Exhibit 10.39
TRANSITION AND RETIREMENT AGREEMENT
THIS AGREEMENT (the "Agreement") entered into on February 20, 1997, by
and between Northeast Utilities, a Massachusetts business trust (together
with its successors and assigns permitted under the Agreement and each direct
and indirect affiliated utility company that shall adopt this Agreement
pursuant to Section 18 hereof, the "Company"), with its principal office in
West Springfield, Massachusetts, and its general office in Berlin,
Connecticut, and Xxxxxxx X. Xxx, a resident of Farmington, Connecticut
("Executive").
WHEREAS, the Company and Executive entered into an Employment Agreement,
effective as of January 1, 1992, (the "Employment Agreement") at which time
Executive was President and Chief Operating Officer of Northeast Utilities
("NU"); and
WHEREAS, Executive is currently employed as the Chairman, President and
Chief Executive Officer of NU and holds other senior officer positions with
the Company; and
WHEREAS, Executive has elected to retire on the later of (i) August 1,
1997 or (ii) the election of his successor (the "Retirement Date") and the
Company believes that Executive's retirement at that time is in the best
interest of NU's shareholders; and
WHEREAS, both parties desire to enter into a new agreement that will
supersede the Employment Agreement at the time of Executive's retirement and
will reflect the transition arrangements and the special retirement and other
benefits to which Executive will be entitled upon his retirement
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Employment. Unless Executive's employment is terminated for
"Cause" as defined in Section 1(c) of the Employment Agreement by reason of
events, actions or circumstances arising (i) after the date of this Agreement
and before the Retirement Date or (ii) before the date of this Agreement and
as to which the Board, as of date of this Agreement, does not have full
knowledge of all material facts and circumstances (and the Company hereby
agrees that Executive's employment shall not be terminated for any other
reason prior to the Retirement Date), the Company hereby agrees to continue
the employment of Executive, and Executive hereby accepts such employment and
agrees to perform his duties and responsibilities, in accordance with the
terms, conditions and provisions of the Employment Agreement until
Executive's Retirement Date. On the Retirement Date, the parties agree that
the Employment Agreement shall be superseded by this Agreement and shall be
terminated and of no further force or effect.
2. Consulting Services. Immediately following the Retirement Date and
for a period of 24 months thereafter (the "Transition Term") , the Company
shall engage Executive as a consultant to the Board of Trustees of NU (the
"Board") to perform such services as are specified by the Board from time to
time including, among other things, assuring an orderly transition for
Executive's successor; provided, however, that Fox shall not be required to
act as a consultant in a capacity which may subject Fox to liability unless
Fox obtains indemnification from the Company or through insurance. During
the Transition Term, Executive shall receive, as his total fee for the
services so specified, $500,000 for the first 12 months and $300,000 for the
second 12 months (plus a reimbursement of all reasonable expenses incurred in
connection with the performance of the consulting services upon presentation
of appropriate documentation in accordance with NU's normal expense
reimbursement policy). Payments shall be made to Executive in monthly
installments. During the Transition Term, Executive agrees to devote such of
his time and business efforts to the performance of his consultancy under
this Section as shall reasonably be required to perform the specified
services. Nothing contained herein shall prevent Executive from pursuing
other business opportunities to the extent that there is no conflict with the
services requested by the Board or with the requirements of Section 3 and 4
of this Agreement. All services to be performed under this Agreement during
the Transition Term shall be performed by Executive in a consulting capacity
and nothing contained herein shall be construed so as to confer employment
status on Executive during that Term.
3. Confidential Information. Executive recognizes and acknowledges
that by reason of his employment by and service to the Company before and
during the Employment Term and the Transition Term, he has had and will
continue to have access to certain confidential and proprietary information
relating to the Company's business, which may include, but is not limited to,
trade secrets, trade "know-how", customer information, supplier information,
cost and pricing information, marketing and sales techniques, strategies and
programs, computer programs and software and financial information
(collectively referred to as "Confidential Information"). Executive
acknowledges that such Confidential Information is a valuable and unique
asset of the Company and Executive covenants that he will not, unless
expressly authorized in writing by the Board, at any time during the course
of his employment or consultancy, use any Confidential Information or divulge
or disclose any Confidential Information to any person, firm or corporation
except in connection with the performance of his duties for the Company and
in a manner consistent with the Company's policies regarding Confidential
Information. Executive also covenants that at any time after the termination
of such employment or consultancy, directly or indirectly, he will not use
any Confidential Information or divulge or disclose any Confidential
Information to any person, firm or corporation, unless such information is in
the public domain through no fault of Executive or except when required to do
so by a court of law, by any governmental agency having supervisory authority
over the business of the Company or by any administrative or legislative body
(including a committee thereof) with apparent jurisdiction to order him to
divulge, disclose or make accessible such information, in which case
Executive will inform the Company in writing promptly of such required
disclosure, but in any event at least two business days prior to disclosure.
