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EXHIBIT 10.9
EXECUTIVE EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement"), including the attached Exhibit
"A," is entered into between ENRON CORP., a Delaware corporation, having offices
at 0000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000 ("Employer"), and XXXXXXX X. XXXX, an
individual currently residing at 0000 Xxxx Xxxxxxx Xxxx, Xxxxxxx, Xxxxx 00000
("Employee"), to be effective as of May 4, 1998 (the "Effective Date").
WITNESSETH:
WHEREAS, Employee is currently employer under that certain Employment
Agreement between Enron Development Corp. and Xxxxxxx X. Xxxx, effective January
1, 1996.
WHEREAS, Employee is willing to continue her employment with Employer
under the terms and conditions set forth in this Employment Agreement which
shall supersede all previous agreements; and
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 or
modify Employee's duties and responsibilities; provided however, in the event
(a) Employer substantially reduces the duties or responsibilities of Employee,
or (b) Xxx Xxx is no longer Chairman of Enron Corp., Employee may elect to
terminate this Agreement under Section 3.2(ii) and said termination shall
constitute an Involuntary Termination for purposes of Section 3.5. Moreover,
Employer may assign this Agreement and Employee's employment to Enron or any
affiliates of Enron. 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.
Notwithstanding any other provision of this Agreement, during the Term, Employee
shall be a member of the Enron Corp. Office of the Chairman.
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 and its affiliates, including the formation of
a potential new water company. Employee may not engage, directly or indirectly,
in any other business, investment, or activity
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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.
1.4 In connection with Employee's employment by Employer, Employer
shall endeavor to 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 endeavor to 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 understands and acknowledges that the terms and conditions
of this Agreement constitute confidential information. Employee shall keep
confidential the terms of
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this Agreement and 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. 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 instead constitute an unfunded and unsecured promise to pay money in the
future exclusively from the general assets of Employer.
2.4 Subject to the approval of the Compensation Committee of the Enron
Corp. Board of Directors at the May 4, 1998 meeting of the Compensation
Committee, Employee shall receive an option to purchase 100,000 shares of Enron
Corp. Common Stock. The grant shall be effective on the date approved by the
Compensation Committee and shall vest 33.3% on each of January 1, 1999, January
1, 2000 and January 1, 2001, and shall be evidenced by a grant agreement.
Subject to the approval of the Compensation Committee of the Enron Corp. Board
of Directors at the May 4, 1998 meeting of the Compensation Committee, Employee
shall receive an option to purchase 350,000 shares of Enron Corp. Common Stock.
The grant shall be effective on the date approved by the Compensation Committee
and shall vest 33.3% on each of May 4, 1999, May 4, 2000 and May 4, 2001, and
shall be evidenced by a grant agreement.
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2.5 The Employer shall pay the Employee a Deferred Project Plan ("DP
Plan") bonus for SARAS in the amount of $1,027,112.00 and for Puerto Rico in the
amount of $2,316,909.00. Employee shall vest immediately in the total sum of
these bonuses and 50% shall be paid to Employee upon the execution of this
Agreement and the remaining 50% shall be paid at the start of commercial
operations subject to adjustment as provided in the DP Plan.
2.6 As of the Effective Date, Employee is fifty percent (50%) vested in
a Stock Option Grant Agreement dated February 12, 1996, granting Employee an
option to purchase 125,000 shares of the Employer's common stock. Employer shall
cause the vesting schedule of said Agreement to be amended at the first meeting
of the Employer's Compensation Committee after the Effective Date to provide
that twenty five percent (25%) of said option shall become exercisable on
January 1, 1999, and twenty five percent (25%) of said option shall become
exercisable on January 1, 2000, subject to the continuing terms and provisions
thereof; provided, however, said Agreement and the grant made thereby shall
become vested by the passage of time only, without condition, regardless whether
Employee's employment with Employer terminates for any reason and whether or not
Employee continues to be employed by Employer or an Affiliate of Employer.
Further, in the event of Employee's termination of employment with the Employer
for any reason prior to January 1, 2000, the unvested options shall become fully
vested. Employee shall have the lesser of three years or the remaining term of
exercise under said Grant Agreement to exercise said option in the event of
Employee's termination of employment with the Employer for any reason during the
Term of this Agreement.
