Exhibit 10.4

 

KLX Energy Services Holdings, Inc.

1300 Corporate Center Way

Wellington, FL 33414

 

September 14, 2018

 

Mr. Thomas P. McCaffrey

Senior Vice President and Chief Financial Officer

1300 Corporate Center Way

Wellington, FL 33414

 

Re:                             Terms of Employment

 

Dear Mr. McCaffrey:

 

This letter agreement confirms the terms and conditions of your employment with
KLX Energy Services Holdings, Inc. (the Company) as set forth below:

 

Start Date:  September 14, 2018.

 

Title and Reporting:  During the term of your employment with the Company, you
will serve as Senior Vice President and Chief Financial Officer of the Company
and its subsidiaries, and you will report directly to the Company’s Chief
Executive Officer.  The Board of Directors (the Board) will take such action as
may be necessary to appoint or elect you as a member of the Board as of the
Start Date above.  Thereafter, during your employment with the Company, the
Board will nominate you for re-election as a member of the Board at the
expiration of the then current term, except to the extent prohibited by legal or
regulatory requirements.  You will not be entitled to any additional
compensation for such Board service while you are also serving as Senior Vice
President and Chief Financial Officer.

 

Duties and Responsibilities:  You will have the duties and responsibilities that
are normally associated with the position described above.  In addition, you are
hereby expressly permitted to continue to serve as an employee, executive
officer, director or consultant of KLX Inc.

 

Cash Compensation:  During the period of your employment with the Company, the
Company will pay you a cash base salary at the annual rate of one dollar ($1) in
accordance with the usual payroll practices of the Company and subject to any
applicable withholdings and deductions.  In addition, during the period of your
employment with the Company, you may receive cash incentive compensation in the
discretion of the Compensation Committee of the Board (the Committee), but you
will not have any contractual entitlement to receive any such cash incentive
compensation.

 

Incentive Equity:  Promptly following completion of the Company’s spin-off from
KLX Inc., the Company will grant you a restricted stock award on the common
stock of the Company pursuant to the Company’s Long-Term Incentive Plan (the
LTIP) (i) representing three percent (3%) of the Company’s common stock on a
fully diluted basis as of the effective date of the Company’s spin-off from KLX
Inc., (ii) to become vested in four (4) equal annual installments on each of the
first four (4) anniversaries of the effective date of the Company’s spin-off
from KLX Inc., subject to your continued employment or other service with the
Company on each applicable vesting date (and subject to the following clause
(iii)), (iii) to become fully vested (A) upon an involuntary termination of your
employment by the Company, (B) upon your death or “Disability” (as defined in
the LTIP), (C) upon your voluntary retirement from the Company, subject to the
consent of the Committee, or (D) upon the occurrence of a “Change in Control”
(as defined in the LTIP) of the Company, and (iv) to be subject to

 

--------------------------------------------------------------------------------

 

such other terms and conditions as are set forth in the form of restricted stock
award agreement as set forth on Exhibit A hereto.  You will also be considered
to receive additional equity or other long-term incentive awards from the
Company in the future.  The level of such participation, if any, will be
determined in the sole discretion of the Board (or the Committee) from time to
time.

 

Monthly Automobile Allowance:  During the period of your employment with the
Company, you will receive either an automobile owned or leased by the Company or
a monthly automobile allowance, as reasonably determined by the Company, which
automobile or allowance will be at least equivalent (i.e., the same make and
model, or equivalent value thereof) to that which KLX Inc. is currently
providing to you.  To the extent that the Company elects to provide a monthly
automobile allowance, such allowance will be paid in accordance with Company
policy, but in any event, no later than on a monthly basis in arrears.

 

Employee Benefits, Vacation and Business Expenses:  Except to the extent
equivalent benefits are provided by KLX Inc. or its successors or affiliates,
during the period of your employment with the Company:  (i) you will be eligible
to participate in all health, welfare, life insurance and retirement plans of
the Company, and reimbursement of financial and estate planning costs and
expenses, and (ii) you will be entitled to all rights and benefits pursuant to
the Company’s travel policy, including, without limitation, personal and
business use of the Company’s corporate aircraft.  You also will be entitled to
annual paid time off in accordance with the Company’s policy on accrual and use
generally applicable to employees of the Company from time to time; provided
that your prior employment and service with each of B/E Aerospace, Inc. and KLX
Inc. will be taken into account with respect to your annual paid time off
entitlement.  Finally, upon presentation of reasonable substantiation and
documentation, you will be reimbursed for all out-of-pocket business expenses
incurred and paid by you during your employment with the Company and in
connection with the performance of your duties hereunder in accordance with
Company policy.

 

Indemnification; Directors’ and Officers’ Liability Insurance:  Both during and
after the period of your service with the Company, regardless of the reason for
termination, the Company hereby agrees to indemnify you and hold you harmless to
the maximum extent permitted by applicable law against and in respect of any and
all actions, suits, proceedings, investigations, claims, demands, judgments,
costs, expenses (including reasonable attorney’s fees), losses, and damages
resulting from your performance of your duties and obligations with the Company
hereunder.  The Company will advance to you as incurred any costs and expenses
(including attorney’s fees) incurred in the defense of any such action, suit,
proceeding or investigation, subject to any limitation pursuant to applicable
law.  The Company will cover you under directors’ and officers’ liability
insurance both during and, while potential liability exists, after the term of
your service with the Company in the same amount and to the same extent as the
Company covers its other active officers and directors.  The foregoing
obligations will survive the termination of your service with the Company.

 

Proprietary Rights Agreement; Code of Conduct:  Contemporaneously with the
execution of this letter agreement, you will enter into the Proprietary Rights
Agreement regarding certain obligations relating to business, confidential
and/or proprietary information of the Company in the form attached as Exhibit B
hereto.  You also acknowledge and agree that, during the period of your
employment with the Company and thereafter, as applicable, you will be subject
to the Company’s Code of Conduct and other employment policies, as may be
amended from time to time.

