sepagreement.htm


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    Exhibit
      10.1

     

    EXECUTION
      COPY

     

    SEPARATION
      AGREEMENT

     

    AND
      GENERAL RELEASE

     

    TERMINATION
      OF EMPLOYMENT AGREEMENT AND RELEASE (the “Agreement”), dated as
      of July 6, 2007 (“Effective Date”) by and between
Rosetta Resources Inc., a Delaware corporation, (the
“Company”), and B.A. Berilgen
      (“Executive”).

     

    WHEREAS,
      the Company and Executive entered into and are parties to an employment
      agreement (the “Employment Agreement”);

     

    WHEREAS,
      the Company and Executive desire to terminate the Employment Agreement and
      to
      terminate Executive’s employment with the Company effective as of July 15, 2007,
      subject to the terms and conditions set forth below;

     

    NOW,
      THEREFORE, in consideration of the mutual promises and agreements hereinafter
      set forth, the Company and Executive agree as follows:

     

    1.  Definitions.  As
      used in this Agreement, the following terms have the following
      meanings:

     

    “Acquisition”
      has the meaning set forth in the Employment Agreement.

     

    “Affiliate”
      means, with respect to any entity, any other corporation, organization,
      association, partnership, sole proprietorship or other type of entity, whether
      incorporated or unincorporated, directly or indirectly controlling or controlled
      by or under direct or indirect common control with such entity.

     

    “Benefit
      Continuation Period” has the meaning set forth in Section
      3.

     

    “Code”
      means the Internal Revenue Code of 1986, as amended from time to time, and
      the
      regulations promulgated thereunder.

     

    “Company”
      has the meaning set forth in the first paragraph hereof.

     

    “Company
      Group” has the meaning set forth in Section 4.

     

    “Competitor”
      means any person or entity that is engaged in acquisition, exploration,
      development and production of oil and gas properties in competition with the
      activities of Company or any of its Affiliates.

     

    “Confidential
      Information” means, without limitation, documents or information, in
      whatever form or medium, concerning evidencing sales; costs; pricing;
      strategies; forecasts and long range plans; financial and tax information;
      personnel information; business, marketing operational projections, plans and
      opportunities; customer, vendor, and supplier information; geological and
      geophysical maps, data, interpretations, and analyses; and prospect locations
      and leads; well logs, interpretations, and analyses; production information;
      in
      each case relating to the Company, but excluding any such information that
      is or
      becomes generally available to the public other than as a result of any breach
      of this Agreement or the Employment Agreement or other unauthorized disclosure
      by Executive.

     

    “Effective
      Date’ has the meaning set forth in the first paragraph
      hereof.

     

    “Employment
      Agreement” has the meaning set forth in the Recitals
      hereto.

     

    “Executive”
      has the meaning set forth in the Recitals hereto.

     

    “Executive
      Claim” means any claim set forth or referred to in, and which is the
      subject of, Section 4..

     

    “Installment
      Payments” has the meaning set forth in Section 3.

     

    “Offer”
      has the meaning set forth in the Employment Agreement.

     

    “Options”
      means all of the options previously granted to Executives to purchase equity
      securities of the Company.

     

    “Resignation
      Date” has the meaning set forth in Section 2.

     

    “Restricted
      Period” has the meaning set forth in Section 5.

     

    “Restrictive
      Covenants” has the meaning set forth in Section 6.

     

    “Separation
      Benefits” has the meaning set forth in Section 3.

     

    “Tax
      Liabilities” means any liabilities or obligations under Section 409A of
      the Code arising out of or relating to this Agreement.

     

    “Welfare
      Continuation Benefits” has the meaning set forth in Section
      3.

     

    2.  Resignation.  Executive
      shall cease to be an employee of the Company effective July 15, 2007 (the
“Resignation Date”) and hereby resigns on the Effective Date
      from Executive’s positions as President and Chief Executive Officer of the
      Company, director and Chairman of the Board of Directors of the Company and
      from
      all other positions, including service on any Board of Directors, which
      Executive holds or occupies with any of the Company’s subsidiaries or
      Affiliates, and the Company hereby accepts such resignations.

