HORIZON OFFSHORE INC
EMPLOYMENT & NON- COMPETITION AGREEMENT - D. SHARP
<DOCUMENT>
<TYPE>EX-10.5
<SEQUENCE>7
<FILENAME>h08284exv10w5.htm
<DESCRIPTION>EMPLOYMENT & NON- COMPETITION AGREEMENT - D. SHARP
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<P align="right"><FONT size="2"><B>EXHIBIT 10.5</B><BR></FONT>

<P align="center"><FONT size="2"><B>AMENDED AND RE-STATED<BR>
EMPLOYMENT AND NON-COMPETITION AGREEMENT</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Employment Agreement (this &#147;Agreement&#148;) between Horizon Offshore,
Inc., a Delaware corporation (&#147;Company&#148;), and David W. Sharp (&#147;Employee&#148;) is
dated as of July&nbsp;1, 2003.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company and the Employee agree as follows:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employment . The Company has hired the Employee and the Employee
agreed to be employed upon the terms and conditions hereinafter set forth.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Term. (a)&nbsp;Subject to the provisions for termination as hereinafter
provided, Employee&#146;s employment pursuant to the terms of this Agreement shall
be for the period of three (3)&nbsp;years from the date of this Agreement. This
three (3)&nbsp;year period of employment is referred to herein as the &#147;Employment
Term.&#148;
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; If Employee continues to serve as an employee of the Company after the
Employment Term, such continued employment shall be subject to the terms of
this Agreement but shall be terminable at will by either the Company or
Employee.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; Following Employee ceasing for whatever reason to be an employee of
the Company, each party shall have the right to enforce all rights, and shall
be bound by all obligations, of such party that are continuing rights and
obligations under the terms of this Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title and Duties. The Employee will have the title &#147;ExecutiveVice
President , Secretary and Chief Financial Officer&#148;, and shall perform such
duties, consistent with the Employee&#146;s job title, as may be prescribed from
time to time by the Chief Executive Officer.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compensation and Benefits. The Company will provide or will cause to
be provided to Employee a minimum annual base salary of $256,000. The Employee
shall be entitled to all benefits and perquisites provided to similarly
situated employees of the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Termination of Employment.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp; During the Employment Term, the Employee&#146;s status as an employee will
terminate immediately and automatically upon the earliest to occur of:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(i)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">the death or &#147;Disability&#148; (as defined below) of
the Employee;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(ii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">the discharge of the Employee by the Company &#147;For
Cause&#148; (as defined below);</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(iii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">the expiration of the Employment Term.</FONT></TD>
</TR>
</TABLE>
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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Employee hereby accepts such employment subject to the terms and
conditions hereof.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(b)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">As used herein, &#147;For Cause&#148; shall mean any one or more of the
following:</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(i)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">violation by the Employee of the terms of this
Agreement or the Employee&#146;s failure to perform the Employee&#146;s
duties in a manner consistent with the Employee&#146;s position;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(ii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">excessive absenteeism on the part of the Employee
that is not otherwise protected or allowed by law;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(iii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">the Employee&#146;s conviction of any felony
whatsoever, or of any misdemeanor that involves fraud,
dishonesty or moral turpitude;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(iv)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">the Employee&#146;s having detectable traces of drugs,
narcotics or any controlled substances in his system while at
work, and/or misuse of prescription medication while working;
as well as the possession or distribution of drugs, narcotics
or any controlled substances at any time or place; or</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(v)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">the Employee&#146;s conducting himself in a way that
is contrary to the Company&#146;s business interests.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Anything in this Agreement to the contrary notwithstanding, the Employee&#146;s
employment may not be terminated &#147;For Cause&#148; unless and until there shall have
been delivered to the Employee a copy of a resolution duly adopted by the
affirmative vote of not less than a majority of the entire membership of the