2.7 As of the Effective Date, Employee is forty percent (40%) vested in
a Stock Option Grant Agreement dated February 10, 1997, granting Employee an
option to purchase 432,322 shares of the Employer's common stock. Employer shall
cause the vesting schedule of said Agreement to be amended at the first meeting
of the Employer's Compensation Committee after the Effective Date to provide
that thirty percent (30%) of said option shall become exercisable on January 1,
1999, and thirty percent (30%) of said option shall become exercisable on
January 1, 2000, subject to the continuing terms and provisions thereof;
provided, however, said Agreement and the grant made thereby shall become vested
by the passage of time only, without condition, regardless whether Employee's
employment with Employer terminates for any reason and whether or not Employee
continues to be employed by Employer or an Affiliate of Employer. Further, in
the event of Employee's termination of employment with the Employer for any
reason prior to January 1, 2000, the unvested options shall become fully vested.
Employee shall have the lesser of three years or the remaining term of exercise
under said Grant Agreement to exercise said option in the event of Employee's
termination of employment with the Employer for any reason during the Term of
this Agreement.
2.8 At the first meeting of the Employer's Compensation Committee after
the Effective Date, Employer shall cause the vesting schedule of Employee's
Restricted Stock Award Agreement dated February 12, 1996, awarding Employee
100,000 shares of the Employer's common stock to be amended to immediately vest
in and release to Employee, sixty-six and 7/10ths percent (66.7%) in said Award
and to provide that the remaining unvested shares of Restricted Stock shall be
released and vested in Employee in two equal amounts on January 31, 1999, and
January 31, 2000, conditioned on Enron International, Inc. meeting its net
income and funds flow targets as approved by the Enron Corp. Board of Directors
for calendar years 1998 and 1999, respectively, as determined by the
Compensation Committee in its sole discretion.
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2.9 As of the Effective Date, Employee is forty percent (40%) vested in
a Restricted Stock Award Agreement dated February 10, 1997, awarding Employee
173,737 shares of the Employer's common stock. Employer shall cause the vesting
schedule of said Agreement to be amended at the first meeting of the Employer's
Compensation Committee after the Effective Date to provide that thirty percent
(30%) of said Award shall become vested in and released to Employee on January
31, 1999, and thirty percent (30%) of said Award shall become vested in and
released to Employee on January 31, 2000, subject to the continuing terms and
provisions thereof; provided, however, said Agreement and the Award made thereby
shall become vested in and released to Employee by the passage of time only,
without condition, regardless whether Employee's employment with Employer
terminates for any reason and weather or not Employee continues to be employed
by Employer or an Affiliate of Employer.
2.10 All Enron International Options granted to Employee by Enron
International Inc. prior to the Effective Date are hereby waived and forfeited
by Employee, and are rescinded.
2.11 The outstanding loan principal and accrued interest owed by
Employee to Employer, as evidenced by that Note certain dated May, 1997, and
executed by Employee, is forgiven to Employee by Employer and Employee is
forever released from the obligations of said Note and the underlying agreements
pertaining thereto.
2.12 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:
(i) For "cause" upon the determination by the Employer's Board of
Directors that "cause" exists for the termination of the
employment relationship. As used in this Section 3.1(i), the term
"cause" shall mean [a] Employee's gross negligence or willful
misconduct in the performance of the duties and services required
of Employee pursuant to this Agreement; [b] Employee has been
convicted of a felony; [c] Employee has willfully refused without
proper legal reason to perform the duties and responsibilities
required of Employee under this Agreement which remains
uncorrected for thirty (30) days following written notice to
Employee by Employer of such breach; [d] Employee's involvement in
a conflict of interest as referenced in Section 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 of such breach; [e]
Employee has willfully engaged in conduct that Employee knows or
should know is materially injurious to Employer, Enron, or any of
their respective subsidiaries; [f] Employee's material breach of
any material provision of this Agreement or
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corporate code or policy which remains uncorrected for thirty
(30) days following written notice to Employee by Employer of
such breach; or [g] Employee violates the Foreign Corrupt
Practices Act or other applicable United States law as proscribed
by Section 5.1. 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
Employer's Board of Directors for determination. If Employee
disagrees with the decision reached by Employer's Board of
Directors, the dispute will be limited to whether Employer's
Board of Directors reached its decision in good faith;
(ii) for any other reason whatsoever, with or without cause, in the
sole discretion of the Board of Directors of Employer;
(iii) upon Employee's death; or
(iv) 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(i); the effect of such 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(ii); the effect of such termination is specified in Section 3.5. The effect
of the employment relationship being terminated pursuant to Section 3.1(iii) 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(iv) 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 8.6, 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:
(i) 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
(ii) 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(i); 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(ii); the effect of such termination is specified in Section 3.3.