 

At-Will Employment:  Your employment with the Company will be “at-will.”  You
may resign at any time with or without notice for any (or no) reason.  The
Company may terminate your employment

 

2

--------------------------------------------------------------------------------

 

at any time, upon at least twelve (12) months’ prior written notice, for any (or
no) reason.  You will not have any contractual right to severance benefits in
connection with any termination of your employment with the Company, except for
the accelerated vesting of the incentive equity award contemplated in this
letter agreement, or except as may be otherwise provided in any severance plan
or policy generally applying to employees of the Company, or as may be otherwise
determined by the Committee in its sole discretion.

 

Governing Law:  This letter agreement will be governed by, and construed under
and in accordance with, the internal laws of the State of Florida, without
regard to the choice of law principles thereof, except that all matters related
to the LTIP and any equity awards granted thereunder, will be governed by the
internal laws of the State of Delaware, without regard to the choice of law
principles thereof.

 

Entire Agreement:  This letter agreement constitutes the entire agreement
between you and the Company with respect to the subject matter hereof and
supersedes any and all prior agreements or understandings between you and the
Company with respect to the subject matter hereof, whether written or oral. 
This letter agreement may be amended or modified only by a written instrument
executed by you and the Company.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

3

--------------------------------------------------------------------------------

 

 

Very truly yours,

 

 

 

KLX ENERGY SERVICES HOLDINGS, INC.

 

 

 

By:

/s/ Amin J. Khoury

 

Name:

Amin J. Khoury

 

Title:

Chairman, CEO and President

 

The above terms and conditions accurately reflect our understanding regarding
the terms and conditions of my employment with the Company, and I hereby confirm
my agreement to the same.

 

Dated: September 14, 2018

/s/ Thomas P. McCaffrey

 

Thomas P. McCaffrey

 

--------------------------------------------------------------------------------

 

EXHIBIT A

 

RESTRICTED STOCK AWARD AGREEMENT

 

A-1

--------------------------------------------------------------------------------

 

KLX ENERGY SERVICES HOLDINGS, INC. LONG-TERM INCENTIVE PLAN
RESTRICTED STOCK AWARD AGREEMENT

 

THIS RESTRICTED STOCK AWARD AGREEMENT (the “Award Agreement”) is made effective
as of [·], 2018 (the “Date of Grant”) by KLX Energy Services Holdings, Inc., a
Delaware corporation (the “Company”), for the benefit of Thomas P. McCaffrey
(the “Participant”).  Capitalized terms not otherwise defined herein shall have
the same meanings as in the KLX Energy Services Holdings, Inc. Long-Term
Incentive Plan (the “Plan”).

 

WHEREAS, the Company desires to grant the Restricted Stock provided for herein
to the Participant pursuant to the Plan and the terms and conditions set forth
herein;

 

NOW THEREFORE, the Restricted Stock is hereby granted, subject to the following
terms and conditions:

 

1.                                      Grant of the Award.  Subject to the
provisions of this Award Agreement and the Plan, the Company hereby grants to
the Participant, an aggregate of <# Shares>(1) restricted shares of Common Stock
(the “Restricted Stock”), subject to adjustment as set forth in the Plan.

 

2.                                      Incorporation of Plan.  The Company has
previously provided the Participant with a copy of the Plan.  This Award
Agreement and the Restricted Stock shall be subject to the Plan, the terms of
which are incorporated herein by reference, and in the event of any conflict or
inconsistency between the Plan and this Award Agreement, the Plan shall govern. 
Defined terms used herein without definition shall have the meanings ascribed
thereto in the Plan.

 

3.                                      Vesting Schedule.  Unless previously
vested or canceled in accordance with the provisions of the Plan or this Award
Agreement, subject to the Participant’s continued employment or other service
with the Company or its subsidiaries on each applicable vesting date (except as
otherwise provided herein), one fourth (1/4th) of the shares of Restricted Stock
shall vest on each of the first, second, third and fourth anniversaries of the
Date of Grant and shall no longer be subject to cancellation pursuant to
Section 4 or the transfer restrictions set forth in Section 5.

 

4.                                      Accelerated Vesting.  Subject to the
following sentence and consistent with the terms and conditions set forth in the
Incentive Equity provision of that certain employment letter, by and between the
Participant and the Company, dated as of September 14, 2018 (the “Employment
Letter”), if, prior to the vesting of all shares of Restricted Stock hereunder,
(A) the Participant’s service with the Company is:  (i) involuntarily terminated
by the Company for any reason, (ii) voluntarily terminated by the Participant
due to the Participant’s retirement from the Company, with the express consent
of the Committee, (iii) terminated due to death or Disability or (B) a Change in
Control occurs while the Participant remains in the continued service of the
Company, then, in each case, all of the unvested shares of Restricted Stock
shall vest immediately as of the date of such termination or Change in Control,
as applicable, and shall no longer be subject to cancellation or the transfer
restrictions set forth in Section 5.  The Participant and the Company agree to
sign a mutual waiver and release of claims agreement, effective as of the date
of termination, as a condition to the accelerated vesting of all then-unvested
shares of the Participant’s Restricted Stock described in Section 4(A),
substantially in the form attached hereto as Exhibit A (the “Mutual Waiver and
Separation Agreement”).  For the avoidance of doubt, in the event that the
Participant becomes a consultant or director of the Company following
termination of the Participant’s employment with the Company, no termination of
service shall be deemed to occur for purposes of the continued vesting of the
Restricted Stock hereunder until such time as the Participant is no longer an
employee, a consultant or a director of the Company.

