
7.3 By Executive. If Executive's employment hereunder shall be
terminated by Executive prior to expiration of the term provided in paragraph
2.1, then, upon such termination, regardless of the reason therefor, all
compensation and benefits to Executive hereunder shall terminate
contemporaneously with the termination of such employment; provided, however,
that if such termination shall occur (i) for a reason encompassed by paragraph
2.3(i) , (ii) for any reason whatsoever on the date upon which a Change in
Control (as hereinafter defined) occurs or within 12 months thereafter, or (iii)
for Good Reason (as hereinafter defined) during the sixty-day period beginning
on the second anniversary of the Effective Date, then Company shall provide
Executive with the Termination Benefits. For purposes of this paragraph, the
following terms shall have the meanings indicated:
"Change in Control" shall mean (1) any merger, consolidation,
or reorganization in which Company is not the surviving entity (or
survives only as a subsidiary of an entity), (2) any sale, lease,
exchange, or other transfer of (or agreement to sell, lease, exchange,
or otherwise transfer) all or substantially all of the assets of
Company to any other person or entity (in one transaction or a series
of related transactions), (3) dissolution or liquidation of Company,
(4) when any person or entity, including a "group" as contemplated by
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,
acquires or gains ownership or control (including, without limitation,
power to vote) of more than 40% of the outstanding shares of Company's
voting stock (based upon voting power), (5) as a result of or in
connection with a contested election of directors, the persons who were
directors of Company before such election shall cease to constitute a
majority of the Board of Directors, or (6) any event that is reported
by Company under Item 1 of a Form 8-K filed with the Securities and
Exchange Commission; provided, however, that the term "Change in
Control" shall not include any reorganization, merger, consolidation,
sale, lease, exchange, or similar transaction involving solely Company
and one or more previously wholly-owned subsidiaries of Company unless
such matter is described in clause (6) above.
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"Good Reason" shall mean termination by Executive of his
employment with Company because in Executive's judgment, and subject to
the good-faith concurrence of the Committee, the scope of Executive's
authority within Company is not appropriate.
7.4 Additional Payments By Company. Notwithstanding anything to the
contrary in this Agreement, in the event that any payment or distribution by
Company to or for the benefit of Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise (a "Payment"), would be subject to the excise tax imposed by Section
4999 of the Internal Revenue Code of 1986, as amended, or any interest or
penalties with respect to such excise tax (such excise tax, together with any
such interest or penalties, are hereinafter collectively referred to as the
"Excise Tax"), Company shall pay to Executive an additional payment (a "Gross-up
Payment") in an amount such that after payment by Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including any Excise Tax imposed on any Gross-up Payment, Executive retains an
amount of the Gross-up Payment equal to the Excise Tax imposed upon the
Payments. Company and Executive shall make an initial determination as to
whether a Gross-up Payment is required and the amount of any such Gross-up
Payment. Executive shall notify Company in writing of any claim by the Internal
Revenue Service which, if successful, would require Company to make a Gross-up
Payment (or a Gross-up Payment in excess of that, if any, initially determined
by Company and Executive) within ten days of the receipt of such claim. Company
shall notify Executive in writing at least ten days prior to the due date of any
response required with respect to such claim if it plans to contest the claim.
If Company decides to contest such claim, Executive shall cooperate fully with
Company in such action; provided, however, Company shall bear and pay directly
or indirectly all costs and expenses (including additional interest and
penalties) incurred in connection with such action and shall indemnify and hold
Executive harmless, on an after-tax basis, for any Excise Tax or income tax,
including interest and penalties with respect thereto, imposed as a result of
Company's action. If, as a result of Company's action with respect to a claim,
Executive receives a refund of any amount paid by Company with respect to such
claim, Executive shall promptly pay such refund to Company. If Company fails to
timely notify Executive whether it will contest such claim or Company determines
not to contest such claim, then Company shall immediately pay to Executive the
portion of such claim, if any, which it has not previously paid to Executive.
7.5 No Duty to Mitigate Losses. Executive shall have no duty to find
new employment following the termination of his employment under circumstances
which require Company to pay any amount to Executive pursuant to this Article 7.
Any salary or remuneration received by Executive from a third party for the
providing of personal services (whether by employment or by functioning as an
independent contractor) following the termination of his employment under
circumstances pursuant to which this Article 7 apply shall not reduce Company's
obligation to make a payment to Executive (or the amount of such payment)
pursuant to the terms of this Article 7.
7.6 Liquidated Damages. In light of the difficulties in estimating the
damages for an early termination of this Agreement, Company and Executive hereby
agree that the payments, if any, to be received by Executive pursuant to this
Article 7 shall be received by Executive as liquidated damages.
7.7 Incentive and Deferred Compensation. This Agreement governs the
rights and obligations of Executive and Company with respect to Executive's base
salary and certain perquisites of employment. Except as expressly provided
herein, Executive's rights and obligations both during
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the term of his employment and thereafter with respect to stock options,
restricted stock, incentive and deferred compensation, life insurance policies
insuring the life of Executive, and other benefits under the plans and programs
maintained by Company shall be governed by the separate agreements, plans and
other documents and instruments governing such matters.
ARTICLE 8: MISCELLANEOUS
8.1 Notices. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when personally delivered or when mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to Company to: Snyder Oil Corporation
777 Main Street, Suite 2500
Fort Worth, Texas 76102
Attention: Chairman of the Board of Directors
If to Executive to: Mr. William G. Hargett
2106 Pleasant Creek Drive
Kingwood, Texas 77345
or to such other address as either party may furnish to the other in writing in
accordance herewith, except that notices or changes of address shall be
effective only upon receipt.
8.2 Applicable Law. This Agreement is entered into under, and
shall be governed for all purposes by, the laws of the State of Texas.
8.3 No Waiver. No failure by either party hereto at any time to give
notice of any breach by the other party of, or to require compliance with, any
condition or provision of this Agreement shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.
8.4 Severability. If a court of competent jurisdiction determines that
any provision of this Agreement is invalid or unenforceable, then the invalidity
or unenforceability of that 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.
8.5 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together will constitute one and the same Agreement.
8.6 Withholding of Taxes and Other Employee Deductions. Company may
withhold from any benefits and payments made pursuant to this Agreement all
federal, state, city and other taxes as may be required pursuant to any law or
governmental regulation or ruling and all other normal employee deductions made
with respect to Company's employees generally.
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8.7 Headings. The paragraph headings have been inserted for purposes
of convenience and shall not be used for interpretive purposes.
8.8 Gender and Plurals. Wherever the context so requires, the
masculine gender includes the feminine or neuter, and the singular number
includes the plural and conversely.
8.9 Affiliate. As used in this Agreement, the term "affiliate" shall
mean any entity which owns or controls, is owned or controlled by, or is under
common ownership or control with, Company.
8.10 Assignment. This Agreement shall be binding upon and inure to the
benefit of Company and any successor of Company, by merger or otherwise. Except
as provided in the preceding sentence, this Agreement, and the rights and
obligations of the parties hereunder, are personal and neither this Agreement,
nor any right, benefit, or obligation of either party hereto, shall be subject
to voluntary or involuntary assignment, alienation or transfer, whether by
operation of law or otherwise, without the prior written consent of the other
party.
8.11 Term. This Agreement has a term co-extensive with the term of
employment provided in paragraph 2.1. Termination shall not affect any right or
obligation of any party which is accrued or vested prior to such termination.
Without limiting the scope of the preceding sentence, the provisions of Articles
4 and 6 shall survive any termination of the employment relationship and/or of
this Agreement.