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3.3 Upon a "Voluntary Termination" of the employment relationship by
Employee prior to expiration of the Term, all future compensation to which
Employee is entitled and all future benefits for which Employee is eligible
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 to which
Employee is entitled and all future benefits for which Employee is eligible
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 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 one hundred twenty-five percent (125%)
of the then current Monthly Base Salary as if Employee's employment (which shall
cease on the date of such Involuntary Termination) had continued for the full
Term of this Agreement 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, 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, 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 Notwithstanding any provision herein to the contrary, upon a
termination of Employee's employment under any of the circumstances described in
Sections 3.5, 3.6 or 3.7 above, Employee shall be entitled to receive a pro-rata
annual bonus payment through the date of
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such termination of employment and Employee shall become fully vested in
specific grants and awards made or awarded to Employee under long term incentive
plans maintained by Employer and its affiliates.
3.9 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 severance plans, and policies of Employer, Enron, or its affiliates.
3.10 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 6 and 7.
3.11 This Agreement governs the rights and obligations of Employer and
Employee with respect to Employee's salary, bonuses, and other perquisites of
employment. Except as provided above in Section 2.5 and in Section 3.8,
Employee's rights and obligations with respect to stock options and restricted
stock are governed by Enron's Stock Option Plan and respective grant agreements
and with respect to incentive compensation payments are governed by the Award
Agreement and the Plan.
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.
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ARTICLE 5: UNITED STATES FOREIGN CORRUPT PRACTICES ACT AND OTHER LAWS:
5.1. Employee shall at all times comply with United States laws
applicable to Employee's actions on behalf of Employer, including specifically,
without limitation, the United States Foreign Corrupt Practices Act, generally
codified in 15 USC 78 (FCPA), as the FCPA may hereafter be amended, and/or its
successor statutes. If Employee pleads guilty to or nolo contendere or admits
civil or criminal liability under the FCPA or other applicable United States
law, or if a court finds that Employee has personal civil or criminal liability
under the FCPA or other applicable United States law, or if a court finds that
Employee committed an action resulting in any Enron entity having civil or
criminal liability or responsibility under the FCPA or other applicable United
States law with knowledge of the activities giving rise to such liability or
knowledge of facts from which Employee should have reasonably inferred the
activities giving rise to liability had occurred or were likely to occur, such
action or finding shall constitute "cause" for termination under this Agreement
unless Employer's management committee (or, if there is no management committee,
the highest applicable level of Employer's management) determines that the
actions found to be in violation of the FCPA or other applicable United States
law were taken in good faith and in compliance with all applicable policies of
Employer and Enron.
ARTICLE 6: OWNERSHIP AND PROTECTION OF INFORMATION; COPYRIGHTS:
6.1 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.
6.2 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 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
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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, 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 customers, suppliers, partners, joint venturers, 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 6 by Employee, and 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
the recovery of damages from Employee and his or her agents involved in such
breach.
6.3 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.
6.4 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 audiovisual 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.
6.5 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
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worldwide right, title, and interest in and to information, ideas, concepts,
improvements, discoveries, and inventions, and its copyrighted works, including
without limitation, the 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 7: POST-EMPLOYMENT NON-COMPETITION OBLIGATIONS:
7.1 As part of the consideration for the compensation and benefits to
be paid to Employee hereunder, in keeping with Employee's duties as a fiduciary
and in order to protect Employer's interests in the confidential information of
Employer and the business relationships developed by Employee with the clients
and potential clients of Employer, and as an additional incentive for Employer
to enter into this Agreement, Employer and Employee agree to the non-competition
provisions of this Article 7. Employee agrees that during the period of
Employee's non-competition obligations hereunder, Employee will not, directly or
indirectly for Employee or for others, in any geographic area or market where
Employer or Enron or any of their affiliated companies are conducting any
business as of the date of termination of the employment relationship or have
during the previous twelve months conducted any business:
(i) engage in any business competitive with the business conducted by
Employer;
(ii) render advice or services to, or otherwise assist, any other
person, association, or entity who is engaged, directly or indirectly, in any
business competitive with the business conducted by Employer;
(iii) induce any employee of Employer or Enron or any of their
affiliates to terminate his or her employment with Employer, Enron, or their
affiliates, or hire or assist in the hiring of any such employee by person,
association, or entity not affiliated with Enron.
