Contract
EXHIBIT
10.1
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the
"Agreement") is entered into as of May 22, 2009, by and between Cadiz Inc., a
Delaware corporation (the "Company") and Xxxxx Xxxxxxxxx, an individual
("Brackpool").
WHEREAS, Brackpool has served as the
Company's Chief Executive Officer pursuant to an Employment Agreement effective
as of July 5, 2003, as subsequently modified from time to time (the "2003
Agreement"); and
WHEREAS, it is in the best interests of
the Company and Brackpool to amend and restate the 2003 Agreement in order that
this Agreement set forth all of the terms and conditions pursuant to which
Brackpool shall continue to provide services to the Company;
NOW, THEREFORE, the parties agree as
follows:
1. TERM OF
EMPLOYMENT. The terms and conditions of Brackpool's employment
under this Agreement shall be effective as of the date hereof and shall continue
until terminated in accordance with the termination provisions of Section 6
below.
2. DUTIES. Brackpool
shall be employed as the Chief Executive Officer of the
Company. Brackpool's duties and responsibilities shall relate,
generally, to those ordinarily performed by the chief executive officer of a
publicly traded corporation. Brackpool shall report to, and take
direction from, the Board of Directors of the Company. Brackpool
further consents to serve in further capacities as an officer and/or director of
the Company or any subsidiary or affiliate of the Company without any additional
salary or compensation. Brackpool's base of operations shall be at
the corporate headquarters office of the Company in Los Angeles, California,
unless changed by mutual agreement. However, Brackpool shall also
render services at such other sites as necessary from time to time to properly
perform his duties.
3. NECESSARY
SERVICES.
a. Performance of
Duties. Brackpool agrees that he will at all times faithfully,
industriously and to the best of his ability, experience and talents, perform to
the reasonable satisfaction of the Company all of the duties that may be
assigned to him hereunder and shall devote such time to the performance of these
duties as may be necessary therefor. Provided that Brackpool
otherwise performs his duties in a satisfactory manner, nothing herein shall
require Brackpool to provide such services on a full-time basis or shall
preclude Brackpool from spending a reasonable amount of time in the pursuit of
other business opportunities, the management of his personal investments or with
any charitable or civic venture with which Brackpool may be involved as long as
such activities do not result in any conflicts with respect to Brackpool’s
duties to Cadiz hereunder, or violate any conflicts of interest policy which may
be maintained from time to time by Cadiz.
b. Exclusive
Services. Brackpool agrees that during the period of his
employment, Brackpool shall provide services exclusively pursuant to this
Agreement, and Brackpool will not, without the prior written consent of the
Company (which consent may not be unreasonably withheld), directly or
indirectly:
(i) engage in the business
of, or own or control any interest in (except as a passive investor owning less
than 10% of the equity securities of a publicly held company), or act as
director, officer of employee of, or consultant to, any individual, partnership,
joint venture, corporation or other business entity, directly or indirectly
engaged anywhere in the United States, its possessions or territories, in any
business competitive with the business then being carried on by the Company or
any affiliate;
(ii) plan or organize any
business activity competitive with the business or planned business of the
Company or its affiliates, or combine, participate, or conspire with other
employees of the Company or its affiliates or other persons or entities for the
purpose of organizing any such competitive business activity; or
(iii) divert or take away,
or attempt to divert or take away, any of the customers or potential customers
of the Company or its affiliates, either for himself or for any other person,
firm, partnership, corporation or other business entity.
4. BASE
COMPENSATION. Subject to such deductions as the Company may
from time to time be required to make pursuant to law, governmental regulation
or order, the Company agrees to pay to Brackpool a base salary of $400,000 per
annum. Payments of base salary shall be made in accordance with the
normal payroll practices of the Company.
