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Exhibit 10.11
▇▇▇▇▇ ▇▇▇▇▇
EMPLOYMENT AND CONSULTING AGREEMENT
AGREEMENT by and between Crystal Water Company, a Connecticut corporation with
its principal office and place of business in ▇▇▇▇▇▇▇▇▇, Connecticut (the
"Company"), Connecticut Water Service, Inc., a Connecticut corporation and
holder of all of the outstanding capital stock of Company (the "Parent") and
▇▇▇▇▇ ▇▇▇▇▇, a resident of Brookly, CT (▇▇. ▇▇▇▇▇ or the "Employee"), dated as
of September 29, 1999.
WHEREAS, the Company and the Parent have determined that it is in the best
interests of the Company and the Parent to employ ▇▇▇▇▇ ▇▇▇▇▇ as President of
the Company and ▇▇. ▇▇▇▇▇ desires to serve in that capacity;
WHEREAS, the Company and the Parent have determined that it is in the best
interests of the Company and the Parent to engage ▇▇▇▇▇ ▇▇▇▇▇ as a Consultant
after the employment period and ▇▇. ▇▇▇▇▇ desires to serve in that capacity.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. The Company shall employ the Employee, and the
Employee shall serve the Company, on the trams and conditions set forth
in this Agreement, for the period commencing on or before September 29,
1999 and ending on December 30, 1999 (the "Employment Period").
2. Consultant Period. After the Employment Period the Parent shall engage
▇▇. ▇▇▇▇▇ as a Consultant and not as an Employee. Said Consulting
period shall continue for a period of 10 years, terminating on December
31, 2009 (the "Consulting Period"). If the Employee resigns prior to
the completion of the Employment Period described in Section (1) the
Company shall not be required to engage ▇▇. ▇▇▇▇▇ as a Consultant.
3. Position, Duties and Location.
a) During the Employment Period, the Employee shall have the title of
President of the Company and shall report directly to the CEO of the
Parent. The Employee's authority, duties and responsibilities shall be
those described in "Schedule A" attached hereto.
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b) During the Consulting Period, ▇▇. ▇▇▇▇▇ shall have the title of
Consultant and shall report directly to the CEO of the Parent. The
Consultant's authority, duties and responsibilities shall be those
described in "Schedule B" attached hereto.
c) During the Consulting Period, ▇▇. ▇▇▇▇▇ shall not be an Employee of
the Parent or any of the other Affiliated Companies (as hereinafter
defined) and as an independent contractor shall be responsible for
the payment of his own social security taxes, federal and state
income taxes, pension contributions if any, and any similar items.
▇▇. ▇▇▇▇▇ shall not be entitled to unemployment compensation or
disability benefits during the Consultant Period.
d) During the Employment Period and excluding any periods of vacation
and sick leave to which the Employee is entitled, the Employee shall
devote reasonable attention and time during normal business hours to
the business and affairs of the Company and, to the extent necessary
to discharge the responsibilities assigned to the Employee under
this Agreement, use the Employee's reasonable best efforts to carry
out such responsibilities faithfully and efficiently. It shall not
be considered a violation of the foregoing for the Employee to serve
on corporate, civic or charitable boards or committees so long as
such activities do not involve a conflict of interest with the
Company or the Parent or other "Affiliated Companies" (as
hereinafter defined) or interfere with the performance of the
Employee's responsibilities as an employee of the Company in
accordance with this Agreement. For purposes of this Agreement,
"Affiliated Companies" means the Parent and all companies controlled
by, controlling or under common control with the Parent.
e) During the Employment Period, the Employee shall be entitled to
maintain his office at the Company's present office location in
▇▇▇▇▇▇▇▇▇, CT. During the Consultant Period, the Company shall
provide such office space and secretarial assistance as may be
necessary for the fulfillment of duties consistent with Schedule B
attached hereto.
4.) Compensation.
a.) Base Salary. The Employee shall be paid at a biweekly rate of
$4615.38 for the duration of the Employment Period. The total Annual
Base Salary due ▇▇. ▇▇▇▇▇ for the period from January 1, 1999 up to and
including the Employment Period shall not exceed $120,551 including any
holiday or other leave for which he has been paid.
b.) Consultant Fees. During the Consultant Period, ▇▇. ▇▇▇▇▇ shall
receive fees equal to $16,000 on an annual basis to be paid on a
quarterly basis of $4,000 per quarter on the first day of the first
month of each quarter.