8.12 Arbitration. If a dispute arises out of or related to this
Agreement and the dispute cannot be settled through direct discussions, Company
and Executive agree that they shall first endeavor to settle the dispute in an
amicable fashion, including the use of a mediator. If such efforts fail to
resolve the dispute, the dispute shall be resolved as follows:
(i) Except as provided in paragraph 8.12(ii), any and all
claims, demands, cause of action, disputes, controversies, and other
matters in question arising out of or relating to this Agreement, any
provision hereof, the alleged breach thereof, or in any way relating to
the subject matter of this Agreement, involving Company, Executive,
and/or their respective representatives, even though some or all of
such claims allegedly are extra-contractual in nature, whether such
claims sound in contract, tort, or otherwise, at law or in equity,
under state or federal law, whether provided by statute or the common
law, for damages or any other relief, shall be resolved by binding
arbitration pursuant to the Federal Arbitration Act in accordance with
the Commercial Arbitration Rules then in effect with the American
Arbitration Association. The arbitration proceeding shall be conducted
in Fort Worth, Texas. The arbitration may be initiated by either party
by the providing to the other a written notice of arbitration
specifying the claims. Within thirty days of the notice of initiation
of the arbitration procedure, each party shall denominate one
arbitrator. The two arbitrators shall select a third arbitrator failing
agreement on which within thirty days of the original notice, the
parties (or either of them) shall apply to the Senior Active United
States District Judge for the Southern District of Texas, who shall
appoint a third arbitrator. The three arbitrators, utilizing the
Commercial Arbitration Rules of the American Arbitration Association,
shall by majority vote within 120 days of the selection of the third
arbitrator, resolve all disputes between the parties. There shall be no
transcript of the hearing before the arbitrators. The arbitrators'
decision shall
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be in writing, but shall be as brief as possible. The arbitrators shall
not assign the reasons for their decision. The arbitrators' decision
shall be final and non-appealable to the maximum extent permitted by
law. Judgment upon any award rendered in any such arbitration
proceeding may be entered by any federal or state court having
jurisdiction. This agreement to arbitrate shall be enforceable in
either federal or state court. The enforcement of this agreement to
arbitrate and all procedural aspects of this agreement to arbitrate,
including but not limited to, the construction and interpretation of
this agreement to arbitrate, the issues subject to arbitration (i.e.,
arbitrability), the scope of the arbitrable issues, allegations of
waiver, delay or defenses to arbitrability, and the rules governing the
conduct of the arbitration, shall be governed by and construed pursuant
to the Federal Arbitration Act and shall be decided by the arbitrators.
In deciding the substance of any such claims, the arbitrators shall
apply the substantive laws of the State of Texas (excluding Texas
choice-of-law principles that might call for the application of some
other State's law); provided, however, it is expressly agreed that the
arbitrators shall have no authority to award treble, exemplary, or
punitive damages under any circumstances regardless of whether such
damages may be available under Texas law, the parties hereby waiving
their right, if any, to recover treble, exemplary, or punitive damages
in connection with any such claims. This agreement to arbitrate is not
applicable to disputes between or among Company and Executive based
upon or arising out of any other agreement, benefit plan, or program
heretofore or hereafter entered into between Executive and Company or
its affiliates. Notwithstanding the preceding provisions of this
paragraph 8.12(i), Company and Executive may agree to use one
arbitrator rather than three arbitrators as provided above, and, in the
event of any such agreement, the 120-day period referred to in the
sixth sentence of this paragraph 8.12(i) shall begin on the date of the
parties' selection of such one arbitrator.
(ii) Notwithstanding the agreement to arbitrate contained in
paragraph 8.12(i), in the event that either party wishes to seek a
temporary restraining order, a preliminary or temporary injunction, or
other injunctive relief in connection with any or all such claims,
demands, cause of action, disputes, controversies, and other matters in
question arising out of or relating to this Agreement, any provision
hereof, the alleged breach thereof, or in any way relating to the
subject matter of this Agreement, involving Company, Executive, and/or
their respective representatives, even though some or all of such
claims allegedly are extra-contrac tual in nature, whether such claims
sound in contract, tort, or otherwise, at law or in equity, under state
or federal law, whether provided by statute or the common law, for
damages or any other relief, each party shall have the right to pursue
such injunctive relief in court, rather than by arbitration. The
parties agree that such action for a temporary restraining order, a
preliminary or temporary injunction, or other injunctive relief may be
brought in the State or federal courts residing in Fort Worth, Texas,
or in any other forum in which jurisdiction is appropriate.
8.13 Entire Agreement. Except as provided in (i) the written benefit
plans and programs referenced in paragraph 3.5(iv) and (ii) any signed written
agreement contemporaneously or hereafter executed by Company and Executive, this
Agreement 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
employment of Executive by Company. Without limiting the scope of the preceding
sentence, all understandings and agreements preceding the date of execution of
this Agreement and relating to the subject matter hereof are hereby null and
void
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and of no further force and effect. Any modification of this Agreement will be
effective only if it is in writing and signed by the party to be charged.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the 15th day of April, 1997, to be effective as of the Effective Date.
SNYDER OIL CORPORATION
By: /s/ John C. Snyder
---------------------------
Name: John C. Snyder
Title: Chairman
"COMPANY"
/s/ William G. Hargett
------------------------------
WILLIAM G. HARGETT
"EXECUTIVE"
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EXHIBIT 2
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT dated as of May 2, 1997 between SNYDER OIL
CORPORATION, a Delaware corporation (the "Company"), and William G. Hargett
("Indemnitee").
Preliminary Statements
Competent and experienced persons are becoming more reluctant to serve
as directors or officers of corporations unless they are provided with adequate
protection against claims and actions against them for their activities on
behalf or at the request of such corporations, generally through insurance and
indemnification.
Uncertainties in the interpretations of the statutes and regulations,
laws and public policies relating to indemnification of corporate directors and
officers are such as to make adequate, reliable assessment of the risks to which
directors and officers of such corporations may be exposed difficult,
particularly in light of the proliferation of lawsuits against directors and
officers generally.
The Board of Directors of the Company, based upon its business
experience, has concluded that the continuation of present trends in litigation
against corporate directors and officers will inevitably make it more difficult
for the Company to attract and retain directors and officers of the highest
degree of competence committed to the active and effective direction and
supervision of the business and affairs of the Company and its subsidiaries and
affiliates and the operation of its and their facilities, and the Board deems
such consequences to be so detrimental to the best interests of the Company that
it has concluded that the Company should act to provide its directors and
officers with enhanced protection against inordinate risks attendant on their
positions in order to assure that the most capable persons otherwise available
will be attracted to, or will remain in, such positions and, in such connection,
such directors have further concluded that it is not only reasonable and prudent
but necessary for the Company to obligate itself contractually to indemnify to
the fullest extent permitted by applicable law its directors and certain of its
officers and certain persons serving other entities on behalf or at the request
of the Company and to assume, to the maximum extent permitted by applicable law,
financial responsibility for expenses and liabilities which might be incurred by
such individuals in connection with claims lodged against them for their
decisions and actions in such capacities.
