Document:

Unassociated Document

    
Exhibit 10.2

     

    
 

    EMPLOYMENT
AGREEMENT

     

    
 

    This
Employment Agreement (the "Agreement") is made this 6th day of August, 2007,
between Deep Down, Inc., located at 15473 East Freeway, Channelview, Texas 77530
(the "Company") and Ronald E.
Smith located at 3010 S Island Dr., Seabrook, TX 77586 (the
"Employee").

    ARTICLE
I

     

    TERMS
AND DUTIES

     

    
      	
              1.1

            	
              The
      Employee is hereby engaged for a three-year period commencing August 6,
      2007 (the "Initial Term"), and the Employee hereby accepts the employment
      as President and Chief Executive Officer. The Initial Term shall be
      automatically renewed for up to two successive consecutive one (1) year
      periods (each, a "Renewal Term" and the Initial Term and Renewal Term are
      collectively referred to as the "consulting period") thereafter unless
      either party sends notice to the other party, not more than 270 days and
      not less than 90 days before the end of the then-existing consulting
      period, of such party's desire to terminate the Agreement at the end of
      the then-existing term, in which case this Agreement will terminate at the
      end of the then-existing term. Employment services will be provided at the
      Company address or at such other places as may be directed by the Company.
      The Employee agrees that time is to be scheduled by the Company and to
      devote reasonable productive time, ability and attention to the business
      of the Company during the term of this Agreement, subject to the direction
      and supervision of the Company.

            

    

    

    ARTICLE
II

     

    COMPENSATION

     

    
      	
              2.1

            	
              As
      compensation for services rendered under this Agreement, the Employee
      shall be entitled to receive a base salary of Two Hundred and Fifty
      Thousand and NO/100 DOLLARS ($250,000.00) per annum payable twice monthly
      less all Federal, State and required payroll withholdings. The salary may
      be increased annually at the discretion of the Board of Directors. The
      Employee is also entitled to annual bonuses as determined by the Board of
      Directors and offshore bonuses as dictated by Company policy. The Employee
      shall provide such reasonable business hours as the Company shall dictate,
      but at least forty hours per week.

            

    

    

    
      
         

      

      
        Page 1 of
4

        
          

        

      

      
         

      

    

    
      	
              2.2

            	
              Employee
      shall be eligible to participate in any and all benefits as are available
      from time to time to key executive officers, directors and employees (and
      their families) of the Company, including all health, medical, dental, and
      life insurance benefits. The Company shall pay 100 % of all premiums with
      respect to such plans for Employee. Employee will be entitled to four
      weeks paid vacation. Employee will also be entitled to $1,000 per month as
      an expense allowance to pay for the cost of a vehicle, insurance,
      gasoline, maintenance, repairs and other unanticipated
    costs.

            

    

    

    ARTICLE
III

     

    TERMINATION

    

    
      	
              3.1

            	
              If
      the Employee willfully breaches or habitually neglects the duties which he
      is required to perform under the terms of the Agreement, the Company may
      at its option terminate this Agreement by giving written notice of
      termination to the Employee.

            

    

    

    
      	
              3.2

            	
              Willfully
      breaches is defined as misappropriation of Company' s assets, being
      intoxicated or under the influence of drugs or alcohol while on the job,
      being convicted of a felony, or not willingly coming to
    work.

            

    

     

    ARTICLE
IV

     

    NON-COMPETITION
BY EMPLOYEE

    

    
      	
              4.1

            	
              Employee
      agrees that this covenant is a separate contract in and of itself. In the
      event that any of the prior clauses of this contract should fail, this
      separate contract shall be binding upon the parties. Employee covenants
      and agrees that during his consultancy with Company and upon termination
      of their engagement, whether by termination of this Agreement, by wrongful
      discharge, or otherwise, Employee shall not directly or indirectly, within
      Texas, enter into or engage generally in direct competition with the
      Company's business, as a Employee in any business providing identical
      services as Company or own a business which provides identical services as
      Company either individually or as a Employee, officer, director,
      independent contractor, or shareholder or otherwise, during the term of
      this Agreement or for three (3) months after termination. This covenant on
      the part of Employee shall be construed as an agreement independent of any
      other provision of this Agreement; and the existence of any claim or cause
      of action of Employee against Company, whether predicated on this
      Agreement or otherwise, shall not constitute a defense to the enforcement
      by Company of this section. Company shall be entitled to such extra
      remedies as injunctions, stays or restraining orders to enforce its rights
      hereunder.

