EXHIBIT 10.01
FIRST AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS FIRST AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement"),
dated as of January 1, 1998, between United States Filter Corporation (the
"Company") and Richard J. Heckmann (the "Employee").
WITNESSETH
WHEREAS, Employee is currently Chairman of the Board of Directors, Chief
Executive Officer and President of the Company; and
WHEREAS, the Company desires to insure the continued availability to the
Company of the Employee's services, managerial skills and business experience,
and the Employee is willing to render such services, all upon and subject to the
terms and conditions contained in this Agreement; and
WHEREAS, the parties previously entered into a certain written
Employment Agreement on June 9, 1998, effective as of January 1, 1998 (the
"Prior Agreement"), and now desire to amend and restate the Prior Agreement in
its entirety.
NOW THEREFORE, in consideration of the premises and the mutual covenants
set forth in this Agreement, the Company and the Employee agree as follows:
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1. EMPLOYMENT AND EMPLOYMENT TERM.
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(a) EMPLOYMENT.
Subject to the terms and provisions set forth in this Agreement, the
Company hereby employs the Employee during the Employment Term (as
hereinafter defined) as the Chief Executive Officer and President of
the Company, and agrees to use its best efforts to cause the Employee
to be a director and Chairman of the Board of Directors of the Company
(the "Board") during the Employment Term, and the Employee hereby
accepts such employment.
(b) EMPLOYMENT TERM.
The period of employment under this Agreement (the "Employment Term")
shall be deemed to have commenced as of January 1, 1998 (the "Effective
Date") and shall continue for a period of sixty-three (63) full
calendar months thereafter, as herein provided. On May 1, 1998, and on
the first day of each month thereafter, the Employment Term shall be
automatically extended by one full calendar month. The Employment Term
shall continue until the expiration of all automatic extensions
affected as aforesaid unless and until it ceases or is terminated
sooner as provided in this Agreement.
2. POSITIONS, RESPONSIBILITIES AND DUTIES.
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(a) IN GENERAL.
During the Employment Term, the Employee shall be employed as, and the
Company shall at all times cause the Employee to be, the Chief
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Executive Officer and President of the Company. In addition to such
positions, the Company shall use its best efforts to ensure that the
Employee is at all times during the Employment Term a director and the
Chairman of the Board. In such positions, the Employee shall have the
duties, responsibilities and authority normally associated with the
office and position of chairman, director, chief executive officer and
president of a publicly traded corporation. No other employee of the
Company shall have authority and responsibilities that are equal to or
greater than those of the Employee. The Employee shall report solely
and directly to the Board and all other officers and other employees
shall report directly to the Employee or the Employee's designees.
(b) TIME.
During the Employment Term, the Employee shall devote such time as is
reasonably necessary to perform the duties associated with his offices
and positions as set forth herein and shall use his best efforts to
perform faithfully and efficiency the duties and responsibilities
contemplated by this Agreement; provided, however, that the Employee
shall not be required to perform any duties and responsibilities which
would be likely to result in non-compliance with or violation or breach
of any applicable law or regulation. Notwithstanding the foregoing, the
Employee may devote reasonable time to activities other than those
required under this Agreement, including the supervision of his
personal investments, and activities involving professional,
charitable, educational, religious and similar types of organizations,
speaking engagements, membership on the
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boards of directors of other orations, and similar type activities, to
the extent that such over activities do not materially inhibit or
prohibit the performance of the Employee's duties under this Agreement
or conflict in any material way with the business of the Company;
provided however, that the Executive shall not serve on the board of
any business or hold any over position unto any business without the
consent of the Board.
3. COMPENSATION AND BENEFITS.
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(a) BASE SALARY.
During the Employment Term, the Employee shall receive a base salary
("Base Salary"), payable in accordance with the Company's payroll
practices generally applicable to the Company's senior executives, of
$500,000 per annum. Such Base Salary shall be reviewed for increase
(but not decrease) in the sole discretion of the Compensation Committee
of tile Board not less frequently the annually during the Employment
Term. In conducting any such annual review, the Compensation Committee
of the Board shall take into account any change in the Employee's
responsibilities, increases in the compensation of other senior
executives of the Company or of its competitors or over comparable
executes and companies, the performance of the Employee and other
pertinent factors. If so increased, such increased Base Salary shall
then constitute "Base Salary" for purposes of this Agreement.