     

    3.  Separation
      Benefits.

     

    In
      consideration of Executive’s agreements hereunder, the Company further agrees to
      make the payments and provide the benefits set forth in Sections 3(a), (b)
      and
      (c) (the “Separation Benefits”).  The Separation Benefits
      supersede and replace any and all benefits to which Executive might otherwise
      be
      or become entitled under the Company’s compensation and employee benefit plans
      (including severance plans and arrangements) and the Employment Agreement,
      other
      than benefit plans subject to Section 401(a) of the Code.

     

    (a)  Accrued
      Obligations.  Within ten business days after the Resignation
      Date, the Company will pay Executive’s accrued and unpaid base salary and
      accrued and unused vacation days, all through the Resignation
      Date.  In addition, in accordance with the Company’s policies and
      procedures, the Company shall promptly reimburse Executive for all unreimbursed
      documented reasonable business expenses properly incurred by Executive on or
      before the Resignation Date.

     

    (b)  Separation
      Payments.  The Company shall pay to Executive (i) on the
      Resignation Date a lump sum payment of $2,000,000 and (ii) for the eighteen
      month period commencing on the Resignation Date $960,000 payable in twelve
      equal
      monthly installments of $80,000, commencing on January 15, 2008
      (“Installment Payments”).

     

    (c)  Certain
      Welfare Benefits.  During the 36-month period beginning on the
      Resignation Date (the “Benefit Continuation Period”), the
      Company shall continue to provide on the same basis the medical, dental and
      life
      insurance benefits that Executive and his dependents were receiving or entitled
      to receive immediately prior to the Resignation Date (“Welfare
      Continuation Benefits”); provided, however, that if Executive
      becomes employed and eligible for similar benefits during the Benefit
      Continuation Period, Executive’s entitlement to benefit continuation under this
      Section 3(c) shall immediately cease, subject to Executive’s rights to COBRA
      continuation coverage under the Company’s welfare benefit plans by paying the
      applicable premium therefor.  If, for any period during which
      Executive is entitled to Welfare Continuation Benefits, the Company reasonably
      determines that Executive cannot receive such Benefits under any Company
      sponsored welfare benefit plan then, in lieu of providing benefits under such
      plan, the Company shall provide to Executive comparable benefits through other
      arrangements or the cash equivalent of the cost thereof.

     

    (d)  Benefits
      to Cease upon Breach of Restrictive Covenants.  In all events, if
      Executive breaches any of the Restrictive Covenants then, notwithstanding
      anything herein to the contrary, Executive shall immediately cease to have
      any
      rights to any unpaid Separation Benefits and any Options outstanding shall
      immediately terminate without any payment to Executive.

     

    4.  Release.

     

    (a)  In
      exchange for this Agreement, Executive (on behalf of Executive and anyone
      claiming through or on behalf of Executive), releases the Company and each
      of
      the Company’s subsidiaries and other Affiliates, its and their successors and
      assigns, and all of their past and present employees, officers, directors and
      stockholders (the “Company Group”), and their agents and
      attorneys from any and all claims and potential claims, whether known or unknown
      and whether or not matured or contingent, demands and causes of action Executive
      has or may have had against any of them, including but not limited to,
      Executive’s service or employment with the Company and the termination
      thereof.  This release includes, but is not limited to, any and all
      claims, demands and causes of action which are related to or
      concern:  the Employment Agreement; service as a director or officer
      of the Company; Executive’s acquisition or ownership of Company securities or
      Options; Executive’ s employment and the prospective termination thereof as
      contemplated hereby; Tax Liabilities; attorneys’ fees or costs; discrimination
      under local, state or federal law; the Age Discrimination in Employment Act
      (ADEA); the Older Workers Benefit Protection Act (OWBPA); Title VII of the
      Civil
      Rights Act of 1964; the Civil Rights Act of 1991; the Americans With
      Disabilities Act; the Employee Retirement Income Security Act; severance pay;
      tort claims including invasion of privacy, defamation, fraud and infliction
      of
      emotional distress; disputed wage claims; and all other claims, demands, and
      causes of action, whether they arise in the United States of America or
      elsewhere.  This release does not apply to (i) any rights or benefits
      as set forth in this Agreement, or (ii) any rights to indemnification to which
      Executive is entitled as an officer or director.