 

--------------------------------------------------------------------------------

(1)                                 Number of restricted shares to represent
three percent (3%) of the Company’s common stock on a fully diluted basis as of
the effective date of the Company’s spin-off from KLX Inc.

 

--------------------------------------------------------------------------------

 

5.                                      Nontransferability of Restricted Stock. 
Unless otherwise determined by the Committee, the Restricted Stock may not be
transferred, pledged, alienated, assigned or otherwise attorned other than by
last will and testament or by the laws of descent and distribution or pursuant
to a domestic relations order, as the case may be; provided, however, that the
Committee may, subject to such terms and conditions as it shall specify, permit
the transfer of the Restricted Stock, including, without limitation, for no
consideration to a charitable institution or a Permitted Transferee.  Any shares
of Restricted Stock transferred to a charitable institution may not be further
transferable without the Committee’s approval and any shares of Restricted Stock
transferred to a Permitted Transferee shall be further transferable only by last
will and testament or the laws of descent and distribution or, for no
consideration, to another Permitted Transferee of the Participant.

 

6.                                      Rights as a Stockholder.  The
Participant shall have, with respect to the Restricted Stock, all the rights of
a stockholder of the Company, including, if applicable, the right to vote the
Restricted Stock and to receive any dividends or other distributions, subject to
the restrictions set forth in the Plan and this Award Agreement.

 

7.                                      Dividends and Distributions.  Any cash,
Common Stock or other securities of the Company or other consideration received
by the Participant as a result of a distribution to holders of Restricted Stock
or as a dividend on the Restricted Stock shall be subject to the same
restrictions as the Restricted Stock, and all references to Restricted Stock
hereunder shall be deemed to include such cash, Common Stock or other securities
or consideration.

 

8.                                      Legend on Certificates.  The Committee
may cause a legend or legends to be put on certificates representing the Common
Stock underlying the Restricted Stock to make appropriate reference to such
restrictions as the Committee may deem advisable under the Plan or as may be
required by the rules, regulations, and other requirements of the Securities and
Exchange Commission, any exchange that lists the Common Stock, and any
applicable federal or state laws.

 

9.                                      Conditions to Delivery of Common Stock
Certificates.  The Company shall not be required to deliver any certificate or
certificates for shares of Common Stock pursuant to this Agreement prior to
fulfillment of all of the following conditions:

 

(a)                                 The obtaining of any approval or other
clearance from any state or federal governmental agency which the Committee
determines to be necessary or advisable; and

 

(b)                                 The lapse of such reasonable period of time
as the Committee may from time to time establish for reasons of administrative
convenience.

 

10.                               Physical Custody.  The Restricted Stock may be
issued in certificate form or electronically in “book entry”.  The Secretary of
the Company or such other representative as the Committee may appoint shall
retain physical custody of each certificate representing Restricted Stock until
all of the restrictions imposed under this Award Agreement with respect to the
shares evidenced by such certificate expire or are removed.  In no event shall
the Participant retain physical custody of any certificates representing
unvested Restricted Stock assigned to the Participant.

 

11.                               No Entitlements.

 

(a)                                 No Right to Continued Service.  This award
is not an employment or other service agreement, and nothing in this Award
Agreement or the Plan shall (i) alter the Participant’s status as an “at-will”
employee of the Company, (ii) be construed as guaranteeing the Participant’s
service with the Company or as giving the Participant any right to continue in
the service of the Company during any period

 

--------------------------------------------------------------------------------

 

or (iii) be construed as giving the Participant any right to be reemployed by
the Company following any termination of service.

 

(b)                                 No Right to Future Awards.  This award of
Restricted Stock and all other equity-based awards under the Plan are
discretionary.  This award does not confer on the Participant any right or
entitlement to receive another award of Restricted Stock or any other
equity-based award at any time in the future or in respect of any future period,
except as otherwise may be provided in the discretion of the Committee.

 

(c)                                  No Effect on Future Compensation.  The
Company has made this award of Restricted Stock to the Participant in its sole
discretion.  This award does not confer on the Participant any right or
entitlement to receive compensation in any specific amount for any future fiscal
year, and does not diminish in any way the Company’s discretion to determine the
amount, if any, of the Participant’s compensation.  In addition, this award of
Restricted Stock will not be taken into account in determining any other
service-related rights the Participant may have, such as rights to any pension
pay.

 

12.                               Taxes and Withholding.  No later than the date
as of which an amount with respect to the Restricted Stock first becomes
includable in the gross income of the Participant for applicable income tax
purposes, appropriate arrangements satisfactory to the Committee must be made
regarding payment of any federal, state or local taxes of any kind required by
law to be withheld with respect to such amount.  Unless otherwise determined by
the Committee, in accordance with rules and procedures established by the
Committee, the minimum required withholding obligations may be settled in Common
Stock, including Common Stock that is part of the award that gives rise to the
withholding requirement.  The obligations of the Company to deliver the
certificates for shares of Common Stock under this Award Agreement shall be
conditional upon such payment or arrangements and the Company shall, to the
extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to the Participant, including, without
limitation, by withholding shares of Common Stock to be delivered upon vesting.

 

13.                               Section 83(b) Election.  If, within 30 days
following the Date of Grant, the Participant makes an election under
Section 83(b) of the Code, or any successor section thereto, to be taxed with
respect to all or any portion of the Restricted Stock as of the date of transfer
of the Restricted Stock rather than as of the date or dates upon which the
Participant would otherwise be taxable under Section 83(a) of the Code, the
Committee may require the Participant to deliver a copy of such election to the
Company immediately after filing such election with the Internal Revenue
Service.

 

14.                               Securities Laws.  In connection with the grant
or vesting of the Restricted Stock, the Committee may require such
written representations, warranties and agreements as the Committee may
reasonably request in order to comply with applicable securities laws or with
this Award Agreement.