All written Confidential Information (including, without limitation, in any
computer or other electronic format) which comes into Executive's possession
during the course of his employment or consultancy shall remain the property
of the Company. Except as required in the performance of Executive's duties
for the Company, or unless expressly authorized in writing by the Board,
Executive shall not remove any written Confidential Information from the
Company's premises, except in connection with the performance of his duties
for the Company and in a manner consistent with the Company's policies
regarding Confidential Information. Upon termination of Executive's
consultancy, Executive agrees immediately to return to the Company all
written Confidential Information in his possession.
4. Non-Competition; Non-Solicitation.
(a) During his employment by and consultancy for the Company and
for a period of (i) one year after the Transition Term anywhere in the United
States and (ii) two years after the Transition Term within the Company's
"service area," as defined below, Executive will not, except with the prior
written consent of the Board, directly or indirectly, own, manage, operate,
join, control, finance or participate in the ownership, management,
operation, control or financing of, or be connected as an officer, director,
employee, partner, principal, agent, representative, consultant or otherwise
with, or use or permit his name to be used in connection with, any business
or enterprise which is engaged in any business that is competitive with any
business or enterprise in which the Company or any of its subsidiaries or
affiliates is engaged. For the purposes of this Section, "service area"
shall mean the geographic area within the states of Connecticut, Delaware,
Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Ohio,
Pennsylvania, Washington D.C. and West Virginia, and within the countries of
Argentina, Costa Rica, China, India, New Zealand and Jamaica, or any other
geographic area in which, at the time of Executive's termination of the
consultancy with the Company, the Company, or any of its subsidiaries or
affiliates, is doing business. Executive acknowledges that the listed
service area is the area in which the Company, or its subsidiaries or
affiliates, presently does business.
(b) The foregoing restrictions shall not be construed to prohibit
the ownership by Executive of less than five percent (5%) of any class of
securities of any corporation which is engaged in any of the foregoing
businesses having a class of securities registered pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act"), provided that such ownership
represents a passive investment and that neither Executive nor any group of
persons including Executive in any way, either directly or indirectly,
manages or exercises control of any such corporation, guarantees any of its
financial obligations, otherwise takes any part in its business, other than
exercising his rights as a shareholder, or seeks to do any of the foregoing.
(c) Executive further covenants and agrees that during his
consultancy by the Company and for the period of two years thereafter,
Executive will not, directly or indirectly, (i) solicit, divert, take away,
or attempt to solicit, divert or take away, any of the Company's "Principal
Customers," defined for the purposes hereof to include any customer of the
Company, or of any of its subsidiaries or affiliates, from which $100,000 or
more of annual gross revenues are derived at such time, or (ii) encourage any
Principal Customer to reduce its patronage of the Company.
(d) Executive further covenants and agrees that during his
consultancy by the Company and for the period of two years thereafter,
Executive will not, directly or indirectly, solicit or hire, or encourage the
solicitation or hiring of, any person who was a managerial or higher level
employee of the Company at any time during the term of Executive's employment
by the Company by any employer other than the Company for any position as an
employee, independent contractor, consultant or otherwise. The foregoing
covenant of Executive shall not apply to any person after 12 months have
elapsed subsequent to the date on which such person's employment by the
Company has terminated.
5. Equitable Relief.
(a) Executive acknowledges and agrees that the restrictions
contained in Sections 3 and 4 are reasonable and necessary to protect and
preserve the legitimate interests, properties, goodwill and business of the
Company, that the Company would not have entered into this Agreement in the
absence of such restrictions and that irreparable injury will be suffered by
the Company should Executive breach any of the provisions of those Sections.
Executive represents and acknowledges that (i) he has been advised by the
Company to consult his own legal counsel in respect of this Agreement, and
(ii) that he has had full opportunity, prior to execution of this Agreement,
to review thoroughly this Agreement with his counsel.
(b) Executive further acknowledges and agrees that a breach of any
of the restrictions in Sections 3 and 4 cannot be adequately compensated by
monetary damages. Executive agrees that the Company shall be entitled to
preliminary and permanent injunctive relief, without the necessity of proving
actual damages, as well as an equitable accounting of all earnings, profits
and other benefits arising from any violation of Sections 3 or 4 hereof,
which rights shall be cumulative and in addition to any other rights or
remedies to which the Company may be entitled. In the event that any of the
provisions of Sections 3 or 4 hereof should ever be adjudicated to exceed the
time, geographic, service, or other limitations permitted by applicable law
in any jurisdiction, it is the intention of the parties that the provision
shall be amended to the extent of the maximum time, geographic, service, or
other limitations permitted by applicable law, that such amendment shall
apply only within the jurisdiction of the court that made such adjudication
and that the provision otherwise be enforced to the maximum extent permitted
by law.