     

    (b)  In
      exchange for this Agreement, the Company (on behalf of the Company and the
      Company’s subsidiaries and other Affiliates, their successors and assigns and
      anyone claiming through or on behalf of the Company or any of the Company’s
      subsidiaries or other Affiliates, their successors and assigns) release
      Executive, Executive’s heirs, executors, personal representatives, attorneys,
      agents, successors and assigns, from any and all claims and potential claims,
      known or unknown and whether or not matured or contingent, demands and causes
      of
      action which they have or may have had against Executive arising out of, related
      to or concerning Executive’s performance of his duties with the Company and with
      respect to expenses reimbursed to Executive prior to the date hereof; provided,
      however that this release does not release Executive from the obligation to
      comply with Executive’s obligations under this Agreement nor from any claim,
      right or cause of action that relates to Calpine or the Acquisition, all of
      which obligations, claims, rights and causes of action are expressly
      preserved.

     

    5.  Executive
      Covenants.

     

    (a)  Confidentiality.  Executive
      acknowledges and agrees that (i) the Company and its Affiliates are engaged
      in a
      highly competitive business; (ii) the Company and its Affiliates have expended
      considerable time and resources to develop goodwill with their customers,
      vendors, and others, and to create, protect, and exploit Confidential
      Information; (iii) the Company must continue to prevent the dilution of its
      and
      its Affiliates’ goodwill and unauthorized use or disclosure of its Confidential
      Information to avoid irreparable harm to its legitimate business interests;
      (iv)
      given Executive’s position and responsibilities with the Company, Executive was
      necessarily involved creating Confidential Information that belongs to the
      Company and enhances the Company’s goodwill; (v) Executive had access to
      Confidential Information that could be used by any Competitor of the Company
      in
      a manner that would irreparably harm the Company’s competitive position in the
      marketplace and dilute its goodwill; and (vi) Executive will not directly or
      indirectly use or disclose Confidential Information.

     

    Executive
      acknowledges and agrees that:  (i) all Confidential Information is,
      shall remain and be the sole and exclusive property of the Company and/or its
      Affiliates; (ii) Executive will hold all Confidential Information in strictest
      confidence and not, directly or indirectly, at any time disclose or divulge
      any
      Confidential Information to any person other than an officer, director or legal
      counsel for the Company or its Affiliates, unless authorized to do so by the
      Company or compelled to do so by law or valid  legal process; (iii) if
      Executive believes Executive is compelled by law or valid legal process to
      disclose or divulge any Confidential Information, Executive will notify the
      Company in writing sufficiently in advance of any such disclosure to allow
      the
      Company the opportunity to defend, limit, or otherwise protect its interests
      against such disclosure; and (iv) concurrently with the execution of this
      Agreement, Executive will return to the Company all Confidential Information
      and
      all copies thereof; in whatever tangible form or medium, including
      electronic.

     

    (b)  Non-Disparagement.  (i)
      Executive agrees that Executive shall not at any time make negative statements
      or  representations, or otherwise communicate negatively, directly or
      indirectly, in writing, orally, or otherwise, or take any action which may,
      directly or indirectly, disparage or be damaging to the Company, its
      subsidiaries, Affiliates, successors or their officers, directors, employees,
      business or reputation.  From and after the Resignation Date,
      Executive shall communicate directly only with D. Henry Houston regarding any
      matters relating to the Company and shall otherwise not contact or attempt
      to
      contact the Company, its officers, directors, shareholders, employees or agents
      regarding any matters relating to the Company, unless such person first contacts
      Executive.

