EXHIBIT 10.2.2

 

 

 

 

 

___________________________________

 

ATWOOD OCEANICS, INC.

 

RETENTION PLAN

 

FOR CERTAIN SALARIED EMPLOYEES

 

___________________________________

 

Effective as of January 1, 2008

 

 

 

 

This Plan will terminate automatically

as of December 31, 2008 if there is no "Effective Date"

(as defined in Plan Section 1.5) on or before that date.

 

 

 

                  

ATWOOD OCEANICS, INC.

RETENTION PLAN

FOR CERTAIN SALARIED EMPLOYEES

 

The Company (as defined herein) hereby adopts this Retention Plan for Certain
Salaried Employees (the "Plan"), effective as of the 1st day of January, 2008.

 

INTRODUCTION

 

The purpose of this Plan is to secure the interests of the Company’s
shareholders in the event of a change of control of the Company. In such an
event, this Plan would provide an enhanced severance payment and other benefits
to encourage certain valued employees to remain employed with the Company during
that period of financial uncertainty preceding and following the change of
control. If such an event does not occur on or before December 31, 2008, this
Plan will terminate automatically, unless otherwise renewed by the Company’s
Board of Directors.

 

ARTICLE I

DEFINITIONS

 

Terms defined above and initially capitalized shall have the respective meanings
so ascribed. When used in this Plan and initially capitalized, the following
words and phrases shall have the following respective meanings unless the
context clearly requires otherwise:

 

1.1          "Base Salary" as to any Covered Employee for any period, shall mean
the greater of the sum of such individual’s monthly base salary and Bonus as of
the Termination of Employment or as of the date immediately preceding the
Effective Date, which is paid to such individual by the Company during
employment for such period, before reduction because of an election between
benefits or cash provided under a plan of the Company maintained pursuant to
Section 125 or 401(k) of the Internal Revenue Code of 1986, as amended, and
before reduction for any other amounts contributed by the Company on such
individual’s behalf to any other employee-benefit plan.

 

1.2          “Bonus ” as to Covered Employee for any period, shall mean the
average of bonus payments, if any, made over the preceding three years,
including any year for which a bonus has been awarded but not paid, divided by
twelve. If the Covered Employee has not been an employee of the Company for at
least three years, then Bonus shall be calculated over the period for which the
employee has been employed with the Company.

 

1.3          "Company" shall mean Atwood Oceanics, Inc., a Texas corporation, or
any entity that is a successor to it in ownership of substantially all its
assets and their affiliates (“Atwood”) and its direct and indirect subsidiaries.

 

 

1.4

"Covered Employee" shall mean an employee described in Article II of the Plan.

 

1.5          "Effective Date" shall mean the date on or before December 31,
2008, on which any of the following is effective:

 

 

(a)

The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or
more of either (i) the then outstanding shares of common stock of Atwood or (ii)
the combined voting power of the then outstanding voting securities of Atwood
entitled to vote generally in the election of directors; provided, however, that
the following acquisitions shall not constitute a Change of Control: (i) any
acquisition directly from Atwood; (ii) any acquisition by

 

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Atwood; (iii) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company; or

 

 

(b)

Atwood shall sell substantially all of its assets to another corporation which
is not a wholly owned subsidiary; or

 

 

(c)

Individuals who, as of the date hereof, constitute the Board of Atwood (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the date hereof whose election, or nomination for election by Atwood’s
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board.

 

1.6          "Employment Year" shall mean a period which commences on the first
date of employment or any anniversary of such date and ends one year from such
date.

 

1.7          "Good Cause" shall mean a material violation of a Company policy or
procedure applicable to employees in the same or similar job position, the
willful disregard or failure to follow the reasonable instructions of a
superior, the taking of any action, or the failure to take any action, which
results in a damage or detriment to the Company, or the conviction of an
employee of a felony involving moral turpitude.

 

1.8          "Health and Life Benefits" shall mean as to any employee, the
group-health and life-insurance benefits sponsored by the Company for its
full-time employees and provided to or elected by such individual as of the date
immediately preceding the Effective Date.

 

 

1.9

"Other Severance" shall have the meaning set forth in Section 2.2 of the Plan.

 

1.10        "Severance Pay" shall mean the sum payable to a Covered Employee
upon Termination of Employment as set forth in Section 3.1 of the Plan.

 

1.11        “Term ” shall mean the period commencing on the Effective Date and
ending one year after that date.

 

1.12        "Termination of Employment" shall mean a termination of employment
with the Company at the option of the Company for any reason, except a
termination of employment for Good Cause shall not mean a Termination of
Employment.

 

1.13        "Years of Continuous Service" shall mean, as to any employee, all
full or partial years during which he was employed on a full-time basis by the
Company.

 

ARTICLE II.

COVERED EMPLOYEES

 

2.1          Who is a Covered Employee. Any employee of the Company who upon the
occurrence of an Effective Date, shall be listed in Schedule 3.1 hereto, which
Schedule 3.1 shall be amended from time to time by the Company, and who has a
Termination of Employment during the Term shall be a Covered Employee and
eligible to receive the benefits described in this Plan.

