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EXHIBIT 10.11
EXECUTIVE EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement"), including the attached Exhibit
"A," is entered into between ENRON CAPITAL & TRADE RESOURCES CORP., a Delaware
corporation and subsidiary of Enron Corp. ("Enron"), having offices at 0000
Xxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000 ("Employer"), and XXXXXX X. XXXXXX, an
individual currently residing in Houston, Texas ("Employee"), to be effective as
of January 1, 1998 (the "Effective Date").
WITNESSETH:
WHEREAS, Employer is desirous of employing Employee pursuant to the
terms and conditions and for the consideration set forth in this Agreement, and
Employee is desirous of entering the employ of Employer pursuant to such terms
and conditions and for such consideration.
NOW, THEREFORE, for and in consideration of the mutual promises,
covenants, and obligations contained herein, Employer and Employee agree as
follows:
ARTICLE 1: EMPLOYMENT AND DUTIES:
1.1 Employer agrees to employ Employee, and Employee agrees to be
employed by Employer, beginning as of the Effective Date and continuing until
the date set forth on Exhibit "A" (the "Term"), subject to the terms and
conditions of this Agreement.
1.2 Employee initially shall be employed in the position set forth on
Exhibit A. Employer may subsequently assign Employee to a different position
with duties, responsibilities, and reporting relationships that are reasonably
equivalent to the position described on Exhibit "A." Moreover, Employer may
assign this Agreement and Employee's employment to Enron or any affiliates of
Enron; provided, however, that Employer will not transfer Employee to a position
outside of Houston, Texas without Employee's consent. Employee agrees to serve
in the assigned position and to perform diligently and to the best of Employee's
abilities the duties and services appertaining to such position as determined by
Employer, as well as such additional or different duties and services
appropriate to such position which Employee from time to time may be reasonably
directed to perform by Employer. Employee shall at all times comply with and be
subject to such policies and procedures as Employer may establish from time to
time.
1.3 Employee shall, during the period of Employee's employment by
Employer, devote Employee's full business time, energy, and best efforts to the
business and affairs of Employer. Employee may not engage, directly or
indirectly, in any other business, investment, or activity that interferes with
Employee's performance of Employee's duties hereunder, is contrary to the
interests of Employer or Enron, or requires any significant portion of
Employee's business time. Nothing in this paragraph 1.3 should prohibit Employee
from serving in positions or on Boards that benefit Employer within the energy
industry. Nor is Employee prohibited from providing service and/or serving as a
Board member for non-profit and/or charitable organizations.
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1.4 In connection with Employee's employment by Employer, Employer
shall provide Employee access to such confidential information pertaining to the
business and services of Employer as is appropriate for Employee's employment
responsibilities. Employer also shall provide to Employee the opportunity to
develop business relationships with those of Employer's clients and potential
clients that are appropriate for Employee's employment responsibilities.
1.5 Employee acknowledges and agrees that, at all times during the
employment relationship Employee owes fiduciary duties to Employer, including
but not limited to the fiduciary duties of the highest loyalty, fidelity and
allegiance to act at all times in the best interests of the Employer, to make
full disclosure to Employer of all information that pertains to Employer's
business and interests, to do no act which would injure Employer's business, its
interests, or its reputation, and to refrain from using for Employee's own
benefit or for the benefit of others any information or opportunities pertaining
to Employer's business or interests that are entrusted to Employee or that she
learned while employed by Employer. Employee acknowledges and agrees that upon
termination of the employment relationship, Employee shall continue to refrain
from using for her own benefit or the benefit of others any information or
opportunities pertaining to Employer's business or interests that were entrusted
to Employee during the employment relationship or that she learned while
employed by Employer. Employee agrees that while employed by Employer and
thereafter she shall not knowingly take any action which interferes with the
internal relationships between Employer and its employees or representatives or
interferes with the external relationships between Employer and third parties.
1.6 It is agreed that any direct or indirect interest in, connection
with, or benefit from any outside activities, particularly commercial
activities, which interest might in any way adversely affect Employer or any of
its affiliates, involves a possible conflict of interest. In keeping with
Employee's fiduciary duties to Employer, Employee agrees that during the
employment relationship Employee shall not knowingly become involved in a
conflict of interest with Employer or its affiliates, or upon discovery thereof,
allow such a conflict to continue. Moreover, Employee agrees that Employee shall
disclose to Employer's President any facts which might involve such a conflict
of interest that has not been approved by Employer's President. Employer and
Employee recognize that it is impossible to provide an exhaustive list of
actions or interests which constitute a "conflict of interest." Moreover,
Employer and Employee recognize there are many borderline situations. In some
instances, full disclosure of facts by the Employee to Employer's President may
be all that is necessary to enable Employer or its affiliates to protect its
interests. In others, if no improper motivation appears to exist and the
interests of Employer or its affiliates have not suffered, prompt elimination of
the outside interest will suffice. In still others, it may be necessary for
Employer to terminate the employment relationship. Employer and Employee agree
that Employer's determination as to whether a conflict of interest exists shall
be conclusive. Employer reserves the right to take such action as, in its
judgment, will end the conflict.
1.7 Employee may be asked from time to time by Employer or Enron to
serve as a director, officer, or employee of an affiliate or joint venture of
Enron. Employer and Employee acknowledge that from time to time the best
interests of such affiliate or joint venture may
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arguably diverge from the best interests of Employer and Enron and thus agree
that, notwithstanding any provision of this Agreement to the contrary,
Employee's proper discharge of her duties as a director, officer, or employee,
as applicable, of such affiliate or joint venture shall not, in and of itself,
constitute a breach of any provision of this Agreement or a cause for
termination under Section 3.1(a).
