Document:

EX-10.1

 

                   August 7, 2006

Ms. Susan M. Suver

18 Gloria Lane

Huntington, NY 11743

	 	 	 	 	 
	 

	 	Re:
	 	Modifications to March 1, 2004 Employment Agreement and Release

Dear Sue:

     The purpose of this letter agreement (this “Agreement”) is to document certain changes we have
agreed to make to your employment agreement with Arrow Electronics, Inc. (“Arrow”) dated March 1,
2004 (“2004 Agreement”) for the purpose of amending and/or clarifying certain provisions of the
2004 Agreement and making certain changes necessary to the bring the 2004 Agreement into compliance
with section 409A of the Internal Revenue Code. Accordingly, notwithstanding any provision of the
2004 Agreement to the contrary:

	 	1.	 	June 30, 2006 will be treated as your last day of active work for Arrow (you will not
be required to be present in the Arrow offices after June 8, 2006), and commencing on July
1, 2006 and ending on the earlier of (a) March 15, 2007 and (b) the day you begin
employment (including self-employment) for a person or entity other than Arrow, you will
be on inactive or “RA” status. The period during which you are on RA status described in
this paragraph 1 will be referred to herein as your “RA Period.”
	 
	 	2.	 	Your active participation in the Arrow 401(k) Plan, the Arrow ESOP and the Arrow SERP
will end on June 30, 2006, and, except as provided below with respect to the SERP, you
will earn no vesting service and no additional benefits under those plans after June 30,
2006. For purposes of receiving a distribution of your vested account balance under the
401(k) Plan or ESOP, June 30, 2006 will be the date of your severance from service with
Arrow. Under the terms of the SERP, you will not be vested in your SERP benefit by June
30, 2006 (and would not have been vested in your SERP benefit even had you remained
employed during the whole of the term of the 2004 Agreement). However, in

 

 

	 	 	 	consideration of the terms of this Agreement, Arrow will make a lump-sum payment to you on
March 15, 2007 in the amount of $50,000.

	 	3.	 	You will remain covered by the Arrow medical plan during your RA Period under the
same terms and conditions as an active employee. At the end of the RA Period you will be
entitled to continuation of medical coverage for you and your eligible dependents under
the plan’s COBRA provisions, at your own expense except that Arrow will pay to you as part
of the lump sum payment to be made to you on March 15, 2007 as described below, the
amount of $13,008 in respect of the cost that would have been incurred by Arrow in
maintaining your current family medical coverage during the period March 16, 2007 to
February 29, 2008. Your participation in all other welfare benefit and fringe benefit
plans, programs and arrangements of Arrow will end on June 30, 2006, subject to any right
you may have under the terms of a plan to convert to individual coverage. You will be
entitled to disability benefits should you become “disabled” as defined in the 2004
Agreement prior to February 29, 2008 on the same terms and conditions (other than active
employment) as an active employee who becomes disabled, subject, in respect of any
benefits payable for any period prior to March 1, 2008, to an offset of the payments made
to you hereunder in respect of salary and bonus.
	 
	 	4.	 	In accordance with the terms of the 2004 Agreement, any unvested Arrow nonqualified
stock options, restricted stock and performance shares granted to you prior to June 30,
2006 which would have vested prior to February 29, 2008 will vest at June 30, 2006,
subject to the receipt from you of a check payable to Arrow in the amount of $3,731.48 to
cover taxes due on your restricted stock vest. For the avoidance of doubt, Schedule A
attached hereto shows the nonqualified stock options, restricted stock and performance
shares that will vest on June 30, 2006. Arrow hereby waives its right of first refusal
with respect to any vested restricted stock. Any stock options, restricted stock and
performance shares that remain unvested as of July 1, 2006 will be forfeited as of that
date. For purposes of the exerciseability of any Arrow vested nonqualified stock options
held by you at June 30, 2006, you will not be considered to have terminated employment
with Arrow until February 29, 2008 or such earlier date as you request in writing in
advance of such date if you determine that such a shortened exerciseability period would
be advantageous to you under Internal Revenue Code section 409A final regulations or other
guidance. Accordingly, until such date, you will continue to be able to exercise, any
such vested nonqualified stock options you hold. After such date any such options still
outstanding and unexercised will be forfeited. Vested Arrow performance shares will be
paid out in accordance with their terms. No new option, restricted stock or performance
awards will be made to you after June 30, 2006.