5. OTHER
COMPENSATION.
a. Equity Incentive Grant. The
Company shall grant to Brackpool concurrently with the execution of this
Agreement 60,000 shares of common stock pursuant to the Company's 2007
Management Equity Incentive Plan (the "2007 Plan") which shares shall, for
purposes of the 2007 Plan, be deemed to be Deferred Stock (as defined in the
2007 Plan) subject to immediate vesting upon execution of this
Agreement.
b. Discretionary Annual
Bonus. Following the conclusion of each fiscal year during the
term of this Agreement, the Board shall make a good faith evaluation of the
performance of Brackpool during such year, on the basis of which Brackpool shall
receive a bonus in an amount and upon such other terms and conditions as shall
be determined at the discretion of the Board.
c. Participation in Long Term Transaction
Incentive Plan. The Company shall grant to Brackpool
concurrently with the execution of this Agreement the right to participate in
the total incentive pool made available to Company management under the
Company's Long Term Transaction Incentive Plan ( Plan Summary Attached ). The
participation percentage will be determined prior to June 30, 2009.
d. Other Equity Based
Compensation. In the event that the Company, following the
execution of this Agreement, adopts a new compensation plan or program for
senior management (the “Compensation Plan”), then Brackpool shall be invited to
participate in the Compensation Plan. Brackpool’s participation in
the Compensation Plan shall be negotiated between Brackpool and the Company in
good faith at a level consistent with that of a member of senior management with
comparable duties and responsibilities.
e. Fringe
Benefits. In addition to the compensation set forth above,
Brackpool shall be entitled to the following benefits:
i. Four
(4) weeks paid annual vacation, provided that no more than two weeks are to be
taken consecutively;
ii. Sick
leave and personal leave with pay in accordance with the prevailing policies of
the Company;
iii. Medical
coverage under the group medical insurance plan of the Company (or COBRA
coverage, at the election of Brackpool);
iv. Participation
in any pension, profit-sharing, 401(k), or deferred compensation plan maintained
by the Company for the general benefit of its employees;
v. An
automobile allowance and/or access to Company vehicles consistent with the
Company's prior practice concerning Brackpool;
vi. Participation
in any other benefit plan maintained by the Company for the general benefit of
its employees; and
vii. Any
other benefits not specifically set forth herein as may be granted by the
Company in its sole and absolute discretion.
f. Deduction and
Reimbursement. Brackpool hereby agrees that the Company may
deduct and withhold from the compensation payable to Brackpool hereunder any
amounts of money required to be deducted or withheld by the Company under the
provisions of any and all applicable local, state or federal statutes or
regulations or any amendments thereto hereafter enacted requiring the
withholding or deducting of compensation.
6. TERMINATION. This
Agreement continue in full force and effect unless and until terminated as
provided in this Section.
a. Termination
Events. This Agreement shall terminate:
i. At
the election of the Company, upon the death or permanent disability of
Brackpool, "permanent disability" being defined as any continuous loss of
one-half (½) or more of the time spent by Brackpool in the usual daily
performance of his duties as a result of physical or mental illness for a
continuous period in excess of ninety (90) days.
ii. At
the election of the Company, upon a Change in Control of the Company (as defined
below) or at such time, if any, as the Company ceases to conduct business for
any reason whatsoever.
iii. At
the election of the Company, upon the dismissal of Brackpool by the Company for
cause. For purposes of this Agreement, "cause" shall include, but
shall not be limited to: (1) the breach by Brackpool of any term or condition of
this Agreement, (2) Brackpool engaging in one or more acts constituting a
felony; (3) Brackpool engaging in one or more acts involving fraud or serious
moral turpitude; (4) Brackpool misappropriating Company assets or engaging in
gross misconduct materially injurious to the Company or its affiliates or
subsidiaries; (4) the making by Brackpool of material misrepresentations to the
Company or its affiliates; or (5) Brackpool’s willful failure to comply with the
instructions of the Company’s Board of Directors.
iv. At
the election of Brackpool, upon a material breach by the Company of any term or
condition of this Agreement or upon a material change in Brackpool’s job title
or a material reduction in Brackpool’s duties and responsibilities
hereunder.
v. At
the election of either party, without cause.
