EXHIBIT 10(s)
EMPLOYMENT AGREEMENT
between
AQUARION COMPANY
and
XXXXXXX X. XXXXXXX
dated as of October 1, 1995
THIS AGREEMENT, made effective as of October 1, 1995 by and
between AQUARION COMPANY (the "Company"), a Delaware corporation, and
XXXXXXX X. XXXXXXX, of 000 Xxxxxxxxx Xxxxx, Xxxx, Xxxxx Xxxxxxxx (the
"Executive"),
W I T N E S S E T H T H A T :
WHEREAS:
i. The Executive is a principal officer of the Company and an
integral part of its senior management who participates in the
decision making process relative to short and long term planning and
policy for the Company;
ii. The Board of Directors of the Company, at its meeting
on September 1, 1995, determined that it would be in the best
interests of the Company and its shareholders to assure continuity in
the management of the Company's administration and operations by
entering into an employment agreement to retain the services of the
Executive on an extended basis; and
iii. The Executive is willing to continue to serve the
Company as a member of its senior management on the terms and
conditions set forth herein;
NOW, THEREFORE, it is hereby agreed by and between the parties
hereto as follows:
1. Employment. The Company agrees to continue the Executive in its
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employ, and the Executive agrees to remain in the employ of the
Company, for the period stated in Paragraph 3 hereof and upon the
other terms and conditions herein provided.
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2. Positon and Responsibilities. During the period of his
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employment hereunder, the Executive agrees to serve as President of
the Company for the period for which he is and shall from time to time
be elected, and as its Chief Executive Officer, and to be responsible
for the general management of the affairs of the Company, reporting
directly to the Board of Directors of the Company. During said period
the Executive agrees to perform such services not inconsistent with
his position as shall from time to time be requested of him by the
Board of Directors including service, if elected, as an officer and
director of any subsidiary or affiliate of the Company.
3. Term and Duties.
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(a) Term of Employment. The term of the Executive's
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employment under this Agreement shall be deemed to have commenced as
of the date first above written and shall continue for a period of
thirty-six full calendar months thereafter.
(b) Duties. During the period of employment hereunder and
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except for illness or incapacity and reasonable vacation periods
(which shall not be less than 20 days in any calendar year), the
Executive's business time, attention, skill and efforts shall be
exclusively devoted to the business and affairs of the Company and its
subsidiaries; provided, however, that nothing in this Agreement shall
preclude the Executive from devoting time during reasonable periods
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required for:
(i) serving as an officer, director or member of a committee of
any company or organization involving no conflict of
interest with the Company or any of its subsidiaries or
affiliates,
(ii) delivering lectures and fulfilling speaking engagements, and
(iii) engaging in charitable and community activities, provided
that such activities do not materially affect or interfere
with the performance of the Executive's obligations to the
Company.
4. Compensation.
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(a) For all services rendered by the Executive in any
capacity during employment under this Agreement, including services as
an executive, officer, director, or member of any committee of the
Company or any subsidiary or affiliate thereof, the Company shall pay
the Executive a base salary at the rate of not less than $215,000 per
year, subject to such periodic increases as the Board shall deem
appropriate in accordance with the Company's customary procedures and
practices regarding the salaries of senior management employees. Such
salary shall be payable in accordance with the customary payroll
practices of the Company, but in no event less frequently than
monthly. Such periodic increases in salary, once granted, shall not
be subject to revocation.
(b) Executive shall be entitled to participate in any
Company incentive or bonus plan covering some or all of its executive
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officers that is in effect during the period of his employment
hereunder and to receive benefits thereunder on a basis consistent
with the overall administration and intent of any such plan and with
past practice, if any, under such plan. In addition, the Executive
shall continue to be eligible to receive incentive pay based on the
performance of Industrial and Environmental Analysts, Inc. through
December 31, 1996 pursuant to the terms of his prior employment
agreement dated as of April 1, 1994, and Executive shall be granted
options for 50,000 shares of the Company's stock pursuant to the
Company's Stock Option Plan, subject to a three year vesting schedule,
as of the date of this Agreement at an exercise price of $23.25 per
share.