(c) If Executive breaches any of his obligations under Sections 3
or 4 hereof, and such breach would have constituted "Cause," as defined in
Section 1(c) of the Employment Agreement if it had occurred during the
Employment Term, the Company shall thereafter have no obligation to make the
payments described in Section 2 nor shall the Company have a Target Benefit
obligation pursuant to the Company's Supplemental Executive Retirement Plan
for Officers (the "Supplemental Plan"), but shall remain obligated for the
Make-Whole Benefit under the Supplemental Plan and compensation and other
benefits provided in any plans, policies or practices then applicable to
Executive in accordance with the terms thereof. Executive irrevocably and
unconditionally (i) agrees that any suit, action or other legal proceeding
arising out of Sections 3 or 4 hereof, including without limitation, any
action commenced by the Company for preliminary and permanent injunctive
relief and other equitable relief, may be brought in the United States
District Court for the District of Connecticut, or if such court does not
have jurisdiction or will not accept jurisdiction, in any court of general
jurisdiction in Hartford, Connecticut, (ii) consents to the non-exclusive
jurisdiction of any such court in any such suit, action or proceeding, and
(iii) waives any objection which Executive may have to the laying of venue of
any such suit, action or proceeding in any such court. Executive also
irrevocably and unconditionally consents to the service of any process,
pleadings, notices or other papers in a manner permitted by the notice
provisions of Section 11 hereof.
(d) Executive agrees that for a period of two years following the
termination of his consultancy by the Company he will provide, and that at
all times after the date hereof the Company may similarly provide, a copy of
Sections 3 and 4 hereof to any business or enterprise (i) which he may
directly or indirectly own, manage, operate, finance, join, control or
participate in the ownership, management, operation, financing, or control
of, or (ii) with which he may be connected as an officer, director, employee,
partner, principal, agent, representative, consultant or otherwise, or in
connection with which he may use or permit his name to be used; provided,
however, that this provision shall not apply in respect of Section 4 after
expiration of the time periods set forth therein.
6. Death or Disability. The fees due to Executive during the
Transition Term under Section 2 and the benefits to be provided to Fox under
Section 7 shall be paid or provided to Fox (and, if applicable, his spouse
and dependents) irrespective of his death or inability to perform his duties
and responsibilities under this Agreement to the full extent required by the
Board by reason of illness, injury or incapacity, in either event occurring
after the date of this Agreement and, in the case of the benefits payable
under Section 7, prior to the Retirement Date. In the event of his death,
the Company shall pay to Executive's executors, legal representatives or
administrators, as applicable, the remaining installments as they would
otherwise become due to Executive, except as provided in Section 9.2.
7. Special Retirement Benefits. On his Retirement Date, Executive
(and, if applicable, his spouse and dependents) shall be entitled to all
compensation and benefits provided to retirees of the Company generally,
notwithstanding Executive's age (but subject to all other terms and
conditions of each plan, practice, policy and program of the Company that
provides such benefits) or to receive cash in lieu of any benefits or
premiums, as applicable, where such benefits may not be continued (or where
such continuation would adversely affect the tax status of the plan pursuant
to which the benefit is provided) under applicable law or regulations. In
addition, Executive shall also be entitled to the following:
(a) a Target Benefit under the Supplemental Plan, notwithstanding
its terms providing for forfeiture of such benefit upon the occurrence of
certain events (including, but not by way of limitation, his retirement prior
to age 60). If Executive has not attained age 57 by the Retirement Date,
such benefit shall be actuarially adjusted from age 57 backward to
Executive's age at the date payment commences; if Executive has attained age
57, the Target Benefit shall be paid without any actuarial adjustment.
(b) All SARs with respect to shares of stock of NU previously
granted to Executive as of January 1, 1997, to the extent not already vested
prior to the Retirement Date, shall be fully vested and payment with respect
to such SARs shall be made at the time and in the amount otherwise to be paid
to Executive if he had not retired on his Retirement Date and had instead
remained actively employed by the Company, including exercise within 36
months after December 31, 1998.
