Document:

mdr-ex1036_129.htm

Exhibit 10.36

McDermott International, Inc. 

Personal and Confidential

 

October 17, 2019

	
 
	
Re: 
	
Retention Bonus

Dear [●]:

 

On behalf of McDermott International, Inc. (the “Company”), I am pleased to offer you the opportunity to receive a cash retention bonus in the aggregate amount of $[ ● ] (the “Retention Bonus”), if you agree to the terms and conditions contained in this letter agreement (this “Agreement”), which will be effective as of the date you execute and return a copy of this Agreement to the Company (such date, the “Effective Date”).  Capitalized terms used but not otherwise defined herein will have the meaning ascribed to such terms in Section 2.

1.Retention Bonus.  Subject to the terms and conditions set forth herein and your continued and uninterrupted employment with the Company Group through each applicable payment date, the Retention Bonus will be payable as follows: (i) 1/3rd of the Retention Bonus will be paid on the Effective Date (the “First Retention Payment”), (ii) 1/3rd of the Retention Bonus will be paid on the Tranche B Funding Date (the “Second Retention Payment”) and (iii) 1/3rd of the Retention Bonus will be paid on the Tranche C Funding Date (the “Third Retention Payment”).  Notwithstanding anything to the contrary contained herein, in the event of either your Qualifying Termination or the Company’s good faith determination (in consultation with Company Counsel) that the Company is likely to commence a voluntary proceeding under chapter 11 of title 11 of the United States Code (the “Chapter 11 Determination Date”), you will be paid any unpaid portion of the Retention Bonus immediately following either your Qualifying Termination date or the Chapter 11 Determination Date, as applicable.  You further agree that in the event your employment with the Company Group terminates for any reason other than due to a Qualifying Termination, you will be obligated to repay to the Company Group within thirty (30) days of such termination a portion of the After-Tax Value of the Retention Bonus previously paid as follows: (i) the after-tax value of the First Retention Payment if such termination occurs prior to the six (6)-month anniversary of the Effective Date, (ii) the after-tax value of the Second Retention Payment if such termination occurs after the Tranche B Funding Date but prior to the six (6) month anniversary of the Tranche B Funding Date, (iii) and the after-tax value of the Third Retention Payment if such termination occurs after the Tranche C Funding Date but prior to December 31, 2020 (the “Completion Date”).  For the sake of clarity, you will not be required to repay any portion of the Retention Bonus if you are employed by the Company Group on the Completion Date.   

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KE-64742104.5

Exhibit 10.36

2.Definitions.  For purposes of this Agreement:

“After-Tax Value of the Retention Bonus” means the aggregate amount of the Retention Bonus net of any taxes you are required to pay in respect thereof and determined taking into account any tax benefit that may reasonably be available in respect of such repayment.  The Company Group will determine in good faith the After-Tax Value of the Retention Bonus, which determination will be conclusive and binding.

“Cause” means “Cause” as defined in any employment, change-in-control or severance agreement between you and the Company Group or in any severance plan of the Company Group in which you participate, or, if no such agreement or plan exists or such term is not defined therein, “Cause” means your (i) material and intentional breach of your duties and responsibilities, which is not remedied promptly after the Company gives you written notice specifying such breach, (ii) commission of a felony, (iii) commission of or engaging in any act of fraud, embezzlement, theft, a material breach of trust or any material act of dishonesty involving the Company Group or (iv) significant violation of the code of conduct of the Company Group or of any statutory or common law duty of loyalty to the Company Group.

“Credit Agreement” means that certain Superpriority Senior Secured Credit Agreement dated as of October [●], 2019, by and among McDermott Technology (Americas), Inc., a Delaware corporation, as borrower, McDermott Technology (US), Inc., a Delaware corporation, as borrower, and McDermott Technology, B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands, as borrower, McDermott International, Inc., a Panamanian corporation, the financial institutions from time to time party thereto as lenders, Credit Agricole Corporate and Investment Bank, as administrative agent for the Revolving Facility (as defined in the Credit Agreement), and as collateral agent, and Barclays Bank PLC, as administrative agent for the Term Facility (as defined in the Credit Agreement) (as amended, restated, supplemented or otherwise modified from time to time)

“Company Group” means the Company and its direct and indirect affiliates and subsidiaries.

“Disability” means “Disability” as defined in any employment, change-in-control or severance agreement between you and the Company Group or in any severance plan of the Company Group in which you participate, or, if no such agreement or plan exists or such term is not defined therein, “Disability” means your inability, due to physical or mental incapacity, to perform the essential functions of your job, for two hundred seventy (270) consecutive days. 