Section 145 of the General Corporation Law of the State of Delaware,
under which law the Company is organized, empowers a corporation organized in
Delaware to indemnify persons who serve as directors, officers, employees or
agents of the corporation or persons who serve at the request of the corporation
as directors, officers, employees or agents of another corporation, partnership,
joint venture, employee benefit plan, trust or other enterprise, and further
specifies that the indemnification provided by such section "shall not be deemed
exclusive of any other rights to which those seeking indemnification may be
entitled under any by-law, agreement, vote of stockholders or disinterested
directors or otherwise," and further empowers a corporation to "purchase and
maintain insurance" on behalf of such persons "against any liability asserted
against him or incurred by him in any such capacity, or arising out of his
status as such, whether or not the corporation would have the power to indemnify
him against such liability under the provisions of" said laws.
The Certificate of Incorporation, as amended, and By-laws of the
Company permit indemnification in accordance with the fullest extent permitted
by applicable law.
The Company has (i) reviewed the type of insurance available to insure
the directors and officers of the Company and of its affiliates against costs,
expenses (including attorneys' fees and disbursements), judgments, penalties,
fines and amounts paid in settlement actually and reasonably incurred by them in
connection with any action, suit or proceeding to which they are, or are
threatened to be made, a party by reason of their status or decisions or actions
in such positions, (ii) studied the nature and extent of the coverage provided
by such insurance and the cost thereof to the Company, (iii) concluded at the
present time not to obtain such insurance in view of the costs and benefits
thereof and (iv) concluded, in part based upon Company's decision not to obtain
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such insurance, that it would be in the best interests of the Company and its
stockholders for the Company to enter into agreements to indemnify certain of
such persons in the form of this Agreement. The Company has, moreover, concluded
that it would continue to be in the best interests of the Company to enter into
such agreements with such persons even if the Company should, in the future,
obtain any such insurance inasmuch as such insurance is, and is likely to
continue to be, subject to certain significant exclusions and limitations or
could cease to be reasonably available on any basis.
The Company desires to have Indemnitee serve or continue to serve as a
director or officer of the Company, or as a director, officer, employee,
partner, trustee, agent or fiduciary of such other corporations, partnerships,
joint ventures, employee benefit plans, trusts or other enterprises (each a
"Company Affiliate") of which he has been or is serving, or will serve on behalf
or at the request of or for the convenience of or to represent the interests of
the Company, free from undue concern for unpredictable, inappropriate or
unreasonable claims for damages by reason of his being, or having been, a
director or officer of the Company or a director, officer, employee, partner,
trustee, agent or fiduciary of a Company Affiliate or by reason of his decisions
or actions on their behalf.
Indemnitee is willing to serve, or to continue to serve, or to take on
additional service for, the Company or the Company's Affiliates in such
aforesaid capacities on the condition that he be indemnified as provided for
herein.
Accordingly, in consideration of the premises and the covenants
contained herein, the Company and Indemnitee do hereby covenant and agree as
follows:
1. Services to the Company. Indemnitee will serve or continue to serve
as a director or officer of the Company (in the case of a Company officer, at
the will of the Company or under separate contract, if any such contract exists
or shall hereafter exist) or as a director, officer, employee, partner, trustee,
agent or fiduciary of a Company Affiliate faithfully and to the best of his
ability so long as he is duly elected and qualified in accordance with the
provisions of the By-laws or other applicable constitutive documents thereof;
provided, however, that (i) Indemnitee may at any time and for any reason resign
from such position (subject to any contractual obligations which Indemnitee
shall have assumed apart from this Agreement) and (ii) neither the Company nor
any Company Affiliate shall have any obligation under this Agreement to continue
the Indemnitee in any such position.
2. Right to Indemnification. The Company shall, to the fullest extent
permitted by applicable law as then in effect, indemnify any Indemnitee who is
or was involved in any manner (including, without limitation, as a party or a
witness) or is threatened to be made so involved in any threatened, pending or
completed investigation, claim, action, suit or proceeding, whether civil,
criminal, administrative or investigative (including, without limitation, any
action, suit or proceeding by or in the right of the Company to procure a
judgment in its favor) (a "Proceeding") by reason of the fact that such person
is or was a director, officer, employee or agent of the Company, or is or was
serving at the request of the Company as a director, officer, employee or agent
of any Company Affiliate against all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such Proceeding; provided, however, that,
except as provided in Section 3(d), the foregoing shall not apply to a director
or officer of the Company with respect to a Proceeding that was commenced by
such director or officer. Such indemnification shall include the right to
receive payment in advance of any expenses incurred by Indemnitee in connection
with such Proceeding, consistent with the provisions of applicable law as then
in effect.
3. Advancement of Expenses; Procedures; Presumptions and Effect of
Certain Proceedings; Remedies. In furtherance, but not in limitation, of the
foregoing provisions, the following procedures, presumptions and remedies shall
apply with respect to advancement of expenses and the right to indemnification
hereunder:
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(a) Advancement of Expenses. All reasonable expenses incurred
by or on behalf of the Indemnitee in connection with any Proceeding
shall be advanced to the Indemnitee by the Company within 20 calendar
days after the receipt by the Company of a statement or statements from
the Indemnitee requesting such advance or advances from time to time,
whether prior to or after final disposition of such Proceeding. Such
statement or statements shall reasonably evidence the expenses incurred
by the Indemnitee and, if required by law at the time of such advance,
shall include or be accompanied by an undertaking by or on behalf of
the Indemnitee to repay the amounts advanced if it should ultimately be
determined that the Indemnitee is not entitled to be indemnified
against such expenses pursuant to this Article.
(b) Procedure for Determination of Entitlement to
Indemnification. (i) To obtain indemnification under this Article, an
Indemnitee shall submit to the Secretary of the Company a written
request, including such documentation and information as is reasonably
available to the Indemnitee and reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to
indemnification (the "Supporting Documentation"). The determination of
the Indemnitee's entitlement to indemnification shall be made not later
than 60 calendar days after receipt by the Company of the written
request for indemnification together with the Supporting Documentation.
The Secretary of the Company shall, promptly upon receipt of such a
request for indemnification, advise the Board in writing that the
Indemnitee has requested indemnification.
(ii) The Indemnitee's entitlement to indemnification hereunder
shall be determined in one of the following ways (each of which shall
give effect to the presumptions set forth in Section 3(c)): (A) by a
majority vote of the Disinterested Directors (as hereinafter defined),
if they constitute a quorum of the Board; (B) by a written opinion of
Independent Counsel (as hereinafter defined) if a quorum of the Board
consisting of Disinterested Directors is not obtainable or, even if
obtainable, a majority of such Disinterested Directors so directs; (C)
by the stockholders of the Company (but only if a majority of the
Disinterested Directors, if they constitute a quorum of the Board,
presents the issue of entitlement to indemnification to the
stockholders for their determination) or (D) as provided in Section
3(c).
(iii) If the determination of entitlement to indemnification is to
be made by Independent Counsel pursuant to Section 3(b)(ii), a majority
of the Disinterested Directors, if any, shall select the Independent
Counsel, but only an Independent Counsel to which the Indemnitee does
not reasonably object. If there shall be no Disinterested Directors,
such Independent Counsel shall be selected by a majority of the
Directors, but only an Independent Counsel to which the Indemnitee does
not reasonably object.