8. Release. Notwithstanding anything else to the contrary in this
Agreement, all payments and benefits provided for under this Agreement,
including without limitation under Sections 2, 6 and 7, shall be conditioned
upon Executive (or his executor or administrator, as applicable, in the event
of his death) executing, and not revoking as provided therein, a written
release prior to the 22nd day following his Retirement Date, substantially in
the form attached hereto as Annex 1, (the "Release"), of any and all claims
against the Company and all related parties with respect to all matters
arising out of Executive's employment by the Company (other than any
entitlements under the terms of this Agreement or under any other plans or
programs of the Company in which he participated and under which he has
accrued a benefit), or the termination thereof. No payments shall commence
to Executive under this Agreement until the eighth day following Executive's
execution of the Release without a revocation.
9. Payments Upon a Change in Control.
9.1. Definition. For purposes of this Section 9, a "Change of Control"
shall mean the happening of any of the following:
(a) When any "person," as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934 (the "Exchange Act"), other than
the Company, its Affiliates, or any Company employee benefit plan (including
any trustee of such plan acting as trustee), is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of NU representing more than 20% of the combined
voting power of either (i) the then outstanding shares of common stock of NU
(the "Outstanding Common Stock") or (ii) the then outstanding voting
securities of NU entitled to vote generally in the election of directors (the
"Voting Securities"); or
(b) Individuals who, as of the beginning of any twenty-four month
period, constitute the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board or cease to be able to exercise
the powers of the majority of the Board, provided that any individual
becoming a trustee subsequent to the beginning of such period whose election
or nomination for election by the Company's stockholders was approved by a
vote of at least a majority of the trustees then comprising the Incumbent
Board shall be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual whose
initial assumption of office is in connection with an actual or threatened
election contest relating to the election of the Board of NU (as such terms
are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange
Act); or
(c) Consummation by NU of a reorganization, merger or
consolidation (a "Business Combination"), in each case, with respect to which
all or substantially all of the individuals and entities who were the
respective beneficial owners of the Outstanding Common Stock and Voting
Securities immediately prior to such Business Combination do not, following
such Business Combination, beneficially own, directly or indirectly, more
than 75% of, respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting securities entitled
to vote generally in the election of directors, as the case may be, of the
corporation, business trust or other entity resulting from or being the
surviving entity in such Business Combination in substantially the same
proportion as their ownership immediately prior to such Business Combination
of the Outstanding Common Stock and Voting Securities, as the case may be; or
(d) Consummation of a complete liquidation or dissolution of NU or
sale or other disposition of all or substantially all of the assets of NU
other than to a corporation, business trust or other entity with respect to
which, following such sale or disposition, more than 75% of, respectively,
the then outstanding shares of common stock and the combined voting power of
the then outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, is then owned beneficially,
directly or indirectly, by all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Common Stock and Voting Securities immediately prior to such sale or
disposition in substantially the same proportion as their ownership of the
Outstanding Common Stock and Voting Securities, as the case may be,
immediately prior to such sale or disposition.
9.2 Payment upon a Change of Control. In the event of a Change of
Control, Executive shall receive a single sum payment equal to the then
remaining amounts due to him under Section 2 within 15 days following the
Change of Control.
10. Arbitration; Expenses. In the event of any dispute under the
provisions of this Agreement other than a dispute in which the primary relief
sought is an equitable remedy such as an injunction, the parties shall be
required to have the dispute, controversy or claim settled by arbitration in
the City of Hartford, Connecticut in accordance with the National Rules for
the Resolution of Employment Disputes then in effect of the American
Arbitration Association, before a panel of three arbitrators, two of whom
shall be selected by the Company and Executive, respectively, and the third
of whom shall be selected by the other two arbitrators. Any award entered by
the arbitrators shall be final, binding and nonappealable (except as provided
in Section 52-418 of the Connecticut General Statutes) and judgment may be
entered thereon by either party in accordance with applicable law in any
court of competent jurisdiction. This arbitration provision shall be
specifically enforceable. The arbitrators shall have no authority to modify
any provision of this Agreement or to award a remedy for a dispute involving
this Agreement other than a benefit specifically provided under or by virtue
of the Agreement. If Executive prevails on any material issue which is the
subject of such arbitration or lawsuit, the Company shall be responsible for
all of the fees of the American Arbitration Association and the arbitrators
and any expenses relating to the conduct of the arbitration (including
reasonable attorneys' fees and expenses). Otherwise, each party shall be
responsible for his or its own expenses relating to the conduct of the
arbitration (including reasonable attorneys' fees and expenses) and shall
share the fees of the American Arbitration Association.