“Good Reason” means “Good Reason” as defined in any employment, change-in-control or severance agreement between you and the Company Group or in any severance plan of the Company Group in which you participate, or, if no such agreement or plan exists or such term is not defined therein, “Good Reason” means any of the following, in each case, without your consent: (i) a change in your title or any material diminution of your responsibilities or authority or the assignment of any duties inconsistent with your position, in each case, compared to what was in effect as of the Effective Date; (ii) a reduction of your annual base salary and/or target bonus as in effect on the Effective Date; or (iii) a relocation of your principal office location more 

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than fifty (50) miles from the Company’s offices at which you are based as of the Effective Date (except for required travel on the Company’s business to an extent substantially consistent with your business travel obligations as of the Effective Date).  Notwithstanding the foregoing, the occurrence of an event that would otherwise constitute Good Reason will cease to be an event constituting Good Reason upon any of the following: (x) your failure to provide written notice to the Company within thirty (30) days of the first occurrence of such event; (y) substantial correction of such occurrence by the Company within thirty (30) days following receipt of your written notice described in (x); or (z) your failure to actually terminate employment within the ten (10) day period following the expiration of the Company’s thirty (30)-day cure period.  Notwithstanding the foregoing, for the purposes of this Agreement, Good Reason, whether defined herein or in any employment, change-in-control or severance agreement between you and the Company Group or in any severance plan of the Company Group in which you participate, will not exist under this Agreement due to any diminution in your duties related to the appointment of a CTO.

“Qualifying Termination” means the termination of your employment before the Completion Date (i) by the Company Group for a reason other than Cause, (ii) by you for Good Reason, or (iii) due to your death or Disability if, and only if, you execute and do not revoke a customary general release of claims that is reasonably satisfactory to the Company Group (the “Release”), and such Release becomes irrevocable, within 60 days of your termination, in which case the effective date of the Qualifying Termination will be deemed to have occurred on your date of termination.  For the sake of clarity, a termination of employment will not be a Qualifying Termination if you do not execute, or if you revoke, the Release, in which case you will be required to repay the After-Tax Value of the Retention Bonus within ten (10) days after the expiration of the 60-day period.

“Tranche B Funding Date” has the meaning set forth in the Credit Agreement.

“Tranche C Funding Date” has the meaning set forth in the Credit Agreement.

3.Withholding Taxes.  The Company Group may withhold from any and all amounts payable to you hereunder such federal, state and local taxes as the Company Group determines in its sole discretion may be required to be withheld pursuant to any applicable law or regulation.

4.No Right to Continued Employment.  Nothing in this Agreement will confer upon you any right to continued employment with the Company Group (or their respective successors) or to interfere in any way with the right of the Company Group (or their respective successors) to terminate your employment at any time.

5.Other Benefits.  The Retention Bonus is a special payment to you and will not be taken into account in computing the amount of salary or compensation for purposes of determining any bonus, incentive, pension, retirement, death or other benefit under any other bonus, incentive, pension, retirement, insurance or other employee benefit plan of the Company Group, unless such plan or agreement expressly provides otherwise.

6.Governing Law.  This Agreement will be governed by, and construed under and in accordance with, the internal laws of the State of Texas, without reference to rules relating to conflicts of laws.

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7.Counterparts.  This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original but all of which together will constitute one and the same instrument.

8.Entire Agreement; Amendment.  This Agreement constitutes the entire agreement between you and the Company Group with respect to the Retention Bonus and supersedes any and all prior agreements or understandings between you and the Company Group with respect to the Retention Bonus, whether written or oral.  This Agreement may be amended or modified only by a written instrument executed by you and the Company Group.  

9.Section 409A Compliance.  The intent of the parties is that the Retention Bonus be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended and the regulations and guidance promulgated thereunder, and accordingly, to the maximum extent permitted, this Agreement will be interpreted in a manner consistent therewith.

10.Administration.  The Company Group will have full power and authority to construe and interpret this Agreement, and any interpretation by the Company Group will be binding on you and your representatives and will be accorded the maximum deference permitted by law.  The Company Group, in its sole discretion, will have the right to modify, supplement, suspend or terminate this Agreement at any time; provided that, except as required by law, in no event will any amendment or termination adversely affect your rights without your prior written consent.  Subject to the foregoing, this Agreement will terminate upon the satisfaction of all obligations of the Company Group or its successor entities hereunder.

[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]

 

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This Agreement is intended to be a binding obligation on you and the Company Group.  If this Agreement accurately reflects your understanding as to the terms and conditions of the Retention Bonus, please sign, date, and return to me one copy of this Agreement.  You should make a copy of the executed Agreement for your records.