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c.) Other Benefits. (1) During the Employment Period: (i) the Employee
shall be entitled to participate in all qualified deferred
compensation, savings and retirement plans, practices, policies and
programs of the Company in accordance with the plans, practices,
programs and policies available to Officers of the Company set forth,
from time to time, in such plans or any Company employee manual; and
(ii) the Employee and/or the Employee's family, as the case may be,
shall be eligible for participation in, and shall receive all benefits
under, all welfare benefit plans, practices, policies and programs
provided by the Company for Officers of the Company in accordance with
the plans, practices, programs and policies of the Company set forth,
from time to time, in such plans or Company employee manual. (2) Upon
completion of the Consulting Period, the employee will thereafter
receive a supplemental executive retirement benefit designed to pay him
$16,000 per year, regardless of any payments then due him under any
pension plan of the Company. (3) The Employee will have use of his
current company vehicle during his employment and shall be given that
vehicle, at the end of the Employment Period, provided he assumes
responsibility for all taxes, insurance and maintenance of said vehicle
after his retirement. (4) Upon completion of the Employment Period, the
Employee shall receive benefits available to Company retirees including
the option to take payment of retirement benefits in a lump sum payout
in accordance with the terms of the Crystal Water Company Defined
Benefit Pension Plan as amended effective January 1, 1998. (5) The
Company shall maintain a life insurance policy for ▇▇. ▇▇▇▇▇ which will
provide a lump sum payment of $150,000 to his spouse should his death
occur during the Consulting Period.
d.) Expenses. During the Employment and Consulting Periods, the
Employee/Consultant shall be entitled to receive prompt reimbursement
for all reasonable authorized travel and other authorized expenses
incurred by the Employee/Consultant in carrying out the
Employee's/Consultant's duties under this Agreement in accordance with
the policies and procedures established by the Company or the Parent,
as applicable.
e.) Fringe Benefits. During the Employment Period, the Employee shall
be entitled to Fringe benefits in accordance with the plans, practices,
programs and policies of the Company set forth, from time to time, in
such plans or any Company employee manual.
f.) Vacation. During the Employment Period, the Employee shall be
entitled to four weeks' paid vacation annually in accordance with the
plans, policies, programs and practices of the Company as set forth,
from time to time, in such plans or any Company employee manual.
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g.) Consideration for Board of Directors. Upon completion of the
Employment Period and subsequent retirement, ▇▇. ▇▇▇▇▇ shall be
recommended by the CEO of the Parent to the Connecticut Water Company
Committee on Directors for consideration as a candidate for nomination
to the Board of Directors of Connecticut Water Company for election at
the Year 2000 Meeting of Shareholders.
5.) Termination of Employment.
a.) Death or Disability. The Employee's employment shall terminate
automatically upon the Employee's death. The Company shall be entitled
to terminate the Employee's employment because of the Employee's
Disability during the Employment Period. "Disability" means that the
Employee has been unable, with or without accommodation, for a period
of 180 consecutive business days, to perform the Employees' duties
under this Agreement, as a result of physical or mental illness or
injury. A termination of the Employee's employment by the Company for
Disability shall be communicated to the Employee by written notice, and
shall be effective on the 30th day after receipt of such notice by the
Employee (the "Disability Effective Date"), unless the Employee returns
to full-time performance of the Employee's duties before the Disability
Effective Date. In the event that the Company terminates the Employee
due to Disability, the Employee shall be considered to have completed
the Employment Period as defined in Paragraph (1) and the Employee
shall not be entitled to any disability benefits other than
specifically set forth in this Agreement.