 

2.2          Exclusions. Any employee who otherwise is a Covered Employee but
who, pursuant to a separate agreement signed on behalf of the Company, receives
severance or other salary continuation benefits upon a Termination of Employment
(other than payments or benefits under the Company’s Executive Life Insurance
Plan) shall not be a Covered Employee under this Plan. This Plan shall be in
lieu of any plan, program, policy or practice of or contract or agreement with
the Company relating to severance of employment ("Other Severance") and any

 

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and all benefits of payments arising out of or relating to Other Severance shall
be fully offset against any benefits or payments due and owing hereunder.

 

ARTICLE III

SEVERANCE PAY AND OTHER BENEFITS

 

3.1            Amount of Severance Pay. The Company shall pay Severance Pay to a
Covered Employee upon a Termination of Employment in an amount equal to the
greater of (a) or (b):

 

 

(a)

such individual’s weekly Base Salary multiplied by such individual’s Years of
Continuous Service; or

 

 

(b)

a payment, depending upon the category of employee as identified in Schedule 3.1
hereto, as follows:

 

Category of Employee

Payment

Houston Management A:

(i)           Less than 4 Years of Continuous Service - 6 months' Base Salary;
or

 

 

(ii)         4 Years but less than 8 Years of Continuous Service - 12 months'
Base Salary; or

 

 

(iii)        8 or greater Years of Continuous Service - 18 months' Base Salary

 

Houston Management B,

Houston Technical,

Rig Management and

Other Administration:

 

 

 

 

(i)           Less than 4 Years of Continuous Service - 1 month Base Salary; or

 

 

(ii)         4 Years but less than 8 Years of Continuous Service - 4 months'
Base Salary; or

 

 

 

(iii)        8 Years but less than 12 Years of Continuous Service - 8 months'
Base Salary; or

 

 

(iv)         12 or greater Years of Continuous Service - 12 months' Base Salary

 

Houston Accounting A, Houston Accounting B and

Houston Staff:

 

 

 

(i)           Less than 4 Years of Continuous Service - 1 month Base Salary; or

 

 

(ii)         4 Years but less than 8 Years of Continuous Service - 3 months'
Base Salary; or

 

 

(iii)        8 or greater Years of Continuous Service - 6 months' Base Salary

 

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3.2                  Health and Life Benefits. Upon a Termination of Employment,
a Covered Individual’s Health and Life Benefits shall be treated as follows:

 

 

(a)

Upon a Termination of Employment and if applicable, the Company will notify each
Covered Employee of the right to elect to continue any Company-provided health
or disability benefits, all in accordance with and subject to the provisions of
the Consolidated Omnibus Budget Reconciliation Act ("COBRA"). The Company shall
charge the maximum allowable premium in connection with any COBRA benefits so
provided. Other than the benefits provided under COBRA, the Company shall have
no further obligation to provide health or disability insurance benefits to any
Covered Individual following a Termination of Employment.

 

 

(b)

Upon written request by a Covered Individual within five (5) days of a
Termination of Employment, the Company shall assign any life, salary
continuation or travel insurance plans or policies to such Covered Individual
which by their terms are so assignable, and such Covered Individual will
thenceforth become responsible for the payment of any premiums required to
maintain said plans or policies from and after the date of Termination of
Employment; otherwise, the Company will cease to continue such life insurance
plans or policies on behalf of any Covered Employee effective as of the date of
Termination of Employment.

 

3.3                Payment for Unused Vacation. Upon a Termination of
Employment, the Company will pay a Covered Employee an amount equal to such
individual’s weekly Base Salary multiplied by each full and partial week of
vacation, which was accrued but unused during the Employment Year in which
occurred such individual’s Termination of Employment. For purposes of
determining payment under this Section 3.3, a full week of vacation consists of
five (5) vacation days.

 

ARTICLE IV

DISTRIBUTION OF CASH PAYMENTS

 

The Company shall pay a Covered Employee the amount to which he or she is
entitled under (as applicable) Plan Section 3.1 (relating to Severance Pay) and
Plan Section 3.3 (relating to Payment for Unused Vacation) in one lump sum
within a reasonable time, but in no event greater than ten (10) business days,
after such Covered Employee’s Termination of Employment.

 

ARTICLE V

ADMINISTRATION OF PLAN

 

5.1                In General. The Plan shall be administered by Atwood, which
shall be the named fiduciary under the Plan. Atwood may delegate any of its
administrative duties, including without limitation duties with respect to the
processing, review, investigation, approval, and payment of benefits under the
Plan, to a named administrator or administrators.

 

5.2                Regulations. Atwood shall promulgate any rules and
regulations that it deems necessary to carry out the purposes of the Plan, or to
interpret the terms and conditions of the Plan; provided that no rule,
regulation, or interpretation shall be contrary to the provisions of the Plan.
The rules, regulations, and interpretations made by Atwood shall, subject only
to the claims procedure outlined in Section 5.3 hereof, be final and binding on
any employee or former employee of the Company, or any successor in interest of
either.