Very truly yours,

McDermott International, Inc.

 

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

Dated: _______________________

_______________________

 

 

 

 

 

 

Signature Page to Agreementmdr-ex1052_479.htm

Exhibit 10.52

 

McDermott International, Inc.
2020 Key Employee Retention Plan

1.Purpose. This McDermott International, Inc. 2020 Key Employee Retention Plan (the “Plan”) is designed to align the interests of McDermott International, Inc. (the “Company”) and eligible key employees of the Company.

2.Effective Date. The Company, intending to be legally bound, hereby adopts the Plan effective as of January 1, 2020 (the “Effective Date”). The Plan will continue from the Effective Date until December 31, 2020, unless earlier terminated by the Company in accordance with Section 7(e) (the “Term”). The expiration of the Term shall not in any event reduce or adversely affect any amounts due to any Participant hereunder.

3.General. The compensation provided under the Plan is intended to be in addition to all other compensation payable to Participants under any employment agreement or incentive plan or program in effect with the Company Group.

4.Definitions. For purposes of this Plan:

“Board” means the Company’s Board of Directors.

“Cause” means, with respect to a Participant, “Cause” as defined in any employment agreement between the Participant, on the one hand, and the Company or any of its subsidiaries, on the other hand, or, if no such agreement exists or such term is not defined therein, means any of the Participant’s (a) continued failure to perform substantially the Participant’s duties with the Company Group (occasioned by reason other than the Participant’s physical or mental illness, death, or Disability) after a written demand for substantial performance is delivered to the Participant by the Senior Vice President, Chief Human Resources Officer, which specifically identifies the manner in which the Senior Vice President, Chief Human Resources Officer or the Chief Executive Officer believes that the Participant has not substantially performed his or her duties, after which he or she shall have 30 days to defend or remedy such failure to substantially perform his or her duties, (b) the Participant engaging in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company Group, or (c) the Participant’s conviction of, with no further possibility of appeal for, or the Participant’s plea of guilty or nolo contendere to, any felony.

“Code” means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder.

“Committee” means the Compensation Committee of the Board.

“Company Group” means the Company and its direct and indirect affiliates and subsidiaries.

 

KE 6455075

 

“Disability” means, with respect to a Participant, “Disability” as defined in any employment agreement between the Participant, on the one hand, and the Company and any of its subsidiaries, on the other hand, or, if no such agreement exists or such term is not defined therein, means a “permanent and total disability” within the meaning of Section 22(e)(3) of the Code, as determined by the Senior Vice President, Chief Human Resources Officer in good faith, upon receipt of medical advice that the Senior Vice President, Chief Human Resources Officer deems sufficient and competent, from one or more individuals selected by the Senior Vice President, Chief Human Resources Officer who are qualified to provide professional medical advice.

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

“Emergence Date” means the effective date of the Plan of Reorganization.

“Participant” has the meaning set forth in Section 5.

“Participation Period” means each successive calendar quarter commencing during the Term. For the sake of clarity, the first Participation Period is January 1, 2020 through March 31, 2020, the second Participation Period is the April 1, 2020 through June 30, 2020, the third Participation Period is July 1, 2020 through September 30, 2020, and the fourth Participation Period is the October 1, 2020 through December 31, 2020.

“Plan” has the meaning set forth in Section 1.

“Plan of Reorganization” means the Chapter 11 Plan of Reorganization of McDermott International, Inc. and its Debtor Affiliates, as finally approved by the U.S. Bankruptcy Court.

“Qualifying Termination” means a termination of a Participant’s employment with the Company and its subsidiaries due to death or Disability or by the Company without Cause.

“Quarterly Retention Opportunity” means, in the case of any Participant, (a) the incentive payable to such Participant under the Plan for the applicable Participation Period, as determined by the Company at the time of the Participant’s selection to participate in the Plan and (b) to the extent the Company implements an equity incentive plan following the Emergence Date and the Participant is eligible to participate in such plan and granted an award thereunder in accordance with allocation schedule set forth in the Plan of Reorganization, then, for each Participation Period starting after the date on which such award is granted, the Participant’s annual target bonus opportunity for 2019.

“Section 409A” means Section 409A of the Code.

“Term” has the meaning set forth in Section 2.

5.Eligible Participants. Each person designated by the Committee from time to time shall be a “Participant” under the Plan and eligible to receive a Quarterly Retention Opportunity with respect to each Participation Period.

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6.Term of Participation.