     

    (ii)           The
      Company agrees that neither the Company nor any of its directors shall at any
      time make, or authorize the making of, and that the Company shall instruct
      the
      Company’s executive officers not to make or authorize the making of, statements
      or representations, or other communications, directly or indirectly, in writing,
      orally, or otherwise, or take any action which (A) except in the context of
      legal or administrative proceedings, directly or indirectly, disparages
      Executive or (B) is designed to be damaging to Executive’s
      reputation.

     

    (c)  Nonsolicitation.  (i)
      Executive agrees that at no time during the two-year period beginning on the
      Resignation Date the (“Restricted Period”) will Executive,
      whether on his own behalf or on behalf of any other individual, partnership,
      firm, corporation or business organization, either directly or indirectly
      solicit, induce, persuade, or entice, or endeavor to solicit, induce, persuade,
      or entice, any person who is then employed by or otherwise engaged to perform
      services for the Company or its Affiliates to leave that employment or cease
      performing those services; and

     

    (ii)  During
      the Restricted Period, Executive will not, whether on his own behalf or on
      behalf of any other individual, partnership, firm, corporation or business
      organization, either directly or indirectly solicit, induce, persuade, or
      entice, or endeavor to solicit, induce, persuade, or entice, any person who
      is
      then a customer, supplier, or vendor of the Company or any of its Affiliates
      to
      cease being a customer, supplier, or vendor of the Company or any of its
      Affiliates or to divert all or any part of such person’s or entity’s business
      from the Company or any of its Affiliates.

     

    (d)  Assistance;
      Advice and Consultation.  (i) Commencing on the Effective Date,
      Executive shall, upon reasonable notice, furnish such information and proper
      assistance to the Company or any of its Affiliates as may reasonably be required
      by the Company in connection with any litigation in which the Company or any
      of
      its Affiliates is, or may become, a party.  The Company shall
      reimburse Executive for all documented reasonable out-of-pocket expenses
      incurred by Executive in rendering such assistance, but shall have no obligation
      to compensate Executive for his time in providing information and assistance
      in
      accordance with this Section 5.

     

    (ii)  Commencing
      on the Effective Date, Executive shall provide reasonable advice and
      consultation to the Company, including its Board of Directors and Chief
      Executive Officer, (i) in connection with the Calpine matter, and (ii) to the
      extent not inconsistent with any new employment undertaken by Executive, in
      connection with the transition to his successors, joint ventures, drilling
      programs, wells and other similar matters.  The Company shall
      reimburse Executive for all documented, reasonable out-of-pocket expenses
      incurred by Executive in connection with such advice and consultation (which,
      for the avoidance of doubt, in the case of the Calpine matter will include
      the
      cost of legal counsel to the extent Executive reasonably asserts he is entitled
      to indemnification therefor), but shall have no obligation to compensate
      Executive for his time in providing such advice and consultation in accordance
      with this Section 5.

     

    (e)  Acknowledgement.  Executive
      acknowledges and agrees that:  (i) the restrictions contained in this
      Section 5 are ancillary to an otherwise enforceable agreement; (ii) the
      Company’s promises and undertakings set forth in Section 3 give rise to the
      Company’s interest in restricting Executive’s post-employment activities; (iii)
      such restrictions are designed to enforce Executive’s promises and undertakings
      set forth in this Section 5 and Executive’s common-law obligations and duties
      owed to the Company and its Affiliates; and (iv) the restrictions are reasonable
      and necessary, are valid and enforceable under Texas law, and do not impose
      a
      greater restraint than necessary to protect the Company’s goodwill, Confidential
      Information, and other legitimate business interests.