(c) Presumptions and Effect of Certain Proceedings. Except as
otherwise expressly provided herein, the Indemnitee shall be presumed
to be entitled to indemnification hereunder upon submission of a
request for indemnification together with the Supporting Documentation
in accordance with Section 3(b)(i), and thereafter the Company shall
have the burden of proof to overcome that presumption in reaching a
contrary determination. In any event, if the person or persons
empowered under Section 3(b) to determine entitlement to
indemnification shall not have been appointed or shall not have made a
determination within 60 calendar days after receipt by the Corporation
of the request therefor together with the Supporting Documentation, the
Indemnitee shall be deemed to be entitled to indemnification and the
Indemnitee shall be entitled to such indemnification unless the Company
establishes as provided in the final sentence of Section 3(d)(ii) or by
written opinion of Independent Counsel that (A) the Indemnitee
misrepresented or failed to disclose a material fact in making the
request for indemnification or in the Supporting Documentation or (B)
such indemnification is prohibited by law. The termination of any
Proceeding described in Section 2, or of any claim, issue or matter
therein, by judgment, order, settlement or conviction, or upon a plea
of nolo contendere or its equivalent, shall not, of itself, adversely
affect the right of the Indemnitee to indemnification or create a
presumption that the Indemnitee did not act in good faith and in a
manner which the Indemnitee reasonably believed to be in
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or not opposed to the best interests of the Company or, with respect to
any criminal Proceeding, that the Indemnitee had reasonable cause to
believe that his conduct was unlawful.
(d) Remedies of Indemnitee. (i) In the event that a
determination is made pursuant to Section 3(b) that the Indemnitee is
not entitled to indemnification hereunder, (A) the Indemnitee shall be
entitled to seek an adjudication of his entitlement to such
indemnification either, at the Indemnitee's sole option, in (x) an
appropriate court of the State of Delaware or any other court of
competent jurisdiction or (y) an arbitration to be conducted by a
single arbitrator, selected by mutual agreement of the Company and
Indemnitee (or, failing such agreement, by the then sitting Chief Judge
of the United States District Court for the Northern District of
Texas), pursuant to the rules of the American Arbitration Association;
(B) any such judicial proceeding or arbitration shall be de novo and
the Indemnitee shall not be prejudiced by reason of such adverse
determination and (C) in any such judicial proceeding or arbitration
the Company shall have the burden of proving that the Indemnitee is not
entitled to indemnification under this Article. If any such
determination is made, the Indemnitee shall be entitled, on five days
written notice to the Secretary of the Company, to receive the written
report of the persons making such determination, which report shall
include the reasons and factual findings, if any, upon which such
determination was based.
(ii) If a determination shall have been made or deemed to have been
made, pursuant to Section 3(b) or (c), that the Indemnitee is entitled
to indemnification, the Company shall be obligated to pay the amounts
constituting such indemnification within five days after such
determination has been made or deemed to have been made and shall be
conclusively bound by such determination unless the Company establishes
as provided in the final sentence of this paragraph that (A) the
Indemnitee misrepresented or failed to disclose a material fact in
making the request for indemnification or in the Supporting
Documentation or (B) such indemnification is prohibited by law. If (x)
advancement of expenses is not timely made pursuant to Section 3(a) or
(y) payment of indemnification is not made within five calendar days
after a determination of entitlement to indemnification has been made
or deemed to have been made pursuant to Section 3(b) or (c), the
Indemnitee shall be entitled to seek judicial enforcement of the
Company's obligation to pay to the Indemnitee such advancement of
expenses or indemnification. Notwithstanding the foregoing, the Company
may bring an action, in an appropriate court in the State of Delaware
or any other court of competent jurisdiction, contesting the right of
the Indemnitee to receive indemnification hereunder due to the
occurrence of an event described in subclause (A) or (B) of this clause
(ii) (a "Disqualifying Event"); provided, however, that in any such
action the Company shall have the burden of proving the occurrence of
such Disqualifying Event.
(iii) The Company shall be precluded from asserting in any judicial
proceeding or arbitration commenced pursuant to this Section 3(d) that
the procedures and presumptions of this Section 3 are not valid,
binding and enforceable and shall stipulate in any such court or before
any such arbitrator that the Company is bound by all the provisions of
this Agreement.
(iv) If the Indemnitee, pursuant to this Section 3(d), seeks a
judicial adjudication of or an award in arbitration to enforce his
rights under, or to recover damages for breach of, this Agreement, the
Indemnitee shall be entitled to recover from the Company, and shall be
indemnified by the Company against, any expenses actually and
reasonably incurred by the Indemnitee if the Indemnitee prevails in
such judicial adjudication or arbitration. If it shall be determined in
such judicial adjudication or arbitration that the Indemnitee is
entitled to receive part but not all of the indemnification or
advancement of expenses sought, the expenses incurred by the Indemnitee
in connection with such judicial adjudication or arbitration shall be
prorated accordingly.
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(e) Definitions. For purposes of this Section 3:
"Disinterested Director" means a director of the
Company who is not or was not a party to the Proceeding in
respect of which indemnification is sought by the Indemnitee.
"Independent Counsel" means a law firm or a member of
a law firm that neither presently is, nor in the past five
years has been, retained to represent (a) the Company or the
Indemnitee in any matter material to either such party or (b)
any other party to the Proceeding giving rise to a claim for
indemnification hereunder. Notwithstanding the foregoing, the
term "Independent Counsel" shall not include any person who,
under the applicable standards of professional conduct then
prevailing under the law of the State of Delaware, would have
a conflict of interest in representing either the Company or
the Indemnitee in an action to determine the Indemnitee's
rights hereunder.
4. Other Rights to Indemnification. The indemnification and advancement
of costs and expenses (including attorneys' fees and disbursements) provided by
this Agreement shall not be deemed exclusive of any other rights to which
Indemnitee may now or in the future be entitled under any provision of
applicable law, the Certificate of Incorporation or any By-law of the Company or
any other agreement or any vote of directors or stockholders or otherwise,
whether as to action in his official capacity or in another capacity while
occupying any of the positions or having any of the relationships referred to in
Section 1 of this Agreement.
5. Duration of Agreement. (a) This Agreement shall be effective from
and after the effective date of the Agreement, and shall continue until and
terminate upon the later of (i) the tenth anniversary after Indemnitee has
ceased to occupy any of the positions or have any of the relationships described
in Section 1 of this Agreement or (ii) (A) the final termination or resolution
of all Proceedings with respect to Indemnitee commenced during such 10-year
period and (B) either (x) receipt by Indemnitee of the indemnification to which
he is entitled hereunder with respect thereto or (y) a final adjudication or
binding arbitration that Indemnitee is not entitled to any further
indemnification with respect thereto, as the case may be.
(b) This Agreement shall be binding upon the Company and its successors
and assigns and shall inure to the benefit of Indemnitee and his heirs,
devisees, executors, administrators or other legal representatives.
6. Severability. If any provision or provisions of this Agreement shall
be held to be invalid, illegal or unenforceable under any particular
circumstances or for any reason whatsoever (a) the validity, legality and
enforceability of the remaining provisions of this Agreement (including, without
limitation, all other portions of any Section, paragraph or clause of this
Agreement that contains any provision that has been found to be invalid, illegal
or unenforceable, that are not themselves invalid, illegal or unenforceable), or
the validity, legality or enforceability under any other circumstances shall not
in any way be affected or impaired thereby and (b) to the fullest extent
possible consistent with applicable law, the provisions of this Agreement
(including, without limitation, all other portions of any Section, paragraph or
clause of this Agreement that contains any such provision that has been found to
be invalid, illegal or unenforceable, that are not themselves invalid, illegal
or unenforceable) shall be deemed revised, and shall be construed so as to give
effect to the intent manifested by this Agreement (including the provision held
invalid, illegal or unenforceable).
7. Identical Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall for all purposes be deemed to be an
original but all of which together shall constitute one and the same Agreement.
Only one such counterpart signed by the party against whom enforceability is
sought needs to be produced to evidence the existence of this Agreement.