 

5.3                Claims Procedure. The Company shall determine the rights of
any employee or former employee of the Company to any benefits hereunder. Any
employee or former employee of the Company who believes that he is entitled to
receive any benefits other than as initially determined by the Company, may file
a claim in writing with Atwood’s President. Atwood shall, no later than ninety
(90) days after the receipt of a claim, either allow or deny the claim in
writing.

 

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A denial of a claim, wholly or partially, shall be written in a manner
calculated to be understood by the claimant and shall include:

 

 

(a)

the specific reason or reasons for the denial;

 

(b)

specific reference to pertinent Plan provisions on which the denial is based;

 

(c)

a description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary; and

 

(d)

an explanation of the claim-review procedure.

 

A claimant whose claim is denied (or his duly authorized representative) may,
within 30 days after receipt of denial of his claim:

 

 

(a)

request a review upon written application to the Company’s personnel
administrator;

 

(b)

review pertinent documents; and

 

(c)

submit issues and comments in writing.

 

Atwood shall notify the claimant of its decision on review within sixty (60)
days after receipt of a request for review. Notice of the decision on review
shall be in writing.

 

5.4                Revocability of Company Action. Any action taken by Atwood
with respect to the rights under the Plan of any employee or former employee
shall be revocable by Atwood as to payments or distributions not yet made to
such person, and acceptance of any benefits under the Plan constitutes
acceptance of and agreement to any appropriate adjustments made by the Company
in future payments or distributions to such person to offset any excess or
underpayment previously made to him with respect to any benefits.

 

ARTICLE VI

AMENDMENT OR TERMINATION OF PLAN

 

6.1                Right to Amend or Terminate. Atwood reserves the right at any
time prior to the Effective Date, and without prior or other approval of any
employee or former employee, to change, modify, amend, or terminate the Plan.
All such changes, modifications, or amendments may be retroactive to any date up
to and including the original effective date of the Plan, and shall be
retroactive to that date unless other provision is specifically made; provided
that no such change, modification, or amendment shall adversely affect any
benefit under the Plan previously paid or provided to a Covered Employee (or his
or her successor in interest).

 

6.2                Automatic Termination. This Plan shall terminate
automatically as of December 31, 2007, or such other extended termination date
duly adopted in accordance with the provisions of Section 6.1 above, if there is
no Effective Date on or before that date. Termination pursuant to this Plan
Section 6.2 shall occur without any action on the part of the Company and shall
be effective without prior notice to or approval of any employee or former
employee of the Company.

 

ARTICLE VII

METHOD OF FUNDING

 

The Company shall pay benefits under the Plan from current operating funds. No
property of the Company is or shall be, by reason of this Plan, held in trust
for any employee of the Company, nor shall any person have any interest in or
any lien or prior claim upon any property of the Company by reason of the Plan
or the Company's obligations to make payments hereunder.

 

ARTICLE VIII

LEGAL FEES AND EXPENSES; ENFORCEMENT

 

It is the intent of the Company that no Covered Employee be required to incur
the expenses associated with the enforcement of his rights under this Plan by
litigation or other legal action because the cost and expense thereof would
substantially detract from the benefits intended to be extended to a Covered
Employee hereunder.

 

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Accordingly, if it should appear to a Covered Employee that the Company has
failed to comply with any of its obligations under this Plan or in the event
that the Company or any other person takes any action inconsistent with the
terms of this Plan to declare this Plan void or unenforceable, or institutes any
litigation designed to deny, or to recover from, the Covered Employee the
benefits intended to be provided to such Covered Employee hereunder, the Company
irrevocably authorizes such Covered Employee from time to time to retain counsel
of his choice, at the expense of the Company as thereafter provided, to
represent such Covered Employee in connection with the initiation or defense of
any litigation or other legal action, whether by or against the Company or any
director, officer, stockholder, or other person affiliated with the Company in
any jurisdiction. Notwithstanding any existing prior attorney-client
relationship between the Company and such counsel, the Company irrevocably
consents to such Covered Employee's entering into an attorney-client
relationship with such counsel, and in that connection the Company and such
Covered Employee agree that a confidential relationship shall exist between such
Covered Employee and such counsel. The Company shall pay and be solely
responsible for any and all attorneys' and related fees and expenses incurred by
such Covered Employee as a result of the Company's failure to perform under this
Plan or any provision thereof; or as a result of the Company or any person
contesting the validity or enforceability of this Plan or any provision thereof.

 

ARTICLE IX

MISCELLANEOUS

 

9.1                Limitation on Rights. Participation in the Plan shall not
give any employee the right to be retained in the service of the Company or any
rights to any benefits whatsoever, except to the extent specifically set forth
herein. Unless otherwise agreed in writing, employment with the Company is "at
will."

 

9.2                Headings. Headings of Articles and Sections in this
instrument are for convenience only, and do not constitute any part of the Plan.

 

9.3                Gender and Number. Unless the context clearly indicates
otherwise, the masculine gender when used in the Plan shall include the
feminine, and the singular number shall include the plural and the plural number
the singular.

 

 

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EXECUTED as of the date first set forth above.

 

 

ATWOOD OCEANICS, INC.

 

 

 

By: /s/ John R. Irwin

 

Name: John R. Irwin

 

Title: President & Chief Executive Officer

 

 

 

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