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Employment Agreement

 

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Title:

Employment Agreement

Entities:

Input/Output, Inc.

Date:

2004

Size:

Preview shows 15KB of 73KB total

Price:

$51

ID:

#1178455

 

 


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                              EMPLOYMENT AGREEMENT


This Employment Agreement (this "Agreement") is made and entered into by
and between Input/Output, Inc., a Delaware corporation (hereinafter referred to
as "Employer"), and J. Michael Kirksey, an individual currently resident in
Harris County, Texas (hereinafter referred to as "Employee"), effective as of
January 1,2004 (the "Effective Date").

WITNESSETH:

WHEREAS, attendant to Employee's employment by Employer, Employer and
Employee wish for there to be a complete understanding and agreement between
Employer and Employee with respect to, among other terms, Employee's duties and
responsibilities to Employer; the compensation and benefits owed to Employee;
the fiduciary duties owed by Employee to Employer; Employee's obligation to
avoid conflicts of interest, disclose pertinent information to Employer, and
refrain from using or disclosing Employer's information;

WHEREAS, Employer considers the establishment and maintenance of a sound
and vital management to be essential to protecting and enhancing its best
interests and the best interests of its stockholders;

WHEREAS, the Board of Directors of Employer (the "Board") has determined
that appropriate steps should be taken to encourage the continued attention and
dedication of members of Employer's management; and

WHEREAS, Employer and Employee wish to enter into this Agreement;

NOW, THEREFORE, in consideration of the mutual promises contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Employer and Employee agree as follows:

Section 1. General Duties of Employer and Employee.

(a) Employer agrees to employ Employee and Employee agrees to accept
employment by Employer and to serve Employer in an executive capacity as its
Executive Vice President and Chief Financial Officer. Employee will report to
the Chief Executive Officer of Employer. The powers, duties and responsibilities
of Employee as Executive Vice President and Chief Financial Officer include
those duties that are the usual and customary powers, duties and
responsibilities of such office, including those powers, duties and
responsibilities specified in Employer's Bylaws, and such other and further
duties appropriate to such position as may from time to time be assigned to
Employee by the Chief Executive Officer of Employer or the Board.

(b) While employed hereunder, Employee will devote substantially all
reasonable and necessary time, efforts, skills and attention for the benefit of
and with


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<PAGE>


Employee's primary attention to the affairs of Employer in order that he or she
may faithfully perform his or her duties and obligations. The preceding sentence
will not, however, be deemed to restrict Employee from attending to matters or
engaging in activities not directly related to the business of Employer,
provided that (i) such activities or matters are reasonable in scope and time
commitment and not otherwise in violation of this Agreement, and (ii) Employee
will not become a director or officer of (or hold any substantially similar
responsibility with) any corporation or other entity (excluding charitable or
other non-profit organizations) without prior written disclosure to, and consent
of, Employer.

(c) At the commencement of Employee's employment by Employer, Employee
will be based at Employer's corporate headquarters located at 12300 Parc Crest
Drive, Stafford, Texas 77008 (the "Place of Employment").

(d) Employee agrees and acknowledges that as an officer and employee
of Employer, and consistent with the terms hereof, he or she owes a fiduciary
duty of loyalty, fidelity and allegiance to act at all times in the best
interests of Employer and to do no act knowingly which would injure Employer's
business, its interests or its reputation.

Section 2. Compensation and Benefits.

(a) Employer will pay to Employee during the term of this Agreement a
base salary at the rate of $227,000 per annum (such base salary as increased by
the Compensation Committee of the Board as hereinafter provided is referred to
herein as the "Base Salary"). The Compensation Committee of the Board will
review the Base Salary from time to time and, during the term of this Agreement,
may increase, but may not decrease, the Base Salary. The Base Salary will be
paid to Employee in equal installments every two weeks or on such other schedule
as Employer may establish from time to time for its management personnel.

(b) Employee will be eligible to participate in Employer's Incentive
Compensation Plan for the fiscal year 2004 with a target of 50% and a maximum of
75% of Employee's Base Salary. During each subsequent fiscal year during the
term of this Agreement, Employee will be eligible, in the Board's sole
discretion, to participate in that year's Incentive Compensation Plan or other
replacement incentive or bonus plan Employer establishes for its key executives.

(c) Employee will be eligible for option grants to purchase shares of
Employer's common stock, $.01 par value ("Common Stock"), or other equity
securities of Employer as provided under Employer's 2000 Long-Term Incentive
Plan (or other stock option plan or plans Employer establishes for its key
executives); such grants to be made in the sole discretion of the Board or a
duly authorized committee of the Board.

(d) Employee will be eligible to participate in Employer's Deferred
Compensation Plan (or any replacement deferred compensation plan Employer
establishes for its


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<PAGE>


key executives).

(e) Effective on the date hereof, without any requirement to accrue,
Employee will be entitled to paid vacation of not less than three (3) weeks each
year. Vacation may be taken by Employee at the time and for such periods as may
be mutually agreed upon between Employer and Employee.

(f) Employee will be reimbursed in accordance with Employer's normal
expense reimbursement policy for all of the actual and reasonable costs and
expenses incurred by him or her in the performance of his or her services and
duties hereunder, including, but not limited to, travel and entertainment
expenses. Employee will furnish Employer with all invoices and vouchers
reflecting amounts for which Employee seeks Employer's reimbursement.