8. Headings. The headings of the paragraphs of this Agreement
are inserted for convenience only and shall not be deemed to constitute part of
this Agreement or to affect the construction thereof.
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9. Modification and Waiver. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by both of the
parties hereto. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provisions hereof (whether or
not similar) nor shall such waiver constitute a continuing waiver.
10. Notification and Defense of Claim. Indemnitee agrees to notify the
Company promptly in writing upon being served with any summons, citation,
subpoena, complaint, indictment, information or other document relating to any
matter which may be subject to indemnification hereunder, whether civil,
criminal or investigative; provided, however, that the failure of Indemnitee to
give such notice to the Company shall not adversely affect Indemnitee's rights
under this Agreement except to the extent the Company shall have been materially
prejudiced as a direct result of such failure. Nothing in this Agreement shall
constitute a waiver of the Company's right to seek participation at its own
expense in any Proceeding which may give rise to indemnification hereunder.
11. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if (i)
delivered by hand and receipted for by the party to whom said notice or other
communication shall have been directed or (ii) mailed by certified or registered
mail with postage prepaid, on the third business day after the date on which it
is so mailed, in either case:
(a) if to Indemnitee, at the address indicated on the
signature page hereof,
(b) if to the Company:
Snyder Oil Corporation
777 Main Street, Suite 2500
Fort Worth, Texas 76102
Attn: Secretary
or to such other address as may have been furnished to either party by the other
party.
12. Governing Law. The parties hereto agree that this Agreement shall be
governed by, and construed and enforced in accordance with, the laws of the
State of Delaware.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement On
April 15, 1997 as of the day and year first above written.
SNYDER OIL CORPORATION
By: /s/John C. Snyder
--------------------------
Name: John C. Snyder
Title: Chairman
By: /s/ William G. Hargett
--------------------------
Name: William G. Hargett
Address: 2106 Pleasant Creek Drive
Kingwood, Texas 77345
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SEPARATION AGREEMENT
THIS SEPARATION AGREEMENT (this "Agreement") is entered into as of
April 17, 1997, by and between Snyder Oil Corporation, a Delaware corporation
("SOCO"), and Thomas J.
Edelman ("Mr. Edelman");
W I T N E S S E T H:
WHEREAS, Mr. Edelman was a co-founder and has been a principal officer
of SOCO since 1981; and
WHEREAS, Mr. Edelman is currently an employee of the Company (as such
term is hereinafter defined) and will remain an employee of the Company through
April 30, 1997 (the "Resignation Date"); and
WHEREAS, Mr. Edelman and SOCO are contemporaneously with the execution
of this Agreement entering into that certain Advisory Agreement (the "Advisory
Agreement"), which Advisory Agreement sets forth the terms and conditions
pursuant to which Mr. Edelman will perform certain advisory services for SOCO
after the Resignation Date; and
WHEREAS, Mr. Edelman and SOCO have agreed to certain terms and
conditions concerning Mr. Edelman's termination of employment with the Company;
NOW, THEREFORE, for and in consideration of the amounts and benefits to
be paid and provided to Mr. Edelman under this Agreement and the mutual
promises, covenants, and undertakings contained in this Agreement, and intending
to be legally bound, SOCO and Mr. Edelman agree as follows:
1. Resignation; Transition From Employee to Contractor: Effective as of
February 20, 1997, Mr. Edelman resigned as (a) an officer and director of the
Company and (b) a fiduciary and member of any committee established with respect
to any employee benefit plan maintained by the Company. For purposes of this
Agreement, the term "Company" shall mean SOCO and each of its subsidiaries
(other than Patina Oil & Gas Corporation and its subsidiaries (collectively,
"Patina")). From the date hereof through the Resignation Date, (1) Mr. Edelman
shall continue to be an employee of the Company, (2) Mr. Edelman shall receive
compensation from the Company at Mr. Edelman's rate of base salary as in effect
on the date hereof, and (3) the Company shall continue to maintain and staff its
office in New York City. Effective as of the Resignation Date, Mr. Edelman's
employment with the Company shall terminate. As of May 1, 1997, there shall be
an independent contractor relationship between SOCO and Mr. Edelman, which
relationship shall be governed by the Advisory Agreement. Upon (A) the payment
of Mr. Edelman's base salary through the Resignation Date, (B) the payment of
the amounts specified in paragraph 4 hereof, and (C) subject to the provisions
of paragraph 7(a) hereof, the payment of the amounts and provision of the
benefits specified in paragraphs 2 and 3 hereof, the Company shall have no
further obligations
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to Mr. Edelman for any salary, bonus, or other compensation of any type for
services rendered by Mr. Edelman to the Company on or before the Resignation
Date.
2. Severance Payment: Subject to the provisions of paragraph 7(a)
hereof, in consideration of his services over the past sixteen (16) years, SOCO
shall pay to Mr. Edelman a severance payment in the form of thirty six (36)
consecutive monthly installments of Thirty Thousand Dollars ($30,000.00) each,
with such monthly installments being due and payable on the 15th day of each
month beginning on May 15, 1997. In the event of Mr. Edelman's death prior to
his receipt of all thirty six (36) of such installments, Mr. Edelman's heirs,
administrators, legatees, or permitted assignees shall be entitled under this
Agreement to all of the remaining unpaid installments that otherwise would have
been due Mr. Edelman, which shall continue to be paid in monthly installments.
Mr. Edelman waives, and the Company shall not be required to pay, any other
severance pay or severance benefits in connection with the termination of the
employment relationship, whether from a severance plan sponsored by the Company
or the general assets of the Company. The consideration and remuneration
provided for under this Agreement are in lieu of and take the place of any other
severance pay or severance benefit, which Mr. Edelman forfeits.
3. Stock Options and Deferred Compensation: Subject to the provisions
of paragraph 7(a) hereof and pursuant to the actions taken by the Board of
Directors of SOCO on February 20, 1997, each agreement evidencing a stock option
awarded to Mr. Edelman under SOCO's 1989 Stock Option Plan, as amended (the
"1989 Plan"), which agreements provide for stock options covering an aggregate
of 292,600 shares of SOCO's common stock, shall be and hereby is amended,
effective as of the expiration of the seven-day revocation period referred to in
paragraph 7(a) hereof, to provide that such stock options (a) are 100% vested
and exercisable in full, (b) shall remain exercisable until March 1, 2002, and
(c) shall terminate and cease to be exercisable on March 2, 2002. Termination of
Mr. Edelman's employment with the Company and SOCO's Affiliates (as such term is
defined in the 1989 Plan) for any reason whatsoever shall not affect the
exercisability of any such stock option. Mr. Edelman understands and agrees that
the actions taken pursuant to this paragraph 3 constitute a modification and/or
extension of the Incentive Options (as such term is defined in the 1989 Plan)
that have heretofore been awarded to Mr. Edelman, and, accordingly, such actions
will cause some or all of such options to no longer qualify as incentive stock
options pursuant to section 422 of the Internal Revenue Code of 1986, as
amended. Subject to the provisions of paragraph 7(a) hereof and effective as of
the expiration of the seven-day revocation period referred to in paragraph 7(a)
hereof, all of the Company contributions made through the Resignation Date to
Mr. Edelman's account under SOCO's Deferred Compensation Plan for Select
Employees shall be fully vested. In addition, the Company hereby confirms that,
pursuant to the terms of SOCO's Savings and Profit Sharing Plan, all of the
amounts credited to Mr. Edelman's accounts under such plan through the
Resignation Date will be fully vested.