(b) INCENTIVE COMPENSATION.
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(i) During the Employment Term, the Employee shall be entitled to
participate in all incentive compensation plans and programs maintained
by the Company for the benefit of senior executives. Such plans and
programs, in the aggregate, shall provide the Employee win compensation
opportunities at least as favorable as the most favorable of such
opportunities provided by the Company to the Employee under such plans
and programs as in effect at any time during the 90-day period
immediately preceding the Effective Date or, if more favorable to the
Employee, as provided at any time thereafter to the Employee or other
senior executives of the Company.
(ii) Without limiting the foregoing, for each fiscal year of the
Company ending with or within the Employment Term, the Employee shall
be paid an annual incentive of not less than sixty percent (60%) of his
base salary (subject to such performance goals as the Company and the
Employee may from time to time negotiate in good faith). Each such
annual incentive shall be paid at the same time that annual incentives
are generally paid to the Company's other senior executives, but no
later than the end of the third month of the fiscal year next following
the fiscal year for which such annual incentive is paid, unless the
Employee shall elect to defer the receipt or alter the payment thereof.
(c) EMPLOYEE BENEFITS.
During the Employment Term, the Employee and/or the Employee's family,
as the case may be, shall be entitled to participate in all employee
benefit plans and programs provided or maintained by the Company
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(including, without limitation, pension, profit sharing, savings,
medical, disability, life and accident plans and programs and the
United States Filter Corporation Executive Severance Pay Plan). Such
plans and programs, in the aggregate, shall provide the Employee and/or
the Employee's family, as the case may be, with benefits at least as
favorable as the most favorable of such benefits provided by the
Company to or in respect of the Employee under such plans and programs
as in effect at any time during the 90-day period immediately preceding
the Effective Date or, if more favorable to the Employee, as provided
at any time thereafter to or in respect of the Employee or over senior
executives of the Company.
(d) VACATION AND FRINGE BENEFITS.
(i) During the Employment Term, the Employee shall be entitled to paid
vacation and fringe benefits at least as favorable as the most
favorable plans and programs of the Company for the Employee under such
plans and programs as in effect at any time during the 90-day period
immediately preceding the Effective Date or, if more favorable to the
Employee, as in effect at any time thereafter for the Employee or other
senior executives of the Company.
(ii) Without limiting the foregoing, during the Employment Tenn, the
Company will lease the Employee an automobile for the Employee's
business and private use, the make and model of which shall be at least
comparable to the make and model provided to the Employee immediately
preceding the Effective Date, and the Company will pay all deposit
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requirements, servicing and maintenance costs, insurance premiums and
the cost of the gasoline for authorized business use. (The term of any
one such automobile lease shall not exceed thirty-six months other than
at the discretion of the Employee.)
(e) OFFICE AND SUPPORT STAFF.
During the Employment Term, the Employee shall be entitled to an office
or offices of a size and with furnishings and other appointments, and
to personal secretarial and other assistance, at least equal to the
most favorable of the foregoing provided to the Employee by the Company
at any time during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Employee, as provided at
any time thereafter to the Employee or other senior executives of the
Company.
(f) EXPENSE REIMBURSEMENT.
During the Employment Term, the Employee shall be entitled to receive
prompt reimbursement for all usual, customary and reasonable, business-
related expenses incurred by the Employee in performing his duties and
responsibilities hereunder in accordance with the practices and
procedures of the Company as in effect and applied immediately prior to
the Effective Date, or, if more favorable to the Employee, as in effect
at any time thereafter with respect to the Employee or other senior
Executives of the Company.
(g) INDEMNIFICATION.
The Company shall maintain directors and officers liability insurance
in commercially reasonable amounts (as reasonably determined by the
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Board), and the Employee shall be covered under such insurance to the
same extent as other directors and senior executives of the Company.