 

15.                               General Provisions.

 

(a)                                 Notices.  Any notice necessary under this
Award Agreement shall be addressed to the Company in care of its Secretary at
the principal executive office of the Company and to the Participant at the
address appearing in the records of the Company for the Participant or to either
party at such other address as either party hereto may hereafter designate in
writing to the other.  Notwithstanding the foregoing, the Company may deliver
notices to the Participant by means of email or other electronic means that are
generally used for employee communications.  Any such notice shall be deemed
effective upon receipt thereof by the addressee.

 

(b)                                 Headings.  The headings of sections and
subsections are included solely for convenience of reference and shall not
affect the meaning of the provisions of this Award Agreement.

 

--------------------------------------------------------------------------------

 

(c)                                  Entire Agreement.  This Award Agreement,
the Employment Letter, the Mutual Waiver and Separation Agreement and the Plan
constitute the entire agreement with regard to the subject matter hereof.  They
supersede all other agreements, representations or understandings (whether oral
or written and whether express or implied) that relate to the subject matter
hereof.

 

(d)                                 Amendments.  The Board or the Committee
shall have the power to alter, amend, modify or terminate the Plan or this Award
Agreement at any time; provided, however, that no such termination, amendment or
modification may adversely affect the Participant’s rights under this Award
Agreement without the Participant’s consent.  Any amendment, modification or
termination shall, upon adoption, become and be binding on all persons affected
thereby without requirement for consent or other action with respect thereto by
any such person.

 

(e)                                  Successor.  Except as otherwise provided
herein, this Award Agreement shall be binding upon and shall inure to the
benefit of any successor or successors of the Company, and to any Permitted
Transferee pursuant to Section 5.

 

(f)                                   Choice of Law.  Except as to matters of
federal law, this Award Agreement and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of Delaware
(other than its conflict of law rules).

 

[Remainder of Page Intentionally Left Blank]

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the Company has executed this Award Agreement as of the date
first written above.

 

 

KLX ENERGY SERVICES HOLDINGS, INC.

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

PARTICIPANT

 

 

 

 

 

Thomas P. McCaffrey

 

--------------------------------------------------------------------------------

 

EXHIBIT A

 

Form of Mutual Waiver Agreement

 

SEPARATION AGREEMENT AND MUTUAL RELEASE

 

This Separation Agreement and Mutual Release (the “Agreement”), is made as of
               , 20     , by and between KLX Energy Services Holdings, Inc., a
Delaware corporation (the “Company”) and Thomas P. McCaffrey (“Employee”), for
the purpose of memorializing the terms and conditions of the Employee’s
departure from the Company’s employment.

 

Now, therefore, in consideration of the sum of one dollar ($1.00) and the mutual
promises, agreements and covenants contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
(the “Settlement Consideration”), the parties hereto, intending to be legally
bound, hereby agree as follows:

 

1.                                      Termination; Employment Letter. 
Effective          , 20    , Employee’s employment with the Company was
terminated.  Upon Employee’s termination, Employee and the Company shall each
have those respective surviving rights, obligations and liabilities described in
that certain Employment Letter, dated as of September 14, 2018, by and between
Employee and the Company (the “Employment Letter”) and that certain Restricted
Stock Award Agreement, dated as of September 14, 2018, by and between Employee
and the Company (the “Restricted Stock Agreement”).

 

2.                                      Non-Released Claims.

 

(a)                                 Employee Non-Released Claims.  It is
explicitly agreed, understood and intended that the general release of claims
provided for in this Agreement shall not include or constitute a waiver of the
Company’s, its agent, representative or designee’s obligations to Employee
(i) that are specified in the Employment Letter as surviving the termination of
Employee’s employment, (ii) that arise out of or from respondeat superior
principles, (iii) for claims for indemnification and defense under any
organizational documents, agreement, insurance policy, or at law or in equity
concerning either the Company, its subsidiaries, affiliates, directors, officers
or employees, (iii) concerning any deferred compensation plan, 401(k) plan,
equity plan or retirement plan and (iv) any claims not waivable under applicable
law, collectively, the “Employee Non-Released Company Claims”.

 

(b)                                 Company Non-Released Claims.  It is
explicitly agreed, understood and intended that the general release of claims
provided for in this Agreement shall not include or constitute a waiver of
(i) the Employee’s obligations to the Company concerning the Company’s
confidential information and proprietary rights that survive Employee’s
termination of employment, including those specified in that certain Proprietary
Rights Agreement, dated as of September 14, 2018, by and between Employee and
the Company (the “Proprietary Rights Agreement”) (ii) any claim of the Company
for fraud based on willful and intentional acts or omissions of Employee, other
than those taken in good faith and in a manner that Employee believed to be in
or not opposed to the interests of the Company, proximately causing a financial
restatement by the Company and (iii) any claims not waivable by the Company
under applicable law, collectively, the “Company Non-Released Employee Claims”.

 

3.                                      General Release in Favor of the
Company:  Employee, for himself and for his heirs, executors, administrators,
trustees, legal representatives and assigns (collectively, the “Releasers”),
hereby forever releases and discharges the Company, its Board of Directors, and
any of its past, present, or future parent corporations, subsidiaries,
divisions, affiliates, officers, directors, agents, trustees, administrators,
attorneys, employees, employee benefit and/or pension plans or funds (including
qualified and non-qualified plans or funds), successors and/or assigns and any
of its or their past, present or future parent corporations, subsidiaries,
divisions, affiliates, officers, directors, agents, trustees, administrators,
attorneys, employees, employee benefit and/or pension plans or funds (including
qualified and non-qualified plans or funds), successors and/or assigns (whether
acting as agents for the Company or in their individual capacities)
(collectively, the “Releasees”) from any and all claims, demands, causes of
action, and liabilities of any kind whatsoever (upon any legal or equitable
theory, whether contractual, common-law, statutory, federal, state, local, or
otherwise), whether known or unknown, by reason of any act, omission,
transaction or occurrence which Releasers ever had, now have or hereafter can,
shall or may have against Releasees up to and including the date of the
execution of this Agreement, except for the Employee Non-Released Company
Claims.  Without limiting the generality of the foregoing, Releasers hereby
release and discharge Releasees from:

 

--------------------------------------------------------------------------------

 

(a)                                 any and all claims for backpay, frontpay,
minimum wages, overtime compensation, bonus payments, benefits, reimbursement
for expenses, or compensation of any kind (or the value thereof), and/or for
liquidated damages or punitive damages (under any applicable statute or at
common law);

 

(b)                                 any and all claims, relating to Employee’s
employment by the Company, the terms and conditions of such employment, employee
benefits related to Employee’s employment, the termination of Employee’s
employment, and/or any of the events relating directly or indirectly to or
surrounding such termination;

 

(c)                                  any and all claims of discrimination,
harassment, whistle blowing or retaliation in employment (whether based on
federal, state or local law, statutory or decisional), including without
limitation, all claims under the Age Discrimination in Employment Act of 1967,
as amended, Title VII of the Civil Rights Act of 1964, as amended, the Americans
with Disabilities Act, the Civil Rights Act of 1991, the Civil Rights Act of
1866, 42 USC §§ 1981-86, as amended, the Equal Pay Act, the Fair Labor Standards
Act, the Family and Medical Leave Act, the Employee Retirement Income Security
Act, the Florida Civil Rights Act of 1992, the Florida Whistle-Blower Law (Fla.
Stat. § 448.101 et seq.), the Florida Equal Pay Act, and waivable rights under
the Florida Constitution;

 

(d)                                 any and all claims under any contract,
whether express or implied;

 

(e)                                  any and all claims for unintentional or
intentional torts, for emotional distress and for pain and suffering;

 

(f)                                   any and all claims for violation of any
statutory or administrative rules, regulations or codes;

 

(g)                                  any and all claims for attorneys’ fees,
costs, disbursements, wages, bonuses, benefits, vacation and/or the like;

 

which Releasers ever had, now have or hereafter can, shall or may have against
Releasees for, upon or by reason of any act, omission, transaction or occurrence
up to and including the date of the execution of this Agreement, except for the
Employee Non-Released Company Claims.

 

4.                                      General Release in Favor of Employee. 
The Releasees, and each of them, hereby release Releasers, and each of them,
from all claims or causes of action whatsoever, known or unknown, including any
and all claims of the common law of the State of Florida, including but not
limited to breach of contract (whether written or oral), promissory estoppel,
defamation, unjust enrichment, or claims for attorneys’ fees and costs and all
claims which were alleged or could have been alleged against the Employee which
arose from the beginning of the world to the date of this Agreement, except for
the Company Non-Released Employee Claims.

 

5.                                      Reserved.

 

6.                                      Covenants not to Sue.

 

(a)                                 Employee Covenant not to Sue.  Employee
represents and warrants that to date, he has not filed any lawsuit, action,
complaint or charge of any kind with any federal, state, or county court or
administrative or public agency against the Company or any other Releasee. 
Without in any way limiting the generality of the foregoing, Employee hereby
covenants not to sue or to assert, prosecute, or maintain, directly or
indirectly, in any form, any claim or cause of action against any person or
entity being released pursuant to this Agreement with respect to any matter,
cause, omission, act, or thing whatsoever, occurring in whole or in part on or
at any time prior to the date of this Agreement, except for the Employee
Non-Released Company Claims.  Employee agrees that he will not seek or accept
any award or settlement from any source or proceeding with respect to any claim
or right waived in this Agreement.

 

(b)                                 Company Covenant not to Sue.  The Company
represents and warrants that to date, it has not filed any lawsuit, action,
complaint or charge of any kind with any federal, state, or county court or
administrative or public agency against Employee or any other Releaser.  Without
in any way limiting the generality

 

--------------------------------------------------------------------------------

 

of the foregoing, the Company hereby covenants not to sue or to assert,
prosecute, or maintain, directly or indirectly, in any form, any claim or cause
of action against any person or entity being released pursuant to this Agreement
with respect to any matter, cause, omission, act, or thing whatsoever, occurring
in whole or in part on or at any time prior to the date of this Agreement,
except for the Company Non-Released Employee Claims.  The Company agrees that it
will not seek or accept any award or settlement from any source or proceeding
with respect to any claim or right waived in this Agreement.

 

7.                                      No Admission.  The making of this
Agreement is not intended, and shall not be construed, as an admission that the
Company or any of the Releasees, has violated any federal, state or local law
(statutory or decisional), ordinance or regulation, breached any contract or
committed any wrongdoing whatsoever.

 

8.                                      Effectiveness.  This Agreement shall not
become effective until the eighth day following Employee’s signing of this
Agreement (“Effective Date”) and Employee may at any time prior to the Effective
Date revoke this Agreement by giving notice in writing of such revocation to:

 

KLX Energy Services Holdings, Inc.

1300 Corporate Center Way,

Wellington, FL 33414

Attn: General Counsel

 

In the event that Employee revokes this Agreement prior to the eighth day after
his execution thereof, this Agreement, and the promises contained herein, shall
automatically be deemed null and void.

 

9.                                      Employee Acknowledgement.  Employee
acknowledges that he has been advised in writing to consult with an attorney
before signing this Agreement, and that Employee has been afforded the
opportunity to consider the terms of this Agreement for twenty-one (21) days
prior to its execution.  Employee further acknowledges that he has read this
Agreement in its entirety, that he fully understands all of its terms and their
significance, that he has signed it voluntarily and of Employee’s own free will,
and that Employee intends to abide by its provisions without exception.