 

 

	 	5.	 	Subject to paragraph 11 below, for each month (and part thereof) through March 15,
2007 you will be paid, in accordance the Arrow’s regular pay cycle schedule, a cash amount
equal to your monthly salary in effect immediately before the RA Period commenced. The
balance of your salary for the period March 16, 2007 through February 29, 2008 discounted
at a rate of 5.5% per annum will be paid to you in a lump sum of $252,627 on March 15,
2007. All payments of compensation, benefits and any other amounts payable by the Company
hereunder, including for the avoidance of doubt the vesting of restricted shares, the
exercise of options and the payout of the performance shares, shall be subject to all
legally required and customary withholding. You will not be paid any car allowance after
June 30, 2006.
	 
	 	6.	 	Subject to paragraph 11 below you will receive the following bonus amounts: (a) an
amount equal to 83.33% of the bonus payable to you under Arrow’s MICP for 2006, being
comprised of 50% in respect of the period January 1 – June 30, 2006 based on Arrow’s 2006
results and 33.33% (being 2/3 of 50%) in respect of the period July 1 – December 31, 2006
based on your target bonus for 2006 (the “Target Bonus”); (b) an amount equal to 66.66%
of the Target Bonus in respect of 2007; and (c) an amount equal to 11.11% of the Target
Bonus in respect of 2008. Such amounts will be paid to you in a lump sum on March 15,
2007, provided you are still on RA status on December 31, 2006. The amounts referred to
in (b) and (c) above will be discounted from the dates such bonuses would otherwise have
been payable to you, being March 31, 2008 in respect of the 2007 bonus and March 31, 2009
in respect of the 2008 bonus, at a rate of 5.5% per annum, resulting in an aggregate
payment on March 15, 2007 in respect of the bonus periods referred to in (b) and (c) of
$94,363. The amount payable in respect of 2006 will depend on Arrow’s 2006 financial
results. (Were the 2006 corporate MICP to pay out at 100% of target, the 2006 payment
would be $112,496.)
	 
	 	7.	 	You received on August 1 a cash amount equal to your accrued vacation through June
30, 2006 and your vacation accrual will cease as of June 30, 2006.
	 
	 	8.	 	Your salary deferral for October – December 2004 under the Arrow Deferred
Compensation Plan (as adjusted for deemed investment experience, less any amounts
previously paid out at a scheduled withdrawal date) will be paid to you at March 15, 2007.
Any other amounts deferred by you under the Arrow Deferred Compensation Plan, including
amounts deferred in respect of your 2004 bonus, (as adjusted for deemed investment
experience, less any amounts previously paid out at a scheduled withdrawal date) will be
paid to you at January 15, 2007 .

 

 

	 	9.	 	Arrow agrees to pay the cost of outplacement consulting reasonably incurred by you in
seeking to find another comparable position of employment up to an amount of $50,000.
Such payment will be made against the receipt of invoices from a reputable firm of
outplacement consultants.
	 
	 	10.	 	You will not be required to attend to Arrow’s business from and after June 8, 2006,
but you agree to be available to advise, consult and perform specific tasks from time to
time until the earlier of (a) February 29,2008 and (b) the day you begin employment
(including self-employment) for a person or entity other than Arrow, at Arrow’s expense
and reasonable request. Arrow does not anticipate that such activities will require more
than three days per month through May 1, 2007 or more than one day per month thereafter.
The indemnification provided under paragraph 2(g) of the 2004 Agreement will apply in
respect of any services rendered by you pursuant to this paragraph 10. You and Arrow
agree to reasonably cooperate with each other as part of either party’s response to any
inquiry, investigation, audit, charge, demand or litigation against you or Arrow arising
out of any act or omission or alleged act or omission by you or Arrow during your
employment with Arrow.
	 
	 	11.	 	The change of control agreement dated June 1, 2004 between you and Arrow shall
terminate on June 30, 2006.
	 
	 	12.	 	You hereby resign from all offices you hold at Arrow effective June 30, 2006.
	 
	 	13.	 	You and Arrow agree that neither of you will disclose or cause to be disclosed any
negative, adverse or derogatory comments or information about Arrow or you, about any
product or service provided by Arrow, or about Arrow’s prospects for the future.
Furthermore, you and Arrow represent that you and Arrow have made no such communication to any
public official, to any person associated with the media, or to any other person or
entity. You and Arrow each acknowledge that each of you relies upon this representation in
agreeing to enter into this Agreement.
	 
