Retention and Severance Payments Agreement for Mr. Davison

Mr. Charles W. Davison, Jr.

June 3, 2019

Re:     Retention and Severance Payments Agreement

 

Dear Chuck:

 

In connection with your acceptance of employment with Oceaneering International, Inc. (“Oceaneering”) as its Chief Operating Officer beginning on June 3, 2019 (the “Effective Date”), Oceaneering agrees to provide you: (i) the Retention Payment (described in Paragraph 1 below) if you remain in the continuous employ of Oceaneering or one of its subsidiaries (collectively, the “Company”) during the period beginning on the Effective Date and ending on the first anniversary of the Effective Date (the “Retention Period”); and (ii) the Severance Payment (as described in Paragraph 2 below), should your employment with the Company be terminated without Cause or for Good Reason during the period beginning on the Effective Date and ending on the third anniversary of the Effective Date (the “Protective Period”), with both payments being subject to the terms and conditions set forth below in this letter agreement (this “Agreement”). Capitalized terms that are used, but not defined, in this Agreement (including Exhibit A attached hereto), but that are defined in the Oceaneering International, Inc. Change of Control Plan, effective as of November 14, 2018 and as amended from time to time (the “Change of Control Plan”), are used in this Agreement (and in Exhibit A) as defined in the Change of Control Plan, provided that, with respect to such defined terms: (A) the term “Participant” shall be deemed to refer to you; and (B) the phrase “immediately prior to the Change of Control Effective Date” in the definition of “Good Reason” and the proviso in Clause (iv) of such definition and Clause (v) of such definition shall be deemed to be deleted, for purposes of this Agreement.

Oceaneering), with such release to be in the form as determined by Oceaneering, in its sole discretion. You shall not be entitled to the Retention Payment or the Severance Payment under any circumstance not described in Paragraph 1 and Paragraph 2, respectively, or if you fail to sign and timely deliver an effective and unrevoked release of claims against the Company and such other related parties.

of 1986, as amended (“Section 409A”), and ambiguous provisions of this Agreement, if any, shall be construed and interpreted in a manner consistent with such intent. If any provision of this Agreement would result in the imposition of an additional tax under Section 409A, that provision will be reformed to avoid imposition of the additional tax.

If this Agreement correctly sets forth our understanding with respect to the subject matter hereof, please sign and return one copy of this Agreement to me at the letterhead address or ***@***.

 

Sincerely,

/s/ Roderick A. Larson    

Roderick A. Larson

President and Chief Executive Officer

Agreed to this 4th day of June, 2019

/s/ Charles W. Davison, Jr.    

Charles W. Davison, Jr.

Your right to the Retention Payment and Severance Payment (together, the “Payments”) shall be further conditioned upon your compliance with the provisions of this Exhibit A to the Agreement. In the event you fail to comply with any of the provisions of this Exhibit A or the Agreement, you agree and acknowledge that you shall repay to Oceaneering any payments received pursuant to the Agreement, and no further benefits shall be payable to you under the Agreement.

1.    Definitions. As used in this Exhibit A, the following terms shall have the following meanings (and any other capitalized terms used but not defined in this Exhibit A shall have the respective meanings assigned or referred to in the Agreement):

(a)    “Business” means any business in which the Company is engaged or in which the Company has taken material steps to engage during the period of your employment.

(b)    “Competing Business” means any Person which, wholly or in any significant part, engages in any business competing with the Business in the Restricted Area.

(c)    “Governmental Authority” means any governmental, quasi-governmental, state, county, city or other political subdivision of the United States or any other country, or any agency, court or instrumentality, foreign or domestic, or any statutory or regulatory body thereof.

(d)    “Legal Requirement” means any law, statute, code, ordinance, order, rule, regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorization, or other directional requirement of any Governmental Authority.

(e)    “Person” means any individual, corporation, partnership, group (as such term is used in Rule 13d‑5 under the Securities Exchange Act of 1934, as amended), association or other person (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended, and the related rules and regulations promulgated thereunder).

(f)    “Prohibited Period” means the period during which you are employed by the Company and extending until 24 months following your termination date.

(g)    “Proprietary Information” includes all confidential or proprietary scientific or technical information, data, formulas and related concepts, business plans (both current and under development), client lists, promotion and marketing programs, trade secrets, or any other confidential or proprietary business information relating to the business of the Company, whether in written or electronic form of writings, correspondence, notes, drafts, records, maps, invoices, technical and business logs, policies, computer programs, disks or otherwise. Proprietary Information does not include information that is or becomes publicly known through lawful means.