The Employee shall be eligible for indemnification by the Company under
the Company by-laws as currently in effect, and the Company agrees that
it shall not take any action that would impair the Employee's rights to
indemnification under the Company by-laws, as currently in effect.
4. TERMINATION OF EMPLOYMENT.
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(a) TERMINATION DUE TO DEATH OR DISABILITY.
The Company may terminate the Employee's employment hereunder due to
Disability (as hereinafter defined). In the event of the Employee's
death or a termination of the Employee's employment by the Company due
to Disability, the Employee or his estate or his legal representative,
as the case may bet shall be entitled to receive:
(i) any unpaid Base Salary through the Date of Termination;
(ii) an immediate prorated annual incentive for the fiscal year in
which the Date of Termination occurs equal to the minimum annual
incentive (determined without regard to any performance goals)
provided by Section 3(b)(ii) multiplied by a fraction, the
numerator of which is the number of days such fiscal year through
the Date of Termination and the denominator of which is 365;
(iii) an immediate lump sum amount equal to the sum of (A) two times
the minimum annual incentive (determined without regard to any
performance goals) provided by Section 3(b)(ii) plus (B) twenty-
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four (24) times the monthly rate of Base Salary at the rate in
effect on the Date of Termination;
(iv) any deferred compensation (including, without limitation,
interest or other credits on such deferred amounts), any accrued
vacation pay and any reimbursement for expenses incurred but not
yet paid prior to such Date of Termination; and
(v) any other compensation or benefits which may be owed or provided
to or in respect of the Employee in accordance with the terms and
provisions of this Agreement or any plans and programs of the
Company.
For purposes of this Agreement, "Disability" means the Employee's
inability to render, for a period of six consecutive months, services
hereunder by reason of permanent disability, as determined by the
written medical opinion of an independent medical physician mutually
acceptable to the Employee and the Company. If the Employee and the
Company cannot agree as to such an independent medical physician each
shall appoint one medical physician and those two physicians shall
appoint a third physician who shall make such determination.
(b) DISCHARGE OR RESIGNATION.
(i) In the event that the Employee's employment with the Company
is terminated for any reason other than due to death or Disability,
then the Company shall pay the Employee (A) any unpaid Base Salary
through the Date of Termination, (B) plus an amount equal to the pro
rated annual incentive for the fiscal year in
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which the Date of Termination occurs equal to the minimum annual
incentive (determined without regard to any performance goals) provided
in Section 3(b)(ii) multiplied by a fraction, the numerator of which is
the number of days from the beginning of fiscal year until the Date of
Termination, and the denominator of which is 365, plus (C) any
previously vested benefits, such as previously vested retirement
benefits, plus (D) any deferred compensation (including, without
limitation, interest or other credits on such deferred amounts), any
accrued vacation pay and any reimbursement for expenses incurred but
not yet paid prior to such Date of Termination. Furthermore, the
Company shall honor any rights previously vested in the Employee under
a stock option or other similar plan or program.
(ii) Furthermore, and in addition to the foregoing, in the
event that the Employee's employment with the Company is terminated for
any reason other than due to death or Disability, then the Company
shall also pay the Employee an amount equal to the sum of his Base
Salary for the balance of the Employment Term, plus the target annual
incentive bonus scheduled for each year following the Date of
Termination for the balance of the Employment Term (determined without
regard to any performance goals).
(iii) For purposes of this Agreement, "Date of Termination" means (A)
in the case of Disability, the last day of the six month
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period referred to in Section 4(a), and (B) in all other cases, the
actual date on which the Executive's employment terminates during the
Term of Employment.
(c) [INTENTIONALLY LEFT BLANK]
(d) [INTENTIONALLY LEFT BLANK]
(e) CHANGE OF CONTROL.
