Exhibit 10.13
EMPLOYMENT AGREEMENT
AGREEMENT, made as of the 5th day of December, 1997 between KEYSPAN
ENERGY DEVELOPMENT CORPORATION (the "Company"), a New York corporation with
offices at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and H. ▇▇▇▇ ▇▇▇▇▇▇▇,
residing at ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (the "Executive").
WHEREAS, the Company desires to employ the Executive as
its President, and
WHEREAS, the Executive desires to accept such
employment,
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which is
acknowledged, the parties agree as follows:
1. Scope of Employment.
(a) The Company hereby employs the Executive as its President, and the
Executive hereby accepts such employment by the Company subject to the terms and
conditions set forth herein. In his capacity as President, the Executive shall
have and may exercise all such powers, duties and functions as are normal and
customary to such positions and as may from time to time be assigned to the
Executive by the Board of Directors of the Company (the "Board") and shall at
all times and in all respects comply with the directions and regulations of the
Company and/or as established by the Board.
(b) The Executive shall faithfully serve the Company to the utmost of the
Executive's abilities and shall use the Executive's best efforts to promote the
interests thereof and shall devote all of the Executive's business time,
attention, skill and efforts exclusively to such duties, except insofar as the
Executive has the prior written consent of the Board to do otherwise.
(c) The Executive shall comply with such directives, policies and manuals
as the Company may issue from time to time to its officers and employees.
2. Term of Employment.
The Term of Employment shall commence on December 5th, 1997 and continue
through and including the earlier of the following dates (the "Termination
Date"):
(i) December 4, 2000 (the "Expiration Date");
(ii) the date of the death of the Executive;
(iii)the date of the termination of the Executive's employment by
the Company pursuant to Section 7 of this Agreement; or
(iv) the date of the resignation of the Executive from employment
pursuant to Section 6 of this Agreement.
3. Compensation.
(a) In consideration of the services rendered by the Executive during the
Term of Employment hereunder, including, but not limited to, service as an
officer or director of the Company or of any subsidiary or affiliate thereof,
and in consideration of the Executive's covenants regarding non-competition in
Section 10 hereof, the Company agrees to pay the Executive an annualized salary
of Two Hundred Twenty-five Thousand dollars ($225,000), less withholding taxes
and other amounts required by applicable laws (the "Base Salary"), to be paid in
monthly installments.
(b) The Executive shall be eligible to participate in an incentive
compensation plan established by the Company, subject to the terms and
conditions of the plan as they may be modified from time to time, to provide an
annual incentive compensation award (with a target award equivalent to 35% of
Base Salary and a maximum award equivalent to 70% of Base Salary), as determined
by the Board upon its review of the Company's performance, progress and profits,
and the goals and expectations established by the Board, and the individual
performance of the Executive.
(c) The Executive shall be eligible to participate in The KeySpan Energy
Corporation Long-Term Performance Incentive Compensation Plan (the "Plan"),
subject to the terms and conditions of the Plan as it may be modified from time
to time. Pursuant to the Plan and such additional
terms as may be set by the Board or a Committee of the Board under the Plan, the
Executive shall receive a grant of Twenty Thousand (20,000) non-qualified stock
options, to become vested over a three-year vesting schedule, and to be
exercisable not later than the tenth (10th) anniversary date of the grant. In
accordance with the Plan, the option price for the stock options shall be at
least equal to One Hundred percent (100%) of the fair market value of a share on
the date the options are granted. Such grant shall be made at the meeting of the
Board of Directors of KeySpan Energy Corporation.
(d) The Company shall pay to the Executive, within thirty (30) days after
execution of this Agreement, the sum of One Hundred Thousand Dollars ($100,000),
less applicable withholding taxes, for transportation and related expenses
incurred or to be incurred by the Executive in traveling between his residence
and the Company's offices.
(e) In the event the Executive is terminated for cause, or resigns for any
reason prior to the termination of this agreement, he agrees to reimburse the
Company a pro rata portion of the $100,000 payment indicated in Section 3(d)
hereof based upon length of employment to date of termination or resignation.
(f) The Executive shall be reimbursed for reasonable business expenses
incurred in connection with the performance of his duties hereunder, in
accordance with the Company's policies as they may be amended from time to time.
(g) The Executive shall be subject to annual reviews for all components of
compensation.