 

10.                               Severability.  If any provision of this
Agreement is held by a court of competent jurisdiction to be illegal, void or
unenforceable, such provision shall have no effect, however, the remaining
provisions shall be enforced to the maximum extent possible.

 

11.                               Entire Agreement.  This Agreement, the
Restricted Stock Agreement, the Proprietary Rights Agreement and the Employment
Letter, taken together, constitute the complete understanding between the
parties and supersedes all such prior agreements between the parties and may not
be changed orally.  Employee acknowledges that neither the Company nor any
representative of the Company has made any representation or promises to
Employee other than as set forth herein or therein.  No other promises or
agreements shall be binding unless in writing and signed by the parties.

 

12.                               General Provisions.

 

(a)                                 Governing Law; Jurisdiction; Venue.  This
Agreement shall be enforced, governed and interpreted by the laws of the State
of Florida without regard to Florida’s conflict of laws principles. Any
controversy or claim arising out of or relating to this Agreement, or the breach
thereof, shall be settled in a court of competent jurisdiction in the State of
Florida in Palm Beach County.  Each party consents to the jurisdiction of such
Florida court in any such civil action or legal proceeding and waives any
objection to the laying of venue in such Florida court.

 

(b)                                 Prevailing Party.  In the event of any
litigation, dispute or contest arising from a breach of this Agreement, the
prevailing party shall be entitled to recover from the non-prevailing party all
reasonable costs incurred in connection with such litigation, dispute or
contest, including without limitation, reasonable attorneys’ fees, disbursement
and costs, and experts’ fees and costs.

 

--------------------------------------------------------------------------------

 

(c)                                  Counterparts.  This Agreement may be
executed in several counterparts, each of which shall be deemed as an original,
but all of which together shall constitute one and the same instrument.

 

(d)                                 Binding Effect.  This Agreement is binding
upon, and shall inure to the benefit of, the parties, the Releasers and the
Releasees and their respective heirs, executors, administrators, successors and
assigns.

 

(e)                                  Interpretation.  Should any provision of
this Agreement require interpretation or construction, it is agreed by the
parties that the entity interpreting or construing this Agreement shall not
apply a presumption that the provisions hereof shall be more strictly construed
against one party who prepared the Agreement, it being agreed that all parties
have participated in the preparation of all provisions of this Agreement.

 

(f)                                   Defense of Trade Secrets Act. 
Notwithstanding anything to the contrary in this Agreement or otherwise,
Employee understands and acknowledges that the Company has informed Employee
that an individual shall not be held criminally or civilly liable under any
federal or state trade secret law for (i) the disclosure of a trade secret that
is made in confidence to a federal, state, or local government official or to an
attorney solely for the purpose of reporting or investigating a suspected
violation of law or (ii) the disclosure of a trade secret that is made in a
complaint or other document filed in a lawsuit or other proceeding if such
filing is made under seal.  Additionally, notwithstanding anything to the
contrary in this Agreement or otherwise, Employee understands and acknowledges
that the Company has informed Employee that an individual who files a lawsuit
for retaliation by an employer for reporting a suspected violation of law may
disclose the trade secret to the attorney of the individual and use the trade
secret information in the court proceeding if the individual files any document
containing the trade secret under seal and does not disclose the trade secret,
except pursuant to a court order.

 

(g)                                  Whistleblowing.  Nothing in this Agreement
or any other agreement between Employee and the Company shall be interpreted to
limit or interfere with Employee’s right to report good faith suspected
violations of law to applicable government agencies, including the Equal
Employment Opportunity Commission, National Labor Relation Board, the
Occupational Safety and Health Administration, the Securities and Exchange
Commission or any other applicable federal, state or local governmental agency,
in accordance with the provisions of any “whistleblower” or similar provisions
of local, state or federal law.  Employee may report such suspected violations
of law, even if such action would require Employee to share the Company’s
proprietary information or trade secrets with the government agency, provided
that any such information is protected to the maximum extent permissible and any
such information constituting trade secrets is filed only under seal in
connection with any court proceeding.  Lastly, nothing in this Agreement or any
other agreement between Employee and the Company will be interpreted to prohibit
Employee from collecting any financial incentives in connection with making such
reports or require Employee to notify or obtain approval by the Company prior to
making such reports to a government agency.

 

[Signature Page Follows]

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Separation Agreement and Mutual Release as of the date first written above.

 

 

 

KLX ENERGY SERVICES HOLDINGS, INC.

 

 

 

 

 

By:

 

 

 

 

Thomas P. McCaffrey

 

PRINT NAME:

 

 

 

 

 

TITLE:

STATE OF FLORIDA

)

 

 

) ss.

 

COUNTY OF               

)

 

 

 

I HEREBY CERTIFY, that on this day, before me, an officer duly authorized in the
State and County aforesaid to take acknowledgments, personally appeared Thomas
P. McCaffrey, to me known to be the person described in and who executed the
foregoing instrument, and acknowledged to and before me that he/she executed the
same.  This individual is personally known to me or has produced a
                       as identification and did take an oath.

 

SWORN TO AND SUBSCRIBED before me this       day of          , 20  .

 

 

 

 

Notary Public

 

My Commission Expires:

 

--------------------------------------------------------------------------------

 

EXHIBIT B

 

PROPRIETARY RIGHTS AGREEMENT

 

--------------------------------------------------------------------------------

 

KLX ENERGY SERVICES HOLDINGS, INC. PROPRIETARY RIGHTS AGREEMENT

 

This Proprietary Rights Agreement (“Agreement”) is intended to set forth in
writing my responsibility to KLX Energy Services Holdings, Inc. and/or any of
its subsidiaries or affiliated businesses (collectively, the “Company”) during
my employment, consultancy, and/or tenure as an independent contractor with the
Company and thereafter.  I recognize that the Company is engaged in a continuous
program of research, development and production respecting its business, present
and future.  As part of my employment, consultancy, and/or tenure as an
independent contractor with the Company, I have certain obligations relating to
business, confidential and/or proprietary information of the Company.