(i) In the event the Employee's employment with the Company is
terminated following a Change of Control, Employee shall receive on the
Date of Termination an amount equal to the sum of his Base Salary for
the balance of the Employment Term, plus the target annual incentive
bonus scheduled for each year following the Date of Termination for the
balance of the Employment Term (determined without regard to any
performance goals). In addition, in the event a Change of Change (as
defined herein) occurs during the Employment Term, the Employee's
benefit in the U.S. Filter Supplemental Executive Retirement Plan shall
immediately become fully vested
(ii) "Change of Control" shall mean the occurrence of any of the
following:
(A) the acquisition by any person (including any syndicate or group
deemed to be a "person" under Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
or any successor provision to either of the foregoing, of
"beneficial ownership"
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directly or indirectly, of shares of capital stock of the Company
entitling such person to exercise 50% or more of the total voting
power of all "Voting Shares" of the Company;
(B) during any year or any period of two consecutive years (not
including any period prior to the execution of this Agreement),
individuals who at the beginning of such period constitute the
Board, and any new director (other than a director designated by a
person who has entered into an agreement with the Company to
effect a transaction described in clause (i), (iii) or (iv) of
this definition) whose election by the Board or nomination for
election by the Company's stockholders was approved by a vote of
at least two-thirds of the directors then still in office who
either were directors at the beginning of the period or whose
election or nomination for election was previously so approved
(hereinafter referred to as "Continuing Directors"), cease for any
reason to constitute at least a majority thereof;
(C) any consolidation of the Company with, or merger of the Company
into, any other person, any merger of another person into the
Company, or any sale or transfer of all or substantially all of
the assets of the Company to another person (other than (x) a
consolidation or merger which does
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not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of capital stock other than shares
of capital stock owned by any of the parties to the consolidation or
merger or (y) a merger which is effected solely to change the
jurisdiction of incorporation of the Company or (z) any consolidation
with or merger of the Company into a wholly owned subsidiary, or any
sale or transfer by the Company of all of substantially all of its
assets to one or more of its wholly owned subsidiaries in any one
transaction or a series of transactions; or
(D) the stockholders of the Company approve a plan of complete liquidation
of the Company.
Notwithstanding the foregoing, unless otherwise determined by the Board of
Directors, no change in control of the Company shall be deemed to have
occurred if (x) the Employee is a member of a group which first announces a
proposal which, if successful, would result in a Change of Control, which
proposal (including any modifications thereof) is ultimately successful, or
(y) the Executive acquires a two percent or more equity interest in the
entity which ultimately acquires the Company pursuant to the transaction
described in (x) of this paragraph.
"Beneficial Ownership" shall be determined in accordance with Rule 13d-3
promulgated under the Exchange Act, except that a person shall be deemed to
be the "beneficial owner" of all
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securities that such person has the right to acquire, whether such right is
exercisably immediately or only after the passage of time.
"Voting Share" means all outstanding shares of any class or classes (however
designated) of capital stock of the Company entitled to vote generally in
the election of the Board of Directors of the Company.
(iii) If any payment or benefit to which the Employee becomes entitled
pursuant to this Agreement will be subject to the tax imposed by
section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") (or any similar tax that may hereafter be imposed) (the
"Excise Tax"), the Company shall pay to the Employee at the time
specified below, an additional amount (the "Gross-up Payment") such
that the net amount retained by the Employee, after deduction of any
Excise Tax on the Total Payments (as hereinafter defined) and any
federal, state and local income tax and Excise Tax upon the payment
provided for by this subsection, shall be equal to the Total Payments.