(c) Nothing in this Agreement shall preclude or affect any
rights or benefits that may now or hereafter be provided for the
Executive or for which the Executive may be or become eligible under
any other form of compensation or employee benefit plan now existing
or that may hereafter be adopted or awarded by the Company or mandated
by law. Specifically, the Executive shall:
(i) participate in the Company's Retirement Plan as well as any
related program under any "excess benefit plan" that may be
adopted during the period of the Executive's employment
hereunder and in which the Executive is designated by the
Company's Board of Directors to participate (hereinafter
referred to collectively as the "Retirement Program");
(ii) participate to the permitted extent the Executive wishes in
The Employee Savings and Investment Plan of the Company and
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related program under any excess benefit plan (hereinafter
referred to collectively as the "Thrift and Savings
Program");
(iii) participate in any Employee Stock Ownership Plan that may
subsequently be adopted by the Company;
(iv) participate in the salary continuation program in the event
of death in accordance with Board policy for Company
officers;
(v) participate in the Company's death and disability benefit
plans and its medical, dental and health and welfare plans;
and
(vi) participate in equivalent successor plans of the Company for
which senior management employees are eligible;
provided, however, that, subject to Paragraph 7(c)(iv), nothing in
this Agreement shall preclude the Company from amending or terminating
any such plan or program, on the condition that such amendment or
termination is applicable to all of the Company's senior management
employees generally.
(d) The Executive shall be paid a lump sum amount by the
Company sufficient to fully reimburse the Executive, on an after-tax
basis for any reasonable moving expenses incurred by the Executive for
a move made at the request of the Company (after consideration of any
tax deduction to which the Executive is entitled by reason of the
incurrence of such expenses).
(e) The Executive shall be paid three annual installments,
commencing on the date of closing for a new residence of the Executive
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due to a move requested by the Company, each equal to the product of
the excess, if any, of the annual interest rate on the mortgage on the
new residence over the annual interest rate on the mortgage on the
Executive's prior residence, times the lesser of the principal amount
of the mortgage on the new residence or the principal amount of the
mortgage on the old residence.
5. Business Expenses. The Company shall pay or reimburse the
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Executive for all reasonable travel and other expenses incurred in
connection with the performance of the Executive's duties under this
Agreement in accordance with such procedures as the Company may from
time to time establish. The Company further agrees to furnish the
Executive with a private office and a private secretary and such other
assistance and accommodations, including an automobile and appropriate
club memberships in Connecticut and North Carolina, as shall be
suitable to the character of the Executive's position with the Company
and adequate for the performance of the Executive's duties under this
Agreement.
6. Additional Benefits. Nothing in this Agreement shall affect
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the Executive's eligibility to participate in all group health,
dental, hospitalization, life, travel or accident or other insurance
plans or programs and all other perquisites, fringe benefits or
retirement plans or additional compensation, including termination pay
programs, which the Company may now or hereafter, in its sole and
absolute discretion, make available to its senior management employees
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generally, and the Executive shall be eligible to receive, during the
period of employment under this Agreement, all benefits and emoluments
for which key employees are eligible under every such plan, program,
perquisite or arrangement to the extent permissible under the general
terms and provisions thereof.