4. Additional Payments. SOCO has agreed to pay Mr. Edelman (a) the sum
of $7,074.90, which amount approximates 50% of the Company's estimated cost of
providing Mr. Edelman and his family with health insurance benefits for a
three-year period beginning on the Resignation Date, and (b) the sum of
$6,346.15 in respect of his unused 1997 vacation time. The amounts referred to
in the preceding sentence shall be paid in a single lump sum cash payment on the
Resignation Date.
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5. Nonsolicitation of Employees: From the date hereof through May 1,
1998, Mr. Edelman agrees that he shall not, directly or indirectly, for himself
or for others, induce any employee of the Company(other than an employee in the
Company's New York City office from and after the Resignation Date) to terminate
his or her employment with the Company, or hire or assist in the hiring of any
such employee by any person, association, or entity not affiliated with the
Company without the written consent of the Chairman or Chief Executive Officer
of SOCO.
6. Publishing Statements: Each party hereto shall refrain, during the
remaining portion of the employment relationship, during the advisory
relationship, and after the advisory relationship terminates, from publishing
any oral or written statements about the other party, any of its subsidiaries,
or any of such entities' officers, directors, employees, agents or
representatives that are slanderous, libelous, or defamatory; or that disclose
private or confidential information about such other party or any of its
subsidiaries, or any of such entities' business affairs, officers, directors,
employees, agents, or representatives; or that constitute an intrusion into the
seclusion or private lives of such other party or any of its subsidiaries, or
any of such parties' officers, directors, employees, agents, or representatives;
or that give rise to unreasonable publicity about the private lives of such
other party or any of its subsidiaries, or any of such entities' officers,
directors, employees, agents, or representatives; or that place such other party
or any of its subsidiaries, or any of such entities' officers, directors,
employees, agents, or representatives in a false light before the public; or
that constitute a misappropriation of the name or likeness of such other party
or any of its subsidiaries, or any of such entities' officers, directors,
employees, agents, or representatives. A violation or threatened violation of
this paragraph 6 may be enjoined by the courts. The rights afforded such other
party under this paragraph 6 are in addition to any and all rights and remedies
otherwise afforded by law. Notwithstanding the foregoing, (a) nothing in this
paragraph 6 shall be interpreted to mean that Mr. Edelman will be constrained
from making responsible statements as to his business judgment on material
corporate matters affecting the Company and (b) the provisions of this paragraph
6 shall cease to apply after March 1, 2002.
7. Mutual Release and Indemnity:
(a) Mr. Edelman, on his behalf and on behalf of his
representatives, heirs, administrators, executors, and assigns, and on behalf of
any other persons or entities claiming by, through, or under Mr. Edelman, does
hereby fully release, acquit and forever discharge the Company and its
employees, officers, directors, trustees, committee-members, Boards, members of
such Boards, chairmen of the boards, shareholders, contractors, consultants,
agents, representatives, attorneys, successors, and assigns (the "Released
Entities"), from and against any and all of Mr. Edelman's rights, claims,
charges, demands, and causes of action against the Released Entities of any kind
or character, both past and present, known or unknown, including but not limited
to those arising under the Age Discrimination in Employment Act of 1967, Title
VII of the Civil Rights Act of 1964, the Americans with Disabilities Act of
1990, and the Employee Retirement Income Security Act of 1974, all as amended,
and any other state or federal statute, regulation or the common law (contract,
tort or other), which relate to Mr. Edelman's employment or termination of
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<PAGE>
employment with the Company, including but not limited to any alleged
discriminatory or retaliatory employment practices, any matter relating to or
arising under any employment agreement with the Company, any and all prior
discussions, representations, understandings, or agreements between, on the one
hand, the Company and/or its agents, representatives, attorneys, or contractors,
and, on the other hand, Mr. Edelman or his agents or representatives, regarding
his employment and termination of employment with the Company or services
heretofore rendered to the Company, or any other matter whatsoever.
Notwithstanding the preceding provisions of this paragraph 7(a), this release
(1) shall not serve to waive or release any of Mr. Edelman's rights or claims
that may arise after the date this Agreement is executed and (2) shall not
affect any future obligation which the Company may have to Mr. Edelman under the
terms of this Agreement or the Advisory Agreement. Mr. Edelman acknowledges and
agrees that all of the requirements of applicable law pertaining to the waiver
of his rights under the Age Discrimination in Employment Act have been complied
with, including that he has been given twenty-one (21) days to consider this
Agreement and this release, that he was advised by the Company to consult an
attorney, and that he has in fact consulted an attorney prior to executing this
Agreement and this release. For a period of seven (7) days following the
execution of this Agreement, Mr. Edelman may revoke the portion of this release
that relates to any claims he may have under the Age Discrimination in
Employment Act. If Mr. Edelman does not within seven (7) days following the
execution of this Agreement provide SOCO with a written notice of such
revocation, then Mr. Edelman shall no longer have such revocation right. If Mr.
Edelman does within seven (7) days following the execution of this Agreement
provide SOCO with a written notice of such revocation, then (A) the Company
shall have no obligation to make any payment under paragraph 2 hereof or provide
the indemnification provided for in paragraph 7(d) hereof, (B) Mr. Edelman's
stock option agreements shall not be amended as provided in paragraph 3 hereof,
and (C) the vesting of Mr. Edelman's account under SOCO's Deferred Compensation
Plan for Select Employees shall not be accelerated as provided in paragraph 3
hereof.
(b) The Company hereby unconditionally and irrevocably forever
releases and discharges Mr. Edelman from all claims, charges, complaints,
obligations, liabilities, promises, agreements, contracts, damages, causes of
action, suits, accrued benefits or other liabilities of any kind or character,
whether known or hereafter discovered, arising from or in any way connected with
or related to Mr. Edelman's past service as (1) an officer, director, employee,
or agent of the Company (including Mr. Edelman's services relating to Patina
taken on behalf of the Company prior to his resignation as an officer of the
Company) or (2) a fiduciary or member of any committee established with respect
to any employee benefit plan maintained by the Company; provided, however, that
such release (A) shall not apply to any claims, demands or causes of action that
the Company may have against Mr. Edelman for past conduct that constitutes a
felony, (B) shall not serve to waive or release any rights or claims of the
Company that may arise after the date this Agreement is executed, and (C) shall
not affect any future obligation which Mr. Edelman may have to the Company under
the terms of this Agreement or the Advisory Agreement.
(c) It is expressly agreed that no future disputes between (1)
any of the Company or any of the Released Entities, and (2) Mr. Edelman, whether
under this Agreement or otherwise, shall in any way affect the enforceability of
the releases granted above.
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<PAGE>
(d) Subject to the provisions of paragraph 7(a) hereof, the
Company hereby agrees to indemnify and hold harmless Mr. Edelman from and
against all losses, claims, damages, liabilities and expenses incurred by him
(including reasonable fees and disbursements of counsel) that arise out of or in
connection with Mr. Edelman's past service as (1) an employee, officer,
director, or agent of the Company (including Mr. Edelman's services relating to
Patina taken on behalf of the Company prior to his resignation as an officer of
the Company) or (2) a fiduciary or member of any committee established with
respect to any employee benefit plan maintained by the Company, in each case to
the same extent that Mr. Edelman was indemnified with respect to such matters by
the Company while he served in such capacities.