b. Payments Following
Termination. Following termination of this Agreement, whether
for any of the reasons specifically set forth above or for any other reason, the
Company shall have no obligation to make payments to or bestow benefits upon
Brackpool after the date of termination except as may be required by law and
as follows,
and references under this Agreement to Brackpool’s termination of employment or
the termination of this Agreement shall be deemed to refer to the date upon
which Brackpool has experienced a “separation from service” within the meaning
of Code Section 409A, as defined below:
i. In
the event of termination by the Company pursuant to Section (a)(i) as the result
of Brackpool’s death or permanent disability, payment of the base compensation
otherwise payable to Brackpool pursuant to Section 4 hereof shall continue to be
paid to Brackpool or his estate for a period of two (2) years following
Brackpool’s death or permanent disability. Such payment shall be in
addition to, and not in lieu of, any payments made pursuant to any Company
provided death or disability benefit plans.
ii. In
the event of termination of this Agreement by the Company following a Change in
Control pursuant to Section (a)(ii) above, Brackpool shall be entitled to
receive for a period of two (2) years following the effective date of
termination, as though Brackpool were continuing to provide services to the
Company under this Agreement (i) base compensation as set forth in Section 4
above and (ii) all fringe benefits as described in Section 5(e) above to the
extent that such benefits can then lawfully be made available by the Company (or
the Company’s successor in interest) to Brackpool.
iii. In
the event of termination of this Agreement by the Company for cause pursuant to
Section (a)(iii) above, or in the event of termination of this Agreement by
Brackpool without cause pursuant to Section a(v) above, the Company shall have
no further liability or obligation to Brackpool under this Agreement other than
the Company's obligation to pay base compensation as set forth in Section 4
above and fringe benefits as described in Section 5(e) above to the extent that
such base compensation and fringe benefits are accrued but unpaid as of the
effective date of termination.
iv. In
the event of termination of this Agreement by Brackpool pursuant to Section
(a)(iv) above or by the Company without cause pursuant to Section (a)(v) above,
or in the event of termination of this Agreement by the Company for any reason
not specifically set forth above, Brackpool shall be entitled to receive for a
period of one (1) year following the effective date of termination (i.e. the
date upon which Brackpool ceases to provide services as Chief Executive Officer
of the Company), as though Brackpool were continuing to provide services to the
Company under this Agreement (i) base compensation as set forth in Section 4
above and (ii) all fringe benefits as described in Section 5(e) above to the
extent that such benefits can then lawfully be made available by the Company to
Brackpool.
v. The
termination of this Agreement shall not affect the right of Brackpool to
exercise any stock option, to purchase securities of the Company, or to receive
payments under any incentive plans in which Brackpool participates, which rights
may have vested under the terms of the applicable equity grant or incentive plan
prior to the date of termination.
c. Change in Control -
Definition. For purposes of this Agreement, a Change in
Control shall be deemed to occur if, and only if, the transaction or event also
constitutes a change in the ownership or effective control of the Company, or in
the ownership of a substantial portion of the assets of the Company, within the
meaning of Code Section 409A. Without limitation of the foregoing,
Change in Control shall include the occurrence of any of the following events
(subject to the full definition of such events as set forth in Code Section
409A); provided, however, that in the event of any conflict between the
description of the following events as set forth below and the provisions of
Code Section 409A, the provisions of Code Section 409A shall
control:
i. a
change in the ownership of the Company (generally, arising from the acquisition
by a person or group of stock of the Company that, together with stock
previously held by such person or group, constitutes more than 50% or the total
fair market value or total voting power of the Company's stock);
ii. a
change in the effective control of the Company (generally, arising from either
(a) the acquisition by a person or group of ownership of stock of the Company
possessing 30 percent or more of the total voting power of the stock of the
Company or (b) the replacement during any 12 month period of a majority of the
Company's Board of Directors by directors whose appointment or election is not
endorsed by a majority of the members of the Board before the date of
appointment or election); or
iii. a
change in the ownership of a substantial portion of the Company's assets
(generally, arising from the acquisition by any person or group of assets from
the Company that have a total gross fair market value equal to or more than 40
percent of the total gross fair market value of all of the assets of the Company
immediately before such acquisition).
d. Return of Company's
Property. If this Agreement is terminated for any reason, the
Company may, at its option, require Brackpool to vacate his offices prior to the
effective date of a termination and to cease all activities on the Company’s
behalf. Brackpool agrees that on the termination of this Agreement in
any manner, he will immediately deliver to the Company all notebooks, brochures,
documents, memoranda, reports, files, books, correspondence, customer lists, or
other written or graphical records, and the like, relating to the business or
work of the Company, which are or have been in his possession or under his
control and which have not been returned to the Company. Brackpool
hereby expressly acknowledges that all such materials referenced above are the
property of the Company.