1.8 Employee acknowledges that the terms and conditions of this
Agreement constitute confidential information. Employee shall not disclose this
confidential information to anyone other than Employee's attorneys, tax
advisors, or as required by law. Employee acknowledges and understands that
disclosure of the terms of this Agreement constitutes a material breach of this
Agreement and could subject Employee to disciplinary action, including without
limitation, termination of employment.
ARTICLE 2: COMPENSATION AND BENEFITS:
2.1 Employee's monthly base salary during the Term shall be not less
than the amount set forth under the heading "Monthly Base Salary" on Exhibit A,
subject to increase at the sole discretion of the Employer, which shall be paid
in semimonthly installments in accordance with Employer's standard payroll
practice. On an annual basis, Employer will review Employee's monthly base
salary for purposes of determining the amount of any increase and eligibility
for bonuses or participation in any compensation plan. The annual review and
subsequent compensation and bonus decision will be based on Employee's
performance and comparisons to salaries and bonuses of other similarly-situated
employees of Employer performing in a reasonably equivalent capacity. Any
calculation to be made under this Agreement with respect to Employee's Monthly
Base Salary shall be made using the then current Monthly Base Salary in effect
at the time of the event for which such calculation is made.
2.2 While employed by Employer (both during the Term and thereafter),
Employee shall be allowed to participate, on the same basis generally as other
employees of Employer, in all general employee benefit plans and programs,
including improvements or modifications of the same, which on the effective date
or thereafter are made available by Employer to all or substantially all of
Employer's employees. Such benefits, plans, and programs may include, without
limitation, medical, health, and dental care, life insurance, disability
protection, and pension plans. Nothing in this Agreement is to be construed or
interpreted to provide greater rights, participation, coverage, or benefits
under such benefit plans or programs than provided to similarly situated
employees pursuant to the terms and conditions of such benefit plans and
programs.
2.3 Employer shall not by reason of this Article 2 be obligated to
institute, maintain, or refrain from changing, amending, or discontinuing, any
such incentive compensation or employee benefit program or plan, so long as such
actions are similarly applicable to covered employees generally. Moreover,
unless specifically provided for in a written plan document adopted by the Board
of Directors of either Employer or Enron, none of the benefits or arrangements
described in this Article 2 shall be secured or funded in any way, and each
shall
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instead constitute an unfunded and unsecured promise to pay money in the future
exclusively from the general assets of Employer.
2.4 Employer may withhold from any compensation, benefits, or amounts
payable under this Agreement all federal, state, city, or other taxes as may be
required pursuant to any law or governmental regulation or ruling.
ARTICLE 3: TERMINATION PRIOR TO EXPIRATION OF TERM AND EFFECTS OF SUCH
TERMINATION:
3.1. Notwithstanding any other provisions of this Agreement, Employer
shall have the right to terminate Employee's employment under this Agreement at
any time prior to the expiration of the Term for any of the following reasons:
a. For "cause" upon the good faith determination by the
Employer's management committee (or, if there is no management
committee, the highest applicable level of management) of Employer that
"cause" exists for the termination of the employment relationship. As
used in this Section 3.1.a, the term "cause" shall mean (i) Employee's
gross negligence or willful misconduct in the performance of the duties
and services required of Employee pursuant to this Agreement; (ii)
Employee's final conviction of a felony; (iii) Employee's involvement
in a conflict of interest as referenced in Sections 1.5-1.6 for which
Employer makes a determination to terminate the employment of Employee
which remains uncorrected for thirty (30) days following written notice
to Employee by Employer; or (iv) Employee's material breach of any
material provision of this Agreement which remains uncorrected for
thirty (30) days following written notice to Employee by Employer of
such breach. It is expressly acknowledged and agreed that the decision
as to whether "cause" exists for termination of the employment
relationship by Employer is delegated to the management committee (or,
if there is no management committee, the highest applicable level of
management) of Employer for determination;
b. for any other reason whatsoever, including termination
without cause, in the sole discretion of the management committee (or,
if there is no management committee, the highest applicable level of
management) of Employer;
c. upon Employee's death; or
d. upon Employee's becoming disabled so as to entitle Employee
to benefits under Enron's long-term disability plan or, if Employee is
not eligible to participate in such plan, then Employee is permanently
and totally unable to perform Employee's duties for Employer as a
result of any medically determinable physical or mental impairment as
supported by a written medical opinion to the foregoing effect by a
physician selected by Employer.
The termination of Employee's employment by Employer prior to the expiration of
the Term shall constitute a "Termination for Cause" if made pursuant to Section
3.1.a; the effect of such
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termination is specified in Section 3.4. The termination of Employee's
employment by Employer prior to the expiration of the Term shall constitute an
"Involuntary Termination" if made pursuant to Section 3.1.b; the effect of such
termination is specified in Section 3.5. The effect of the employment
relationship being terminated pursuant to Section 3.1.c as a result of
Employee's death is specified in Section 3.6. The effect of the employment
relationship being terminated pursuant to Section 3.1.d as a result of the
Employee becoming incapacitated is specified in Section 3.7.
3.2 Notwithstanding any other provisions of this Agreement except
Section 7.6, Employee shall have the right to terminate the employment
relationship under this Agreement at any time prior to the expiration of the
Term of employment for any of the following reasons:
a. a material breach by Employer of any material provision of
this Agreement which remains uncorrected for 30 days following written
notice of such breach by Employee to Employer; or
b. for any other reason whatsoever, in the sole discretion of
Employee.
The termination of Employee's employment by Employee prior to the expiration of
the Term shall constitute an "Involuntary Termination" if made pursuant to
Section 3.2.a; the effect of such termination is specified in Section 3.5. The
termination of Employee's employment by Employee prior to the expiration of the
Term shall constitute a "Voluntary Termination" if made pursuant to Section
3.2.b; the effect of such termination is specified in Section 3.3.