            

    

    

    
      	
              4.2

            	
              The
      Employee will not solicit or divert or attempt to solicit or divert, any
      business, patronage, or clients of the Company from the Company to himself
      or a competitor or rival of Company for three (3) months from the date of
      Employee's withdrawal or termination from the
  Company.

            

    

     

    
 

    
      
         

      

      
        Page 2 of
4

        
          

        

      

      
         

      

    

    
      	
              4.3

            	
              During
      the term of this Agreement, the Employee will not communicate or divulge
      to or for the benefit of any competitor or rival of the Company, any of
      the trade secrets or processes of the Company including
      client list or pricing information, and used by the Company.
      Notwithstanding the foregoing, upon termination of this Agreement and the
      Non-Compete period, Employee shall not be prohibited from contacting any
      prospective client or determine appropriate pricing for any products
      and/or services on behalf of any new
Company.

            

    

    

    
      	
              4.4

            	
              The
      Employee states that he has read this Agreement in full and understands
      the terms and language in Article IV. The Employee has had outside counsel
      of his choosing
      review the Covenant of Noncompete and counsel has explained all terms and conditions
      to him. The Employee swears that he is not under any duress or coercion to
      enter this Covenant of Noncompete, but is doing it of his own free will in
      order to gain the experience, specialized training and especially the extra
      compensation offered by Company.

            

    

    

    
      	
              4.5

            	
              Confidentiality
      of this business is very
      important as the nature of the business is securing the customers
      confidence. Therefore, Employee may not directly or indirectly make known
      to any person, firm or corporation the names, addresses or any information
      pertaining to or regarding any customer of the Company during or after
      termination of employment through the end of the Non-Compete
      period.

            

    

    

    ARTICLE
V

     

    GENERAL
PROVISIONS

    

    
      	
              5.1

            	
              Any
      notices to be given hereunder by either party to the other may be effected
      either by personal delivery in writing or by mail, registered or
      certified, postage prepaid with return receipt requested. Mailed notices
      shall be addressed to the parties at the address appearing in the
      introductory paragraph of this Agreement, but each party may change her
      address by written notice in accordance with the paragraph. Notices
      delivered personally shall be deemed communicated as of actual receipt;
      mailed notices shall be deemed communicated as of three (3) days after
      mailing.

            

    

    

    
      	
              5.2

            	
              This
      Agreement supersedes any and all other agreements, either oral or written,
      between the parties hereto with respect to the employment of the Employee
      by the Company and contains all of the covenants and agreements between
      the parties with respect to such employment in any manner whatsoever. Any
      changes or amendments must be in writing, signed by all the parties, or
      they are null and void.

            

    

    
      
         

      

      
        Page 3 of
4

        
          

        

      

      
         

      

    

    

     

    
      	
              5.3

            	
              This Agreement shall be governed
      by and construed in accordance with the laws of the State of Texas and
      enforceable in Houston,
Texas.

            

    

    

    
      	
              5.4

            	
              Where
      context and circumstances require, the gender of all words used in this
      contract shall include the masculine, feminine and
  neuter.

            

    

    

    EXECUTED
in Harris County, Texas on the day and year first above written.

     

     

    
       

      
        	 	

                COMPANY:

                

                DEEPDOWN,
      INC.

                

                By:  /s/ Robert E. Chamberlain,
      Jr.                 
      

                Name:     
      Robert E. Chamberlain, Jr.

                Title:       
      Chairman & CAO

                

                

                

                EMPLOYEE:

                

                RONALD
      E. SMITH

                

                

                /s/
      Ronald E.
      Smith                      
      

                Name:    
      Ronald E.
      Smith

                Title:    
      President & CEO

              

      

       

    

    

     

    Page
4 of 4Unassociated Document

    Exhibit 10.3

    
 

    CONSULTING
AGREEMENT

     

    

    This
Consulting Agreement (the "Agreement") is made this 6th day of August, 2007,
between Deep Down. Inc., located at 15473 East Freeway, Channelview, Texas 77530
(the "Company") and Eugene L. Butler & Associates, located at 1039 Bayou
Island Dr.; Houston, TX 77063, (the "Consultant").

