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EXHIBIT 10.10
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement"), dated as of this 20th day
of April, 1998, is entered into between Western Water Company, a California
corporation (the "Company"), and Xxxxxx X. Xxxxx ("Executive").
RECITAL
WHEREAS, the Company desires to employ Executive as Vice President and
Chief Financial Officer.
NOW, THEREFORE, the Company and Executive desire to set forth in this
Agreement the terms and conditions of Executive's employment with the Company.
AGREEMENT
1. EMPLOYMENT.
The Company hereby employs Executive to render services as Vice
President and Chief Financial Officer of the Company. The Company agrees that
Executive will be located, and will render such services, in the San Diego
Metropolitan area. Executive hereby accepts such employment and agrees to render
his services fully, faithfully, and to the best of his ability, on a full-time
basis, subject to the direction and control of the Company's Board of Directors.
Executive's services shall be exclusive to the Company except that Executive
shall be entitled to hold outside directorships in other companies, provided
that serving in such capacity will not materially affect Executive's performance
of his duties hereunder. Executive shall report to the Company's Chief Executive
Officer and to the Board of Directors.
2. TERM.
Subject to the provisions of Paragraph 6 below, the term of this
Agreement shall be for a period of two (2) years commencing on April 20, 1998
and ending on April 19, 2000. Any material adverse change in Executive's job,
responsibilities or working conditions amounting to a "constructive termination"
shall be deemed to be termination of Executive's employment without cause.
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3. COMPENSATION AND BENEFITS.
(a) Base Salary.
For the services to be rendered by Executive under this
Agreement, the Company shall pay Executive a base salary of not less than two
hundred ten thousand ($210,000) per year payable in equal monthly installments,
less income tax withholdings and other normal employee deductions. Executive's
base salary shall be automatically adjusted each year in proportion to annual
changes in the cost of living index as published by the U.S. Government for the
San Diego area.
(b) Stock Options and Acceleration of Vesting.
Executive shall participate in incentive compensation programs
and in stock option plans to the extent deemed appropriate by the Board of
Directors. In the event the Company terminates Executive at any time (other than
pursuant to Paragraph 6 (iii) hereof) within three years from the date hereof
all outstanding options held by Executive to purchase Common Stock of the
Company shall automatically and immediately become vested. Upon the occurrence
of (i) the dissolution or liquidation of the Company, (ii) a reorganization,
merger or consolidation of the Company with one or more corporations as a result
of which the Company is not the surviving corporation or as a result of which it
is the surviving corporation and its outstanding voting securities are converted
to or reclassified as cash, securities of another corporation of other property,
(iii) a sale of assets of the Company or its subsidiaries having a fair market
value equal to more than fifty percent (50%) of the total fair market value of
the Company's assets to an entity which is not controlling, controlled by or
under common control with the Company, or (iv) the acquisition of a record or
beneficial interest in more than fifty percent (50%) of the then outstanding
voting securities of the Company, either in a single transaction or a series of
transactions, by an entity or "group" within the meaning of Section 13(d) of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder, which is not an affiliate of the Company (the events
described in clauses (i) through (iv) shall hereinafter be referred to as
"Change of Control Events"), all outstanding options held by Executive to
purchase Common Stock of the Company shall automatically and immediately become
vested on the closing date of such transaction.
(c) Other Benefit Plans.
Executive shall participate in and receive benefits under and in
accordance with the provisions of any employee benefit plan adopted or to be
adopted by the Company and which is generally applicable to executives of the
Company.
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4. VACATION.
Executive shall be entitled to a vacation in accordance with the
Company's written vacation policy.
5. REIMBURSEMENT FOR EXPENSES.
Executive shall be entitled to incur on behalf of the Company reasonable
and necessary expenses in connection with his duties and the Company shall not
unreasonably withhold reimbursement for all such expenses, provided they have
been incurred for and promote the business of the Company. Executive agrees to
provide the Company with records and other documentary evidence necessary to
substantiate each such expenditure as an income tax deduction. Executive
understands that failure to provide such documentation may result in the Company
denying reimbursement of some or all of the expense for which reimbursement is
sought.
6. TERMINATION.
Executive's employment under this Agreement shall terminate:
(i) upon death of Executive;
(ii) upon written notice from the Company to Executive in the
event of an illness or other cause incapacitating him from
performing his duties for six consecutive months; or
(iii) upon written notice from the Company in the event that
Executive commits any felonious act, is guilty of gross
negligence in the performance of his duties, or willfully fails
or refuses to comply with the reasonable directions of the Board
of Directors.
7. UNFAIR COMPETITION.
(a) Confidential Information.
In the course of his agreement, Executive will have access to
confidential records and information of the Company. During his employment by
the Company and thereafter, Executive will not directly or indirectly disclose
or misuse any such information except in accordance with his duties under this
Agreement. This provision of this Paragraph 7 shall survive the expiration or
termination, for any reason, of this Agreement or Executive's employment.
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(b) Noncompetition.
During the term hereof and for a period of two (2) years
following termination of his employment, Executive agrees not to carry on in any
state of the United States of America or in any foreign country in which the
Company or any subsidiary or affiliate thereof is conducting business, either
for himself or as any member of any partnership, or as a stockholder, director,
officer, agent, or employee of another person, firm or corporation or otherwise,
any business similar to that being carried on by the Company (or any subsidiary
or affiliate thereof) if such business carried on by the Executive is materially
detrimental to the Company; provided, however, that the mere ownership by
Executive of not more than 5% of any corporation or similar business venture
shall not be deemed to be a violation of this covenant.