e. Public
Identification. If this Agreement is terminated for any
reason, Brackpool shall immediately and forever thereafter cease to hold himself
out to any person, firm, partnership, corporation or other entity as an
employee, agent, independent contractor or representative of the Company or of
any entity owned by, or affiliated with, the Company.
f. Timing of Payments Under
Certain Circumstances. With respect to any amount that becomes
payable to or for the benefit of Brackpool under this Agreement upon Brackpool’s
Separation from Service (as defined below) for any reason, the provisions of
this subsection (f) will apply, notwithstanding any other provision of this
Agreement to the contrary. If the Company determines in good faith
that Brackpool is a “specified employee” within the meaning of Section 409A of
the Internal Revenue Code, any Treasury regulations promulgated thereunder and
any guidance issued by the Internal Revenue Service relating thereto
(collectively, “Code Section 409A”), then to the extent required under Code
Section 409A, payment of any amount of deferred compensation that becomes
payable to or for the benefit of Brackpool upon Separation from Service (other
than by reason of the death of Brackpool) and that otherwise would be payable
during the six-month period following Brackpool’s Separation from Service shall
be suspended until the lapse of such six-month period (or, if earlier, the date
of Brackpool’s death). A “Separation from Service” of Brackpool means
Brackpool’s separation from service, as defined in Code Section 409A, with the
Company and all other entities with which the Company would be considered a
single employer under Internal Revenue Code Section 414(b) or (c), applying the
80% threshold used in such Internal Revenue Code Sections or any Treasury
regulations promulgated thereunder. Any payment suspended as provided
in this subsection (f), unadjusted for interest on such suspended payment, shall
be paid to Brackpool in a single payment on the first business day following the
end of such six-month period or within 30 days following the death of Brackpool,
as applicable, provided that the death of Brackpool during such six-month period
shall not cause the acceleration of any amount that otherwise would be payable
on any date during such six-month period following the date of Brackpool’s
death.
7. EXPENSES. The
Company shall reimburse Brackpool for all out-of-pocket expenses incurred by
Brackpool in the performance of his duties hereunder, including, but not limited
to, telephone, travel, and office expenses, all subject to such written
guidelines and/or requirements for verification as the Company may, in its sole
and absolute discretion, establish.
8. CONFIDENTIALITY AND TRADE
SECRETS. For purposes of this Section 8, the term "Company"
shall collectively refer to the Company and any affiliate thereof.
a. Confidential
Information. Brackpool shall keep in strictest confidence all
information relating to the business, affairs, products, customers and suppliers
of the Company (collectively hereinafter referred to as "Trade Secrets"), which
Brackpool has obtained or may acquire in the course of his employment by the
Company and which is not otherwise generally known to the
public. Brackpool acknowledges that such Trade Secrets are of great
value, and have been developed and/or acquired at great expense to the Company,
and the Company would not enter into this contract of employment and such
information would not be made available to Brackpool in Brackpool's fiduciary
capacity unless the Company were assured that all such information will be used
for the exclusive benefit of the Company. Accordingly, during the
term of this Agreement, and at all times thereafter, Brackpool shall not
publish, communicate, divulge, disclose or use, whether or not for his own
benefit, any such information without the prior written consent of the
Company.
b. Non-Competition. Brackpool
agrees that during the period of his employment, Brackpool will not, directly or
indirectly, engage in the business of, or own or control any interest in (except
as a passive investor owning less than 10% of the equity securities of a
publicly held company), or act as a director, officer of employee of, or
consultant to, any individual, partnership, joint venture, corporation or other
business entity, directly or indirectly engaged in any country in which the
Company conducts business (including, without limitation, the United States, its
possessions and territories), in any business competitive with the business then
being carried on by the Company.