     

    6.  Remedies.

     

    (a)  Executive
      acknowledges and agrees that the Company’s remedies at law for a breach or
      threatened breach of any of the covenants set forth in Sections 5(a), (b),
      (c)
      and (d) (the “Restrictive Covenants”) would be inadequate and,
      in recognition of this fact, Executive agrees that, in the event of a breach
      or
      threatened breach, in addition to any remedies at law, the Company, without
      posting any bond, shall be entitled to obtain equitable relief in the form
      of
      specific performance, temporary restraining order, temporary or permanent
      injunction or any other equitable remedy which may then be
      available.

     

    (b)  It
      is
      expressly understood and agreed that although Executive and the Company consider
      the restrictions contained in Section 5 to be reasonable, if a final judicial
      determination is made by a court of competent jurisdiction that the time or
      territory or any other restriction contained in this Agreement is an
      unenforceable restriction against Executive, the provisions of this Agreement
      shall not be rendered void but shall be deemed amended to apply as to such
      maximum time and territory and to such other maximum extent as such court may
      judicially determine or indicate to be enforceable. Alternatively, if any court
      of competent jurisdiction finds that any restriction contained in this Agreement
      is unenforceable, and such restriction cannot be amended so as to make it
      enforceable, such finding shall not affect the enforceability of any of the
      other restrictions contained herein.

     

    7.  No
      Admission of Wrongdoing.  This Agreement is not an admission of
      wrongdoing or liability by Executive, the Company, or any member of the Company
      Group and any and all such wrongdoing or liability is expressly
      denied.

     

    8.  Entire
      Agreement; Amendment.  This Agreement shall supersede the
      Employment Agreement in its entirety any and all existing agreements between
      Executive and the Company or any of its affiliates relating to the terms of
      Executive’s employment with the Company and its Affiliates and contains the
      entire understanding of the parties with respect to Executive’s resignation and
      the termination of Executive’s employment.  It may not be altered,
      modified or amended except by a written agreement signed by both parties
      hereto.

     

    9.  No
      Waiver.  The failure of a party to insist upon strict adherence to
      any term of this Agreement on any occasion shall not be considered a waiver
      of
      such party’s rights or deprive such party of the right thereafter to insist upon
      strict adherence to that term or any other term of this Agreement.

     

    10.  Severability;
      Section 409A; Withholdings.

     

    (a)  In
      the
      event that any one or more of the provisions of this Agreement shall be or
      become invalid, illegal or unenforceable in any respect, the validity, legality
      or enforceability of the remaining provisions of this Agreement shall
      not  be affected thereby.

     

    (b)  Any
      provision of this Agreement to the contrary notwithstanding, all compensation
      payable pursuant to Section 3(b)(i) of this Agreement that is determined by
      the
      Company in its sole judgment to be subject to the payment date requirements
      of
      Section 409A(a)(2)(B) of the Code shall be paid in a manner that the Company
      in
      its sole judgment determines meets such requirements of Code Section 409A and
      any related rules, regulations or other guidance, even if meeting such
      requirements would result in a delay in the time of payment of such
      compensation.

     

    (c)  Any
      payments or benefits provided to Executive hereunder shall be subject to make
      all applicable withholdings.

     

    11.  Assignment.  This
      Agreement shall inure to the benefit of and be binding upon the parties hereto
      and their respective heirs, representatives, successors and
      assigns.  This Agreement shall not be assignable by
      Executive.

     

    12.  Governing.
      Law; Venue.  This Agreement shall be governed by the laws of the
      State of Texas except for its laws with respect to conflict of
      laws.  The exclusive forum for any lawsuit arising from or related to
      the termination of Executive’s employment or this Agreement shall be any state
      or federal court in Texas.  This provision does not prevent the
      Company from removing to an appropriate federal court any action brought in
      state court.  EXECUTIVE HEREBY CONSENTS TO, AND WAIVES ANY
      OBJECTIONS TO, REMOVAL TO FEDERAL COURT BY THE COMPANY OF ANY ACTION BROUGHT
      AGAINST IT BY EXECUTIVE.