For purposes of determining whether any of such payments or benefits
will be subject to the Excise Tax, and the amount of such Excise Tax,
(if) any over payments or benefits received or to be received by the
Employee in connection with a Change of Control or his termination of
employment, whether pursuant to the terms of this Agreement or
otherwise (which together with the payments and benefits pursuant to
this Agreement, constitute the "Total Payments") shall be treated
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as "parachute payments" within the meaning of section 280G(b)(2) of
the Code, and all "excess parachute payments" within the meaning of
section 280G(b)(1) shall be treated as subject to the Excise Tax,
unless in the opinion of tax counsel selected by the Company's
independent auditors and acceptable to the Employee such other
payments or benefits (in whole or in part) do not constitute parachute
payments, or such excess parachute payments (in whole or in part)
represent reasonable compensation for services actually rendered
within the meaning of section 280G(b)(4) of the Code in excess of the
base amount within the meaning of section 280G(b)(3) of the Code, or
are otherwise not subject to the Excise Tax, (B) the amount of the
Total Payments which shall be treated as subject to the Excise Tax
shall be equal to the lesser of (1) the total amount of the Total
Payments or (2) the amount of excess parachute payments within the
meaning of section 280G(b)(l) (after applying paragraph (A), above),
and (C) the value of any non-cash benefits or any deferred payment or
benefit shall be determined by the Compass independent auditors in
accordance with the principles of sections 280G(d)(3) and (4) of the
Code. For purposes of determining the amount of the Gross-Up Payment,
the Employee shall be deemed to pay federal income taxes at the
highest marginal rate of federal income taxation in the calendar year
in which the Gross-Up Payment is to be made and state and local income
taxes at the highest marginal
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rate of taxation in the sate and locality of his residence on the Date
of Termination, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes.
In the event that the Excise Tax is subsequently determined to be less
than the amount taken into account hereunder at the time of
termination of his employment, the Employee shall repay to the Company
at the time that the amount of such reduction in Excise Tax is finally
determined the portion of the Gross-Up Payment attributable to such
reduction (plus the portion of the Gross-Up Payment attributable to
the Excise Tax and federal and state and local income tax imposed on
the Gross-Up Payment being repaid by him if such repayment results in
reduction in Excise Tax and/or a federal and state and local income
tax deduction) plus interest on the amount of such repayment at the
rate provided in section 1274(b)(2)(B) of the Code. In the event that
the Excise Tax is determined to exceed the amount taken into account
hereunder at the time of the Employee's termination of employment
(including by reason of any payment the existence or amount of which
cannot be determined at the time of the Gross-Up Payment), the Company
shall make an additional Gross-Up Payment in respect of such excess
(plus any interest payable with respect to such excess) at the time
that the amount of such excess is finally determined. If the mounts of
any payments under this Agreement cannot be finally determined on or
before the payment
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date otherwise scheduled for payment, the Company shall pay to the
Employee on such date an estimate, as determined in good faith by the
Company, of the minimum amount of such payment and shall pay the
reminder of such payments (together with interest at the rate provided
in section 1274(b)(2)(B) of the Code) as soon as the amount thereof
can be determined, but in no event later than the thirtieth day after
the Date of Termination. In the event that the amount of the estimated
payments exceeds the amount subsequently determined to have been due,
such excess shall constitute a loan by the Company to the Employee
payable on the fifth day after demand by the Company (together with
interest at the rate provided in section 1274(b)(2)(B) of the Code).
(f) CONTINUATION OF EMPLOYEE BENEFITS.
Upon the termination of the Employee's employment hereunder for
whatever reason, the Company shall continue, for such period after the
Date of Termination as it is required in accordance with this Section
4, to continue to pay Base Salary to or in respect of the Employee, to
cover the Employee and/or the Employee's family under those life,
disability, accident and health insurance benefits that were
applicable to the Employee on the Date of Termination at the same
benefit levels and on the same terms and conditions then in effect;
provided, however, that such coverage shall be no less favorable than
that to which the Employee and/or his family was entitled immediately
prior to his Date of Termination; and further provided that in the
event Employee's employment hereunder is
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terminated for Disability, such coverage shall continue for twenty-
four (24) months following the Date of Termination. In the event that
the Employee and/or the Employee's family's participation in any such
program is barred, the Company shall arrange to provide the Employee
and/or the Employee's family with benefits substantially similar to
those which the Employee and/or the Employee's family would otherwise
have been entitled to receive under such plans and programs from which
continued participation is barred. Following the continuation period
described in this subsection, the Employee and the Employee's family
shall be entitled to elect continuation coverage under Section 601 et.
--
seq. of the Employee Retirement Income Security Act.
---
(g) EQUITY BASED AWARDS.