c. Client
Information. Brackpool hereby specifically agrees that he will
not utilize any information concerning the customers, licensees or other
clients, partners or affiliates of the Company which Brackpool acquires during
the term of this Agreement, whether or not the same originated through
Brackpool's efforts, for any purpose detrimental to the business of the
Company. Without limitation of the foregoing, Brackpool agrees that
he shall not at any time interfere with any existing contracts of the Company,
and further agrees that he shall not engage in business discussions with any
person or entity with whom he or the Company are in negotiations at the time he
ceases to be an employee of the Company until after such negotiations have been
concluded.
d. Solicitation of
Employees. Brackpool acknowledges that important factors in
the Company's business and operations are the loyalty and good will of its
employees and its customers. Accordingly, Brackpool agrees that both
during the term of this Agreement and after the expiration or termination of
this Agreement he will not enter into, and will not participate in, any plan or
arrangement to cause any of the Company's employees to terminate his employment
with the Company or hire any of such employees in connection with business
initiated by Brackpool or any other person, firm or
corporation. Brackpool further agrees that information as to the
capabilities of the Company's employees, their salaries and benefits, and the
other terms of their employment is confidential and proprietary to the Company
and constitutes its valuable trade secrets.
e. Ongoing
Obligation. The provisions in this Section 8 shall be
binding during Brackpool's employment and at all times thereafter, regardless of
the circumstances or reasons for termination of this Agreement. In
the event the provisions in this Section 8 are more restrictive than
permitted by the laws of the jurisdiction in which enforcement of this provision
is sought, such provisions shall be interpreted to extend only over the maximum
period of time, range of activities or geographic area as to which it may be
enforceable.
9. REMEDY FOR
BREACH. Brackpool acknowledges that the services to be
rendered by him hereunder are of a special, unique and extraordinary character,
which gives this Agreement a peculiar value to the Company, the loss of which
cannot be reasonably or adequately compensated in damages in an action at law,
and a breach by Brackpool of the provisions of this Agreement will cause the
Company irreparable injury. It is, therefore, expressly acknowledged
that this Agreement may be enforced by injunction and other equitable remedies,
without bond. Such relief shall not be exclusive, but shall be in
addition to any other rights or remedies Company may have for such breach, and
Company shall be entitled to recover all costs and expenses, including
reasonably attorneys' fees, incurred by reason of any breach of the covenants of
this Agreement. Similarly, the provisions of this Section 9 shall not
it any way limit any rights or remedies to which Brackpool may be entitled in
the event of a breach by the Company of any obligations of the Company arising
under this Agreement.
10. LITIGATION AND ATTORNEYS
FEES. In the event of any litigation or arbitration between
the parties hereto in connection with this Agreement or to enforce any provision
or right hereunder, each party to such litigation or arbitration shall pay its
own costs and expenses.
11. BOARD
ACTIONS. Any actions required to be taken or determinations to
be made by the Board under this Agreement may, at the discretion of the Board,
be taken or made by the Compensation Committee or any other duly authorized
committee of the Board.
12. 2003
AGREEMENT. The terms and conditions set forth in this
Agreement shall amend and supersede in their entirety all of the terms and
conditions of the 2003 Agreement, which shall be deemed of no further force and
effect as of the effective date of this Agreement (subject to the satisfaction
by the Company of all obligations for compensation accrued but not paid to
Brackpool as of such date).
13. ADDITIONAL
ACKNOWLEDGMENTS.
a. Brackpool
understands that the terms of this Agreement may be required to be disclosed in,
or filed as an exhibit to, the Company’s annual proxy statement or other reports
filed publicly with the U.S. Securities and Exchange Commission.
x. Xxxxxxxxx
acknowledges and agrees that he has fully read and understands this Agreement,
has been advised to and has been given the opportunity to consult with his
attorney concerning this Agreement, has been advised that the Company's attorney
as not acted as his attorney concerning this Agreement, has had any questions
regarding its effect or the meaning of its terms answered to his satisfaction
and, intending to be legally bound hereby, has freely and voluntarily executed
this Agreement.