 

I acknowledge and agree that:

 

1.                                      Agreement and Effective Date

 

This Agreement shall be effective on, the first day of my employment,
consultancy, and/or tenure as an independent contractor with the Company and
shall continue in effect throughout my employment, consultancy, and/or tenure as
an independent contractor (the “Agreement Period”).  As an inducement to, and in
consideration of, my acceptance and/or continuation of employment, consultancy,
and/or tenure as an independent contractor with the Company, and the Company’s
compensating me for services and extending to me certain other benefits of a
compensatory nature, but without any obligation on the Company’s part to
continue such employment, compensation or benefits for any specified period
whatsoever, I agree to protect, safeguard and maintain the integrity and
confidentiality of the Company’s valuable assets and legitimate business
interests in accordance with the terms and conditions set forth in this
Agreement.

 

2.                                      Confidentiality

 

2.1                               Permitted Use.  I will maintain in confidence
and will not disclose or use, either during or after the Agreement Period, any
“Proprietary Information”, whether or not in written form, except to the extent
required to perform my duties on behalf of the Company.

 

2.2                               Definition of Proprietary Information.  As
used in this Agreement, Proprietary Information means all of the following
materials and information that I use, receive, have access to, conceive or
develop or have used, received, conceived or developed, in whole or in part, in
connection with my employment, consultancy and/or tenure as an independent
contractor with the Company:

 

(i)                                     Written materials of the Company;

 

The names and information relating to customers and prospective customers of the
Company and/or persons, firms, corporations or other entities with whom the
Company has provided goods or services at any time, including contact persons,
addresses and phone numbers, their characteristics and preferences and types of

 

--------------------------------------------------------------------------------

 

services provided to or received from those customers and prospective customers;

 

(ii)                                  The terms of various agreements between
the Company and any third parties, including without limitation, the terms of
customer agreements, vendor or supplier agreements, lease agreements,
advertising agreements, fee arrangements, terms of dealing and the like;

 

(iii)                               Any data or database, trading algorithms or
processes, or other information compiled by the Company, including, but not
limited to, customer lists, customer information, information concerning the
Company, or any business in which the Company is engaged or contemplates
becoming engaged, any company with which the Company engages in business, any
customer, prospective customer or other person, firm or corporation to whom or
which the Company has provided goods or services or to whom or which any
employee of the Company has provided goods or services on behalf of the Company,
or any compilation, analysis, evaluation or report concerning or deriving from
any data or database, or any other information;

 

(iv)                              All policies, procedures, strategies and
techniques regarding the services performed by the Company or regarding the
training, marketing and sales of the Company, either oral or written.  The
Company’s internal corporate policies and practices related to its services,
price lists, fee arrangements and terms of dealings with customers or potential
customers or vendors.  Information relating to formulas, records, research and
development data, trade secrets, processes, other methods of doing business,
forecasts and business and marketing plans;

 

(v)                                 Any other information, data, know-how or
knowledge of a confidential or proprietary nature observed, used, received,
conceived or developed by me in connection with my employment, consultancy,
and/or tenure as an independent contractor by the Company, including and not
limited to the Company’s methodologies, price strategies, price lists, costs and
quantities sold, financial and sales information, including, but not limited to,
the Company’s financial condition, business interests, initiatives, objectives,
plans or strategies; internal information regarding personnel identity, skills,
compensation, organizational charts, budgets or costs of individual departments,
and the compensation paid to those working for or who provide services to the
Company; and performance of investments, funds or portfolio companies, including
any “track record” or other financial performance information or results;

 

--------------------------------------------------------------------------------

 

(vi)                              All other non-public information regarding the
amount and nature of the capital and assets owned or controlled by, or net worth
of, the Company and/or any of the Company’s shareholders, members, partners,
employees or investors; the investments made, directly or indirectly, by the
Company (including, but not limited to, any partnerships, corporations or other
entities in which the Company may invest and the assets which any of those
entities acquires); the expected or actual rates of return or holding periods of
any investment by the Company; the respective interest in any investment of any
of its shareholders, members, partners or investors or the manner in which those
interests are held; the identities of the other persons or entities who
participate in any investment made by the Company; and financial statements,
projections, budgets and market information;

 

(vii)                           All discoveries, software (including, without
limitation, both source code and object code), models, drawings, photographs,
specifications, trademarks, formulas, patterns, devices, compilations and all
other proprietary know-how and technology, whether or not patentable or
copyrightable, and all copies and tangible embodiments of any of the foregoing,
and that have been or will be created for the Company by me, whether alone or
with others;

 

(viii)                        The Company’s inventions, products, research and
development, production processes, manufacturing and engineering processes,
machines and equipment, finances, customers, marketing, and production and
future business plans, information belonging to customers or suppliers of the
Company disclosed incidental to my employment, consultancy, and/or tenure as an
independent contractor and any other information which is identified as
confidential by the Company; and

 

(ix)                              “Trade Secrets”, which shall include, but not
be limited to, information regarding formulas, processes or methods that:
(a) derive independent economic value, actual or potential, from not being
generally known to or readily ascertainable by proper means, by other persons
who can obtain economic value from its disclosure or use; and (b) is the subject
of reasonable efforts by the Company to maintain its secrecy.  “Trade Secrets”
shall also include all other information or data that qualifies as a trade
secret under applicable law.