4. Benefits.
(a) The Executive shall be eligible to participate in the group medical
and dental plans established and/or offered by the Company for the benefit of
employees of the Company and their eligible dependents, subject to the terms and
conditions of such plans, as they may be modified from time to time, and
applicable laws and regulations.
(b) The Executive shall be eligible to participate in The KeySpan Energy
Corporation Employees' Savings Plan or in another defined contribution (401(k)
retirement plan established and maintained by the Company for the benefit of
employees of the Company, subject to the terms and conditions of such plan, as
it may be amended from time to time, and applicable laws and regulations.
(c) The Company shall cover the Executive at the Company's expense for
workers' compensation and statutory disability insurance.
(d) The Executive shall not be eligible to participate in any other
benefit plans that may be established and/or offered by the Company for the
benefit of its employees and their eligible dependents, including but not
limited to group life insurance, long-term disability and retirement plans.
(e) Effective January 1, 1998, the Executive shall be eligible for 25 paid
vacation days per year upon the terms and conditions of the Company's policies
as they may be amended from time to time. Unused vacation days may not be
carried over from year to year. Upon termination of the Executive's employment
for any reason, the Executive shall be entitled to unused accrued vacation pay
for that calendar year through the date of termination.
5. Termination by the Executive.
The Executive may terminate employment at any time prior to the Expiration
Date upon the Executive's giving the Company notice of termination to be
effective in not less than 30 days.
6. Termination by the Company.
(a) For Cause. The Executive's employment may be terminated by the Company
for cause at any time. Actions or omissions by the Executive which entitle the
Company to terminate employment for cause shall include, but not be limited to,
(i) failure of the Executive in the judgment of
the Company to perform satisfactorily the Executive's assigned duties; or (ii)
the Executive's arrest or indictment for, or conviction of, a crime involving
moral turpitude, dishonesty, theft, a breach of trust, unethical business
conduct or conduct which, in the judgment of the Company may impair the
Company's reputation; or (iii) failure of the Executive to devote substantially
all of his time and business attention exclusively to the business of the
Company and his duties hereunder as required by this Agreement; or (iv) the
inability of the Executive to perform the Executive's duties hereunder, whether
by reason of injury or illness (mental or physical) or otherwise, for a period
in excess of ninety (90) calendar days; or (v) any act of dishonesty, gross
negligence or other serious misconduct by the Executive in the judgment of the
Company; or (vi) violation by the Executive of any other material term or
condition of this Agreement. Upon the Company's giving notice that it is
terminating employment for cause, the Termination Date shall be the date on
which such notice is mailed or hand-delivered to the Executive, unless the
notice states otherwise, and the Executive shall not be entitled to receive any
other compensation or payments hereunder (except as such compensation or
payments relate to the Executive's services prior to the Termination Date).
(b) Other Than For Cause. The Executive's employment may be terminated by
the Company at any time and for any or no reason upon the Company's giving
notice that it is terminating employment other than for cause. In such event,
the Company may discharge the Executive immediately or as of such future date as
the Company may determine to be appropriate.
7. Severance Payment.
(a) Upon the termination of the Executive's employment other than for
cause as described in Section 6(b) hereof, the Company shall pay to the
Executive an amount equal to twelve months Base Salary if termination occurs
within first year of hire, nine months Base Salary if termination occurs within
second year, six months Base Salary if termination occurs within three years
hereunder, to be paid monthly or in a lump sum as determined by the Company,
less such withholding and deductions as may be required by law. The Executive
shall not be eligible for the severance payment described in this Section for
termination of employment for any other reason.
(b) As a precondition to receiving the severance payment described in
Section 7(a) hereof, the Executive agrees to execute and deliver to the Company
a general release, in a form acceptable to the Company, releasing the Company,
its parent, subsidiary and affiliated companies and their officers, directors,
employees and agents from any and all causes of action that the Executive may
have arising out of the Executive's employment, this Agreement or anything else.
(c) Notwithstanding anything contained in this Section 7 to the contrary,
the Executive shall not be eligible for any severance payment hereunder if the
Company or any of its parent, subsidiary or affiliated companies shall offer the
Executive comparable employment within thirty (30) days of termination of the
Executive's employment hereunder and the Executive accepts such offer.