8. Notices: For purposes of this Agreement, notice, demands and all
other communica tions between the parties shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
certified or registered mail, return receipt requested, postage prepaid,
addressed as follows:
If to Mr. Edelman:
Mr. Thomas J. Edelman
770 Park Avenue, Apt. 8D
New York, New York 10021
If to SOCO or the Company:
Snyder Oil Corporation
Attn: John C. Snyder, Chairman
777 Main Street, Suite 2500
Fort Worth, Texas 76102
or to such other address as either party may furnish to the other in writing in
accordance herewith, except that notices of change of address shall be effective
only upon receipt.
9. Withholding of Taxes: The Company may withhold from any benefits
and payments made pursuant to this Agreement all federal, state, city and other
taxes as may be required pursuant to any law or governmental regulation or
ruling.
10. Successor Obligations and Assignment: The rights and obligations of
the Company under this Agreement shall inure to the benefit of and be binding
upon the successors and assigns of the Company. Mr. Edelman can freely assign
any rights accruing to him under this Agreement (other than pursuant to
paragraph 3 hereof) to any associated party subject to the consent of SOCO,
which consent shall not be unreasonably withheld.
11. Amendment: This Agreement may not be modified except by an
agreement in writing executed by both SOCO and Mr. Edelman.
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12. Governing Laws: This Agreement shall be subject to and governed by
the laws of the State of Texas, without giving effect to principles of conflicts
of law.
13. Validity: In the event that any portion or provision of this
Agreement is found to be invalid or unenforceable, such invalid or unenforceable
portion shall be severed and the remainder of this Agreement shall remain valid
and enforceable.
14. Counterparts: This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
15. Effect of Agreement: The terms of this Agreement shall supersede
any obligations and rights of the Company and Mr. Edelman relating to the
subject matter hereof. However, nothing in this Agreement shall be construed to
diminish in any way the rights of Mr. Edelman or the Company pursuant to the
Advisory Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
SNYDER OIL CORPORATION
By: /s/John C. Snyder
-------------------------
John C. Snyder, Chairman
/s/Thomas J. Edelman
-------------------------
THOMAS J. EDELMAN
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ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT (this "Agreement") is entered into effective as
of May 1, 1997, by and between Snyder Oil Corporation, a Delaware corporation
(the "Company"), and Thomas J. Edelman ("Advisor" or "Mr. Edelman");
WITNESSETH:
WHEREAS, the Company wishes to continue to benefit from the advice,
experience and knowledge of Mr. Edelman; and
WHEREAS, Advisor is willing to advise the Company, upon the terms and
conditions contained herein;
NOW, THEREFORE, for and in consideration of the compensation to be paid
Mr. Edelman under this Agreement and the mutual promises, covenants, and
undertakings contained herein, the Company and Advisor agree as follows:
1. Independent Contractor: There shall be created pursuant to this
Agreement an independent contractor relationship between the Company and Advisor
whereby Mr. Edelman shall supply advisory services to the Company in accordance
with and subject to the terms and conditions set forth herein.
2. Term: The term of this Agreement shall be for a three-year period
ending April 30, 2000, unless earlier terminated pursuant to its provisions.
3. Services: During the term of this Agreement, and subject to his
reasonable availability, Mr. Edelman shall provide such advisory services as the
Board of Directors of the Company (the "Board") or the Chief Executive Officer
of the Company (the "CEO") may reasonably request or that Mr. Edelman believes
might be valuable to the Company, including assisting the Board and the CEO in
such strategic and financial matters, acquisition strategy or other projects as
the Board or the CEO deems appropriate. Advisor agrees to make all reasonable
efforts to attend Board meetings at the request of the Chairman of the
Governance Committee of the Board. The method of performance, hours utilized and
other details of Advisor's services hereunder shall be within Mr. Edelman's sole
control. While retained as an advisor by the Company, Advisor shall have the
right to devote his time and efforts to whatever other business, professional,
public service, or community pursuits as he may elect. The Company recognizes
that Mr. Edelman currently is an officer and director of Patina Oil & Gas
Corporation and Lomak Petroleum, Inc., is a director of certain other public
companies and may have similar business relationships in the future.
Consequently, except to the extent specifically provided for in a separate
agreement, Advisor has no obligation to offer the Company any opportunities of
which he becomes aware.
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4. Compensation and Expense Reimbursement:
A. General Services Fee: As compensation for his services
during the term of this Agreement, Mr. Edelman shall receive a monthly fee,
payable on the 15th of each month beginning May 15, 1997, in the amount of
$10,000.
B. Additional Fees: In addition, the Company shall pay Advisor
such amounts as the parties may mutually agree from time to time and reflect in
one or more separate agreements with respect to Mr. Edelman's performance of any
services outside the scope of this Agreement. Specifically, the Company and
Advisor may from time to time enter into fee agreements relating to transactions
which Advisor brings to the attention of the Company or on which the Company
requests Mr. Edelman's assistance. If Advisor becomes entitled to any amount
under any such separate agreement during any calendar year, then (1) the amount
payable thereunder shall be reduced by one-half of the fees paid pursuant to
paragraph 4A of this Agreement during such calendar year and on or before the
date of payment of such amount and (2) the fees payable pursuant to paragraph 4A
hereof from and after the date of payment under such separate agreement shall be
reduced by one-half until the earlier of (a) the end of such calendar year and
(b) the time the reductions under the preceding clauses (1) and (2) equal the
amount payable under such separate agreement. The fee payable under paragraph 4A
of this Agreement shall not be reduced below $5,000 for any month as the result
of the foregoing sentence.
C. Expenses: The Company shall promptly reimburse Advisor for
all reasonable out-of-pocket expenses incurred by him in performance of his
services hereunder, provided that such expenses are in line with the Company's
policies and are submitted to the Company (with proper supporting documentation)
in accordance with the Company's policy then in effect for employee expense
reports. Such expenses shall include, but are not limited to, transportation,
hotel accommodations, and such other expenses as might be incurred by Advisor in
furtherance of the Company's business.
5. Confidential Information: Advisor and the Company acknowledge that
the Company's and Advisor's businesses are highly competitive and that they may,
from time to time, provide each other with access to confidential information.
Both parties agree that they will not make any unauthorized disclosure of
confidential business information obtained from each other ("Confidential
Information"), or make any unauthorized use thereof. However, each party shall
be permitted to disclose Confidential Information as is required by law,
including deposition or trial testimony pursuant to subpoena, provided that if
they are requested or required (by oral question, interrogatories, request for
information or documents, subpoena, civil investigative demand or similar
process) to disclose any Confidential Information, if reasonably possible under
the circumstances as determined in good faith, they will promptly notify the
other party of such request or requirement so that the other party may seek an
appropriate protective order or waive compliance with the provisions of this
Agreement.
In the absence of a protective order or the receipt of a waiver
hereunder, or in the good faith determination of Advisor that time is of the
essence, Advisor shall obtain legal counsel, and if Advisor and/or his counsel
in good faith believe that Advisor is compelled to disclose the
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Confidential Information or be exposed to liability for contempt or suffer other
censure or penalty, Advisor may disclose only such Confidential Information to
the party compelling disclosure as is required by law, as determined by Advisor
on advice of counsel. Advisor further agrees that he will cooperate with the
Company in its efforts to obtain a protective order or other reliable assurance
that confidential treatment will be accorded the Confidential Information. All
reasonable legal fees, costs and expenses incurred by Mr. Edelman in obtaining
legal representation pursuant to his obligations under this paragraph shall be
paid by the Company.
The obligations of the parties set forth in this paragraph 5 shall
apply during the term of this Agreement and shall survive for one year following
the termination of this Agreement for any reason whatsoever.