(g) Employee will be entitled to participate in all insurance and
retirement plans, incentive compensation plans (at a level appropriate to his or
her position) and such other benefit plans or programs as may be in effect from
time to time for the key management employees of Employer including, without
limitation, those related to savings and thrift, retirement welfare, medical,
dental, disability, salary continuance, accidental death, travel accident life
insurance, incentive bonus, membership in business and professional
organizations, and reimbursement of business and entertainment expenses.
Specifically, Employee will be entitled to participate in the Input/Output Inc.
Deferred Compensation Plan as long as it is made available to other key
management employees.

(h) Employer, during the term of this Agreement and thereafter without
limit of time, will indemnify Employee for claims and expenses to the extent
provided in Employer's Certificate of Incorporation and Bylaws. Employer will
also provide Employee coverage under Employer's policy or policies of directors'
and officers' liability insurance to the same extent as other executive
officers of Employer during the term of this Agreement and thereafter.

(i) All Base Salary, bonus and other payments made by Employer to
Employee pursuant to this Agreement will be subject to such payroll and
withholding deductions as may be required by law and other deductions applied
generally to employees of Employer for insurance and other employee benefit
plans in which Employee participates.

Section 3. Fiduciary Duty; Confidentiality.

(a) In keeping with Employee's fiduciary duties to Employer, Employee
agrees that he or she will not knowingly take any action that would create a
conflict of interest with Employer, or upon discovery thereof, allow such a
conflict to continue. In the event that Employee discovers that such a conflict
exists, Employee agrees that he or she will disclose to the Board any facts
which might involve a conflict of interest that has not been approved by the
Board.


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<PAGE>


(b) As part of Employee's fiduciary duties to Employer, Employee
agrees to protect and safeguard Employer's information, ideas, concepts,
improvements, discoveries, and inventions and any other proprietary or
confidential information relating to Employer or its business (collectively,
"Confidential Information") and, except as may be required by Employer, Employee
will not knowingly, either during his or her employment by Employer or
thereafter, directly or indirectly, use for his or her own benefit or for the
benefit of another, or disclose to another, any Confidential Information, except
(i) with the prior written consent of Employer; (ii) in the course of the proper
performance of Employee's duties under this Agreement; (iii) for information
that becomes generally available to the public other than as a result of the
unauthorized disclosure by Employee; (iv) for information that becomes available
to Employee on a nonconfidential basis from a source other than Employer or its
affiliated companies who is not bound by a duty of confidentiality to Employer;
or (v) as may be required by any applicable law, rule, regulation or order.

(c) Upon termination of his or her employment with Employer, Employee
will immediately deliver to Employer all documents in Employee's possession or
under his or her control which embody any of Employer's Confidential
Information.

(d) In addition to the foregoing provisions of this Section 3, and
effective as of the Effective Date, Employee reaffirms the duties imposed upon
Employee by that certain Employee Proprietary Information Agreement dated as of
January 1, 2004 by and between Employer and Employee.

(e) Employee will comply with Employer's Code of Ethics issued on
February 4,2003, and any amendments or replacement policies adopted by the Board
(the "Code of Ethics").

Section 4. Term of Agreement: At-Will Employment.

The term of this Agreement will commence effective as of the Effective Date,
and, subject to the terms and conditions hereof will continue for a two-year
period ending on December 31, 2005, and thereafter, the term will be
automatically extended for successive periods of one year unless prior to the
end of the original two-year period (or, if applicable, any such one-year
period), Employer gives Employee at least ninety (90) days prior written notice
that Employer has decided not to extend the term of this Agreement.
Notwithstanding any provision contained herein to the contrary, Employee
acknowledges that his or her employment with Employer is at will and that
Employer may terminate his or her employment at any time and for any reason or
for no reason at the discretion of Employer, but subject to any rights Employee
has under Sections 5, 6 and 8 of this Agreement.

Section 5. Termination.

(a) Employee's employment with Employer hereunder will terminate upon



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<PAGE>


the first to occur of the following:

(1) The death or "Disability" (as defined in Section 5(b) hereof)
of Employee;

(2) Employer terminates such employment for "Cause" (as defined
in Section 5(c) hereof);

(3) Employee terminates such employment for "Good Reason" (as
defined in Section 5(d) hereof);

(4) Employer terminates such employment for any reason other than
Cause, or for no reason at all;

(5) Employee terminates such employment for any reason other than
Good Reason, or for no reason at all; or

(6) Employee's sixty-fifth (65th) birthday, at which time
Employee will continue to be employed by Employer as an employee at
will.

(b) As used in this Agreement, "Disability" means permanent and total
disability (within the meaning of Section 22(e)(3) of the Internal Revenue Code
of 1986, as amended (the "Code"), or any successor provision) which has existed
for at least 180 consecutive days.

(c) As used in this Agreement, "Cause" means:

(1) the willful and continued failure by Employee to
substantially perform his or her obligations under this Agreement
(other than any such failure resulting from his or her Disability)
after a written demand for substantial performance has been delivered
to him or her by the Board which specifically identifies the manner in
which the Board believes Employee has not substantially performed such
provisions and Employee has failed to remedy the situation within ten
(10) days after such demand or a willful and material violation of the
Employer's Code of Ethics;

(2) Employee's willfully engaging in conduct materially and
demonstrably injurious to the property or business of Employer,
including without limitation, fraud, misappropriation of funds or
other property of Employer, gross negligence that is materially
injurious to the property or business of Employer, or conviction of a
felony or any crime of moral turpitude; or

 

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