8. Ownership of Employee Developments.
All copyrights, patents, trade secrets, or other intellectual property
rights associated with any ideas, concepts, techniques, inventions, processes,
or works of authorship that the Executive develops or creates during the course
of performing work for the Company or its clients (collectively, the "Work
Product") shall belong exclusively to the Company and shall, to the extent
possible, be considered a work made by the Executive for hire for the Company
within the meaning of Title 17 of the United States Code. To the extent the Work
Product may not be considered work made by the Executive for hire for the
Company, the Executive agrees to assign and automatically assign at the time of
creation of the Work Product, without any requirement of further consideration,
any right, title, or interest the Executive may have in such Work Product. Upon
request of the Company, the Executive shall take such further actions, including
execution and delivery of instruments of conveyance, as may be appropriate to
give
full and proper effect to such assignment.
9. Confidentiality.
(a) As a fiduciary of the Company, the Executive agrees not to disclose
any confidential information made available to or learned by the Executive in
the course of the performance of the Executive's duties at the Company and with
respect to the business of the Company.
For the purposes of this Section, the term "confidential" means
information disclosed to the Executive or known, learned, created or observed by
the Executive as a consequence of, or through the Executive's employment by the
Company concerning the Company or any parent, subsidiary or affiliated company
which is presently existing or which may be formed in the future, which is
confidential, secret or otherwise not generally known in the industry, and
pertains directly or indirectly to the business activities, products, services,
customers or processes of Company or any of its subsidiaries or affiliated
companies, including, but not limited to, information concerning mailing lists,
publicity, data, research, copy, other printed matter, photographs, films,
reproductions, finances, processes, trade secrets, business plans, customer
lists and records, potential customer lists, customer billing and other related
information.
The Executive shall not take any original or copy of any document or other
papers, computer diskettes, methods, procedures, etc., containing or disclosing
such confidential information or documents or summaries containing the substance
of any part thereof. Any records of confidential information prepared by
Executive or which came into the Executive's possession during the period of
employment with the Company are and remain the property of the Company and upon
termination of Executive's employment, all such records and copies thereof shall
either be left with or returned to Company.
(b) The Executive agrees that the restrictions contained in Section 9(a)
of this Agreement are necessary for the protection of the Company during and
following the Terms of Employment hereunder, and any breach thereof will cause
the Company damage for which there are no adequate remedies at law and the
Executive consents to the issuance of an injunction in favor of the Company and
its successors and assigns enjoining the breach of the aforesaid restrictions by
any court of competent jurisdiction. The Executive agrees that the rights of the
Company to obtain an injunction granted by this paragraph of the Agreement shall
not be considered a waiver of the rights of the Company to assert any other
remedies they may have at law or in equity.
10. Non-competition.
(a) The Executive acknowledges that, while serving Company, the Executive
will have numerous, extensive and controlling contacts with the Company's
customers and will provide unique and special services to the Company. The
Company and the Executive acknowledge that the Executive will be privy to
confidential information of the Company and its parent, subsidiary and
affiliated companies and their customers and, therefore, if the Executive
competes with the Company, the Company would suffer a considerable financial
loss in that among other things it would lose the value of some or all of its
good will.
In consideration of employment with the Company under the terms of this
Agreement, the Executive agrees that during the Term of Employment and for one
(1) year thereafter, neither the Executive nor any corporation, partnership or
other entity controlled by, under common control with, or presently controlling
the Executive will (i) in the northeast, travel, canvas or advertise for, or
otherwise assist, render services to, become employed by, be a consultant to, or
invest in any business entity or with any individual engage in, or engage
directly or indirectly in, any line or lines of business carried on or
contemplated which, directly or indirectly, is a competitor of the Company or
its parent, subsidiary and affiliated companies, (ii) solicit business or
otherwise deal directly or indirectly with any customers or persons who were
employees of customers or vendors of the Company at any time, (iii) directly or
indirectly divert or attempt to divert from the Company or its parent,
subsidiary and affiliated companies, any business in which it has been engaged
during the term of the Executive's employment with the Company, or in which it
might reasonably be expected to become engaged, (iv) directly or indirectly
interfere or attempt to interfere with the relationships between the Company,
its customers, employees of customers or vendors, and (v) directly or indirectly
interfere or attempt to interfere with the relationship of employer-employee or
principal and agent of any person bearing such relationship to the Company or
its parent, subsidiary and affiliated companies, nor directly or indirectly
divert or attempt to divert any such person from employment or representation of
the Company or its parent, subsidiary and affiliated companies; provided,
however, that the Executive shall not be prohibited by the terms of this
paragraph from investing in and owning not more than one percent (1%) of the
outstanding shares of common stock of any corporation, the shares of which are
publicly traded pursuant to the Securities Exchange Act of 1934, and/or
passively invest as a limited partner in any non-publicly traded security.