b.) By the Company. The Company may terminate the Employee's employment
for Cause. "Cause" means: (i) the Employee's failure to perform the
duties of his employment in any material respect after notice from the
Company and failure to cure within ten business days after delivery of
such notice, (ii) malfeasance or gross negligence in the performance of
the Employee's duties of employment, (iii) the Employee's commission of
a felony under the laws of the United States or any state thereof
(whether or not in connection with his employment), (iv) the commission
by the Employee of a fraud upon the Company or any of the other
Affiliated Companies, (b) willful misconduct on the part of the
Employee, (vi) the Employee's breach of any of the provisions of
Paragraph 10 or 11 of this Agreement, or (vii) any other act or
omission by the employee (other than an act or omission resulting from
the exercise by the Employee of good faith business judgment) which is
materially injurious to the financial condition or the business
reputation of the Company or any of the Affiliated Companies provided,
however, that the Employee may, within ten (10) days of receipt of such
notice, request in writing a hearing by the Board of the Parent. Upon
such request, the Employee shall be entitled to be heard by the Board
of Directors of the Parent, which shall determine whether or not the
Employee shall be terminated and shall provide its reasons for any
termination to the Employee in writing.
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c.) By the Employee. A termination of the Employee's employment by the
Employee shall be effected by giving the Company written notice of the
termination.
d.) No Waiver. The failure to set forth any fact or circumstance in a
Notice of Termination for Cause shall not constitute a waiver of the
right to assert, and shall not preclude the party giving notice from
asserting, such fact or circumstance in an attempt to enforce any right
under or provision of this Agreement.
e.) Date of Termination. The "Date of Termination" means the date of
the Employee's death, the Disability Effective Date, the date on which
the termination of the Employee's employment by the Company for Cause
is effective, or the date that is 60 days after the date on which the
Employee gives the Company notice of a termination of employment, as
the case may be.
6. Termination of Consulting. The Consulting services of ▇▇▇▇▇ ▇▇▇▇▇ shall
commence on January 1, 2000 upon completion of the Employment Period
and, unless terminated by the Parent, which may be done by the Parent
for any of the reasons specified in clauses (iii), (iv), (vi), or
(viii) of the definition of "cause," shall terminate only upon his
death or upon his completing the 10 year Consulting Period.
7. Obligations of the Company upon Termination.
a.) Other Than for Cause or Death. If, during the Employment Period,
the Company terminates the Employee's employment, other than for Cause
or death, the Company shall continue to pay Employee all amounts
contemplated by this Agreement as a result of his being an Employee of
the Company, including the $16,000.00 per year annual benefits payable
to the Employee under Paragraph 4(c)(2) hereof.
b.) For Cause or Death. If the Employee's employment is terminated due
to death or by the Company for Cause during the Employment Period or if
the Employee voluntarily terminates employment, the Company shall pay
the Employee the Annual Base Salary through the Date of Termination and
the amount of any compensation previously deferred by the Employee
(together with any accrued interest or earning thereon), and any
benefits due in accordance with the Crystal Water Company Defined
Benefit Plan as amended effective January 1, 1998, in each case to the
extent not yet paid, and neither the Company nor any Affiliated Company
shall have any further obligations under this Agreement.
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8.) Non-exclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Employee's future participation in any plan, program, policy
or practice provided by the Company or any of the other Affiliated
Companies for which the Employee may qualify, nor shall anything in
this Agreement limit or otherwise affect such rights as the Employee
may have under any contract or agreement with the Company or any of the
other Affiliated Companies. Vested benefits and other amounts that the
Employee is otherwise entitled to receive under any plan, policy,
practice or program of, or any contract or agreement with, the Company
or any of the other Affiliated Companies on or after the Date of
Termination shall be payable in accordance with such plan, policy,
practice, program, contract or agreement, as the case may be, except as
otherwise explicitly modified by this Agreement.
9.) Full Settlement. In no event shall the Employee be obligated to seek
other employment or take any other action by way of mitigation of the
amounts payable to the Employee under any of the provisions of this
Agreement, but if the Employee secures other employment, any employee
welfare benefits the Company is required to provide to the Employee
following termination of the Employee's employment shall be secondary
to those provided by another employer (if any).
10.) Confidential Information. ▇▇. ▇▇▇▇▇ understands that in the course of
his Employment/Consultant period by the Company, he will receive or
have access to confidential information concerning the business or
proposes of the Company and any of the other Affiliated Companies and
which the Company or any of the other Affiliated Companies desire to
protect. Such confidential information shall be deemed to include, but
not be limited to, the Company's customer lists and information, and
employee lists, including, if known, personnel information and data.