3.3 Upon a "Voluntary Termination" of the employment relationship by
Employee prior to expiration of the Term, all future compensation described on
Exhibit "A" to which Employee is entitled and all future benefits for which
Employee is eligible, with the exception of vested benefits and/or rights under
other Enron benefit, incentive, and/or compensation plans, as well as any and
all statutory rights and benefits, shall cease and terminate as of the date of
termination. Employee shall be entitled to pro rata salary through the date of
such termination, but Employee shall not be entitled to any individual bonuses
or individual incentive compensation not yet paid at the date of such
termination.
3.4 If Employee's employment hereunder shall be terminated by Employer
for Cause prior to expiration of the Term, all future compensation described on
Exhibit "A" to which Employee is entitled and all future benefits for which
Employee is eligible, with the exception of vested benefits and/or rights under
other Enron benefit incentive, and/or compensation plans, as well as any and all
statutory rights and benefits, shall cease and terminate as of the date of
termination. Employee shall be entitled to pro rata salary through the date of
such termination, but Employee shall not be entitled to any individual bonuses
or individual incentive compensation not yet paid at the date of such
termination.
3.5 Upon an Involuntary Termination of the employment relationship by
either Employer or Employee prior to expiration of the Term, Employee shall be
entitled, in consideration of Employee's continuing obligations hereunder after
such termination (including, without limitation, Employee's non-competition
obligations), to receive the compensation
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specified in Section 2.1, as well as the unpaid Retention Bonuses described on
Exhibit "A," as if Employee's employment (which shall cease on the date of such
Involuntary Termination) had continued for the full Term of this Agreement. Upon
an Involuntary Termination, Employee also will be entitled to all vested
benefits and rights under other Enron benefits, incentive, and/or compensation
plans to which Employee may be entitled through her termination and pursuant to
plan documents. In the event of Involuntary Termination, the compensation
specified in Section 2.1 that will be paid to Employee will be paid on a
semi-monthly basis; the unpaid Retention Bonuses described in Exhibit A will be
paid on the dates noted on Exhibit A. Employee shall not be under any duty or
obligation to seek or accept other employment following Involuntary Termination
and the amounts due Employee hereunder shall not be reduced or suspended if
Employee accepts subsequent employment. Employee's rights under this Section 3.5
are Employee's sole and exclusive rights against Employer, Enron, or their
affiliates, and Employer's sole and exclusive liability to Employee under this
Agreement, in contract, tort, or otherwise, for any Involuntary Termination of
the employment relationship. Employee covenants not to xxx or lodge any claim,
demand or cause of action against Employer for any sums for Involuntary
Termination other than those sums specified in this Section 3.5. If Employee
breaches this covenant, Employer shall be entitled to recover from Employee all
sums expended by Employer (including costs and attorneys fees) in connection
with such suit, claim, demand or cause of action.
3.6 Upon termination of the employment relationship as a result of
Employee's death, Employee's heirs, administrators, or legatees shall be
entitled to Employee's pro rata salary through the date of such termination and
all vested benefits and rights under other Enron benefits, incentive, and/or
compensation plan, as well as the unpaid Retention Bonuses described on Exhibit
"A," but Employee's heirs, administrators, or legatees shall not be entitled to
any individual bonuses or individual incentive compensation not yet paid to
Employee at the date of such termination.
3.7 Upon termination of the employment relationship as a result of
Employee's incapacity, Employee shall be entitled to his or her pro rata salary
through the date of such termination and all vested benefits and rights under
other Enron benefits, incentive, and/or compensation plan, as well as the unpaid
Retention Bonuses described on Exhibit "A," but Employee shall not be entitled
to any individual bonuses or individual incentive compensation not yet paid to
Employee at the date of such termination.
3.8 In all cases, the compensation and benefits payable to Employee
under this Agreement upon termination of the employment relationship shall be
offset against any amounts to which Employee may otherwise be entitled under any
and all benefit plans and policies of Employer, Enron, or its affiliates.
Employee is eligible for benefits under Employer's severance plans, if
applicable.
3.9 Termination of the employment relationship does not terminate those
obligations imposed by this Agreement which are continuing obligations,
including, without limitation, Employee's obligations under Articles 5 and 6.
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ARTICLE 4: CONTINUATION OF EMPLOYMENT BEYOND TERM;
TERMINATION AND EFFECTS OF TERMINATION:
4.1 Should Employee remain employed by Employer beyond the expiration
of the Term specified on Exhibit "A," such employment shall convert to a
month-to-month relationship terminable at any time by either Employer or
Employee for any reason whatsoever, with or without cause. Upon such termination
of the employment relationship by either Employer or Employee for any reason
whatsoever, all future compensation to which Employee is entitled and all future
benefits for which Employee is eligible shall cease and terminate. Employee
shall be entitled to pro rata salary through the date of such termination, but
Employee shall not be entitled to any individual bonuses or individual incentive
compensation not yet paid at the date of such termination, other than vested
benefits and/or rights under other Enron benefit, incentive, and/or compensation
plans, pursuant to the terms of the applicable plan documents.
ARTICLE 5: OWNERSHIP AND PROTECTION OF INFORMATION; COPYRIGHTS:
5.1 All information, ideas, concepts, improvements, discoveries, and
inventions, whether patentable or not, which are conceived, made, developed or
acquired by Employee, individually or in conjunction with others, during
Employee's employment by Employer (whether during business hours or otherwise
and whether on Employer's premises or otherwise) which relate to Employer's
business, products or services (including, without limitation, all such
information relating to corporate opportunities, research, financial and sales
data, pricing and trading terms, evaluations, opinions, interpretations,
acquisition prospects, the identity of customers or their requirements, the
identity of key contacts within the customer's organizations or within the
organization of acquisition prospects, or marketing and merchandising
techniques, prospective names, and marks) shall be disclosed to Employer and are
and shall be the sole and exclusive property of Employer. Moreover, all
drawings, memoranda, notes, records, files, correspondence, drawings, manuals,
models, specifications, computer programs, maps and all other writings or
materials of any type embodying any of such information, ideas, concepts,
improvements, discoveries, and inventions are and shall be the sole and
exclusive property of Employer.