(b) The Executive agrees to promptly notify the
Company if the Executive receives any offer of employment that involves or may
involve any activity described in Section 10(a) hereof if the employment might
commence during or within one (1) year after the termination of the Executive's
employment with the Company. Such notice shall be in writing and shall contain a
complete description of the terms of the offer, including the position and
compensation offered. After the Executive has so notified the Company, the
Executive agrees that the Company may inform such potential employer of the
existence of this Agreement, including the provisions of this Section 10, and
once the Executive has indicated that he intends to accept the offer if the
Company so permits, the Company shall have ten (10) days to elect:
(i) To convince the Executive to stay at the same or a different
salary, compensation, or terms; or
(ii) To release the Executive from any of the restrictions in this
Section 10, but only with respect to the particular employment
position offered to the Executive; or
(iii)To insist upon full compliance with the restrictions in this
Section 10.
(c) The Executive agrees that damages cannot compensate the Company in the
event of a breach or violation of this Section and, injunctive relief being
essential for the protection of the Company and its successors and assigns, in
addition to other applicable remedies, Company may obtain such injunctive relief
in the event of any such breach or violation and may assert any other remedies
it may have at law or in equity.
(d) The Executive has carefully read and considered the provisions of this
Section 10 and agrees that the restrictions are fair and reasonable and are
reasonably required for the protection of the interests of the Company. The
Executive understands that the restrictions contained in this Section may limit
his ability to engage in a business similar to the Company's business, but
acknowledges that he will receive sufficiently high remuneration and other
benefits from the Company hereunder to justify such restrictions.
11. Miscellaneous.
(a) Withholding Taxes. The Company shall withhold from all payments
hereunder all applicable taxes which it is required to withhold therefrom,
unless the Executive has otherwise paid such taxes or made other arrangements
satisfactory to the Company.
(b) Notices. Any notice or other communication provided for in this
Agreement shall be in writing and delivered by mail or by hand, in the case of
the Company, to KeySpan Energy Development Corp., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: ▇. ▇. ▇▇▇▇▇▇, ▇▇.; and, in the case of the
Executive, to the address as it appears in the first paragraph hereof, or such
other address as the Executive may provide to the Company.
(C) Waiver. This Agreement may not be modified, altered or amended except
by a written instrument signed by the parties. Any waiver or any breach of any
provision hereof, or of any right or power by any party on one or more
occasions, shall not be construed as a waiver of, or a bar to, the exercise of
such right or power on any other occasion or as a waiver of any subsequent
breach.
(d) Severability. The unenforceability or invalidity of any provision
hereof shall in no way affect the enforceability or validity of any other
provision.
(e) Binding Effect; Successors. This Agreement shall inure to the benefit
of and shall be binding upon the Company and its successors and assigns and the
Executive and the Executive's heirs. The Executive may not assign, transfer, or
otherwise dispose of this Agreement, or any of the parties' rights hereunder,
without prior written consent of the Company, and any such attempted assignment,
transfer or other disposition without such consent shall be null and void.
(f) Entire Agreement. This Agreement constitutes the entire agreement
between the parties and supersedes any prior or contemporaneous agreement among
the parties with respect to the terms and conditions of the Executive's
employment.
(g) Controlling Law. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the State of New York applicable to
contracts made and to be performed therein, without giving effect to the
principles thereof relating to the conflict of laws. Any action in law or equity
arising out or relating to this Agreement shall be commenced in the New York
State court of appropriate jurisdiction located in Kings County, New York or the
U.S. District Court for the Eastern District of New York.
IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the day and year first above written.
KEYSPAN ENERGY DEVELOPMENT CORP.
/s/ H. ▇▇▇▇ ▇▇▇▇▇▇▇ By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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