(a)Subject to the provisions of the Plan and any participation agreement granted hereunder, each Participant shall earn a Quarterly Retention Opportunity as of the end of each Participation Period so long as the Participant remains employed by the Company Group through the end of the applicable Participation Period. Notwithstanding the foregoing, if a Participant incurs a Qualifying Termination prior to the end of a Participation Period, such Participant shall be entitled to receive the full Quarterly Retention Opportunity for such Participation Period.

(b)The Participant shall not be eligible to earn a Quarterly Retention Opportunity with respect to any calendar quarter that commences following the end of the Term.

(c)Any Quarterly Retention Opportunity required to be made under the Plan shall be paid on a fully vested basis by the Company as soon as possible after the end of the applicable Participation Period and in no event later than 45 days following the end of the applicable Participation Period (or, if the Participant becomes entitled to such Quarterly Retention Opportunity as a result of a Qualifying Termination prior to the end of a Participation Period, then as soon as possible after such Qualifying Termination and in no event later than 30 days following such Qualifying Termination).

7.Plan Administration. The Plan shall be administered by the Company. The Company is given full authority and discretion within the limits of the Plan to establish such administrative measures as may be necessary to administer and attain the objectives of the Plan. The Company shall have full power and authority to construe and interpret the Plan and any interpretation by the Company shall be binding on all Participants and shall be accorded the maximum deference permitted by law.

(a)All rights and interests of Participants under the Plan shall be non-assignable and nontransferable, and otherwise not subject to pledge or encumbrance, whether voluntary or involuntary, other than by will or by the laws of descent and distribution. In the event of any sale, transfer, or other disposition of all or substantially all of the Company’s assets or business, whether by merger, stock sale, consolidation, or otherwise, the Company may assign the Plan.

(b)Any payment to a Participant in accordance with the provisions of the Plan shall, to the extent thereof, be in full satisfaction of all claims against the Company Group, and the Company may require Participant, as a condition precedent to such payment, to execute a receipt and release to such effect.

(c)Payment of amounts due under the Plan shall be provided to a Participant in the same manner as such Participant receives his or her regular paycheck or by mail at the last known address of such Participant in the possession of the Company. The Company will deduct all applicable taxes and any other withholdings required to be withheld with respect to the payment of any award pursuant to the Plan.

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(d)The Company shall not be required to establish any special or separate fund or to make any other segregation of assets to ensure the payment of any award provided for hereunder. Quarterly Retention Opportunity payments shall not be considered as extraordinary, special incentive compensation, and it will not be included as “earnings,” “wages,” “salary,” or “compensation” in any pension, welfare, life insurance, or other employee benefit plan or arrangement of the Company Group.

(e)The Company, in its sole discretion, will have the right to modify, supplement, suspend, or terminate the Plan at any time; provided that, except as required by law, the Plan may not be amended or terminated in any way adverse to any Participant unless (i) Committee obtains the prior written consent of the affected Participants or (ii) the Committee reasonably determines such change is reasonably necessary to obtain any governmental (including court) approvals required to make the Plan effective before the Emergence Date; and provided, further, that, on and following the Emergence Date and prior to the end of the Term, the Plan shall not be terminated without the consent of all Participants in the Plan.

(f)Nothing contained in the Plan shall in any way affect the right and power of the Company to discharge any Participant or otherwise terminate his or her employment at any time or for any reason or to change the terms of his or her employment in any manner.

(g)Except as otherwise provided under the Plan, any expense incurred in administering the Plan shall be borne by the Company.

(h)Captions preceding the sections hereof are inserted solely as a matter of convenience and in no way define or limit the scope or intent of any provision hereof.

(i)The administration of the Plan shall be governed by the laws of the State of Texas, without regard to the conflict of law principles of any state. Any persons or corporations who now are or shall subsequently become parties to the Plan shall be deemed to consent to this provision.

(j)The Plan is intended to either comply with, or be exempt from, the requirements of Section 409A. To the extent that the Plan is not exempt from the requirements of Section 409A, the Plan is intended to comply with the requirements of Section 409A and shall be limited, construed, and interpreted in accordance with such intent. Notwithstanding the foregoing, in no event whatsoever shall the Company be liable for any additional tax, interest, income inclusion, or other penalty that may be imposed on a Participant by Section 409A or for damages for failing to comply with Section 409A.

****

 

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IN WITNESS WHEREOF, the Company has caused the Plan to be signed by its duly authorized officer as of the date first set forth above.

MCDERMOTT INTERNATIONAL, INC.

 

	
 
	
 
	
By:
	
 
	
/s/ Tosha Perkins

	
 
	
 
	
Name:
	
 
	
Tosha Perkins

	
 
	
 
	
Title:
	
 
	
Senior Vice President, Chief Human Resources Officer

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

 

 

[Signature Page to 2020 Key Employee Retention Plan]

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