In the event of the termination of the Employee's employment
hereunder, any vesting or service requirements under any outstanding
stock option or restricted stock awards then held by the Employee
shall be deemed fully satisfied as of the Date of Termination.
Anything herein or in any other agreement, plan or program to the
contrary notwithstanding, in the event of the termination of the
Employee's employment hereunder for whatever reason, all outstanding
vested stock options held by the Employee as of the Date of
Termination, including any for which vesting has been accelerated
pursuant to this Section, shall remain exercisable for the balance of
the respective terms thereof.
(h) NO MITIGATION OR OFFSET.
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The Company agrees that, if the Employee's employment with the Company
terminates, the Employee is not required to seek other employment or
to attempt in any way to reduce any amounts payable to or in respect
of the Employee by the Company pursuant to this Agreement. Further,
the amount of any payment or benefit provided for in this Agreement
shall not be reduced by an compensation earned by the Employee as the
result of employment by another employer, by retirement benefits, by
offset against any amount claimed to be owed by the Employee to the
Company, or otherwise.
(i) [INTENTIONALLY LEFT BLANK]
5. ENFORCEMENT OF AGREEMENT; DEFENSE OF ACTIONS.
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If the Employee determines that it is necessary or desirable for him
to retain legal counsel or incur other costs and expenses in connection with
either enforcing party and all of his rights under this Agreement or defending
against any allegations by the Company of breach of this Agreement by him, the
Employee shall be entitled to recover from the Company reasonable attorneys'
fees, costs and expenses incurred by him in connection with such enforcement or
defense. Such payments shall be made by the Company to the Employee (or
directly to the Employee's attorney) promptly following submission to the
Company of appropriate documentation evidencing the incurrence of such
attorneys' fees, costs, and expenses. The Employee's rights to payments under
this Section shall not be affected by the final outcome of any dispute with the
Company; provided however, that to the extent that the court shall determine
that under the circumstances recovery by the Employee of all or a part of any
such fees and costs and expenses would be unjust or inappropriate, the Employee
shall not be entitled to such recovery.
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6. PROTECTIVE COVENANTS.
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(a) COMPENSATION BENEFITS IF SECTION 6 (b) OR (c) ARE BREACHED.
The Employee agrees that if, during the Employment Term and for a
period of one year thereafter, he (i) competes in any manner (except
as provided below), directly or indirectly, though any person, firm or
corporation, alone or as a member of a partnership or as an officer,
director, stockholder, investor or employee of or consultant to any
other corporation or enterprise or otherwise engages or assists any
other person, firm, corporation or enterprise in engaging in any
business then being conducted by the Company (but not later than as of
the Date of Termination) in any geographic area in which the Company
is then conducting such business or (ii) breaches his obligations
under Section 6(b) or (c), any compensation benefits to which the
Employee would otherwise have been entitled shall be suspended for one
year, or, if less, the remaining balance of the period unto respect to
which the Employee, would be so entitled to such payment and benefits,
which payments and benefits shall be deemed immediately forfeited.
Nothing herein shall prohibit the Employee from being a stockholder in
a mutual fund or a diversified investment company or a passive owner
of not more than two percent of the outstanding stock of any class of
a corporation any equity securities of which are publicly traded, so
long as the Employee has no active participation in the business of
such corporation. Clause (i) of this subsection shall not apply
following the Employment Term if the
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Employee's employment is terminated following a Change of Control.
(b) NO SOLICITATION OF EMPLOYEES.
The Employee further agrees that during the Employment Term and for
one year thereafter, he shall not, in any manner, directly or
indirectly induce or attempt to induce any employee of the Company to
terminate or abandon his or her employment for any purpose whatsoever.
This subsection (b) shall not apply following the Employment Term if
the Employee's employment is terminated following a Change of Control.
(c) NON-DISCLOSURE.