▇▇. ▇▇▇▇▇ agrees that he will not, at any time during the period ending
earlier of (i) two years after the Date of Termination or (ii) two
years after completion of the Consulting Period reveal to anyone
outside the Company or any of the other Affiliated Companies or use for
his own benefit any such information without specific written
authorization by the Company or the Parent. ▇▇. ▇▇▇▇▇ further agrees
not to use any such confidential information or trade secrets in
competing with the Company or any of the other Affiliated Companies at
any time during or in the period ending the earlier of (i) the two-year
period immediately following the Date of Termination, or (ii) two years
after completion of the Consulting Period.
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11.) Covenants by the Employee Not to Compete with the Company or the Parent
(a) ▇▇. ▇▇▇▇▇ covenants and agrees that he will not at any time during
the period ending the earlier of (i) two years from and after such Date
of Termination or (ii) two years after completion of the Consulting
Period directly or indirectly in any manner or under any circumstances
or conditions whatsoever be or become interested, as an individual,
partner, principal, agent, clerk, employee, stockholder, officer,
director, trustee or in any other capacity whatsoever, except as a
nominal owner of stock of a public corporation, in any other business
which, at any such date, is a Competitor (as defined herein), either
directly or indirectly, with the Company or any of the other Affiliated
Companies, or engage or participate in, directly or indirectly (whether
as an officer, director, employee, partner, consultant, holder of an
equity or debt investment, lender or in any other manner or capacity),
or lend the Employee's name (or any part or variant thereof) to, any
business which, at any such date, is a Competitor, either directly or
indirectly, with the Company or any of the other Affiliated Companies,
or as a result of the Employee's engagement or participation would
become, a Competitor, either directly or indirectly, with any aspect of
the business of the Company or any of the other Affiliated Companies,
as it exists at any such date, or solicit any officer, director,
employee or agent of the Company or any of the other Affiliated
Companies or any subsidiary or affiliate of the Company or any of the
other Affiliated Companies to become an officer, director, employee or
agent of the Employee, the Employee's respective affiliates or anyone
else. Ownership, in the aggregate, of less than five percent (5%) of
the outstanding shares of capital stock of any corporation with one or
more classes of its capital stock listed on a national securities
exchange or publicly traded in the over-the-counter market shall not
constitute a violation of the foregoing provision. For the purposes of
this Agreement, a Competitor is any business service areas then being
served by the Company or any of the other Affiliated Companies which is
similar to the business of the Company or any of the other Affiliated
Companies or in any way in competition with the business of the Company
or any of the other Affiliated Companies.
(b) The Employee hereby acknowledges that the Employee's services are
unique and extraordinary, and are not readily replaceable, and hereby
agrees that the Company and the Parent, in enforcing the covenants
contained in Paragraphs 10 and 11 herein, in addition to any the
remedies provided for herein or otherwise available at law, shall be
entitled in any court of equity having jurisdiction to an injunction
restraining the Employee in the event of a breach, actual or
threatened, of the agreements and covenants contained in Paragraphs 10
or 11.
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c) The parties hereto believe that the restrictive covenants of this
Paragraph 11 are reasonable. However, if at any time is shall be
determined by any court of competent jurisdiction that this Paragraph
11 or any portion of it as written, are unenforceable because the
restrictions are unreasonable, the parties hereto agree that such
portions as shall have been determined to be unreasonably restrictive
shall thereupon be amended as to make such restrictions reasonable in
the determination of such court, and the said covenants, as so
modified, shall be enforceable between the parties to the same extent
as if such amendments had been made prior to the date of any alleged
breach of said covenants.
12.) Insurance. The Company shall have the right at its own cost and expense
to apply for and to secure in its own name, or otherwise, life, health
or accident insurance or any or all of them covering the Employee, and
the Employee agrees to submit to the usual and customary medical
examination and otherwise to cooperate with the Company in connection
with the procurement of any such insurance, and any claims thereunder.