7. Termination of Employment. Notwithstanding any other
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provision of this Agreement, the Executive's employment under this
Agreement may be terminated:
(a) by the Company, in the event of the Executive's
serious, willful misconduct in respect of the Executive's duties under
this Agreement, including conviction for a felony or perpetration of a
common law fraud which has resulted or is likely to result in material
economic damage to the Company or any of its subsidiaries, by written
notice to the Executive, specifying the event relied upon for such
termination;
(b) by either the Company or the Executive, if the
executive accepts employment or a consulting position with another
company; or
(c) by the Executive, in the event of any (i) failure to
elect or reelect or to appoint or reappoint the Executive to the
offices of President and Chief Executive Officer of the Company or
other material change by the Company of the Executive's functions,
duties or responsibilities which change would cause the Executive's
position with the Company to become of less dignity, responsibility,
importance or scope from the position and attributes thereof described
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in Paragraph 2 above, (ii) assignment or reassignment by the Company
or by one of its subsidiaries of the Executive to another place of
employment outside of Fairfield County, Connecticut, (iii)
liquidation, dissolution, consolidation, or acquisition or merger of
the Company, or transfer of all or substantially all of its assets
other than a transaction in which a successor corporation with a net
worth at least equal to that of the Company assumes this Agreement and
all obligations and undertakings of the Company hereunder, or (iv)
reduction in the Executive's total compensation and benefits, as
specified in Paragraph 4 above and as currently provided, or other
material breach of this Agreement by the Company or any of its
subsidiaries, by thirty (30) days written notice to the Company,
specifying the event relied upon for such termination and given within
180 days after such event.
8. Payments Upon Termination of Employment. In the event of
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any termination by the Executive pursuant to Paragraph 7(c) above, or
in the event the Executive's employment under this Agreement is
terminated by the Company for any reason other than one of those
specified in Paragraphs 7(a) or 7(b) above, the Company shall, as
liquidated damages or severance pay, or both, promptly pay to the
Executive and provide the Executive and the dependents, beneficiaries
and estate of the Executive as follows:
(a) The Company shall pay the Executive, at his option,
either as a lump sum or in equal monthly installments over the
unexpired portion of the term of employment provided for in Paragraph
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3(a) above, a cash amount equal to the present value of the excess of
(i) the salary provided in Paragraph 4(a) above, including the
increases therein provided, for the unexpired portion of the term of
employment provided for in Paragraph 3(a) above (commencing with the
month in which termination shall have occurred) less the amounts, if
any, the Executive would have paid in cash in respect of employee
benefits provided for in Paragraph 4(c)(v) above if the Executive were
still employed, over (ii) the amounts, if any, paid to the Executive
pursuant to any severance or termination pay program or arrangement of
the Company or any of its subsidiaries, provided, however, that in the
event such termination occurs following a Change in Control (as
defined in Paragraph 14(a)), then the amount paid hereunder shall
instead equal 2 times the Executive's annual salary.
(b) The Company shall also pay the Executive a lump sum
cash amount equal to the present value of the excess of (i) the
aggregate benefit that would have been paid under the Retirement
Program described in Paragraph 4(c)(i) above as in effect on the date
first above written, if the Executive had continued to be employed at
an annual rate of compensation equal to that used to calculate the
payments provided by Paragraph 8(a) above, and to be entitled to
service credit for eligibility and benefit purposes during the
unexpired portion of the term of employment provided for in Paragraph
3(a) above, over (ii) the aggregate benefit actually payable under the
Retirement Program and any successor retirement program of the Company
consisting of a tax qualified pension plan and a related excess
benefit plan. In clarification of the immediately preceding sentence,
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the aggregate benefit that would have been paid under the Retirement
Program shall be calculated as of the normal or early retirement date
for which the Executive would have qualified, assuming the Executive
were still employed on that date and were fully vested in such
benefit, and which would produce the highest present value.
(c) The Company shall also pay the Executive a lump sum
cash amount equal to the present value of the aggregate contributions
or payments, if any, that would have been made by the Company or any
of its subsidiaries under the Thrift and Savings Program and Employee
Stock Ownership Plan described in Paragraph 4(c)(ii) and (iii) above
or any successor program of the Company in effect on the date on which
termination shall have occurred, if the Executive had continued to be
employed, and to participate in the Thrift and Savings Program and
Employee Stock Ownership Plan or such successor programs to the same
extent as the Executive participated for the last month during which
the Executive was permitted to participate, during the unexpired
portion of the term of employment provided for in Paragraph 3(a) above
at an annual rate of compensation equal to that used to calculate the
payments provided by Paragraph 8(a) above.