	 	14.	 	If asked you may state that you have resigned from Arrow and that you and Arrow have
agreed to keep the terms of your separation confidential. Otherwise, you agree that, as a
condition of this Agreement, you will not disclose or in any other manner communicate the
terms and provisions of this Agreement to or with any other person except to your legal
counsel, financial or tax advisor(s), your significant other, persons within Arrow who
need to know the terms of this Agreement in order to implement it, or as required by law
or court order. You also acknowledge and agree that the attorney(s), tax advisor(s), and
other authorized

 

 

	 	 	 	individuals, as defined above, must be informed by you of, and agree to be bound by, the
confidentiality provisions of this Agreement. In the event that you, your attorney(s),
your tax advisor(s), or immediate family members are required by law, court order, or
subpoena to make any disclosure concerning Arrow or this Agreement, you will promptly
notify Arrow of the intended disclosure so as to afford Arrow sufficient opportunity to
protect and/or enforce the confidentiality provisions of this Agreement. If requested by
you, Arrow agrees to provide a reference to a prospective employer in the terms set forth
on Schedule B attached hereto. You should direct any enquiries about your employment with
Arrow from prospective employers to Keith Shull, acting head of Global Human Resources.

	 	15.	 	Release. In consideration for all the foregoing provisions, each of you and
Arrow and its affiliates hereby releases the other and its agents, directors and employees
from and against any and all claims (statutory, contractual or otherwise) arising out of
your employment or the termination thereof or any discrimination in connection therewith
and for any further additional payments of any kind or nature whatsoever except as
expressly set forth herein. Without limiting the foregoing, you hereby release Arrow from
any claim under the Age Discrimination in Employment Act and any other similar law.
Nothing contained herein will be construed as impacting your right to claim unemployment
benefits following the termination hereof, if any, or preventing you or Arrow from
providing information to or making a claim with any governmental agency to the extent
permitted or required by law. This release will, however, constitute an absolute bar to
the recovery of any damages or additional compensation, consideration or relief of any
kind or nature whatsoever arising out of or in connection with such claim.
	 
	 	16.	 	This Agreement is made in the State of New York and will be governed by the laws of
the State of New York. If any portion hereof will be deemed void or unenforceable by a
court of competent jurisdiction, the same will reform such portion as nearly as possible
to effectuate its intent or sever said portion and give enforcement to the remainder of
the Agreement and Release.
	 
	 	17.	 	Rescission/Advice of Counsel. You acknowledge that Arrow advised you to
consult with an attorney prior to signing this release; advised you that you had
twenty-one (21) days in which to consider whether you should sign this release; and
advised you that if you signed this release, you would be given seven (7) days following
the date on which you signed the release to revoke it and that the release would not be
effective until after this seven-day period had lapsed. Therefore, notwithstanding the
above provisions, no payments called for by Arrow herein shall be made until the
expiration of such revocation period.

 

 

     Please indicate your agreement to the foregoing modifications to the 2004 Agreement by signing
and dating both copies of this letter on the lines provided below, and returning one of the fully
executed copies to the undersigned.

	 	 	 	 	 
	 	Very truly yours,

Arrow Electronics, Inc.

 	 
	 	By:  	/s/ Peter S. Brown
 	 
	 	 	Peter S. Brown 	 
	 	 	 	 
	 

Agreed, acknowledged and accepted:

	 	 	 	 	 
	/s/ Susan M. Suver

	 	 	 	August 9, 2006
	 

	 	 	 	 
	Susan M. Suver

	 	 	 	Dateexv10w1

 

Exhibit 10.1

CONSULTING AGREEMENT

      This CONSULTING AGREEMENT to be effective as of August 16, 2006 (this “Agreement”), is
executed by MARINER ENERGY, INC. (the “Company”), 2000 West Sam Houston Parkway South, Suite 2000,
Houston, Texas 77042, and Ricky G. Lester (the “Consultant”). In consideration of the mutual
promises set forth herein, it is agreed by and between the Company and the Consultant:

1. Nature of Services. The Consultant has resigned his employment with the Company, but
under this Agreement, the Consultant shall perform services from time to time as requested by the
Company and shall continue to serve as Vice President, Chief Financial Officer and Treasurer of the
Company until such time as a successor Vice President, Chief Financial Officer and Treasurer is
named and shall assist in transition upon the hiring of his successor. The Consultant shall report
to Scott D. Josey, Chief Executive Officer and President of the Company. The services to be
performed shall include, without limitation, responsibility for the Company’s finance, accounting,
control, tax, capital budgeting, financial reporting, risk management, and information systems and
special projects as may be assigned from time to time, including making the certification required
by the Company’s chief financial officer in connection with the filing and effectiveness of its
Form S-4 Registration Statement. The exact topics or subjects of Consultant’s services and the
portion of his time to be devoted thereto will be determined by Company and directions will be
furnished to the Consultant.

2. Relationship of the Parties. The Consultant shall perform services under this
Agreement as an independent contractor. The Consultant is not, shall not be, and shall not hold
himself out to be, an employee or servant of the Company and shall not be entitled to any of the
benefits to which active employees of the Company may be entitled, including, but not limited to,
the Company’s life, health, medical or disability insurance programs, its pension plan, stock
incentive plan, savings plan, or any of its unemployment or workers’ compensation benefits, but
shall continue to exercise the powers and authority of his offices until such time as his successor
is named or the earlier termination of this Agreement.

3. Compensation. As compensation for services rendered under this Agreement, the Company
shall pay the Consultant a fee of $2300 per day. Semi-monthly, the Consultant shall submit to the
Company a statement identifying the project and describing the dates when work was performed.

4. Reimbursement of Expenses. The Company shall reimburse the Consultant for all
reasonable and necessary expenses incurred by the Consultant rendering the services under this
Agreement, if any. Travel expenses to and from the Company’s Houston office are not reimbursable.
The Consultant shall submit to the Company, not later than one month after such expenses are
incurred, an itemized account of such expenses in such form as may be required by the Company.

5. Effective Date and Term. This Agreement shall commence upon execution and shall remain
in force and effect on a month-to-month basis. Notwithstanding the foregoing, either the
Consultant or the Company may terminate this Agreement at any time upon giving thirty days’ notice
to the other party, and the Company may terminate this Agreement at any time without notice
effective immediately if the Company believes in good faith that the Consultant has breached or
neglected his obligations pursuant to this Agreement or committed an act of dishonesty, fraud,
misrepresentation or moral turpitude, whether or not related to the performance of services under
this Agreement.

 

 

6. Confidentiality. The Consultant acknowledges that the business of the Company is
highly competitive and that the Company has provided and will provide him with access to
Confidential Information relating to the business of the Company. “Confidential Information” means
and includes the Company’s and its subsidiaries’ confidential and/or proprietary information and/or
trade secrets that have been developed or used and/or that will be developed during the term of
this Agreement and that cannot be obtained readily by third parties from outside sources.
Confidential Information includes, without limitation, within the foregoing definition, technical,
business, and financial information, land and lease files, exploration, exploitation, development
and operation plans and results, land surveys and plats, geological, geophysical, seismic, and
reserve data, trade secrets and know-how, research, product plans, products, services, employee and
customer lists, areas of mutual interests, markets and marketing information, software,
developments, inventions, processes, formulas, technology, designs, drawings, engineering, and
hardware configuration information, information regarding customers, employees, contractors and the
industry not generally known to the public; strategies, methods, books, records, and documents;
technical information concerning products, equipment, services, and processes; procurement
procedures and pricing techniques; the names of and other information concerning investors and
affiliates; pricing strategies and price curves; positions; plans and strategies for expansion,
acquisitions or divestitures; budgets; research; communications and electronic commerce
information; trading methodologies and terms; evaluations, opinions, and interpretations of
information and data; marketing and merchandising techniques; grids and maps; electronic databases;
models; specifications; internal business records; contracts benefiting or obligating the Company;
bids or proposals submitted to or obtained from third parties; technologies and methods;
organizational structure; personnel information; payment amounts or rates paid to consultants or
other service providers; and other confidential or proprietary information not generally available
to the public. The Consultant acknowledges that this Confidential Information constitutes a
valuable, special, and unique asset used by the Company in its business to obtain a competitive
advantage over its competitors and that protection of such Confidential Information against
unauthorized disclosure and use is of critical importance to the Company in maintaining its
competitive position.