    ARTICLE
I

     

    TERMS
AND DUTIES

    

    
      	
              1.1

            	
              The
      Consultant is hereby engaged for a period commencing on August 6, 2007 and
      ending May 31, 2010 (the "Initial Term"), and the Consultant hereby
      accepts the engagement by providing the services of Eugene L. Butler
      ("Butler") as Chief Financial Officer. The Initial Term shall be
      automatically renewed for up to two successive consecutive one (1) year
      periods (each, a ''Renewal Term" and the Initial Term and Renewal Term are
      collectively referred to as the "consulting period") thereafter unless
      either party sends notice to the other party, not more than 270 days and
      not less than 90 days before the end of the then-existing consulting
      period, of such party's desire to terminate the Agreement at the end of
      the then- existing term, in which case this Agreement will terminate at
      the end of the then-existing term. Consulting services will be provided at
      the Company address or at such other places as may be directed by the
      Company. The Consultant agrees that time is to be scheduled by the Company
      and to devote reasonable productive time, ability and attention to the
      business of the Company during the term of this Agreement, subject to the
      direction and supervision of the
Company.

            

    

     

    ARTICLE
II

     

    COMPENSATION

    

    
      	
              2.1

            	
              As
      compensation for services rendered under this Agreement, the Consultant
      shall be entitled to receive a base consulting fee of One Hundred Eighty
      Thousand and NO/100 DOLLARS ($180,000.00) per annum payable twice monthly
      plus an amount equal to Federal and State payroll withholdings customarily
      withheld for an employee earning this compensation, including but not
      limited to FICA and Medicare. The consulting fee may be increased annually
      at the discretion of the Board of Directors. The Consultant is also
      entitled to annual bonuses as determined by the Board of Directors. The
      Consultant shall provide such reasonable business hours as the Company
      shall dictate, but at least forty hours per
  week.

            

    

    

    
      
        
           

        

        
          Page 1 of
4

          
            

          

        

        
           

        

      

    

    

    

    
      	
              2.2

            	
              Butler
      shall be eligible to participate in any and all benefits as are available
      from time to time to key executive officers, directors and employees (and
      their families) of the Company, including all health, medical, dental, and
      life insurance benefits. The Company shall pay 100 % of all premiums with
      respect to such plans for Butler. Butler may, at his option, elect to be
      reimbursed for medical insurance premiums incurred for medical insurance
      not provided through the Company. Butler will be entitled to four weeks
      paid vacation. Butler will also be entitled to $1,000 per month as an
      expense allowance to pay for the cost of a vehicle, insurance, gasoline,
      maintenance, repairs and other unanticipated
  costs.

            

    

    

    
      	
              2.3

            	
              The
      Employment Agreement dated May 31, 2007 is hereby terminated and replaced
      by this Consulting Agreement. Notwithstanding the foregoing, the 3,000,000
      options granted pursuant to the Employment Agreement remain as validly
      existing options.

            

    

    

    ARTICLE
III

     

    TERMINATION

    

    
      	
              3.1

            	
              If
      the Consultant willfully breaches or habitually neglects the duties which
      he is required to perform under the terms of the Agreement, the Company
      may at its option terminate this Agreement by giving written notice of
      termination to the Consultant.

            

    

    

    
      	
              3.2

            	
              Willfully
      breaches is defined as misappropriation of Company' s assets, being
      intoxicated or under the influence of drugs or alcohol while on the job.
      being convicted of a felony, or not willingly coming to
    work.

            

    

     

    ARTICLE
IV

     

    NON-COMPETITION
BY CONSULTANT

     

    

    
      	
              4.1

            	
              Consultant agrees that this
      covenant is a separate contract in and of itself. In the event that
      any of the prior
      clauses of this contract should fail, this separate contract shall be
      binding upon the
      parties. Consultant covenants and agrees that during his consultancy with
      Company and upon
      termination of their engagement, whether by termination of this
      Agreement, by
      wrongful discharge. or otherwise, Consultant shall not directly or
      indirectly, within
      Texas, enter into or engage generally in direct competition with the
      Company's business,
      as a Consultant in any business providing identical services as Company or
      own a business which
      provides identical services as Company either individually or as a
      Consultant, officer,
      director, independent contractor, or shareholder or otherwise, during the
      term of this
      Agreement or for three (3) months after termination. This covenant on the
      part of Consultant
      shall be construed as an agreement independent of any other provision of
      this Agreement; and
      the existence of any claim or cause of action of Consultant against
      Company. whether
      predicated on this Agreement or otherwise, shall not constitute a
      defense to the
      enforcement by Company of this section. Company shall be entitled to such
      extra remedies as
      injunctions, stays or restraining orders to enforce its rights
      hereunder.