The Employee shall not, at any time during the Employment Term or
thereafter, make use of or disclose, directly or indirectly, any trade
secret, customer lists or other confidential or secret information of
the Company not available to the public generally or to the
competitors of the Company ("Confidential information), except to the
extent that such Confidential Information becomes a matter of public
record or is otherwise available to the general public, other than as
a result of any act or omission of the Employee, or is required to be
disclosed by any law, regulation or order of any court or regulatory
commission, department or agency. Promptly following the Date of
Termination, the Employee shall surrender to the Company all records,
memoranda, notes, plans, reports, computer tapes and software and
other documents and data relating to any Confidential Information or
the business of the Company that he may then possess or have under his
control (together with all copies thereon; provided,
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however, that the Employee may retain copies of such documents as are
necessary for the preparation of his federal or state income tax
returns.
(d) FALSE, DEFAMATORY, OR DISPARAGING STATEMENTS.
The Employee agrees that, while he is employed by the Company, and
after his Date of Termination, he shall not make any false, defamatory
or disparaging statements about the Company, or the officers or
directors of the Company that are reasonably likely to cause material
damage to the Company, or the officers or directors of the Company.
While the Employee is employed by the Company, and after his Date of
Termination, the Company agrees that neither the officers nor the
directors of the Company shall make any false, defamatory or
disparaging statements about the Employee that are reasonably likely
to cause material damage to the Executive.
(e) INJUNCTIONS TO PREVENT BREACHES OF PROTECTIVE COVENANTS.
The parties hereto agree that the Company would be damaged irreparably
in the event of any provision of paragraphs (b), (c) or (d), next
above, were not performed by the Employee in accordance with their
respective terms or were otherwise breached and that money damages
would be an inadequate remedy for any such nonperformance or breach.
Therefore, the Company or its successors or assigns shall be entitled,
in addition to any other rights and remedies existing in their favor,
to an injunction or injunctions to prevent any breach or threatened
breach of any such provisions and to enforce such provisions
specifically (without posting a bond or other security). The parties
hereto agree that the Employee
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would be damaged irreparably in the event of any provision of paragraph
(d), next above, were not performed by the Company in accordance with
its or were otherwise breached and that money damages would be an
inadequate remedy for any such nonperformance or breach. Therefore, the
Employee shall be entitled, in addition to any other rights and
remedies existing in his favor, to an injunction or injections to
prevent any breach or threatened breach of any such provisions and to
enforce such provision specifically (without posting a bond or other
security).
7. SUCCESSORS.
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(a) THE EMPLOYEE.
This Agreement is personal to the Employee and, without the prior
express written consent of the Company, shall not be assignable by the
Employee, except that the Employee's rights to receive any compensation
or benefits under this Agreement may be transferred or disposed of
pursuant to testamentary disposition, intestate succession or pursuant
to a domestic relations order of a court of competent jurisdiction.
This Agreement shall inure to the benefit of and be enforceable by the
Employee's heirs, beneficiaries and/or legal representatives.
(b) THE COMPANY.
This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns. The Company shall require any
successor to all or substantially all of the business and/or assets of
the Company, whether direct or indirect, by purchase, merger,
consolidation, acquisition of stock, or otherwise, by an agreement in
form ant substance
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satisfactory to the Employee, expressly to assume and agree to perform
this Agreement in the same manner and to the same extent as the Company
would be required to perform if no such succession had taken place.
8. MISCELLANEOUS.
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(a) APPLICABLE LAW.
This Agreement shell be governed by and construed in accordance with
the laws of the State of California, applied without reference to
principles of conflict of laws.
(b) AMENDMENTS.
This Agreement may not be amended or modified otherwise than by a
written agreement executed by the parties hereto or their respective
successors and legal representatives.
(c) NOTICES.
All notices and other communications hereunder shall be in writing and
shall be given by hand-delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed
as follows:
If to the Company: UNITED STATES FILTER CORPORATION
40-004 Cook Street
Palm Desert, CA 9221
If to the Employee: RICHARD J. HECKMANN
72551 Clancy Lane
24
Rancho Mirage, CA 92270
With a copy to: LAZOF & COSS
Attn: Ronald C. Lazof, Esq.
4590 MacArthur Boulevard,
Suite 390
Newport Beach, CA 92660
or to such other address as either party shall have furnished to the
other in writing in accordance herewith. Notices and communications
shall be effective when actually received by the addressee.