11. Notices. All notices and other communications required or
permitted under this Agreement or necessary or convenient in connection
herewith shall be in writing and shall be deemed to have been given when hand
delivered or mailed by registered or certified mail, as follows (provided
that notice of change of address shall be deemed given only when received):
If to the Company, to:
Northeast Utilities
X.X. Xxx 000
Xxxxxxxx, XX 00000-0000
Attention: Vice President, Secretary and General Counsel
With a required copy to:
Xxxxxx, Xxxxx & Xxxxxxx
0000 Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxxxxxxx, Esquire
If to Executive, to:
Xxxxxxx X. Xxx
Xxx Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
With a required copy to:
Xxxxxxx & Xxxxxxx
Xxx Xxxxxxxx Xxx
Xxxxxxxx, XX 00000-0000
Attention: Xxxxx Xxxxxx, Esquire
or to such other names or addresses as the Company or Executive, as the case
may be, shall designate by notice to each other person entitled to receive
notices in the manner specified in this Section.
12. Contents of Agreement; Amendment and Assignment.
(a) This Agreement supersedes all prior agreements, except the
Employment Agreement shall continue to the extent and for the time period
stated in Section 1, and otherwise sets forth the entire understanding
between the parties hereto with respect to the subject matter hereof and
cannot be changed, modified, extended or terminated except upon written
amendment approved by the Board and executed on its behalf by a duly
authorized officer and by Executive.
(b) All of the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the
respective heirs, executors, administrators, legal representatives,
successors and assigns of the parties hereto, except that the duties and
responsibilities of Executive under this Agreement are of a personal nature
and shall not be assignable or delegatable in whole or in part by Executive.
The Company shall require any successor (whether direct or indirect, by
purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company, by agreement in
form and substance satisfactory to Executive, expressly to assume and agree
to perform this Agreement in the same manner and to the extent the Company
would be required to perform if no such succession had taken place.
13. Severability. If any provision of this Agreement or application
thereof to anyone or under any circumstances is adjudicated to be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
not affect any other provision or application of this Agreement which can be
given effect without the invalid or unenforceable provision or application
and shall not invalidate or render unenforceable such provision or
application in any other jurisdiction. If any provision is held void,
invalid or unenforceable with respect to particular circumstances, it shall
nevertheless remain in full force and effect in all other circumstances.
14. Remedies Cumulative; No Waiver. No remedy conferred upon a party
by this Agreement is intended to be exclusive of any other remedy, and each
and every such remedy shall be cumulative and shall be in addition to any
other remedy given under this Agreement or now or hereafter existing at law
or in equity. No delay or omission by a party in exercising any right,
remedy or power under this Agreement or existing at law or in equity shall be
construed as a waiver thereof, and any such right, remedy or power may be
exercised by such party from time to time and as often as may be deemed
expedient or necessary by such party in its sole discretion.
15. Beneficiaries/References. Executive shall be entitled, to the
extent permitted under any applicable law, to select and change a beneficiary
or beneficiaries to receive any compensation or benefit payable under this
Agreement following Executive's death by giving the Company written notice
thereof. In the event of Executive's death or a judicial determination of
his incompetence, reference in this Agreement to Executive shall be deemed,
where appropriate, to refer to his beneficiary, estate or other legal
representative.
16. Miscellaneous. All section headings used in this Agreement are for
convenience only. This Agreement may be executed in counterparts, each of
which is an original. It shall not be necessary in making proof of this
Agreement or any counterpart hereof to produce or account for any of the
other counterparts.
17. Withholding. The Company may withhold from any payments under this
Agreement all federal, state and local taxes as the Company is required to
withhold pursuant to any law or governmental rule or regulation. Executive
shall bear all expense of, and be solely responsible for, all federal, state
and local taxes due with respect to any payment received under this
Agreement.
18. Governing Law. This Agreement shall be governed by and interpreted
under the laws of the State of Connecticut without giving effect to any
conflict of laws provisions.
19. Adoption by Affiliates; Obligations.
(a) At the earliest feasible time or times, the Company will cause
each entity in which it now or hereafter holds, directly or indirectly, more
than a 50 percent voting interest and that has at least fifty (50) employees
on its direct payroll (an "Employer") to approve and adopt this Agreement
and, by such approval and adoption, to be bound by the terms hereof as though
a signatory hereto.
(b) The obligations under this Agreement shall, in the first
instance, be paid and satisfied by Northeast Utilities Service Company
("NUSCO"). If NUSCO shall be dissolved or for any other reason shall fail to
pay and satisfy the obligations, each individual Employer shall thereafter
be jointly and severally liable to pay and satisfy the obligations to
Executive.
(c) The Declaration of Trust of NU provides that no shareholder of
NU shall be held to any liability whatever for the payment of any sum of
money, or for damages or otherwise under any contract, obligation or
undertaking made, entered into or issued by the trustees of The Company or by
any officer, agent or representative elected or appointed by the trustees and
no such contract, obligation or undertaking shall be enforceable against the
trustees or any of them in their or his individual capacities or capacity and
all such contracts, obligations and undertakings shall be enforceable only
against the trustees as such and every person, firm, association, trust and
corporation having any claim or demand arising out of any such contract,
obligation or undertaking shall look only to the trust estate for the payment
or satisfaction thereof. Any liability for benefits under this Agreement
incurred by The Company shall be subject to the provisions of this Subsection
(c).