5.2 Employee acknowledges that the business of Employer, Enron, and
their affiliates is highly competitive and that their strategies, methods,
books, records, and documents, their technical information concerning their
products, equipment, services, and processes, procurement procedures and pricing
techniques, the names of and other information (such as credit and financial
data) concerning their customers, investors and business affiliates, all
comprise confidential business information and trade secrets which are valuable,
special, and unique assets which Employer, Enron, or their affiliates use in
their business to obtain a competitive advantage over their competitors.
Employee further acknowledges that protection of such confidential business
information and trade secrets against unauthorized disclosure and use is of
critical importance to Employer, Enron, and their affiliates in maintaining
their competitive position. Employee hereby agrees that Employee will not, at
any time during or after his or her employment by Employer, make any
unauthorized disclosure of any confidential business information or trade
secrets of Employer, Enron, or their affiliates, or make any use thereof,
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except in the carrying out of his or her employment responsibilities hereunder.
Enron and its affiliates shall be third party beneficiaries of Employee's
obligations under this Section. As a result of Employee's employment by
Employer, Employee may also from time to time have access to, or knowledge of,
confidential business information or trade secrets of third parties, such as
actual and potential customers, suppliers, partners, joint venturers, investors,
financing sources and the like, of Employer, Enron, and their affiliates.
Employee also agrees to preserve and protect the confidentiality of such third
party confidential information and trade secrets to the same extent, and on the
same basis, as Employer's confidential business information and trade secrets.
Employee acknowledges that money damages would not be sufficient remedy for any
breach of this Article 5 by Employee, and Employer shall be entitled to enforce
the provisions of this Article 5 by terminating any payments then owing to
Employee under this Agreement and/or 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 Article 5, but shall
be in addition to all remedies available at law or in equity to Employer,
including the recovery of damages from Employee and his or her agents involved
in such breach.
5.3 All written materials, records, and other documents made by, or
coming into the possession of, Employee during the period of Employee's
employment by Employer which contain or disclose confidential business
information or trade secrets of Employer, Enron, or their affiliates shall be
and remain the property of Employer, Enron, or their affiliates, as the case may
be. Upon termination of Employee's employment by Employer, for any reason,
Employee promptly shall deliver the same, and all copies thereof, to Employer.
5.4 If, during Employee's employment by Employer, Employee creates any
original work of authorship fixed in any tangible medium of expression which is
the subject matter of copyright (such as videotapes, written presentations on
acquisitions, computer programs, drawings, maps, architectural renditions,
models, manuals, brochures, or the like) relating to Employer's business,
products, or services, whether such work is created solely by Employee or
jointly with others (whether during business hours or otherwise and whether on
Employer's premises or otherwise), Employee shall disclose such work to
Employer. Employer shall be deemed the author of such work if the work is
prepared by Employee in the scope of his or her employment; or, if the work is
not prepared by Employee within the scope of his or her employment but is
specially ordered by Employer as a contribution to a collective work, as a part
of a motion picture or other audio-visual work, as a translation, as a
supplementary work, as a compilation, or as an instructional text, then the work
shall be considered to be work made for hire and Employer shall be the author of
the work. If such work is neither prepared by the Employee within the scope of
his or her employment nor a work specially ordered and is deemed to be a work
made for hire, then Employee hereby agrees to assign, and by these presents does
assign, to Employer all of Employee's worldwide right, title, and interest in
and to such work and all rights of copyright therein.
5.5 Both during the period of Employee's employment by Employer and
thereafter, Employee shall assist Employer and its nominee, at any time, in the
protection of Employer's worldwide right, title, and interest in and to
information, ideas, concepts, improvements, discoveries, and inventions, and its
copyrighted works, including without limitation, the
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execution of all formal assignment documents requested by Employer or its
nominee and the execution of all lawful oaths and applications for applications
for patents and registration of copyright in the United States and foreign
countries.
ARTICLE 6: POST-EMPLOYMENT NON-COMPETITION OBLIGATIONS:
6.1 Employer shall provide Employee with Confidential Information as
described above. To protect the confidential business information and trade
secrets described in Section 5 above, and as an additional incentive for
Employer to enter into this Agreement, Employer and Employee agree to the
non-competition provisions of this Article. Employee agrees that during the
period of Employee's non-competition obligations thereunder, Employee will not,
directly or indirectly, for Employee or for others, in any State of the United
States in which Employer is qualified to do business or in any foreign country
in which Employer has an office as of the date of termination of the employment
relationship:
a. engage in any business engaged by Employer, Enron, or their
affiliates during the Term including, but not limited to, buying,
selling, trading, structuring or execution of transactions in paper,
pulp, packaging, metals, interest rates, currencies, securities, or
other commodities (including, without limitation, energy commodities),
or any futures, derivatives, or equities related to any of the
foregoing, whether at wholesale or retail, or the development of
systems, information technology, accounting or risk management with
respect to any of the foregoing;
b. render advice or services to, or otherwise assist, any
other person, association, or entity who is engaged, directly or
indirectly, in any business engaged by Employer, Enron, or their
affiliates during the Term, including, but not limited to, buying,
selling, trading, structuring or execution of transactions in paper,
pulp, packaging, metals, interest rates, currencies, securities, or
other commodities (including, without limitation, energy commodities)
or any futures, derivatives, or equities related to any of the
foregoing, whether at wholesale or retail, or the development of
systems, information technology, accounting or risk management with
respect to any of the foregoing; or
c. engage in any other business in which Employer, Enron, or
their affiliates have engaged during the Term, including, but not
limited to, acquiring or disposing of assets or equity investments or
providing or raising capital, through loans, equity, joint ventures,
partnerships, working interests, production payments or similar
arrangements that have been or will be pursued by Employer.