(d) For purposes of calculating the lump sum cash payments
provided by Paragraphs 8(a), (b) and (c) above, present value shall be
determined by using a discount factor equal to one percentage point
below the prime rate as published in The Wall Street Journal as of the
date on which termination shall have occurred.
(e) For a period of 24 months (commencing with the month in
which termination shall have occurred), the Executive shall continue
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to be entitled to all employee benefits provided for in Paragraph
4(c)(v) above as may be in effect on the date of termination, as if
the Executive were still employed during such period under this
Agreement, with benefits based upon the compensation used to calculate
the payments provided by Paragraph 8(a) above, and if and to the
extent that such benefits shall not be payable or provided under any
such plan, the Company shall pay or provide such benefits on an
individual basis. The medical, dental, health and welfare benefits
provided for in Paragraph 4(c)(v) above, in accordance with this
Paragraph 8(e) shall be secondary to any comparable benefits provided
by another employer provided that an appropriate refund is made of any
reduction in the amount paid pursuant to Paragraph 8(a)(i) which had
assumed that such benefits would be primary.
(f) All stock options granted to the Executive pursuant to the
Company's stock option plan shall become immediately vested and
exercisable, to the extent permitted by said plan.
9. Source of Payments; Interest. All payments provided for in
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Paragraphs 4, 5, 6 and 8 above shall be paid in cash from the general
funds of the Company. Any payments not made within thirty (30) days
after termination or such time as they may otherwise be due hereunder
shall bear interest at the interest rate used to establish the
discount factor provided for in Paragraph 8(d). The Company shall not
be required to establish a special or separate fund or other
segregation of assets to assure such payments.
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10. Litigation Expenses.
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(a) In the event of any litigation or other proceeding
between the Company and the Executive with respect to the subject
matter of this Agreement and the enforcement of rights hereunder, the
Company shall reimburse the Executive for all reasonable costs and
expenses relating to such litigation or other proceeding, including
reasonable attorneys' fees and expenses, provided that such litigation
or proceeding results in any:
(i) settlement requiring the Company to make a payment to the
Executive, or
(ii) judgement or order in favor of the Executive enforcing any
provision of this Agreement or awarding any payment or other
consideration to the Executive, regardless of whether such
judgement or order is subsequently reversed on appeal or in
a collateral proceeding.
In no event shall the Executive be required to reimburse the Company
for any of the costs and expenses relating to such litigation or other
proceeding. The obligation of the Company under this Paragraph 10
shall survive the termination for any reason of this Agreement
(whether such termination is by the Company, by the Executive, upon
the expiration of this Agreement or otherwise).
11. Income Tax Withholding. The Company may withhold from any
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payments made under this Agreement all federal, state, city or other
taxes as shall be required pursuant to any law or governmental
regulation or ruling.
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12. Non-Disclosure of Proprietary Information. The Executive
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will gain, with respect to the Company and its affiliates, detailed
knowledge of all affairs, trade secrets, discoveries, plans,
development work in process, cost information, outstanding bid and bid
proposal information, customer requirements, contractual provisions,
employee capabilities and proposed marketing initiatives, other
confidential information and the like (the "Proprietary Information")
in the course of the Executive's employment hereunder and under any
prior employment agreement with the Company or an affiliate, and the
Executive will necessarily continue to have the fullest knowledge of
such matters. Disclosure to or utilization of such knowledge and
Proprietary Information to any person, firm, business, organization,
corporation, agency or other entity, whether or not engaged in any
line of business competing in any respect with the business of the
Company as now constituted, or as the same may be developed will cause
irreparable injury and damage to the business of the Company. The
Executive covenants and agrees that he will not at any time, during
and after the period of his employment hereunder, except as may be
required by law, disclose any of the Proprietary Information to, or
utilize such information on behalf of, any person, firm, business,
organization, corporation, agency or other entity (other than an
employee or agent of the Company entitled to receive the same). The
Executive's obligations under this Paragraph 12 shall not apply to
information which is or becomes part of the public domain through no
fault of the Executive. Further, upon termination of his employment
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hereunder, the Executive agrees that he will deliver to the Company,
or any affiliated company designated by the Company, any and all
records, files, lists or other documents containing information within
the scope of the foregoing description, including, without limitation,
the Executive's records of contracts with customers and potential
customers, and all copies of the same, and shall not retain any copies
of Proprietary Information.