20. Costs of Defense - Retirement Benefits. Notwithstanding anything
herein to the contrary, the Company shall pay to Executive (or his survivors)
all costs incurred in defense against any reduction by the Company of the
retirement (or related survivor) benefits that the Company is obligated to
pay under this Agreement.
21. Establishment of Trust. The Company may establish an irrevocable
trust fund pursuant to a trust agreement to hold assets to satisfy any of its
obligations under this Agreement. Funding of such trust fund shall be
subject to the Board's discretion, as set forth in the agreement pursuant to
which the fund will be established.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have
executed this Agreement as of the date first above written.
NORTHEAST UTILITIES
By:/s/Xxxxxx X. Wax
Senior Vice President, Secretary and General Counsel
By:/s/Xxxxxxx X. Xxx
ANNEX 1
CONFIDENTIAL TRANSITION AND RETIREMENT AGREEMENT
GENERAL RELEASE
THIS AGREEMENT, made and entered into on this day of ,
1997, by and between Northeast Utilities, a Massachusetts business trust
(together with each direct and indirect affiliated utility company that has
adopted the Transition and Retirement Agreement entered into on February 20,
1997 (the "Transition Agreement"), with Xxxxxxx X. Xxx, hereinafter, the
"Company"), with its principal office in West Springfield, Massachusetts, and
its general office in Berlin, Connecticut, and Xxxxxxx X. Xxx, a resident of
Farmington, Connecticut ("Fox").
W I T N E S S E T H:
WHEREAS, the Company had heretofore employed Fox under an
Employment Agreement originally entered into as of January 1, 1992 (the
"Employment Agreement"); and
WHEREAS, Fox has retired and the Employment Agreement has been
terminated as of , , except to the extent specifically
provided in the Transition Agreement; and
WHEREAS, the Company and Fox wish to enter into an agreement to
provide for a mutual release as to any claims including, without limitation,
claims that might be asserted by Fox under the Employment Agreement and the
Age Discrimination in Employment Act, as further described herein, and
reaffirm Fox's right to indemnification;
NOW, THEREFORE, in consideration of the mutual promises contained
herein, the parties hereto, intending to be legally bound, hereby agree as
follows:
1. The Company and Fox hereby agree that Fox's retirement shall
be effective on , and that the Employment Agreement, except as
otherwise provided in the Transition Agreement, shall terminate on that date.
2. Notwithstanding Fox's retirement and the termination of the
Employment Agreement, in consideration of the release provided by Fox under
this Agreement, the Company shall pay or cause to be paid or provided to Fox,
subject to applicable employment and income tax withholdings and deductions,
all amounts and benefits required under the Transition Agreement.
3. Fox agrees and acknowledges that the Company, on a timely
basis, has paid, or agreed to pay, to Fox all other amounts due and owing
based on his prior services in accordance with the terms of the Employment
Agreement and that the Company has no obligation, contractual or otherwise to
Fox, except as provided herein or in the Transition Agreement, nor does it
have any obligation to hire, rehire or re-employ Fox in the future.
4. In full and complete settlement of any claims that Fox may
have against the Company, including any possible violations of the Age
Discrimination in Employment Act, 29 U.S.C. Section 621 et seq., ("ADEA") in
connection with his termination of employment, and for and in consideration
of the undertakings of the Company described herein, Fox does hereby REMISE,
RELEASE, AND FOREVER DISCHARGE the Company, and each of its subsidiaries and
affiliates, their officers, directors, shareholders, partners, employees and
agents, and their respective successors and assigns, heirs, executors and
administrators (hereinafter all included within the term "the Company"), of
and from any and all manner of actions and causes of actions, suits, debts,
claims and demands whatsoever in law or in equity, which he ever had, now
has, or hereafter may have, or which Fox's heirs, executors or administrators
hereafter may have, by reason of any matter, cause or thing whatsoever from
the beginning of Fox's employment to the date of this Agreement; and
particularly, but without limitation of the foregoing general terms, any
claims arising from or relating in any way to Fox's employment relationship
or the Employment Agreement and his retirement from that employment
relationship and the termination of the Employment Agreement, including but
not limited to, any claims which have been asserted, could have been
asserted, or could be asserted now or in the future under any federal, state
or local laws, including any claims under ADEA, Title VII of the Civil Rights
Act of 1964, as amended, 42 U.S.C. Section 2000e et seq. ("Title VII"), the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), the
Rehabilitation Act of 1973, the Americans with Disabilities Act, the Family
and Medical Leave Act, the Energy Reorganization Act of 1974, as amended,
Section 11(c) of the Occupational Safety and Health Act, and the Energy
Policy Act, and any common law claims now or hereafter recognized and all
claims for counsel fees and costs. Notwithstanding the foregoing, nothing
contained in this Agreement shall prevent Fox from requiring the Company to
fulfill its obligations under this Agreement, under the Transition Agreement,
under the Employment Agreement, to the extent of any continuing obligations
accruing prior to Fox's retirement, or under any employee benefit plan, as
defined in Section 3(3) of ERISA, maintained by the Company and in which Fox
participated.