d. render advice or services to, or otherwise assist, any
other person, association or entity, in any other business in which
Employer, Enron, or their affiliates have engaged during the Term,
including, but not limited to, the business of procuring or delivering
paper, pulp, packaging, metals, interest rates, currencies, securities,
or other commodities (including, without limitation, energy
commodities) or providing or raising
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capital, through loans, equity, joint ventures, partnerships, working
interests, production payments or similar arrangements;
The non-competition obligations in Section 6.1a., b., c., and d., shall extend
throughout the Term of this Agreement and for a period of six (6) months after
the expiration of the Term of this Agreement; provided, however, that in the
event that Employee is involuntarily terminated pursuant to Section 3.1b. or
3.2a, Employee's obligations under this Section 6.1 shall continue for six (6)
months after the date of such Involuntarily Termination. If, after that
six-month period has elapsed, Employee commences employment that violates
Section 6.1a., b., c., or d., then Employer's obligation to pay Employee under
Section 3.5 shall cease as of the first day of such employment by Employee.
6.2 Employee agrees that she will not call on, service, and/or solicit
competing business on behalf of another entity from customers of Employer,
Enron, or their affiliates for the Term of this Agreement and for a period of
twelve (12) months thereafter.
6.3 During the Term of this Agreement, and for a period of twelve (12)
months thereafter, Employee will not, either directly or indirectly, call on,
solicit or induce any other employee of Employer, Enron, or their affiliates to
terminate their employment and will not assist in the hiring of any such
employee by any other person or entity not affiliated with Employer, Enron, or
their affiliates.
6.4 Employee understands that the foregoing restrictions may limit his
or her ability to engage in certain businesses in the United States and/or any
country in which Employer is doing business during the period provided for
above, but acknowledges that Employer has a need to protect the confidential
business information and trade secrets of Employer. Employee also acknowledges
that she will receive sufficiently high remuneration and other benefits (e.g.,
the right to receive compensation under Section 3.5 for the remainder of the
Term upon Involuntary Termination) under this Agreement to justify such
restriction. Employee acknowledges that money damages would not be sufficient
remedy for any breach of this Article 6 by Employee, and that Employer shall be
entitled to enforce the provisions of this Article 6 by terminating any payments
then owing to Employee under this Agreement and/or 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 Article
6, but shall be in addition to all remedies available at law or in equity to
Employer, including, without limitation, the recovery of damages from Employee
and his or her agents involved in such breach.
6.5 It is expressly understood and agreed that Employer and Employee
consider the restrictions contained in this Article 6 to be reasonable and
necessary to protect the proprietary information of Employer. Nevertheless, if
any of the aforesaid restrictions are found by a court having jurisdiction to be
unreasonable, or overly broad as to geographic area or time, or otherwise
unenforceable, the parties intend for the restrictions therein set forth to be
modified by such courts so as to be reasonable and enforceable and, as so
modified by the court, to be fully enforced.
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6.6 Nothing in Article 6 shall be construed to prohibit Employee from
engaging in the private practice of law during the term of the restrictive
covenants described herein, provided, however, that Employee will not accept a
position as an in-house lawyer with a competitor of ECT, Enron, or its
affiliates, and that Employee will not use the practice of law as a subterfuge
to circumvent the requirements of Article 6.
6.7 Nothing in Article 6 shall be construed to prohibit Employee from
engaging in personal, noncompetitive transactions such as the purchase and/or
sale of her home or the management of her personal investments so long as the
transactions are not used as a subterfuge to circumvent the requirements of
Article 6.
ARTICLE 7: MISCELLANEOUS:
7.1 For purposes of this Agreement the terms "affiliates" or
"affiliated" means an entity who directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with
Enron or Employer.
7.2 Employee shall refrain, both during the employment relationship and
after the employment relationship terminates, from publishing any oral or
written statements about Employer, Enron, any of their respective subsidiaries
or affiliates, or any of such entities' officers, employees, agents or
representatives that are slanderous, libelous, or defamatory; or that disclose
private or confidential information about Employer, Enron, any of their
respective subsidiaries or affiliates, or any of such entities' business
affairs, officers, employees, agents, or representatives; or that constitute an
intrusion into the seclusion or private lives of Employer, Enron, any of their
respective subsidiaries or affiliates, or such entities' officers, employees,
agents, or representatives; or that give rise to unreasonable publicity about
the private lives of Employer, Enron, any of their respective subsidiaries or
affiliates, or any of such entities' officers, employees, agents, or
representatives; or that place Employer, Enron, any of their respective
subsidiaries or affiliates, or any of such entities' or its officers, employees,
agents, or representatives in a false light before the public; or that
constitute a misappropriation of the name or likeness of Employer, Enron, any of
their respective subsidiaries or affiliates, or any of such entities' or its
officers, employees, agents, or representatives. A violation or threatened
violation of this prohibition may be enjoined by the courts. The rights afforded
the Enron entities and affiliates under this provision are in addition to any
and all rights and remedies otherwise afforded by law.
7.3 For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when personally delivered or when mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows: (a) if to Employer, to: Enron Capital & Trade Resources
Corp.,1400 Xxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000, Attention: Chief Executive
Officer; with a copy to: Enron Corp., 0000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000,
Attention: Corporate Secretary; or (b) if to Employee, to the address Employee
most recently provided to the Employer. Either Employer or Employee may furnish
a change of address to the other in writing in accordance herewith, except that
notices of changes of address shall be effective only upon receipt.
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12
7.4 This Agreement shall be governed in all respects by the laws of the
State of Texas, excluding any conflict-of-law rule or principle that might refer
the construction of the Agreement to the laws of another State or country.
7.5 No failure by either party hereto at any time to give notice of any
breach by the other party of, or to require compliance with, any condition or
provision of this Agreement shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.