 

--------------------------------------------------------------------------------

 

3.                                      Trade Secrets

 

3.1                               Use and Return of Proprietary Information and
Trade Secrets:

 

(i)                                     I agree that, upon termination of my
employment (if applicable) and/or tenure as an independent contractor with the
Company for any reason (regardless of whether or not the Company retains me as a
consultant) or at any other time upon the Company’s request, I shall return to
Company, without retaining any copies, all Proprietary Information and Trade
Secrets, as well as all other Company’s documents and other materials, which are
in my possession regardless of the form in which any such materials are kept;

 

(ii)                                  I acknowledge that all documents, in hard
copy or electronic form, received, created or used by me in connection with my
employment, consultancy, and/or tenure as an independent contractor with the
Company are and will remain the property of the Company.  I agree to return all
such documents (including all copies) promptly upon the termination of my
employment, consultancy, and/or tenure as an independent contractor, certify
that no other documents remain, and agree that, during or after my employment,
consultancy, and/or tenure as an independent contractor, I will not, under any
circumstances, without the written consent of the Company, disclose those
documents to anyone outside the Company or use those documents for any purpose
other than the advancement of the Company’s interests;

 

3.2                               Defense of Trade Secrets Act.  Notwithstanding
anything to the contrary, I understand and acknowledge that the Company has
informed me that an individual shall not be held criminally or civilly liable
under any federal or state trade secret law for (i) the disclosure of a trade
secret that is made in confidence to a federal, state, or local government
official or to an attorney solely for the purpose of reporting or investigating
a suspected violation of law, or (ii) the disclosure of a trade secret that is
made in a complaint or other document filed in a lawsuit or other proceeding if
such filing is made under seal. Additionally, notwithstanding anything to the
contrary, I understand and acknowledge that the Company has informed me that an
individual who files a lawsuit for retaliation by an employer for reporting a
suspected violation of law may disclose the trade secret to the attorney of the
individual and use the trade secret information in the court proceeding if the
individual files any document containing the trade secret under seal and does
not disclose the trade secret, except pursuant to a court order.

 

4.                                      No Conflicting Obligations

 

Except as otherwise set forth in the Employment Letter, my performance of this
Agreement does not and will not breach any agreement to keep in confidence
proprietary information, knowledge or data acquired by me prior to my
employment, consultancy, and/or tenure as an independent contractor with the
Company.  I will not disclose, induce, or permit the Company to, either directly
or indirectly, use, any confidential or proprietary information or material
belonging to any previous employer or other person

 

--------------------------------------------------------------------------------

 

or entity.  Except as otherwise set forth in the Employment Letter, I am not a
party to any other agreement that will interfere with my full compliance with
this Agreement.  I will not enter into any agreement, whether written or oral,
conflicting with the provisions of this Agreement.

 

5.                                      Whistleblowing

 

Nothing in this Agreement or any other agreement between you and the Company
shall be interpreted to limit or interfere with your right to report good faith
suspected violations of law to applicable government agencies, including the
Equal Employment Opportunity Commission, National Labor Relation Board, the
Occupational Safety and Health Administration, the Securities and Exchange
Commission or any other applicable federal, state or local governmental agency,
in accordance with the provisions of any “whistleblower” or similar provisions
of local, state or federal law.  You may report such suspected violations of
law, even if such action would require you to share the Company’s Proprietary
Information or Trade Secrets with the government agency, provided that any such
Proprietary Information is protected to the maximum extent permissible and any
such information constituting Trade Secrets is filed only under seal in
connection with any court proceeding.  Lastly, nothing in this Agreement or any
other agreement between you and the Company will be interpreted to prohibit you
from collecting any financial incentives in connection with making such reports
nor to require you to notify or obtain approval by the Company prior to making
such reports to a government agency.

 

6.                                      Survival

 

Notwithstanding the termination of the Agreement Period, this Agreement shall
survive such termination and continue in accordance with its terms and
conditions.  Unless provided otherwise in a written contract with the Company,
this Agreement does not in any way restrict my right or the right of the Company
to terminate my employment, consultancy, and/or tenure as an independent
contractor at any time, for any reason or for no reason.

 

7.                                      Specific Performance

 

A breach of any of the promises or agreements contained herein will result in
irreparable and continuing damage to the Company for which there will be no
adequate remedy at law, and the Company shall be entitled to injunctive relief
and/or a decree for specific performance, and such other relief as may be proper
(including monetary damages, if appropriate).

 

8.                                      Waiver

 

The waiver by the Company of a breach of any provision of this Agreement by me
will not operate or be construed as a waiver of any other or subsequent breach
by me.

 

--------------------------------------------------------------------------------

 

9.                                      Severability

 

If any part of this Agreement is found invalid or unenforceable, that part will
be amended to achieve as nearly as possible the same economic effect as the
original provision and the remainder of this Agreement will remain in full
force.

 

10.                               Governing Law

 

This Agreement will be governed by and construed in accordance with the laws
(other than the conflict of laws rules) of the state of Florida.

 

11.                               Entire Agreement

 

Except for the Employment Letter (and the exhibits thereto), this Agreement
constitutes the entire agreement between the parties relating to this subject
matter and supersede all prior or simultaneous representations, discussions,
negotiations and agreements, whether written or oral, except for prior
proprietary rights agreements which shall for the period prior to the effective
date of this Agreement be deemed to be in addition to, and not in lieu of, this
Agreement for such prior period.  This Agreement may be amended or modified only
with the written consent of both me and the Company.  No oral waiver, amendment
or modification will be effective under any circumstances whatsoever.

 

12.                               Assignment

 

This Agreement may be assigned by the Company.  I may not assign or delegate my
duties under this Agreement without the Company’s prior written approval.  This
Agreement shall be binding upon my hairs, successors and permitted assignees.

 

--------------------------------------------------------------------------------

 

Date:

 

 

 

 

 

EMPLOYEE

 

 

 

 

 

(Name)

 

 

 

 

 

(Printed Name)

 

 

 

 

KLX ENERGY SERVICES HOLDINGS, INC.

 

 

 

 

 

By:

 

 

 

Title:

 

 

--------------------------------------------------------------------------------