Board (without giving effect to the Employee&#146;s status as a director or any vote
of the Employee) at a meeting of the Board called and held for the purpose
(after reasonable notice to the Employee and an opportunity for the Employee to
be heard before the Board), finding that in the good faith opinion of the Board
the Employee was culpable of any of the conduct set forth in clauses (i)
through (v)&nbsp;of this subparagraph (b)&nbsp;and specifying the particulars thereof in
detail.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; As used herein, &#147;Disability&#148; shall mean a physical or mental
impairment of the Employee that in the determination of the Board has prevented
the Employee from performing the duties assigned to the Employee by the company
for 90 consecutive days or more during any 12 consecutive months. Days of
absence attributable to leave under the Family Medical Leave Act or as
reasonable accommodation under the Americans With Disabilities Act, or other
laws protecting such absences, will not be counted as part of the 90&nbsp;days in
determining whether the Employee is disabled within the meaning of this
definition. The Employee&#146;s employment hereunder, except as otherwise agreed to
in writing between the Company and the Employee, shall cease as of the date of
such determination. The Employee agrees to submit to medical examinations, at
the Company&#146;s sole cost and expense, to determine whether the Employee is
substantially unable, with or without reasonable accommodation, to perform the
essential functions of his position with the Company, pursuant to reasonable
requests that the Company may make from time to time. During the period of any
such physical or mental impairment as provided above, the salary otherwise
payable to the Employee may, in the absolute discretion of the Company, be
reduced by the amount of any disability benefits or
</FONT>
<P align="center"><FONT size="2">2</FONT>
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<P align="left"><FONT size="2"> payments received by the Employee from the Company or any disability or
health plan funded in whole or in part by the Company (excluding health
insurance benefits or other reimbursement of medical expenses attributable to
insurance policies that have not been funded in any part by the Company).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp; Employee shall have the right to terminate this Agreement in the event
of the acquisition or a public announcement that a person or group of persons
(other than the holders of the Company&#146;s common stock on the date of this
Agreement and other than the Company or any of its subsidiaries or any employee
benefit plan of the Company or any such subsidiary) has acquired 30% or more of
the Company&#146;s outstanding common stock; or the Company is involved in a merger
or other business combination or sale or transfer of assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
subsidiaries, taken as a whole, and as a result of such transaction the
Company&#146;s equity holders prior to the transaction hold less than fifty (50%)
percent of the surviving or transferee entity.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp; In the event of termination of this Agreement by Employee in
accordance with Section&nbsp;5 (d), above, Employee shall be entitled to: (i)&nbsp;a lump
sum payment by Company equal to two hundred (200%) percent of Employee&#146;s annual
base salary in effect at the time of termination, (ii)&nbsp;a lump sum payment by
Company equal to the difference between the option exercise price of any
unvested option and the market value of the stock on the date of termination,
and (iii)&nbsp;continued participation in any welfare benefit plans, including
without limit medical, life insurance and disability insurance and continued
receipt of any perquisites Employee is receiving on the date of termination
for a period of two (2)&nbsp;years.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp; Notwithstanding anything to the contrary in this Agreement, in the
event that any payment, benefit or distribution by Company to or for the
benefit of the Employee, whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise (a
&#147;Payment&#148;), would be subject to the excise tax imposed by Section&nbsp;4999 of the
Internal Revenue Code of 1986, as amended, or any interest or penalties with
respect to such excise tax (such excise tax, together with any such interest or
penalties, are hereinafter collectively referred to as the &#147;Excise Tax&#148;),
Company shall pay to the Employee an additional payment (a &#147;Gross-up payment&#148;)
in an amount such that after payment by the Employee of all taxes (including
any interest or penalties imposed with respect to such taxes), including any
Excise Tax imposed on any Gross-up Payment, the Employee retains an amount of
the Gross-up Payment equal to the Excise Tax imposed upon the Payments. Company
and the Employee shall make an initial determination as to whether a Gross-up
Payment is required and the amount of any such Gross-up Payment. The Employee
shall notify Company in writing of any claim by the Internal Revenue Service
which, if successful, would require Company to make a Gross-up Payment (or a
Gross-up Payment in excess of that, if any, initially determined by Company and
the Employee) within five days of the receipt of such claim. Company shall
notify the Employee in writing at least ten days prior to the due date of any
response required with respect to such claim if it plans to contest the claim.