Nothing in this Agreement shall be construed to prohibit Fox from
reporting any suspected instance of illegal activity of any nature, any
nuclear safety concern, any workplace safety concern, or any public safety
concern to the Nuclear Regulatory Commission (NRC), the United States
Department of Labor, or any other federal or state governmental agency. This
Agreement shall not be construed to prohibit Fox from providing information
to the NRC or to any other federal or state governmental agency or
governmental officials, or testifying in any civil or criminal proceedings
concerning any matter. This Agreement shall not be construed as a waiver or
withdrawal of safety concerns, if any, which Fox may have reported to the
NRC, or the withdrawal of participation by Fox in any NRC proceedings.
Nothing in this Agreement shall limit or impair any right Fox may
otherwise have to indemnity and defense by the Company, and, notwithstanding
any contrary provision of this Agreement, (i) the Company shall indemnify and
defend Fox in connection with any action, suit or proceeding in which he may
be involved or with which he may be threatened by reason of his being or
having been a Trustee or officer of the Company in the same manner
contemplated by (including the payment or advancement of any reasonable
expenses as incurred) and to the fullest extent permitted by the Declaration
of Trust of Northeast Utilities as of the date hereof, unless later limited
in accordance with applicable law, or under applicable law, (in which case he
shall notify the Company within five business days after receiving service of
process as to the commencement of the action, suit or proceeding and give the
Company the right to control the defense of any such action, suit or
proceeding, provided that no delay in giving such notice shall result in a
forfeiture of any rights by Fox unless, and then only to the extent that, the
Company is actually prejudiced by such delay), and (ii) Fox may join the
Company in any action, suit or proceeding, or bring any action, suit or
proceeding against the Company, as may be necessary for the protection or
enforcement of such rights of indemnification and defense by the Company.
5. Except to the extent permitted by paragraph 4, Fox further
agrees and covenants that neither he, nor any person, organization or other
entity on his behalf, will file, charge, claim, xxx or cause or permit to be
filed, charged, or claimed, any action for damages, including injunctive,
declaratory, monetary or other relief against the Company, involving any
matter occurring at any time in the past up to the date of this Agreement, or
involving any continuing effects of any actions or practices which may have
arisen or occurred prior to the date of this Agreement, including any charge
of discrimination under ADEA, Title VII, the Workers' compensation Act or
state or local laws. In addition, Fox further agrees and covenants that
should he, or any other person, organization or entity on his behalf, file,
charge, claim, xxx or cause or permit to be filed, charged, or claimed, any
action for damages, including injunctive, declaratory, monetary or other
relief, despite his agreement not to do so under this Agreement, or should he
otherwise fail to abide, in any material respect, by any of the terms of this
Agreement, then the Company will be relieved of all further obligations owed
under the Transition Agreement and this Agreement, he will forfeit all monies
paid to him under Transition Agreement and he will pay all of the costs and
expenses of the Company (including reasonable attorneys' fees) incurred in
the defense of any such action or undertaking.
6. In full and complete settlement of any claims that the Company
may have against Fox, other than the fulfillment of Fox's obligations under
this Agreement or under the Transition Agreement, and for and in
consideration of the undertakings of Fox described herein, the Company does
hereby REMISE, RELEASE, AND FOREVER DISCHARGE Fox and his heirs, executors
and administrators (hereinafter all included within the term "Fox"), of and
from any and all manner of actions and causes of actions, suits, debts,
claims and demands whatsoever in law or in equity, which the Company ever
had, now has, or hereafter may have, by reason of any civil (but specifically
not any criminal act) matter, cause or thing whatsoever by reason of his
being or having been a Trustee or officer of the Company from the beginning
of Fox's employment with the Company to the date of this Agreement; and
particularly, but without limitation of the foregoing general terms, any
claims arising from or relating in any way to actions taken by Fox by reason
of his being or having been a Trustee or officer of the Company and his
retirement from those relationships with the Company.