     

    13.  JURY
      TRIAL WAIVER.  IN THE EVENT THAT ANY DISPUTE ARISING FROM OR
      RELATED TO THIS AGREEMENT OR EXECUTIVE’S TERMINATION OF EMPLOYMENT WITH THE
      COMPANY RESULTS IN A LAWSUIT, BOTH THE COMPANY AND EXECUTIVE MUTUALLY WAIVE
      ANY
      RIGHT THEY MAY OTHERWISE HAVE FOR A JURY TO DECIDE THE ISSUES IN
      THE  LAWSUIT, REGARDLESS OF THE PARTY OR PARTIES ASSERTING CLAIMS IN
      THE LAWSUIT OR THE NATURE OF SUCH CLAIMS.  THE COMPANY AND EXECUTIVE
      IRREVOCABLY AGREE THAT ALL ISSUES IN SUCH A LAWSUIT SHALL BE DECIDED BY A JUDGE
      RATHER THAN A JURY.

     

    14.  Further
      Acknowledgement.  By signing this agreement, in addition to
      releasing all Executive Claims, Executive acknowledges
      that:

     

    
      	
              a.  

            	
              The
                Company has advised Executive by this Agreement in writing to consult
                with
                an attorney and Executive
                has
                consulted with an attorney prior to signing this
                Agreement.

            


    

     

    
      	
              b.  

            	
              The
                consideration for this Agreement is in addition to anything of value
                to
                which Executive already is
                entitled.

            


    

    


    
      	
              c.  

            	
              Executive
                was
                given at least 21 days to consider the actual terms of this
                Agreement.

            


    

     

    
      	
              d.  

            	
              Executive
                agrees with the Company that changes, whether material or immaterial,
                do
                not restart the running of the 21-day consideration
                period.

            


    

    


    
      	
              e.  

            	
              Executive
                understands that Executive
                may
                revoke this agreement within seven (7) calendar days from the date
                of
                signing, in which case this Agreement shall be null and void and
                of no
                force and effect on the Company or Executive.

            


    

    


    
      	
              f.  

            	
              Executive
                understands that this Agreement shall not become effective or enforceable
                until the 7-day revocation period has expired.  Executive
                further understands and acknowledges that, to be effective, the revocation
                must be in writing, delivered to D. Henry Houston c/o the Company,
                on or
                before 5:00 PM of the seventh (7th)
                calendar
                day after the date Executive
                signs this Agreement.

            


    

    


    EXECUTIVE
      ACKNOWLEDGES AND CONFIRMS THAT HE HAS CAREFULLY READ THIS TERMINATION OF
      EMPLOYMENT AGREEMENT AND GENERAL RELEASE AND THAT  IT CONTAINS A
      COVENANT NOT TO SUE AND A GENERAL RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS
      ARISING OUT OF EXECUTIVE’S EMPLOYMENT, INCLUDING, BUT NOT LIMITED TO, THE
      RELEASE OF ALL CLAIMS UNDER TITLE VII OF THE 1964 CIVIL RIGHTS ACT, THE
      AMERICANS WITH DISABILITIES ACT, THE AGE DISCRIMINATION IN EMPLOYMENT ACT AS
      AMENDED BY THE OLDER WORKERS’ BENEFIT PROTECTION ACT, AND/OR ANY OTHER FEDERAL
      OR STATE FAIR EMPLOYMENT OR ANTI-DISCRIMINATION STATUTES OR
      REGULATIONS.

    


    15.  Counterparts.

     

    This
      Agreement may be executed in separate counterparts, each of which is deemed
      to
      be an original and all of which taken together constitute one and the same
      agreement.

     

    [SIGNATURE
      PAGE FOLLOWS]

     


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    IN
      WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
      the
      day and year first above written.

     

    
 

     

    
      	
              /s/
                B.A. Berilgen

            
	
              B.A.
                Berilgen

               

            
	
               

              Rosetta
                Resources Inc.

            
	
              By:
                /s/ D. Henry Houston

            
	
              Name:
                D. Henry Houston

              Title:
                Director