If Company decides to contest such claim, the Employee shall cooperate fully
with Company in such action; provided, however, Company shall bear and pay
directly or indirectly all costs and expenses (including additional interest
and penalties) incurred in connection with such action and shall indemnify and
hold the Employee harmless, on an after-tax basis, for any Excise Tax or income
tax, including interest and penalties with respect
</FONT>
<P align="center"><FONT size="2">3</FONT>
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<P align="left"><FONT size="2">thereto,
imposed as a result of Company&#146;s action. If, as a result of Company&#146;s
action with respect to a claim, the Employee receives a refund of any amount
paid by Company with respect to such claim, the Employee shall promptly pay
such refund to Company. If Company fails to timely notify the Employee whether
it will contest such claim or Company determines not to contest such claim,
then Company shall immediately pay to the Employee the portion of such claim,
if any, which it has not previously paid to the Employee.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade Secrets, Etc. The Employee shall hold, both during the Employment
Term and thereafter, in a fiduciary capacity for the benefit of the Company all
secret or confidential information, knowledge or data relating to the Company
or any of its subsidiaries or corporate affiliates and their respective
businesses and operations, which shall have been obtained by the Employee
during the Employee&#146;s employment (whether prior to or after the date hereof)
and which shall not have become public knowledge (other than by acts of the
Employee or his representatives in violation of this Agreement). The Employee
agrees (i)&nbsp;that, without the prior written consent of the Company or as may be
otherwise required by law or legal process, he will not communicate or divulge
any such information, knowledge or data to any party other than the Company and
(ii)&nbsp;to deliver promptly to the Company upon its written request any
confidential information, knowledge or data in his possession, whether produced
by the Company or any of its subsidiaries and corporate affiliates or by the
Employee, that relates to the business of the Company or any of its
subsidiaries and joint ventures or any past, current or prospective activity of
the Company or any of its subsidiaries and joint ventures. The Employee shall
be permitted to retain copies of such data as are necessary in order to enable
the Employee to assert any rights under this Agreement, provided that such data
shall be used solely for such purpose.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Limited Covenant Not to Compete. (a)&nbsp;While Employee is employed by the
Company and for a period of one year following the termination of Employee&#146;s
employment with the Company, the Employee will not, directly or indirectly,
own, manage, operate, control, be employed by, participate in, or be connected
in any manner with the ownership, management, operation or control of any
company or other business enterprise engaged in a line or lines of business
similar to that of the Company or any of its subsidiaries or joint ventures,
within the States of Texas, Louisiana, Mississippi, Alabama or Florida
(including any area offshore in the Gulf of Mexico or any such state) or any
other jurisdiction, whether within or outside the United States in which the
business of the Company or any of its subsidiaries or joint ventures is carried
on, so long as the Company or any of its subsidiaries or joint ventures carries
on a like line of business therein; provided, however, that nothing contained
herein shall prohibit the Employee from making investments in any publicly held
company which do not exceed in the aggregate two percent of the equity interest
of such company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; As part of the consideration for the compensation and benefits to be
paid to the Employee hereunder; to protect the trade secrets and confidential
information of Company and its affiliates that have been and will in the future
be disclosed or entrusted to the Employee, the business good will of the
Company and its affiliates that has been and will in the future be developed in
the Employee, or the business opportunities that have been and will in the
future be disclosed or entrusted to the Employee by the Company and its
affiliates; and, as an additional incentive for the Company to enter in this
Agreement, the Company and the Employee agree to the non-competition
</FONT>
<P align="center"><FONT size="2">4</FONT>
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<P align="left"><FONT size="2">obligations hereunder. The obligations of the Employee set forth in this
Section&nbsp;7 shall apply during the term of this Agreement and any continued
employment of the Employee by the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No Tampering. While Employee is employed by the Company and for one
year following the termination of Employee&#146;s employment with the Company, the
Employee shall not (a)&nbsp;request, induce or attempt to influence any supplier of
goods or services to the Company to curtail or cancel any business they may
transact with the Company; (b)&nbsp;request, induce or attempt to influence any
customers of the Company that have done business with or potential customers
which have been in contact with the Company to curtail or cancel any business
they may transact with the Company; or (c)&nbsp;request, induce or attempt to
influence any employee of the Company to terminate his or her employment with
the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Statements Concerning the Company. The Employee shall refrain, both
during the Employment Term and following the termination of Employee&#146;s
employment by the Company for any reason, from publishing any oral or written
statements about the Company, any of its affiliates, or any of such entities&#146;
officers, employees, agents or representatives that are slanderous, libelous,
or defamatory; or that disclose private or confidential information about the
Company, any of its affiliates, or any of such entities&#146; business affairs,
officers, employees, agents or representatives; or that constitute an intrusion
into the seclusion or private lives of the Company, any of its affiliates, or
any of such entities&#146; officers, employees, agents or representatives or that
give rise to unreasonable publicity about the private lives of the Company, any
of its affiliates, or any of such entities&#146; officers, employees, agents or
representatives; or that place the Company, any of its affiliates, or any of
such entities&#146; officers, employee, agents or representatives in a false light
before the public; or that constitute a misappropriation of the name or
likeness of the Company, any of its affiliates, or any of such entities;
officers, employees, agents or representatives. A violation or threatened
violation of this prohibition may be enjoined by the courts. The rights
afforded the Company and its affiliates under this provision are in addition to
any and all rights and remedies otherwise afforded by law.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Injunctive Relief. In the event of a breach or threatened breach by
the Employee of the provisions of Sections&nbsp;6, 7, 8 or 9 of this Agreement
during or after the term of this Agreement, the Company shall be entitled to
injunctive relief restraining the Employee from violation of such paragraph.