These non-competition obligations shall extend until December 31, 2001.
7.2 Employee understands that the foregoing restrictions may limit his
or her ability to engage in certain businesses anywhere in the world during the
period provided for above, but acknowledges that Employee 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 7 by Employee, and Employer shall be entitled to enforce the
provisions of this Article 7 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 7, 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.
7.3 It is expressly understood and agreed that Employer and Employee
consider the restrictions contained in this Article 7 to be reasonable and
necessary to protect the proprietary information of Employer. Nevertheless, if
any of the aforesaid restrictions are found by a court
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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.
ARTICLE 8: MISCELLANEOUS:
8.1 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.
8.2 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.
8.3 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:
If to Employer:
Enron Corp.
0000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention: Corporate Secretary
If to Employee, to the address shown on the first page hereof.
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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8.4 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.
8.5 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.
8.6 If a dispute arises out of or related to this Agreement, other than
a dispute regarding Employee's obligations under Article 6, or Article 7, 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.
8.7 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 her agent for service of process to
receive the summons and other pleadings in connection with any such litigation.
8.8 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.
8.9 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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8.10 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
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 CORP. XXXXXXX X. XXXX
By: /s/ Xxxxxxx X. Xxx /s/ Xxxxxxx X. Xxxx
----------------------------- ---------------------------
Name:
This 6th day of May, 1998
Title: Chairman and CEO
-----------------------------
This 7th day of May, 1998
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EXHIBIT "A" TO
EXECUTIVE EMPLOYMENT AGREEMENT
BETWEEN ENRON CORP. AND XXXXXXX X. XXXX
Employee Name: Xxxxxxx X. Xxxx
Term: Effective May 5, 1998 through December 31, 2001
Position: Vice Chairman, Enron Corp., and Chairman of Enron
International Inc.
Location: Houston, Texas
Reporting Relationship: Reports to Office of the Chairman
Monthly Base Salary: Fifty Nine Thousand One Hundred Sixty Six and 67/100
Dollars ($59,166.67)
Bonus: Employee shall be eligible to participate in the
Enron Corp. Annual Incentive Plan ("Plan"). All
bonuses shall be paid in accordance with the terms
and provisions of the Plan. Employee's 1998 bonus
amount under this Plan shall be one percent (1%) of
Enron International Inc.'s earnings defined as either
after-tax net income or earnings per share ("EPS")
multiplied by the appropriate number of EI shares
(both methodologies approximately equivalent in
value), subject to adjustment in the sole discretion
of Enron Corp.'s Chairman and CEO, taking into
consideration net income, EPS, total obligations and
cash flow from operations targets, as such targets
are set each year by the Board of Directors of
Employer, as well as other performance criteria,
consistent with the treatment of other similarly
situated executives of Employer. Employer and
Employee agree to negotiate Employee's bonus
opportunity for calendar years 1999, 2000, and 2001,
no later than January 31st of each applicable
calendar year.
Long Term Incentive Plan: Starting in 1999, Employee shall be eligible to
participate in either 1) the Enron Corp. Long Term
Incentive Plan, or 2) an equity participation plan
related to Enron's interest in a potential new water
company. At the sole discretion of the Chairman of
the Board of Employer, Employee may be eligible to
participate in both.
ENRON CORP. XXXXXXX X. XXXX
By: /s/ Xxxxxxx X.Xxx /s/ Xxxxxxx X. Xxxx
------------------------ ---------------------------
Name:
This 6th day of May, 1998
Title: Chairman & CEO
---------------------
This 7th day of May, 1998
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FIRST AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
This Agreement, entered into and made effective as of February 1, 1999,
by and between ENRON 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 XXXXXXX X. XXXX ("Employee"), an individual residing in Houston,
Texas, is an amendment to that certain Executive Employment Agreement between
the Company and Employee entered into the 6th day of May, 1998, and made
effective as of May 4, 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, Enron Corp. and Azurix Corp., respectively, 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 February 1, 1999, the Employment Agreement is
assigned by Company to, and assumed by, Enron Corp. and Azurix Corp.,
respectively. Any reference to the "Company" and/or "Employer" in the
Employment Agreement shall mean Enron Corp. and Azurix Corp.,
respectively. Employee consents to such assignment and assumption, and
releases Company from every obligation under the Employment Agreement.