7.6 If a dispute arises out of or related to this Agreement, other than
a dispute regarding Employee's obligations under Sections 5 or 6, and if the
dispute cannot be settled through direct discussions, then Employer and Employee
agree to first endeavor to settle the dispute in an amicable manner by
mediation, before having recourse to any other proceeding or forum.
7.7 Each of Employer and Employee is a citizen of the State of Texas.
Employer's principal place of business is in Houston, Xxxxxx County, Texas.
Employee resides in Xxxxxx County, Texas. This Agreement was negotiated and
signed in Houston, Texas. This Agreement shall be performed in Houston, Texas.
Any litigation that may be brought by either Employer or Employee involving the
enforcement of this Agreement or the rights, duties, or obligations of this
Agreement, shall be brought exclusively in the State or federal courts sitting
in Houston, Xxxxxx County, Texas. In the event that service of process cannot be
effected upon a party, each party hereby irrevocably appoints the Secretary of
State for the State of Texas as its or his agent for service of process to
receive the summons and other pleadings in connection with any such litigation.
7.8 It is a desire and intent of the parties that the terms,
provisions, covenants, and remedies contained in this Agreement shall be
enforceable to the fullest extent permitted by law. If any such term, provision,
covenant, or remedy of this Agreement or the application thereof to any person,
association, or entity or circumstances shall, to any extent, be construed to be
invalid or unenforceable in whole or in part, then such term, provision,
covenant, or remedy shall be construed in a manner so as to permit its
enforceability under the applicable law to the fullest extent permitted by law.
In any case, the remaining provisions of this Agreement or the application
thereof to any person, association, or entity or circumstances other than those
to which they have been held invalid or unenforceable, shall remain in full
force and effect.
7.9 This Agreement shall be binding upon and inure to the benefit of
Employer and any other person, association, or entity which may hereafter
acquire or succeed to all or substantially all of the business or assets of
Employer by any means whether direct or indirect, by purchase, merger,
consolidation, or otherwise. Employee's rights and obligations under Agreement
hereof are personal and such rights, benefits, and obligations of Employee shall
not be voluntarily or involuntarily assigned, alienated, or transferred, whether
by operation of law or otherwise, without the prior written consent of Employer.
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13
7.10 There exist other agreements between Employer and Employee
relating to the employment relationship between them, e.g., the agreement with
respect to company policies contained in Employer's Conduct of Business Affairs
booklet and agreements with respect to benefit plans. This Agreement replaces
and merges previous agreements and discussions pertaining to the following
subject matters covered herein: the nature of Employee's employment relationship
with Employer and the term and termination of such relationship. This Agreement
does not replace benefit plans, incentive plans, long-term compensation plans,
or similar plans or programs, which are described and defined in related plan
documents. This Agreement constitutes the entire agreement of the parties with
regard to such subject matters, and contains all of the covenants, promises,
representations, warranties, and agreements between the parties with respect
such subject matters. Each party to this Agreement acknowledges that no
representation, inducement, promise, or agreement, oral or written, has been
made by either party with respect to such subject matters, which is not embodied
herein, and that no agreement, statement, or promise relating to the employment
of Employee by Employer that is not contained in this Agreement shall be valid
or binding. Any modification of this Agreement will be effective only if it is
in writing and signed by each party whose rights hereunder are affected thereby,
provided that any such modification must be authorized or approved by the Board
of Directors of Employer.
IN WITNESS WHEREOF, Employer and Employee have duly executed this
Agreement in multiple originals to be effective on the date first stated above.
ENRON CAPITAL & TRADE RESOURCES CORP.
By: /s/ XXXXXXX X. XXXX
----------------------------------
Xxxxxxx X. Xxxx
Chairman and Chief Executive Officer
This 9th day of June, 1998
By: /s/XXXXXXX X. XXXXXXXX
----------------------------------
Xxxxxxx X. Xxxxxxxx
President and Chief Operating Officer
This 9th day of June, 1998
XXXXXX X. XXXXXX
/s/ XXXXXX X. XXXXXX
---------------------------------------
This 1st day of June, 1998
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EXHIBIT "A" TO
EXECUTIVE EMPLOYMENT AGREEMENT
BETWEEN ENRON CAPITAL & TRADE RESOURCES CORP.
AND XXXXXX X. XXXXXX
Employee Name: Xxxxxx X. Xxxxxx
Term: January 1, 1998 through December 31, 2000
Position: President - Energy & Finance Services
Location: Houston
Monthly Base Salary: Employee's monthly base salary shall be
Twenty Seven Thousand Eighty-Three and
34/100 Dollars ($27,083.34) per month.
Bonus: Employee shall be eligible to participate in
the Enron Corp. Annual Incentive Plan
("Plan") or any appropriate replacement
bonus plan of ECT. All bonuses shall be paid
in accordance with the terms and provisions
of the Plan, a portion of which may be paid
in cash and a portion of which may be paid
in stock options and/or restricted stock.
Signing Bonus: Employer shall pay Employee the sum of
$375,000.00 within the first regularly
scheduled payday following ten (10) business
days of the signing of this Agreement by
both parties.
Retention Bonus: On the first regularly scheduled payday
following January 1, 1999, Employer shall
pay Employee the sum of $200,000.00.
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On the first regularly scheduled payday
following January 1, 2001, Employer shall
pay Employee the sum of $200,000.00.
ENRON CAPITAL & TRADE RESOURCES CORP.