13. Entire Understanding. This Agreement contains the entire
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understanding between the Company and the Executive with respect to
the subject matter hereof and supersedes any prior employment
agreement between the Company and the Executive, including the
employment agreement dated as of April 1, 1994, except that this
Agreement shall not affect or operate to reduce any benefit or
compensation inuring to the Executive of a kind elsewhere provided and
not expressly provided in this Agreement.
14. Severability. If, for any reason, any one or more of the
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provisions or part of a provision contained in this Agreement shall be
held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other
provision or part of a provision of this Agreement not held so
invalid, illegal or unenforceable, and each other provision or part of
a provision shall to the full extent consistent with law continue in
full force and effect. If this Agreement is held invalid or cannot be
enforced, then to the full extent permitted by law any prior agreement
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between the Company and the Executive shall be deemed reinstated as if
this Agreement had not been executed.
15. Consolidation, Merger, or Sale of Assets. Nothing in this
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Agreement shall preclude the Company from consolidating or merging
into or with, or transferring all or substantially all of its assets
to, another corporation or acquiring entity which assumes this
Agreement and all obligations and undertakings of the Company
hereunder. Upon such a consolidation, merger or transfer of assets
and assumption, the term, "the Company", as used herein shall mean
such other corporation or acquiring entity and this Agreement shall
continue in full force and effect.
16. Notices. All notices, requests, demands and other
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communications required or permitted hereunder shall be given in
writing and shall be deemed to have been duly given if delivered or
mailed, postage prepaid, first class as follows:
(a) to the company:
Aquarion Company
000 Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Secretary
(b) to the Executive:
Xxxxxxx X. Xxxxxxx
000 Xxxxxxxxx Xxxxx
Xxxx, Xxxxx Xxxxxxxx 00000
or to such other address as either party shall have previously
specified in writing to the other.
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17. No Attachment. Except as required by law, no right to
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receive payments under this Agreement shall be subject to
anticipation, commutation, alienation, sale, assignment, encumbrances,
charge, pledge, or hypothecation or to execution, attachment, levy, or
similar process or assignment by operation of law, and any attempt,
voluntary or involuntary, to effect any such action shall be null,
void and of no effect.
18. Binding Agreement. This Agreement shall be binding upon,
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and shall inure to the benefit of, the Executive and the Company and
their respective permitted successors and assigns.
19. Modification and Waiver. This Agreement may not be modified
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or amended except by an instrument in writing signed by the parties
hereto. No term or condition of this Agreement shall be deemed to
have been waived, nor shall there be any estoppel against the
enforcement of any provision of this Agreement except by written
instrument signed by the party charged with such waiver or estoppel.
No such written waiver shall be deemed a continuing waiver unless
specifically stated therein, and each such waiver shall operate only
as to the specific term or condition waived and shall not constitute a
waiver of such term or condition for the future or as to any act other
than that specifically waived.
20. Headings of No Effect. The paragraph headings contained in
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this Agreement are included solely for convenience of reference and
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shall not in any way affect the meaning or interpretation of any of
the provisions of this Agreement.
21. Governing Law. This Agreement and its validity,
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interpretation, performance, and enforcement shall be governed by the
laws of the State of Connecticut.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed and its seal to be affixed hereunto by its officers thereunto
duly authorized, and the Executive has signed this Agreement, all as
of the date first above written.
AQUARION COMPANY
ATTEST:
By:
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Secretary Its Chairman of the Board
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XXXXXXX X. XXXXXXX