Enron Corp. and Azurix Corp., respectively, each assume the obligations
of Enron Corp. and Azurix Corp., under the Employment Agreement.
2. Article 3, Section 3.5 is hereby deleted in its entirety
and the following language inserted in its entirety:
"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
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on a semi-monthly basis; the unpaid Bonuses described in Exhibit "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."
3. Article 3, Section 3.8 is hereby deleted in its entirety
and the following language inserted in its entirety:
"3.8 Notwithstanding any provision herein to the
contrary, upon a termination of Employee's employment under any of the
circumstances described in Sections 3.6 or 3.7 above, Employee shall
be entitled to receive a pro-rata annual bonus payment through the
date of such termination of employment. Further, upon termination of
Employee's employment under any of the circumstances described in
Sections 3.5, 3.6, or 3.7, Employee shall become fully vested in
specific grants and awards made or awarded to Employee under long term
incentive plans maintained solely by Enron Corp. and its affiliates;
provided however, any grants and awards made or awarded under the
Azurix Corp. 1999 Stock Plan shall be excluded and governed by the
terms and provisions of the respective grants and awards under the
Azurix Corp. 1999 Stock Plan."
4. Exhibit "A" to the Employment Agreement is hereby deleted
in its entirety and the attached Exhibit "A" is inserted in its
entirety.
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.
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In Witness Whereof, the parties have duly executed this Agreement as of
the date first above written.
ENRON CORP.
By: /s/ XXXXXXX X. XXX
----------------------------------
Name: Xxxxxxx X. Xxx
Title: Chairman & CEO
This 10th day of March, 1999
AZURIX CORP.
By: /s/ XXXXXX X. XXXXXXXXX
----------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Managing Director
Human Resources
and Administration
This 1st day of March, 1999
XXXXXXX X. XXXX
/s/ XXXXXXX X. XXXX
-------------------------------------
This 1st day of March, 1999
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EXHIBIT "A" TO
EXECUTIVE EMPLOYMENT AGREEMENT
BETWEEN ENRON CORP., AZURIX CORP., AND XXXXXXX X. XXXX
Employee Name: Xxxxxxx X. Xxxx
Term: Effective February 1, 1999 through December 31, 2001
Position: Vice Chairman, Enron Corp., and Chairman and Chief
Executive Officer of Azurix Corp.
Location: Houston, Texas
Reporting Relationship: Reports to Office of the Chairman, Enron Corp.
Monthly Base Salary: Fifty-Nine Thousand One Hundred Sixty Six Dollars and
Sixty Seven Cents ($59,166.67)
Bonus: Employee shall be eligible to participate in the Enron
Corp. Annual Incentive Plan ("Plan") or any replacement
plan of Azurix Corp. All bonuses shall be paid in
accordance with the terms and provisions of the Plan, a
portion or all of which may be paid in cash, and a
portion or all of which may be paid in stock or stock
options. All bonuses paid shall be based upon the
performance of Azurix Corp. and Employee as determined
by the Board of Directors of Azurix Corp.
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Long Term Incentive
Plan: Employee shall be eligible to participate in either 1)
the Enron Corp. Long Term Incentive Plan or 2) an
equity participation plan related to Enron's interest
in a new water company. At the sole discretion of the
Chairman of the Board of Employer, Employee may be
eligible to participate in both plans.
ENRON CORP.
By: /s/ XXXXXXX X. XXX
----------------------------------
Name: Xxxxxxx X. Xxx
Title: Chairman & CEO
This 10th day of March, 1999
AZURIX CORP.
By: /s/ XXXXXX X. XXXXXXXXX
----------------------------------
Name: Xxxxxx X. Xxxxxxxxx
--------------------------------
Title: Managing Director
Human Resources
and Administration
This 1st day of March, 1999
XXXXXXX X. XXXX
/s/ XXXXXXX X. XXXX
-------------------------------------
This 1st day of March, 1999
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