14. GENERAL
PROVISIONS.
a. The
failure of the Company at any time to enforce performance by Brackpool of any
provisions of this Agreement shall in no way affect the Company's rights
thereafter to enforce the same, nor shall the waiver by the Company of any
breach of any provision hereof be held to be a waiver of any other breach of the
same or any other provision.
b. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and the successors and assigns of the Company; provided, however, it is
understood and agreed that the services to be rendered and the duties to be
performed by Brackpool hereunder are of a special, unique and personal nature
and that it would be difficult or impossible to replace such services; by reason
thereof, Brackpool may not assign either the benefits or the obligations of this
Agreement.
x. Xxxxxxxxx
shall be considered an employee of the Company within the meaning of all
federal, state and local laws and regulations governing unemployment insurance,
workers' compensation, industrial accident, labor and taxes.
d. This
Agreement is the entire agreement between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral and written agreements and
negotiations between the parties.
e. The
headings of the several paragraphs in this Agreement are inserted solely for the
convenience of the parties and are not a part of and are not intended to govern,
limit or aid in the construction of any term or provision hereof.
f. This
Agreement may not be modified except by a written instrument signed by all
parties hereto.
g. All
clauses and covenants contained in this Agreement are severable, and in the
event any of them shall be held to be invalid by any court, such clauses or
covenants shall be limited as permitted under applicable law, or, if the same
are not susceptible to such limitation, this Agreement shall be interpreted as
if such invalid clauses or covenants were not contained herein.
h. This
Agreement is made with reference to the laws of the State of California and
shall be governed by and construed in accordance therewith. Any
litigation concerning or to enforce the provisions of this Agreement shall be
brought in the courts of the State of California.
i. Any
controversy or claim arising out of or relating to this Agreement, or breach
thereof, may, with the prior consent of both the Company and Brackpool, be
settled by binding arbitration in Los Angeles, California in accordance with the
Commercial Arbitration Rules of the American Arbitration
Association.
15. SECTION
409A.
a. It
is the intention of Company and Brackpool that this Agreement shall comply with
the requirements of Code Section 409A. All payments under this Agreement are
intended to be excluded from the requirements of Code Section 409A or be payable
on a fixed date or schedule under Code Section 409A. All payments made under
this Agreement shall be strictly paid in accordance with the terms of this
Agreement. Notwithstanding any other provision of this Agreement to the
contrary, if Company or Brackpool determines that any compensation or benefit
payable under this Agreement may be subject to Code Section 409A(a)(1), Company
and Brackpool, at the request of either but with the written consent of the
other, which consent shall not be unreasonably withheld, shall adopt such
amendments to this Agreement or adopt other policies and procedures (including
amendments, policies and procedures with retroactive effect), or take any other
actions necessary or appropriate to cause the compensation and benefits payable
under this Agreement not to be subject to Code Section 409A(a)(1) and to
preserve the intended tax treatment of such compensation and benefits. Each
payment of compensation under this Agreement shall be treated as a separate
payment of compensation for purposes of Code Section 409A.
b. Any
reimbursements or in-kind benefits provided under this Agreement that are
subject to Code Section 409A shall be made or provided in accordance with the
requirements of Code Section 409A, including, where applicable, the requirement
that (A) any reimbursement is for expenses incurred during the period of time
specified in the Agreement, (B) the amount of expenses eligible for
reimbursement, or in-kind benefits provided, during a calendar year may not
affect the expenses eligible for reimbursement, or in-kind benefits to be
provided, in any other calendar year, (C) the reimbursement of an eligible
expense will be made no later than the last day of the calendar year following
the year in which the expense is incurred, and (D) the right to reimbursement or
in-kind benefits is not subject to liquidation or exchange for another
benefit.
c. Company
shall not make any deductions for money or property that Brackpool owes to
Company, or offset or otherwise reduce any sums that may be due or become
payable to or for the account of Brackpool, from amounts that constitute
deferred compensation for purposes of Code Section 409A.
x. Xxxxxxxxx’x
right to any deferred compensation, as defined under Code Section 409A, shall
not be subject to borrowing, anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors, to the
extent necessary to avoid tax, penalties and/or interest under Code Section 409A
or otherwise.
IN WITNESS WHEREOF, the parties
hereto have executed this Agreement as of the date first above
written.
BRACKPOOL:
/s/ Xxxxx
Xxxxxxxxx
Xxxxx
Xxxxxxxxx
THE
COMPANY
By:
/s/ Xxxxxx
Xxxxxxxxx
Xxxxxx
Xxxxxxxxx
Chair,
Compensation Committee