(d) WITHHOLDING.
The Company may withhold from any amounts payable under this Agreement
such federal, state or local income taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
(e) SEVERABILITY.
The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other
provision of this Agreement.
(f) CAPTIONS.
The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect.
(g) BENEFICIARIES/REFERENCES.
The Employee shall be enabled to select (and change) a beneficiary or
beneficiaries to receive any compensation or benefit payable
hereunder following the Employee's death, and may change such
election, in either
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case by giving the Company written notice thereof. In the event of
the Employee's death or a judicial determination of his incompetence,
reference in this Agreement to the Employee shall be deemed, where
appropriate, to refer to other beneficiary(ies), estate or his legal
representative(s).
(h) ENTIRE AGREEMENT.
This Agreement will contain the entire agreement between the parties
concerning the subject matter hereof and will supersede all prior
agreements, understandings, discussions, negotiations and
undertakings, whether written or oral, between the parties with
respect to the subject matter hereof. However, nothing in this
Agreement shall adversely affect the Employee's rights to benefits
accrued prior to the Effective Date, and, except as contemplated
hereby, the Employee's rights with respect to stock options and
restricted stock granted prior to the Effective Date shall be
governed by the respective stock options and restricted stock
agreements relating thereto.
(i) ARBITRATION.
Company and Employee agree that any controversy or dispute arising
out of or in connection with this Agreement, its interpretation,
performance of termination, shall, upon demand of a party, be
submitted to and decided by binding arbitration. The arbitration
shall be conducted pursuant to Part 3, Title 9 of the
California Code of Civil Procedure Sections 1280-1288.8.
-------------------------------------------------------
Discovery, including depositions for the purpose of discovery,
shall be broadly permitted, and the provisions of the California
----------
Code of Civil
-------------
26
Procedure Section 1283.05 shall apply. Any demand to arbitrate
---------
shall be deemed to have been made on the date actually received by
the party upon whom it is served, and, for the purposes of the
statute of limitations, shall have the same effect as it suit had
been filed on the date the demand is made. The arbitration shall
occur in Orange County, California, before a single retired or former
judge of the Superior Court of the State of California, or the Court
of Appeals of the State of California. The parties shall agree upon
an arbitrator within ten (10) days after the demand is made, and if
the parties fail to so agree, then any of them may apply to the Court
for an order appointing an arbitrator meeting the requirements of
this section. The arbitrator's decision shall be rendered in ninety
(90) days after the hearing and the decision of the arbitrator shall
be final and binding and shall be subject to confirmation, correction
or vacation in accordance with the provisions of California Code of
------------------
Civil Procedure Sections 1285-1287.4. Any application, petition,
---------------
or other proceeding (A) to enforce the award or the provisions of
this Agreement, (B) to the extent that the arbitrator does not have
the power or authority to resolve or grant the relief sought, and/or
(C) for provisions or equitable relief pending appointment of the
arbitrator, shall be commenced in the appropriate State or Federal
Court having jurisdiction in Orange County, California, and the
parties hereby consent to jurisdiction and venue in such Courts.
(j) REPRESENTATION.
The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and Mat the performance of its
27
obligations under this Agreement will not violate any agreement
between the Company and any other person, firm or organization or any
applicable laws or regulations.
(k) SURVIVORSHIP.
The respective rights and obligations of the parties hereunder shall
survive any termination of this Agreement or the Employee's
employment hereunder to the extent necessary to the intended
preservation of such rights and obligations.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date
set forth opposite their signatures herein below.
EMPLOYER:
---------
UNITED STATES FILTER CORPORATION,
a California corporation
DATED: September 30, 1998 By: /s/ Alfred E. Osborne, Jr.
_______________________________
Its: Dr. Alfred E. Osborne, Jr.
______________________________
(title)
Chairman of the Compensation Committee
EMPLOYEE:
--------
DATED: September 30, 1998 By: /s/ Richard J. Heckmann
_______________________________
RICHARD J. HECKMANN
29