(h)    “Restricted Area” means any state or, if outside the United States, any country or subdivision thereof in which the Company (i) is then currently engaged in the Business, (ii) has engaged in the Business during the prior two years of your employment, or (iii) is actively pursuing business opportunities for the Business, and in each such case you either (x) received Proprietary Information about the Company’s operations in such location or (y) worked in such location during the prior two years of your employment.

2.    Confidential Treatment. You acknowledge and agree that you have acquired, and will in the future acquire as a result of your employment by the Company or otherwise, Proprietary Information of the Company which is of a confidential or trade secret nature, and all of which has a great value to the Company and is a substantial basis and foundation upon which the Company’s business is predicated. Accordingly, other than in the legitimate performance of your job duties, you agree:

(a)    to regard and preserve as confidential at all times all Proprietary Information;

(b)    to refrain from publishing or disclosing any part of the Proprietary Information and from using, copying or duplicating it in any way by any means whatsoever; and

(c)    not to use on your own behalf or on behalf of any third party or to disclose the Proprietary Information to any person or entity without the prior written consent of Oceaneering.

3.    Property of the Company. You acknowledge that all Proprietary Information and other property of the Company which you accumulate during your employment with the Company are the exclusive property of the Company. Upon your termination of employment with the Company, or at any time upon the Company’s request, you shall surrender and deliver to the Company (and not keep, recreate or furnish to any third party) any and all work papers, reports, manuals, documents and the like (including all originals and copies thereof) in your possession which contain Proprietary Information relating to the business, prospects or plans of the Company. Further, you agree to search for and delete all Company information, including Proprietary Information, from your computer, smartphone, tablet, or any other personal electronic storage devices, other than payroll information or other financial information that you may need for your tax filings, and, upon request, certify to the Company that you have completed this search and deletion process.

4.    Cooperation. You agree that, following any termination of your employment with the Company, you will not disclose or cause to be disclosed any Proprietary Information, unless (in any such case) required by court order. Pursuant to the Defend Trade Secrets Act of 2016, you shall be held criminally or civilly liable under any Federal or state trade secret law for the disclosure of any Proprietary Information that (i) is made (A) in confidence to a Federal, state or local government official, either directly or indirectly, or to an attorney and (B) solely for the purpose of reporting or investigating a suspected violation of law or (ii) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. The Company may seek your assistance, cooperation or testimony following any such termination in connection with any investigation, litigation or proceeding arising out of matters within your

knowledge and related to your employment by the Company, and in such instance, you shall provide such assistance, cooperation or testimony and Oceaneering shall pay your reasonable costs and expenses in connection therewith.

5.    Non-Competition; Non-Solicitation.

(a)    You and Oceaneering agree to the non-competition and non-solicitation provisions of this Section 5: (i) in consideration for the Proprietary Information provided by the Company to you; and (ii) to protect the Proprietary Information of the Company disclosed or entrusted to you by the Company or created or developed by you for the Company, the business goodwill of the Company developed through the efforts of you and the business opportunities disclosed or entrusted to you by the Company.

(b)    Subject to the exceptions set forth in Section 5(c), you expressly covenant and agree that, during the Prohibited Period: (i) you will refrain from carrying on or engaging in, directly or indirectly, any Competing Business in the Restricted Area; and (ii) you will not, directly or indirectly, own, manage, operate, join, become an employee, partner, owner or member of (or an independent contractor to), control or participate in or loan money to, sell or lease equipment to or sell or lease real property to any Person that engages in a Competing Business in the Restricted Area.

(c)    Notwithstanding the restrictions contained in Section 5(b), you may own an aggregate of not more than 1% of the outstanding capital stock or other equity security of any class of any corporation or other entity engaged in a Competing Business, if such capital stock or other equity security is listed on a national securities exchange or regularly traded in the over-the-counter market by a member of a national securities exchange, without violating the provisions of Section 5(b), provided that you do not have the power, directly or indirectly, to control or direct the management or affairs of any such corporation or other entity and that you are not involved in the management of such corporation.