By: /s/ XXXXXXX X. XXXX
----------------------------------
Xxxxxxx X. Xxxx
Chairman and Chief Executive Officer
This 9th day of June, 1998
By: /s/XXXXXXX X. XXXXXXXX
----------------------------------
Xxxxxxx X. Xxxxxxxx
President and Chief Operating Officer
This 9th day of June, 1998
XXXXXX X. XXXXXX
/s/ XXXXXX X. XXXXXX
---------------------------------------
This 1st day of June, 1998
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FIRST AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
This Agreement, entered into on this 29th of October, 1998, and made
effective as of September 1, 1998, by and between ENRON CAPITAL & TRADE
RESOURCES CORP. an Oregon corporation ("Company") having its headquarters at
0000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000, AZURIX CORP., a Delaware corporation
having its headquarters at 000 Xxxx Xxxxxx, Xxxxxxx, Xxxxx 00000, and XXXXXX X.
XXXXXX ("Employee"), an individual residing in Houston, Texas, is an amendment
to that certain Executive Employment Agreement between the Company and Employee
entered into the 1st day of January 1, 1998, and made effective as of January 1,
1998 (the "Employment Agreement").
WHEREAS, the parties desire to amend the Employment Agreement to
provide for assignment of the Employment Agreement by Company to, and assumption
of the Employment Agreement by, Azurix Corp., and to make other amendments to
the Employment Agreement as provided herein;
NOW, THEREFORE, in consideration thereof and of the mutual covenants
contained herein, the parties agree as follows:
1. Effective September 1, 1998, the Employment Agreement is
assigned by Company to, and assumed by, Azurix Corp. Any reference to
the "Company" and/or "Employer" in the Employment Agreement shall mean
Azurix Corp. Employee consents to such assignment and assumption, and
releases Company from every obligation under the Employment Agreement.
Azurix Corp. assumes every obligation of Company under the Employment
Agreement.
2. Exhibit "A" to the Employment Agreement is hereby deleted
in its entirety and the attached Exhibit "A" is inserted in its
entirety.
3. Article 3, Section 3.5 is hereby deleted in its entirety
and the following language shall be inserted in its place:
"3.5 Upon an Involuntary Termination of the employment relationship by
either Employer or Employee prior to the expiration of the Term,
Employee shall be entitled, in consideration of Employee's continuing
obligations hereunder after such termination (including, without
limitation, Employee's non-competition obligations), to receive the
compensation specified in Section 2.1, as well as unpaid Bonuses
described on Exhibit "A", as if Employee's employment (which shall
cease on the date of such Involuntary Termination) had continued for
the full Term of this Agreement Upon an Involuntary Termination,
Employee shall also be entitled to all vested benefits and rights under
other Enron benefits, incentive, and/or compensation plans to which
Employee may be entitled through her termination and pursuant to plan
documents and all other benefits that Employee may be entitled to under
any other compensation plans. In the event of Involuntary Termination,
the compensation specified in Section 2.1 that will be paid to Employee
will be paid on a semi-monthly basis; the unpaid Bonuses described in
Exhibit
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"A" will be paid annually and the amounts under the compensation plans
will be paid in accordance with the terms and provisions of the
respective compensation plans. Employee shall not be under any duty or
obligation to seek or accept other employment following Involuntary
Termination and the amounts due Employee hereunder shall not be reduced
or suspended if Employee accepts subsequent employment. Employee's
rights under this Section 3.5 are Employee's sole and exclusive rights
against Employer, Enron, or their affiliates, and Employer's sole and
exclusive liability to Employee under this Agreement, in contract,
tort, or otherwise, for any Involuntary Termination of the employment
relationship. Employee covenants not to xxx or lodge any claim, demand
or cause of action against Employer for any sums for Involuntary
Termination other than those sums specified in this Section 3.5. If
Employee breaches this covenant, Employer shall be entitled to recover
from Employee all sums expended by Employer (including costs and
attorneys fees) in connection with such suit, claim, demand or cause of
action."
4. Article 3, Sections 3.6, 3.7, and 3.8 of the Employment
Agreement are deleted in its entirety and the following inserted in its
entirety:
"3.6 Upon termination of the employment relationship as a
result of Employee's death, Employee's heirs, administrators, or
legatees shall be entitled to Employee's pro rata salary through the
date of such termination, and all vested benefits and rights under
other Enron or Company benefits, incentive, and/or compensation plans,
as well as the unpaid pro rata Bonuses described on Exhibit "A" up to
the date of death.
3.7 Upon termination of the employment relationship as a
result of Employee's incapacity, Employee shall be entitled to his or
her pro rata salary through the date of such termination, and all
vested benefits and rights under other Enron or Company benefits,
incentive, and/or compensation plans, as well as the unpaid pro rata
Bonuses described on Exhibit "A" up to the date of incapacity.
3.8 In all cases, the compensation and benefits payable to
Employee under this Agreement upon termination of the employment
relationship shall be in addition to any amounts to which Employee may
otherwise be entitled under any and all benefit plans and programs of
Employer, Enron, or its affiliates; provided however, Employee shall
not be entitled to any benefits under Employer or Enron's severance
plans.
5. Article 6, Sections 6.1 and 6.2 of the Employment Agreement
are hereby deleted in its entirety and the following is inserted in its
entirety:
"6.1 Employer shall provide Employee with Confidential Information as
described above. To protect the confidential business information and
trade secrets described in Section 5 above, and as an additional
incentive for Employer to enter into this Agreement, Employer and
Employee agree to the non-competition provisions of this Article.
Employee agrees that during the period of Employee's non-competition
obligations thereunder, Employee will not, directly
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18
or indirectly for Employee or for others, in any State of the United
States in which Employer is qualified to do business or in any foreign
country in which Employer has an office as of the date of termination
of the employment relationship engage in any business engaged by
Employer, Enron, or their affiliates during the Term related to the
water business. The non-competition obligations in Section 6.1 shall
extend throughout the Term of this Agreement and for a period of six
(6) months after the expiration of this Agreement; provided, however,
that in the event Employee is involuntarily terminated pursuant to
Section 3.1b. or 3.2a, Employee's obligations under this Section 6.1
shall continue for six (6) months after the date of such Involuntary
Termination. If, after that six-month period has elapsed, Employee
commences employment that violates Section 6.1, then Employer's
obligation to pay Employee under Section 3.5 shall cease as of the
first day of such employment by Employee.