6. Capacity and Benefits: At all times while serving under this
Agreement, Advisor shall be an independent contractor and not a common-law
employee. Therefore, except to the extent provided in any other agreement
between Advisor and the Company, Advisor shall not, during the term of this
Agreement, be entitled to participate in the Company's benefit plans and
programs for its employees. Further, Advisor will in no way be considered to be
an agent, employee, or servant of the Company. Advisor shall have no authority
to bind the Company without receiving specific written authority to do so. It is
not the purpose or intention of this Agreement or the parties to create, and the
same shall not be construed as creating, any partnership, partnership relation,
joint venture, agency, or employment relationship.
7. Termination:
A. Disability: If Advisor becomes unable to provide advisory
services hereunder during the term of this Agreement by reason of illness or
incapacity, then this Agreement shall terminate, and Advisor shall be entitled
to the entire monthly fee provided under paragraph 4A hereof for the month in
which such termination occurs.
B. Death: If Advisor dies during the term of this Agreement,
then this Agreement shall terminate, and Advisor shall be entitled to the entire
monthly fee provided under paragraph 4A hereof for the month in which Advisor's
death occurs.
C. Termination by the Company or Advisor: This Agreement may
be terminated at any time on or after April 30, 1998, by either party for any
reason whatsoever, with or without cause, upon 30 days' prior written notice to
the other party. In such event, Advisor shall be entitled to pro-rata
compensation under paragraph 4A hereof through the effective date of such
termination.
D. Expiration of the Term: This Agreement shall terminate
automatically and without notice upon the expiration of the three-year term
provided in paragraph 2 hereof.
E. Other Agreements: If Advisor revokes any portion of the
release provided for in that certain Separation Agreement of even date herewith
between the Company and Advisor, or if Advisor breaches such Separation
Agreement or any other agreement with the Company, then this
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Agreement shall automatically terminate effective as of the date of such
revocation or breach, as applicable.
F. Effect of Termination: Upon termination of this Agreement,
all of the parties' obligations, other than the confidentiality obligations
under paragraph 5 hereof and the Company's obligation to pay any unpaid fees or
unreimbursed expenses under this Agreement, shall terminate. The confidentiality
obligations under paragraph 5 hereof and the Company's indemnification of the
Advisor, a copy of which is attached to this Agreement as an Exhibit, shall
survive termination of this Agreement as set forth in such paragraph and
Exhibit.
8. Notices: For purposes of this Agreement, notice, demands and all
other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when delivered by United States
certified or registered mail, return receipt requested, addressed as follows:
If to Advisor:
Mr. Thomas J. Edelman
770 Park Avenue, Apt. 8D
New York, New York 10021
If to the Company:
Mr. John C. Snyder
Chairman
Snyder Oil Corporation
777 Main Street, Suite 2500
Fort Worth, Texas 76102
or to such other address as either party may furnish to the other in writing in
accordance herewith, except that notices of change of address shall be effective
only upon receipt.
9. Successor Obligations and Assignment: The rights and obligations of
the Company under this Agreement shall inure to the benefit of and be binding
upon its successors and assigns. Advisor may assign any rights accruing to him
under this Agreement to any affiliated entity with the consent of the Company,
which consent shall not be unreasonably withheld.
10. Amendment: This Agreement may not be modified except by an
agreement in writing executed by both the Company and Advisor.
11. Governing Laws: This Agreement shall be subject to and governed by
the laws of the State of Texas, without giving effect to principles of conflicts
of law.
12. Validity: In the event that any portion or provision of this
Agreement is found to be invalid or unenforceable, the other portions or
provisions hereof shall not be affected thereby.
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13. Counterparts: This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
14. Effect of Agreement: The terms of this Agreement shall supersede
any obligations and rights of the Company and Advisor respecting advisory
services. Nothing in this Agreement shall be construed as permitting either
party hereto to directly or indirectly benefit from any confidential business
information obtained from the other party during the period that Mr. Edelman was
an employee, officer or director of the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
17 day of April,1997, to be effective as of May 1,1997.
SNYDER OIL CORPORATION
By: /s/ John C. Snyder
------------------------------
John C. Snyder
Chairman
/s/ Thomas J. Edelman
------------------------------
Thomas J. Edelman
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EXHIBIT TO
ADVISORY AGREEMENT
May 1, 1997
Thomas J. Edelman
770 Park Avenue, Apt. 8D
New York, New York 10021
Dear Mr. Edelman:
In connection with your engagement to advise and assist us pursuant to
the Advisory Agreement dated the date hereof, Snyder Oil Corporation (the
"Company") hereby agrees to indemnify and hold harmless Thomas J. Edelman (the
"Advisor" or "Mr. Edelman") and his affiliates, to the full extent lawful from
against all losses, claims, damages, liabilities and expenses incurred by him
(including fees and disbursements of counsel) which (A) are related to or arise
out of (i) actions taken or omitted to be taken (including any untrue statements
made or any statements omitted to be made) by the Company or (ii) actions taken
or omitted to be taken by an indemnified person with our consent or in
conformity with our actions or omissions or (B) are otherwise related to or
arising out of Mr. Edelman's activities on our behalf under his engagement, and
we will reimburse Mr. Edelman or his affiliates indemnified hereunder for all
expenses (including fees and disbursements of counsel) as they are incurred by
him or such other indemnified person in connection with investigating, preparing
or defending any such action or claim, whether or not in connection with pending
or threatened litigation in which Mr. Edelman or any other indemnified person is
a party. We will not be responsible, however, for any losses, claims, damages,
liabilities or expenses pursuant to clause (B) of the preceding sentence which
are finally judicially determined to have resulted primarily from the bad faith
or gross negligence of the person seeking indemnification hereunder. We also
agree that Mr. Edelman or his affiliates, shall have no liability to us for or
in connection with such engagement except for such liability for losses, claims,
damages, liabilities or expenses incurred by us which is finally judicially
determined to have resulted primarily from Mr. Edelman's bad faith or gross
negligence. We also agree that we will not, without the prior written consent of
Mr. Edelman, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification may be sought hereunder (whether or not Mr. Edelman or any other
indemnified person is an actual or potential party to such claim, action, suit
or proceeding) unless such settlement, compromise or consent includes an
unconditional release of Mr. Edelman and each other indemnified person hereunder
from all liability arising out of such claim, action, suit or proceeding. The
foregoing agreement shall be in addition to any rights that Mr. Edelman or any
other indemnified person may have at common law or otherwise, including, but not
limited to, any right to contribution. We hereby consent to personal
jurisdiction and service and venue in any court in which any claim which is
subject to this agreement is brought against Mr. Edelman or any other
indemnified person.
Exhibit - 1
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It is understood that, in connection with Mr. Edelman's above-mentioned
Advisory Agreement, Mr. Edelman may also be engaged to act for us in one or more
additional capacities, and that the terms of the original Advisory Agreement or
any such additional Agreement may be embodied in one or more separate written
agreements. This indemnification shall apply to the original Advisory Agreement,
any such additional Agreement and any modification of the original Advisory
Agreement or such additional Agreement and shall remain in full force and effect
following the completion or termination of Mr. Edelman's Agreement(s).
We further understand that if Mr. Edelman is asked to act for us in any
other formal capacity, such further action may be subject to a separate
agreement containing provisions and terms to be mutually agreed upon.
Very truly yours,
SNYDER OIL CORPORATION
By:/s/ John C. Snyder
-----------------------------
John C. Snyder
Chairman
Agreed and Accepted:
By:/s/ Thomas J. Edelman
-----------------------------
Thomas J. Edelman
Exhibit - 2
