Preview | Employment Agreement |

EMPLOYMENT AGREEMENT

This Employment Agreement (this Agreement) is entered into and effective as of July 6, 2005 between Horizon Offshore, Inc., a Delaware corporation (the Company), and George G. Reuter (Executive).

W I T N E S S E T H:

WHEREAS, the Company and Executive are parties to that certain Amended and Restated Employment and Non-Competition Agreement, dated as of July 1, 2003 (the Prior Agreement);

WHEREAS, the Company and Executive desire to terminate the Prior Agreement and supersede and replace the Prior Agreement with this Agreement; and

WHEREAS, the Company desires to continue to employ Executive, and Executive desires to continue to serve the Company, on the terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements herein contained, the parties hereby agree as follows:

1. Employment. The Company agrees to continue to employ Executive, and Executive agrees to be employed by the Company, during the Employment Period (as defined in Section 4(a)), on the terms and subject to the conditions set forth in this Agreement. Executive and the Company hereby agree that, effective as of the date of this Agreement, the Prior Agreement is hereby terminated and shall be of no further force or effect.

2. Position and Duties.

(a) Executive agrees to serve as Executive Vice President and Chief Operating Officer of the Company or in such other capacity or position of greater or equal authority to which Executive may be assigned by the Companys Board of Directors (the Board). The Executives capacity, position or duties after a Change of Control (which for purposes of this Agreement shall have the meaning given to such term in Section 11.12(a) of the Companys 2005 Stock Incentive Plan (the Incentive Plan)) shall not be considered of greater or equal authority with Executives capacity, position or duties prior to a Change of Control unless (i) after the Change of Control the Executive holds an equivalent position with, and exercises equivalent or greater authority and has equivalent or greater duties on behalf of, the Company or the Post-Transaction Corporation (as defined in the Incentive Plan) and (ii) after the Change of Control the Executives place of employment shall be inside the Houston metropolitan area. Executive agrees to perform diligently and to the best of Executives abilities the duties and services pertaining to such capacities or positions as reasonably determined by the Board, as well as such additional or different duties and services to which Executive may from time to time be reasonably directed to perform by the Board. Executives position, job descriptions, duties and/or responsibilities may be modified from time to time in the sole discretion of the Board;

provided, however, that Executive may not be assigned to any capacity or position of lesser authority than that of an executive officer of the Company. Executive agrees to devote his full business time and attention to the business and affairs of the Company and shall use his best efforts in faithfully performing his duties and responsibilities under this Agreement.

(b) Executive may not engage, directly or indirectly, in any other business, investment or activity that interferes with Executives performance of his duties hereunder, is contrary to the interest of the Company or any of its subsidiaries (each, a Horizon Company, or collectively, the Horizon Companies) or requires any significant portion of Executives business time. Notwithstanding the foregoing, the parties recognize and agree that Executive may engage in passive personal investments and other business activities which do not interfere with the business and affairs of the Company or interfere with Executives performance of his duties hereunder.

(c) Executive agrees to perform his duties and responsibilities under this Agreement in accordance with the Companys general policies and directives as they may exist at any given time, including, without limitation, the Companys Code of Ethics and Business Conduct.

3. Compensation and Related Matters.

(a) During the Employment Period, the Company shall pay to Executive a minimum annual base salary of $275,000 (such annual base salary, as it may be increased from time to time as provided herein, the Annual Base Salary), which shall be paid in equal installments in accordance with the Companys regular payroll practices for its similarly situated employees. During the Employment Period, the Annual Base Salary shall be reviewed at least annually; provided, however, that a salary increase shall not necessarily be awarded as a result of any such review. Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation of the Company to Executive hereunder. The Annual Base Salary shall not be reduced and may not be reduced after any increase.

(b) In consideration of Executives execution and delivery of this Agreement, the Company shall pay to Executive a bonus in the amount of $220,000 in cash. Fifty percent (50%) of such bonus shall be payable by the Company in one lump sum promptly following the execution and delivery of this Agreement by the Company and Executive and the remaining fifty percent (50%) shall be paid on December 31, 2005. In addition, subject to the approval of the Incentive Plan by the Companys stockholders at the Companys 2005 annual meeting, the Company shall grant to Executive 6,266,442 shares of restricted common stock pursuant to the Incentive Plan within five business days of the date of the Incentive Plan is approved by Companys stockholders (the Restricted Shares). Twenty-five percent (25%) of the Restricted Shares shall vest on September 30, 2005 and an additional twenty-five percent (25%) shall vest on each of the first, second and third anniversaries of the date of this Agreement. Executive shall have the right to satisfy his withholding tax obligation with respect to the issuance and vesting of the Restricted Shares, in whole or in part, by electing to have the Company withhold Restricted Shares that Executive otherwise would be entitled to receive hereunder in accordance with, and

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