Nothing herein shall be construed as prohibiting the Company from pursuing any
other remedy at law or in equity it may have in the event of breach or
threatened breach of this Agreement by the Employee.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Binding Effect. (a)&nbsp;This Agreement shall be binding upon and inure
to the benefit of the Company and any of its successors or assigns.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; This Agreement is personal to the Employee and shall not be assignable
by the Employee without the consent of the Company (there being no obligation
to give such consent) other than such rights or benefits as are transferred by
will or the laws of descent and distribution.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; The Company will require any successor or assign (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the assets or businesses of the Company (i)&nbsp;to assume
unconditionally and expressly this Agreement and (ii)&nbsp;to agree to perform
</FONT>
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<P align="left"><FONT size="2">all of the obligations under this Agreement in the same manner and to the same
extent as would have been required of the Company had no assignment or
succession occurred, such assumption to be set forth in a writing reasonably
satisfactory to the Employee. In the event of any such assignment or
succession, the term &#147;Company&#148; as used in this Agreement shall refer also to
such successor or assign.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notices. Any notice or other communication required under this
Agreement shall be in writing, shall be deemed to have been given and received
when delivered in person, or, if mailed, shall be deemed to have been given
when deposited in the United States mail, first class, registered or certified,
return receipt requested, with proper postage prepaid, and shall be deemed to
have been received on the third business day thereafter, and shall be addressed
as follows:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
    <TD width="100%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">If to the Company, addressed to:</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Horizon Offshore, Inc.</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">2500 City West Boulevard, Suite&nbsp;2200</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Houston, Texas 77042</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">If to the Employee, addressed to:</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">David W. Sharp</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">315 Cove Creek</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Houston, Texas 77042</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="left"><FONT size="2">or such other address as to which any party hereto may have notified the other
in writing.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Texas.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Entire Agreement. This Agreement and the documents referred to
herein, contain or refer to the entire agreement or understanding between the
Employee and the Company relating to the employment of the Employee by the
company. No provision of the Agreement may be modified or amended except by an
instrument in writing signed by or for both parties hereto.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Severability. If any term or provision of this Agreement, or the
application thereof to any person or circumstance, shall at any time or to any
extent be invalid or unenforceable, the remainder of this Agreement, or the
application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby and each term and provision of this Agreement shall be valid and
enforced to the fullest extent permitted by law.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Waiver of Breach. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of
any subsequent breach thereof.

</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Remedies Not Exclusive. No remedy specified herein shall be deemed
to be such party&#146;s exclusive remedy, and accordingly, in addition to all of the
rights and remedies provided for in this
</FONT>
<P align="center"><FONT size="2">6</FONT>
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<P align="left"><FONT size="2">Agreement, the parties shall have all other rights and remedies provided to
them by applicable law, rule or regulation.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Beneficiaries. Whenever this Agreement provides for any payment to be
made to the Employee or his estate, such payment may be made instead to such
beneficiary or beneficiaries as the Employee may have designated in writing and
filed with the Company. The Employee shall have the right to revoke any such
designation from time to time and to re-designate any beneficiary or
beneficiaries by written notice to the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Arbitration. All disputes arising out of or in connection with this
Agreement or any transaction hereunder shall be finally settled under the
Commercial Arbitration Rules of the American Arbitration Association. This
clause means that the parties hereby waive their right to have such disputes
adjudicated, litigated or tried in a court of law. The arbitrator&#146;s award
shall be final and binding. Judgment upon the award rendered may be entered in
any court having jurisdiction over the party against which the award is
rendered. The arbitration shall take place in Houston, Texas.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date just above written.
</FONT>
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    <TD width="28%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="39%">&nbsp;</TD>
</TR>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">HORIZON OFFSHORE, INC.</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Name:
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Bill J. Lam</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Title:
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">President</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">EMPLOYEE:</FONT></TD>
</TR>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">&nbsp;</FONT></TD>
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<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left"  colspan="3" valign="top"><FONT size="2">
<HR size="1" noshade></FONT></TD>
</TR>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">David W. Sharp</FONT></TD>
</TR>
</TABLE>
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<P align="center"><FONT size="2">7</FONT>



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