7. The Company further agrees and covenants that neither it, nor
any person, organization or other entity on its behalf, will file, charge,
claim, xxx or cause or permit to be filed, charged, or claimed, any action
for damages, including injunctive, declaratory, monetary or other relief
against Fox, involving any matter occurring at any time in the past up to the
date of this Agreement, or involving any continuing effects of any actions or
practices which may have arisen or occurred prior to the date of this
Agreement, by reason of his being or having been a Trustee or officer of the
Company, so long as Fox meets, in all material respects, his obligations
under this Agreement and the Transition Agreement. In addition, the Company
further agrees and covenants that should it, or any other person,
organization or entity on its behalf, file, charge, claim, xxx or cause or
permit to be filed, charged, or claimed, any action for damages, including
injunctive, declaratory, monetary or other relief, despite its agreement not
to do so under this Agreement, then it will pay all of the costs and expenses
of Fox (including reasonable attorneys' fees) incurred in the defense of any
such action or undertaking.
8. The Company expressly excepts from the provisions of paragraph
6 and 7, above, any actions, claims, suits, or other assertions against Fox
which are instituted by the Company as the result of an investigation
conducted upon the demand of a shareholder including but not limited to the
investigation conducted upon the demand of Xxxxxx Xxxxxxxx, or any actions
instituted on behalf of the Company by shareholders, including but not
limited to all such actions now pending in the courts of Connecticut and
Massachusetts. This paragraph 8 shall not be construed to limit or impair in
any way Fox's rights (i) to indemnity and defense by the company, (ii) under
any applicable insurance, and (iii) to the payments and other benefits under
this Agreement, under the Transition Agreement, under the Employment
Agreement, to the extent of any continuing obligations accruing prior to
Fox's retirement, or under any employee benefit plan, as defined in Section
3(3) of ERISA, maintained by the Company and in which Fox participated.
9. Fox hereby agrees and acknowledges that under this Agreement,
the Company has agreed to provide him with compensation and benefits that are
in addition to any amounts to which he otherwise would have been entitled
under the Employment Agreement or otherwise in the absence of this Agreement
and the Transition Agreement, and that such additional compensation is
sufficient to support the covenants and agreements by Fox herein.
10. Fox further agrees and acknowledges that the undertakings of
the Company as provided in the Transition Agreement are made to provide an
amicable conclusion of Fox's employment. Fox and the Company, its officers
and directors, will not, disparage the name, business reputation or business
practices of the other. In addition, by signing this Agreement, Fox agrees
not to pursue any internal grievance with the Company.
11. Fox hereby certifies that he has read the terms of this
Agreement, that he has been advised by the Company to consult with an
attorney and that he understands its terms and effects. Fox acknowledges,
further, that he is executing this Agreement of his own volition, without any
threat, duress or coercion and with a full understanding of its terms and
effects and with the intention, as expressed in Section 4 hereof, of
releasing all claims recited herein in exchange for the consideration
described herein, which he acknowledges is adequate and satisfactory to him
provided the Company meets all of its obligations under this Agreement. The
Company has made no representations to Fox concerning the terms or effects of
this Agreement other than those contained in this Agreement.
12. Fox hereby acknowledges that he was presented with this
Agreement on , , and that he was informed that he had the right
to consider this Agreement and the release contained herein for a period of
twenty-one (21) days prior to execution. Fox also understands that he has
the right to revoke this Agreement for a period of seven (7) days following
execution, by giving written notice to the Company at 000 Xxxxxx Xxxxxx,
Xxxxxx, XX 00000, in which event the provisions of this Agreement shall be
null and void, and the parties shall have the rights, duties, obligations and
remedies afforded by applicable law.
13. This Agreement shall be interpreted and enforced under the
laws of the State of Connecticut.
14. The Declaration of Trust of Northeast Utilities ("NU")
provides that no shareholder of NU shall be held to any liability whatever
for the payment of any sum of money, or for damages or otherwise under any
contract, obligation or undertaking made, entered into or issued by the
Trustees of NU or by any officer, agent or representative elected or
appointed by the Trustees and no such contract, obligation or undertaking
shall be enforceable against the trustees or any of them in their or his
individual capacities or capacity and all such contracts, obligations and
undertakings shall be enforceable only against the trustees as such and every
person, firm, association, trust and corporation having any claim or demand
arising out of any such contract, obligation or undertaking shall look only
to the trust estate for the payment or satisfaction thereof. Any liability
for benefits under the Transition Agreement or this Agreement incurred by NU
shall be subject to the provisions of this Section 14.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on the day and year first above written.
ATTEST: NORTHEAST UTILITIES
By:
Secretary
Witness XXXXXXX X. XXX