13.) Release. As a condition of eligibility for severance payments or
benefits provided for in Paragraph 7(a) of this Agreement, at the
request of the Company or the Parent, the Employee shall execute and
deliver for the benefit of the Company and the Parent, and any of the
Affiliated Companies, a general release in the form set forth in
Schedule C, and such release shall become effective in accordance with
its terms provided that neither the Company nor the Parent is in breach
of its obligations under that Agreement at the time such request is
made. The failure or refusal of the Employee to sign such a release or
the revocation of such a release shall cause the termination of any and
all obligations of the Company and the Parent to make payments or
provide benefits hereunder, and the forfeiture of the right of the
Employee to receive any such payments and benefits. The Employee
acknowledges that the Company and the Parent have advised the Employee
to consult with an attorney prior to signing this Agreement and that
the Employee has had an opportunity to do so.
14.) Regulatory Limitation. Notwithstanding any other provision of this
Agreement, the Company shall not be obligated to make, and the Employee
shall have no right to receive, any payment, benefit or amount under
this Agreement which would violate any law, regulation or regulatory
order applicable to the Company, or any of the other Affiliated
Companies at the time such payment, benefit or amount is due
("Prohibited Payment"). If and to the extent the Company shall at a
later date be relieved of the restriction on its ability to make any
Prohibited Payment, then at such time the Company, or the Parent shall
promptly make payment of any such amounts to the Employee. The parties
hereto acknowledge that as of the date of this Agreement, no payment,
benefit, or amount payable under this Agreement would be a Prohibited
Payment.
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15.) Notices. All notices under this Agreement shall be in writing and shall
be deemed effective when delivered in person to the Employee or to the
Secretary of the Company and the Parent, or if mailed, postage prepaid,
registered or certified mail, addressed, in the case of the Employee,
to the Employee's last known address as carried on the personnel
records of the Company, and, in the case of the Company and the Parent,
to the corporate headquarters, attention of the CEO, or to such other
address as the party to be notified may specify by notice to the other
party.
16.) Successors and Assigns.
a.) Assignment by Employee. This Agreement is personal to the Employee
and shall not be assignable by the Employee.
b.) Assignment by the Company. This Agreement shall inure to the
benefit of and by binding upon the Company and the other Affiliated
Companies and their respective successors and assigns. As used in this
Agreement, the "Company" and the other Affiliated Companies shall mean
both the Company and the other Affiliated Companies, respectively, and
any such successor that assumes and agrees to perform this Agreement,
by operation of law or otherwise.
17.) Arbitration. Any dispute which may arise between the parties hereto
may, if both parties agree, be submitted to binding arbitration in the
State of Connecticut in accordance with the Rules of the American
Arbitration Association; provided that any such dispute shall first be
submitted to the Company's Board of Directors in an effort to resolve
such dispute without resort to arbitration.
18.) Severability. If any of the terms or conditions of this Agreement shall
be declared void or unenforceable by any court or administrative body
of competent jurisdiction, such term or condition shall be deemed
severable from the remainder of this Agreement, and the other terms and
conditions of this Agreement shall continue to be valid and
enforceable.
19.) Amendment. This Agreement may be modified or amended only by an
instrument in writing executed by the parties hereto.
20.) Construction. This Agreement supersede and replace all prior agreements
and understandings between the parties hereto on the subject matter
covered hereby. This Agreement shall be governed and construed under
the laws of the State of Connecticut. Words of the masculine gender
mean and include correlative words of the feminine gender. Paragraph
headings are for convenience only and shall not be considered a part of
the terms and provisions of the Agreement.
21.) Guarantee. The Parent hereby guarantees the obligations of the Company
hereunder.
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IN WITNESS WHEREOF, the Company and the Parent have caused this Agreement to be
executed by a duly authorized officer, and the Employee has hereunto set the
Employee's hand, this ____ day of _____ 19__.
CONNECTICUT WATER SERVICE, INC.
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
---------------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
President & CEO
CRYSTAL WATER COMPANY
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/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
[Someone other than ▇▇▇▇▇]
/s/ ▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇
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SCHEDULE A
POSITION DESCRIPTION
PRESIDENT - CRYSTAL WATER COMPANY
1. Serves as a primary spokesman for the company in developing its public
image and represents the company in its relationships with major
customers, suppliers, the financial community, industry groups,
government bodies, as well as directing participation in appropriate
outside meetings. Develops and maintains appropriate working
relationships with government officials.