            

    

    

    
      
        
           

        

        
          Page 2 of
4

          
            

          

        

        
           

        

      

    

    

    

    
      	
              4.2

            	
              The Consultant will not solicit or
      divert or attempt to solicit or divert, any business, patronage, or clients of the
      Company from the Company to himself or a competitor or rival of
      Company for three
      (3)
      months from the date
      of Consultant's withdrawal or termination from the
  Company.

            

    

    

    
      	
              4.3

            	
              During the term of this Agreement,
      the Consultant will not communicate or divulge to or for the benefit of any competitor or
      rival of the Company, any of the trade secrets or processes of the Company including client
      list or pricing
      information, and used by the Company. Notwithstanding the foregoing,
      upon termination of this Agreement and the Non-Compete period, Consultant shall not be
      prohibited from contacting any prospective client or determine appropriate pricing for
      any products and/or
      services on behalf of any new
Company.

            

    

    

    
      	
              4.4

            	
              The Consultant states that he has
      read this Agreement in full
      and understands the
      terms and language in Article IV. The
      Consultant has had outside counsel of his choosing review the Covenant of Noncompete and counsel has
      explained all terms and conditions to him. The Consultant swears that he is
      not under any duress or coercion to enter this Covenant of Noncompete, but is doing it of his
      own free will in order to gain the experience, specialized training and especially the extra
      compensation offered by
Company.

            

    

    

    
      	
              4.5

            	
              Confidentiality of this business
      is very important as the nature of the business is securing the customers confidence.
      Therefore, Consultant may not directly or indirectly make known
      to any person, firm or corporation
      the names, addresses or any information pertaining to or regarding any customer of the
      Company during or after termination of employment through the end of the
      Non-Compete period.

            

    

    

    ARTICLE V

     

    GENERAL PROVISIONS

    

    
      	
              5.1

            	
              Any notices to be given hereunder
      by either party to the other may be effected either by personal delivery in writing or by
      mail, registered or certified, postage prepaid with return receipt requested. Mailed notices
      shall be addressed to the parties at the address appearing in the introductory
      paragraph of this Agreement, but each party may change her address by written notice in
      accordance with the paragraph. Notices delivered personally shall be deemed communicated as of
      actual receipt; mailed notices shall be deemed communicated as of three
      (3)
      days after
      mailing.

            

    

     

     

     

     

     

     

     

     

    

    
      
        
           

        

        
          Page 3 of
4

          
            

          

        

        
           

        

      

    

    

    

    
      	
              5.2

            	
              This
      Agreement supersedes any and all other agreements, either oral or written,
      between the parties hereto with respect to the employment of the
      Consultant by the Company and contains all of the covenants and agreements
      between the parties with respect to such employment in any manner
      whatsoever. Any changes or amendments must be in writing, signed by all
      the parties, or they are null and
void.

            

    

     

    

    
      	
              5.3

            	
              This
      Agreement shall be governed by and construed in accordance with the laws
      of the State of Texas and enforceable in Houston.
  Texas.

            

    

    

    
      	
              5.4

            	
              Where
      context and circumstances require, the gender of all words used in this
      contract shall include the masculine, feminine and
  neuter.

            

    

    

    EXECUTED
in Harris County, Texas on the day and year first above
written.

    

    
    

     

    
      	 	

              COMPANY:

               

              DEEP
      DOWN, INC.

               

               

              By:  /s/
      Ronald E.
      Smith                    
      

              Name:    
      Ronald E. Smith

              Title:      
      President & CEO

               

              CONSULTANT:

               

              EUGENE
      L. BUTLER & ASSOCIATES

               

              /s/
      Eugene L.
      Butler                                        
      
Name:    
      Eugene L. Butler

              Title:      
      President

            

    

     

     

     

    Page 5 of 4

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