The Consultant agrees that he will not, at any time during or after the term of this Agreement,
make any unauthorized disclosure of any Confidential Information of the Company or its subsidiaries
or make any use thereof except in the carrying out of his services under this Agreement or as may
be required by law.

The Consultant acknowledges that, during the course of his consulting arrangement with the Company,
he may be provided with or have access to Confidential Information of third parties, such as actual
and potential customers, suppliers, partners, joint venturers, investors, financing sources and the
like, of the Company. The Consultant also agrees to preserve and protect the confidentiality of
such third-party Confidential Information to the same extent, and on the same basis, as
Confidential Information of the Company and its subsidiaries and, to the extent that the Company or
any of its subsidiaries is subject to confidentiality obligations or agreement to third parties
with respect to any information, in accordance with such obligations and agreements.

7. The Consultant shall exercise reasonable care and diligence to prevent any actions or conditions
that could result in a conflict with the Company’s best interests.

8. Insurance Requirements. During the term of this Agreement, the Consultant agrees to
maintain and pay for, at his own cost and expense, (a) comprehensive general liability insurance,
on an occurrence, not claims made, basis with minimum limits of $1,000,000 for death, injury and
property damage per injury/per occurrence, and (b) comprehensive automobile liability insurance
covering owned, hired or non-owned vehicles used by the Consultant with minimum limits of $500,000
per injury and $500,000 each occurrence for bodily injury, and $500,000 each occurrence

2

 

for property damage. In the event that the Consultant fails to obtain or maintain such coverage
after execution of this Agreement, the Company may obtain such coverage on behalf of the Consultant
and shall charge the Consultant for all costs and expenses of obtaining and maintaining such
insurance coverage.

9. Assignment. This Agreement shall be binding upon, and inure to the benefit of, parties
and their respective heirs, representatives, successor and permitted assigns. This Agreement shall
not be assignable by the Consultant.

10. Notice. Notices or communication required or permitted to be given under this
Agreement shall be given to the respective parties in writing either personally or by certified
mail, postage prepaid, as follows:

	 	 	 	 	 
	          

	 	Mariner Energy, Inc.
	 	Ricky G. Lester
	 

	 	2000 West Sam Houston Parkway South
	 	20307 Fairway Trails Lane
	 

	 	Suite 2000
	 	Spring, TX 77379
	 

	 	Houston, Texas 77042	 	 
	 

	 	Attention: Teresa Bushman	 	 

or at such other addresses and to such other persons as either party may from time to time
designate by notice given as herein provided. Notice hereunder shall be deemed to have been
received by the person to whom addressed at the time it is personally delivered or 72 hours after
it is deposited certified mail return receipt requested in the United States mail as hereinabove
specified.

11. Choice of Law and Severability. This Agreement shall in all respects be governed by
the laws of the State of Texas without giving effect to any principles of conflicts of laws. In
the event that any of the provisions, or portions thereof, of this Agreement are held to be
unenforceable or invalid by a court of competent jurisdiction, the validity and enforceability of
the remaining provisions or portions shall not be affected.

12. MODIFICATIONS. THIS AGREEMENT CONSTITUTES THE FULL, COMPLETE AND ENTIRE AGREEMENT
BETWEEN THE COMPANY AND THE CONSULTANT WITH RESPECT TO THE SERVICES TO BE PROVIDED BY THE
CONSULTANT HEREUNDER AND SUPERSEDES ALL PRIOR UNDERSTANDING, AGREEMENTS, OR ARRANGEMENTS BETWEEN
THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF. No modifications, renewal, extensions or
waiver of this Agreement or any of the provisions contained herein shall be binding upon either
party, unless made in writing and signed by each party.

3

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date set forth below to
be effective as of August 16, 2006.

	 	 	 	 	 
	 	MARINER ENERGY, INC.

 	 
	Date:  August 9, 2006 	By:  	/s/ Scott D. Josey
 	 
	 	 	Name:  	Scott D. Josey 	 
	 	 	Title:  	Chairman of the Board, Chief Executive Officer and President 	 
	 
	 	 	 
	Date:  August 9, 2006 	/s/ Ricky G. Lester
 	 
	 	RICKY G. LESTER 	 
	 	 	 
	 

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