6.2 Employee agrees that she will not call on, service, and/or
solicit competing business on behalf of another entity from customers
of Employer, Enron, or their affiliates in the water business for the
Term of this Agreement and for a period of twelve (12) months
thereafter."
This Amendment is a First Amendment to the Employment Agreement, and
the parties agree that all other terms, conditions and stipulations contained in
the Employment Agreement, and any amendments thereto, shall remain in full force
and effect and without any change or modification, except as provided herein.
In Witness Whereof, the parties have duly executed this Agreement as of
the date first above written.
ENRON CAPITAL & TRADE RESOURCES CORP.
By: /s/ XXXXX X. XXXXXXXX
---------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President and Secretary
This _____ day of ______________, 19__
-3-
19
AZURIX CORP.
By: /s/ XXXXXXX X. XXXX
-------------------------------
Name: Xxxxxxx X. Xxxx
Title: Chairman
This 29th day of October, 1998
XXXXXX X. XXXXXX
/s/ XXXXXX X. XXXXXX
----------------------------------
This 29th day of October, 1998
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20
EXHIBIT "A" TO
EXECUTIVE EMPLOYMENT AGREEMENT
BETWEEN ENRON CAPITAL & RESOURCES CORP., AZURIX CORP.,
AND XXXXXX X. XXXXXX
Employee Name: Xxxxxx X. Xxxxxx
Term: September 1, 1998 through August 31, 2003
Position: Executive Director and President of the Americas and
member of the Executive Committee primarily
accountable for all profit and loss aspects of the
development, implementation and operations of the
business in the Americas including, without
limitation, management of acquisitions, finance,
development and strategy.
Location: Houston, Texas
Reporting Relationship: Reports to Xxxxxxx X. Xxxx, Chairman
Monthly Base Salary: Thirty Three Thousand Three Hundred Thirty-Three
Dollars and 33/100 Cents ($33,333.33) per month.
Bonus: Employee shall be eligible to participate in the
Enron Corp. Annual Incentive Plan ("Plan") or any
replacement plan of Employer. All bonuses shall be
paid in accordance with the terms and provisions of
the Plan, a portion of which may be paid in cash,
and a portion of which may be paid in stock options
and/or restricted stock. Employee's bonus for 1998
shall be $725,000.00. All bonuses paid thereafter
shall be based on performance but with reasonable
expectation of receiving between 100% and 200% of
annual base salary. Employee shall be eligible for a
pro rata bonus upon completion of the Term of this
Agreement.
Signing Bonus Employer shall pay Employee the sum of $350,000.00
as described below:
1. $150,000.00 shall be paid to Employee
within the first regularly scheduled payday
following ten (10) business days of the
signing of this Agreement; and
2. $200,000.00 shall be paid on
January 15, 1999.
-5-
21
Long Term Incentives: Employee shall be eligible to participate in the
Azurix Corp. stock plan. Upon finalization of the
plan, Employee shall receive a grant based on the
initial valuation of the Company with a theoretical
5 year total value of 9 million dollars. The
theoretical value methodology shall be the same
methodology used for other executives of the
Employer participating in the plan. Employee shall
be vested 25% upon receipt of grant, effective
January 1, 1999 and 18.75% for each grant date
anniversary in accordance with the terms and
provisions of the plan. Employer in its sole
discretion may make additional grants during this 5
year period.
ENRON CAPITAL & TRADE RESOURCES CORP.
By: /s/ XXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President and Secretary
This _____ day of ______________, 19__
AZURIX CORP.
By: /s/ XXXXXXX X. XXXX
---------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Chairman
This 29th day of October, 1998
XXXXXX X. XXXXXX
/s/ XXXXXX X. XXXXXX
-------------------------------------------
This 29th day of October, 1998
-6-
22
SECOND AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
This Agreement, entered into on this 15th of March, 1999, and made
effective as of February 1, 1999, by and between AZURIX CORP., a Delaware
corporation having its headquarters at 000 Xxxx Xxxxxx, Xxxxxxx, Xxxxx 00000
("Employer") and XXXXXX X. XXXXXX ("Employee"), an individual residing in
Houston, Texas, is a second amendment to that certain Executive Employment
Agreement between the Employer and Employee entered into the 1st day of January
1, 1998, and made effective as of January 1, 1998 (the "Employment Agreement").
WHEREAS, the parties desire to amend the Employment Agreement as
provided herein;
NOW, THEREFORE, in consideration thereof and of the mutual covenants
contained herein, the parties agree as follows:
1. The description of Long Term Incentives described on
Exhibit "A" to the First Amendment to the Employment
Agreement is hereby deleted in its entirety and the
following language inserted in its entirety:
"Long Term Incentives: Employee shall be eligible to
participate in the Azurix
Corp. Stock Plan. Upon
finalization of the Plan,
Employee shall receive a one
million share stock option
grant with the stock option
strike price equal to the
fair market value of the
Company. Employee shall vest
25% on each grant date
anniversary (4-yr vesting).
Employer in its sole
discretion may make
additional grants during this
5-year period."
This Amendment is a Second Amendment to the Employment Agreement, and
the parties agree that all other terms, conditions and stipulations contained in
the Employment Agreement, and any amendments thereto, shall remain in full force
and effect and without any change or modification, except as provided herein.
-1-
23
In Witness Whereof, the parties have duly executed this Agreement as of
the date first above written.
AZURIX CORP.
By: /s/ XXXXXXX X. XXXX
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: Chairman
This 1st day of March, 1998
XXXXXX X. XXXXXX
/s/ XXXXXX X. XXXXXX
------------------------------------
This 1st day of March, 1998
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