(c) Savings Clause.
Executive acknowledges that the above restrictions on his
activities are fair and reasonable for the protection and the goodwill of the
Company. If a court of competent jurisdiction determines any of the above
restrictions to be unreasonable to any extent, however, the parties intend that
the restriction or scope of such covenants be reduced to the extent necessary to
be reasonable and enforceable.
(d) Injunctive Relief.
Executive further acknowledges that a breach or violation of the
covenants contained in this Paragraph 7 will cause severe and irreparable harm
to the Company and that recovery by the Company of monetary damages will not
constitute an adequate remedy. Accordingly, in the event of any breach or
violation of such covenants by Executive, the Company shall have the right to
have Paragraph 7 of this Agreement specifically enforced by any court having
equity jurisdiction, without requirement of bond or showing of actual damages.
Nothing set forth herein shall limit or restrict any other rights and remedies
the Company may have available to it under law or in equity.
(e) Accounting.
The Company shall have the right to require Executive to account
for and pay over to the Company all compensation, profits, monies, accruals,
increments or other benefits (collectively "Benefits") derived or received by
Executive as the result of any transaction constituting a breach of this
Agreement, and Executive agrees to account for and pay over such Benefits to the
Company.
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(f) Extension of Covenants.
The duration of these restrictive covenants and agreements shall
be extended by a period equal to the duration of any breach thereof and if there
is found to be a breach thereof, the pendency of any litigation, including any
appears, relating thereto.
(g) Survival of Restrictions.
The provisions of this Paragraph 7 shall survive the expiration
or termination, for any reason, of this Agreement or Executive's employment.
8. MERGER OR REORGANIZATION.
This Agreement shall not be terminated by the voluntary or involuntary
dissolution of the Company or by any merger or consolidation where the Company
is not the surviving or resulting corporation, or upon any transfer of all or
substantially all of the assets of the Company. In the event of any such merger
or consolidation or transfer of assets, the provisions of this Agreement shall
be binding on and shall inure to the benefit of the surviving or resulting
corporation or the corporation to which such assets shall be transferred.
9. ARBITRATION.
Any controversy or claim arising out of or relating to this Agreement,
the breach thereof, or the coverage of this arbitration provision shall be
settled by arbitration which shall be in accordance with the Commercial
Arbitration Rules of the American Arbitration Association as such rules shall be
in effect on the date of delivery of demand for arbitration. The arbitration of
such issues, including the determination of the amount of any damages suffered
by either party hereto by reason of the acts or omissions of the other, shall be
to the exclusion of any court of law. The decision of the arbitrators or a
majority of them shall be final and binding on both parties and their respective
heirs, executors, administrators, successors and assigns. There shall be three
arbitrators, one to be chosen directly by each party at will and the third
arbitrator to be selected by the two arbitrators so chosen. Each party shall pay
the fees of the arbitrator selected by him and of his own attorneys and the
expenses of his witnesses and all other expenses connected with the presentation
of his case. All other costs of the arbitration, including the cost of the
record or transcripts thereof, if any, administrative fees, and all other fees
and costs shall be borne equally by the parties.
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10. NON-ASSIGNABILITY.
The obligations of Executive hereunder are personal and may not be
assigned or transferred in any manner whatsoever, nor are such obligations
subject to involuntary alienation, assignment or transfer.
11. AMENDMENT.
No term or provision of this Agreement may be modified, waived, amended,
discharged or changed orally and any such modification, waiver, amendment,
discharge, or change shall be valid, binding and enforceable only when set forth
in a written agreement executed by both of the parties hereto.
12. NOTICES.
All notices which a party is required or may desire to give to the other
party under or in connection with this Agreement shall be sufficient if given by
addressing same to the other party as follows:
If to Executive to:
Xxxxxx X. Xxxxx
0000 Xxxxxxxx Xxxxxxxxx
Xx Xxxxx, XX 00000
If to the Company to:
Western Water Company
0000 Xx Xxxxx Xxxxxxx Xxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
or at such other place as may be designated in writing by like notice. Any
notice shall be deemed to have been delivered when addressed as required herein
and deposited, postage prepaid, in the United States Mail.
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13. ENTIRE AGREEMENT.
This Agreement contains the entire agreement of the Company and
Executive relating to the subject matter hereof, and it replaces and supersedes
any and all prior agreements between the parties relating to the same subject
matter, including without limitation, the Old Agreement. In connection
therewith, by execution of this Agreement, Executive and the Company hereby
terminate in its entirety the Old Agreement effective as of the date hereof,
which shall thereafter cease to have any force or effect, except that Executive
shall be entitled to receive any payments as provided therein of any amounts and
benefits that have accrued to him thereunder through the date hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
hereinabove set forth.
WESTERN WATER COMPANY
By /s/ XXXXX X. XXXXXX
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XXXXX X. XXXXXX
Chairman
EXECUTIVE
By /s/ XXXXXX X. XXXXX
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XXXXXX X. XXXXX
Vice President and Chief
Financial Officer
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