2. Works with external agencies to address opportunities for expanding
service territories, as well as to expand the economic development of
the operating regions.
3. Recommends programs aimed at achieving growth, diversification, and
profitability.
4. Works with CEO to ensure that future planning is carried out.
5. At specified intervals, reviews with the CEO operating and capital
budgets, performance toward objectives and changes.
6. Develops, grows and manages a profitable business. Preserves the
strength of the company to best preserve its independence and the
interests of the stockholders and customers.
7. Ensures that corporate policies are uniformly understood and properly
interpreted and administered by subordinates.
8. Works with the CEO to develop the basic objectives, policies and
operating plans of the business, both tactical and strategic. Ensures
that regulatory history and trends are recognized for their impact.
9. Maintains a strong management team, assuring the availability of
qualified people to support and strengthen the resources of the
business in meeting its objectives.
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SCHEDULE B
POSITION DESCRIPTION
CONSULTANT
A. Develops and maintains appropriate working relationships with
government officials.
B. Works with external agencies to address opportunities for expanding
service territories, as well as expand the economic development of the
operating regions.
C. Recommends programs aimed at achieving growth, diversification, and
profitability.
D. Works with the CEO to develop the basic objectives, policies, and
operating plans of the business, both tactical and strategic. Ensures
that regulatory history and trends are recognized for their impact.
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ATTACHMENT C
RELEASE
We advise you to consult an attorney before you sign this Release. You have
until the date which is seven (7) days after the Release is signed and returned
to the Crystal Water Company ("the Company") to change your mind and revoke your
Release. Your Release shall not become effective or enforceable until after that
date.
In consideration for the severance benefits and payments provided under your
Employment Agreement dated ___________ with the Company and Connecticut Water
Service, Inc. ("the Parent"), and more specifically enumerated in Exhibit 1
hereto, by your signature below you agree to accept such benefits and not to
make any claims of any kind against the Company, its past and present and future
Parent corporations, subsidiaries, divisions, subdivisions, affiliates and
related companies or their successors and assigns, including without limitation
the Parent, or any and all past, present and future Directors, officers,
fiduciaries or employees of any of the foregoing (all parties referred to in the
foregoing are hereinafter referred to as the "Releasees") before any agency,
court or other forum, and you agree to release the Releasees from all claims,
known or unknown, arising in any way from any actions taken by the Releasees up
to the date of this Release, including, without limiting the foregoing, any
claim for wrongful discharge or breach of contract or any claims arising under
the Age Discrimination in Employment Act of 1967, Title VII of the Civil Rights
Act of 1964, the Americans with Disabilities Act of 1990, the Employee
Retirement Income Security Act of 1974, Connecticut's Fair Employment Practices
Act or any other federal, state or local statute or regulation and any claim for
attorneys' fees, expenses or costs of litigation.
THE PRECEDING PARAGRAPH MEANS THAT BY SIGNING THIS RELEASE YOU WILL HAVE WAIVED
ANY RIGHT YOU MAY HAVE TO BRING A LAWSUIT OR MAKE ANY LEGAL CLAIM AGAINST THE
RELEASEES BASED ON ANY ACTIONS TAKEN BY THE RELEASEES UP TO THE DATE OF THIS
RELEASE.
By signing this Release, you further agree as follows:
1.) You have read this Release carefully and fully understand its terms;
2.) You have had at least twenty-one (21) days to consider the terms of the
Release;
3.) You have seven (7) days from the date you sign this Release to revoke
it by written notification to the Company. After this seven (7) day
period, THIS Release is final and binding and may not be revoked;
4.) You have been advised to seek legal counsel and have had an opportunity
to do so;
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5.) You would not otherwise be entitled to the severance benefits provided
under your Employment Agreement with the Company and the Parent had you
not agreed to waive any right you have to bring a lawsuit or legal
claim against the Releasees; and
6.) Your agreement to the terms set forth above is voluntary.
By signing this Release, you do not agree to release the Company from future
performance of its obligation to pay or provide severance benefits in accordance
with your Employment Agreement, and any failure to pay or provide such benefit
will void this release.
Name: _____________________________
Signature: _____________________________
Date: _____________________________
Received by: _____________________________
Date: _____________________________