(d)    You further expressly covenant and agree that, during the Prohibited Period, you will not: (i) engage or employ, or solicit or contact with a view to the engagement or employment of, any person who is an officer or employee of the Company; or (ii) canvass, solicit, approach or entice away or cause to be canvassed, solicited, approached or enticed away from the Company any person who or which is or was a customer of the Company, during the prior two years of your employment with the Company, and either (x) about which you received Proprietary Information or (y) with which you had contact or dealings on behalf of the Company.

(e)    You expressly recognize that you are a key employee and an important member of the management or research and development team who will be provided with access to Proprietary Information and trade secrets as part of your employment and that the restrictive covenants set forth in this Exhibit A are reasonable and necessary in light of your position and access to the Proprietary Information.

6.    Non-Disparagement. You agree that, following any termination of your employment with the Company, you will not disparage, orally or in writing, the Company, the

management of the Company, any product or service provided by the Company or the future prospects of the Company.

7.    Relief. You and Oceaneering agree and acknowledge that the limitations as to time, geographical area and scope of activity to be restrained as set forth in this Exhibit A are reasonable and do not impose any greater restraint than is necessary to protect the legitimate business interests of Oceaneering. You and Oceaneering also acknowledge that money damages would not be sufficient remedy for any breach of this Exhibit A by you, and Oceaneering shall be entitled to enforce the provisions of this Exhibit A by terminating any Retention or Severance Payment then owing to you under the Agreement or otherwise and to specific performance and injunctive relief as remedies for such breach or any threatened breach. Such remedies shall not be deemed the exclusive remedies for a breach of this Exhibit A but shall be in addition to all remedies available at law or in equity, including the recovery of damages from you and your agents. However, if it is determined that you have not committed a breach of this Exhibit A, then Oceaneering shall make the payment(s) due under the Agreement and pay to you all such payments that had been suspended pending such determination.

8.    Reasonableness; Enforcement. You acknowledge and agree that the geographic scope and duration of the covenants contained in this Exhibit A are fair and reasonable in light of: (a) the nature and wide geographic scope of the operations of the Business; (b) your level of control over and contact with the Business in all jurisdictions in which it is conducted; (c) the fact that the Business is conducted throughout the Restricted Area; and (d) the amount of compensation and Proprietary Information that you are receiving in connection with the performance of your duties for the Company. It is the desire and intent of you and Oceaneering that the provisions of this Exhibit A be enforced to the fullest extent permitted under applicable Legal Requirements, whether now or hereafter in effect and, therefore, to the extent permitted by applicable Legal Requirements, you and Oceaneering hereby waive the application of any provision of applicable Legal Requirements that would render any provision of this Exhibit A invalid or unenforceable, in whole or in part.

9.    Reformation. Oceaneering and you agree that the foregoing restrictions are reasonable under the circumstances and that any breach of the covenants contained in this Exhibit A would cause irreparable injury to Oceaneering. You expressly represent that enforcement of the restrictive covenants set forth in this Exhibit A will not impose an undue hardship upon you or any Person affiliated with you. Further, you acknowledge that your skills are such that you can be gainfully employed in non-competitive employment, and that the restrictive covenants will not prevent you from earning a living. Nevertheless, if any of the aforesaid restrictions are found by a court of competent jurisdiction to be unreasonable, or overly broad as to geographic area or time, or otherwise unenforceable, the parties intend for the restrictions herein set forth to be modified by the court making such determination so as to be reasonable and enforceable and, as so modified, to be fully enforced.

10.    Protected Disclosures. Notwithstanding any provision to the contrary in the Agreement, nothing in the Agreement prohibits you from reporting possible violations of law or regulation to any governmental agency or entity, including the U.S. Department of Justice, the U.S. Securities and Exchange Commission, the U.S. Congress, and any agency Inspector General, or making other disclosures that are protected under the whistleblower provisions of federal law or regulation. Nothing in the Agreement limits your ability to communicate with any government agencies or otherwise participate in any investigation or proceeding that may be

conducted by any government agency, including providing documents or other information, without notice to Oceaneering. Additionally, you and Oceaneering acknowledge and agree that you do not need the prior authorization of Oceaneering to make any such reports or disclosures and you are not required to notify Oceaneering or any of its affiliates that you have made such reports or disclosures.

Restrictive covenants set forth in this Exhibit A are
agreed to this 4th day of June, 2019

/s/ Charles W. Davison, Jr.    

Charles W. Davison, Jr.