EXHIBIT 10.34
ENGAGEMENT AGREEMENT
THIS AGREEMENT is made the 1st day of April 2005.
BETWEEN: CONSOLIDATED WATER CO. LTD.,
a Cayman Islands company having its registered office at
Trafalgar Place, West Bay Road
P.O. Box 1114 GT, Grand Cayman, B.W.I.
("the Company")
AND: XXXXXX XXXXXXXX
of 0000 XX 0xx Xxxxxx, Xxx. 000, Xxxx Xxxxx, XX 00000 XXX
(the "Senior Vice President")
IT IS HEREBY AGREED:
ENGAGEMENT
1. Subject to satisfaction of the condition precedent in Clause 12, the
Senior Vice President is hereby engaged as Senior Vice President and,
subject to the next succeeding paragraph, Chief Financial Officer of
the Company for one year nine months commencing on the 1st day of
April, 2005 subject to the termination provisions set out in Clauses 18
and 19 hereof and to the extension provisions set out in Clause 20
hereof.
The Senior Vice President will assume the title and duties of Chief
Financial Officer on June 1st 2005 or on such earlier date as he elects
in writing and so notifies the Chief Executive Officer ("CEO")..
REMUNERATION
2. The Senior Vice President's remuneration will be US$108,750.00 for the
period to 31st December 2005 and subject to Clause 5, US$145,000.00 per
annum thereafter, in both cases payable monthly in arrears.
3. In addition, during the term of this Agreement, the Company will pay
the cost of providing medical insurance in the United States, with
coverage reasonably equivalent to that generally provided for the
Company's Cayman Islands employees from time to time, for the Senior
Vice President and his immediate family.
4. In addition, during the term of this Agreement, the Company will make
all statutory payroll contributions required of employers in the United
States, including but not limited to FICA, Medicare, SUI, and WC in
respect of the Senior Vice President to the appropriate United States
regulatory agencies as mandated by applicable United States laws.
5. The Senior Vice President's remuneration will be reviewed by the CEO as
of January 1st each year who may grant an increase but shall not reduce
the Senior Vice President's salary below the level set out in Clause 2
hereof.
6. Provided that within 90 days of the date of this Agreement (in respect
of the year 2005) and by not later than March 31st in respect of each
financial year of the Company commencing with the year 2006 the Senior
Vice President and the CEO have agreed Performance Goals for that
financial year and the Company or the Senior Vice President as the case
may be shall meet or exceed all or some of those agreed goals the
Senior Vice President will qualify for a Performance Bonus for that
year of up to 25% of the Senior Vice President's base salary for that
financial year as adjusted by Clause 5. If in any year the Company or
the Senior Vice President meet all Performance Goals, then the
Performance Bonus shall be the full 25% of the base salary but if only
some Performance Goals are met, the Performance Bonus shall be such
percentage of the maximum Performance Bonus for that year as the CEO
shall in his absolute discretion determine.
In respect of the year 2005, for the purpose of calculating the
Performance Bonus, the base salary will be the amount earned from the
date the Senior Vice President takes up his appointment as Chief
Financial Officer as described in Clause 1 above.
The Performance Bonus, if any, calculated aforesaid shall be paid not
later than the following 28th February in cash.
7. The Company will provide the Senior Vice President with a motor vehicle
which, in the CEO's sole opinion, is suitable for the discharge of the
Senior Vice President's duties hereunder and shall bear all expenses in
connection with it.
RESPONSIBILITIES
8. The Senior Vice President's work will be performed mainly in South
Florida, United States of America.
2
The Company reserves the right to transfer the Senior Vice President to
any other place of business which it may establish in the United States
of America.
9. The Senior Vice President shall devote the whole of his business time
and attention to perform his duties hereunder and shall use his best
endeavours to promote the Company's interests and welfare. These duties
include responsibility for certain administrative functions in the U.S
and providing interim financial advice and assistance to the current
Chief Financial Officer and CEO.
As Chief Financial Officer, the Senior Vice President will generally
provide strategic and operational direction to the Company's financial
function and assist the Board and senior management in establishing
financial and operating strategic objectives and policies to ensure
attainment of corporate objectives.
In this regard, the Senior Vice President shall perform the duties
commonly performed by a Senior Vice President and, subject to the
second paragraph of clause 1, Chief Financial Officer of a United
States publicly listed company which duties include, in conjunction
with reasonable and appropriate subordinate staff to be provided by the
Company, the following:-
(a) maintaining the accounts of the Company, its wholly-owned
subsidiaries and managed affiliates (collectively "the
Group");
(b) managing subordinate staff in the Group's accounting and
administrative departments;
(c) preparing and drafting all annual and quarterly financial
reports filed with the SEC, including financial statements and
disclosure included in management's discussion and analysis;
(d) preparing financial information required in SEC filings
relating to the issue by the Company of debt and/or equity,
including historical financial data, pro forma financial
statements, financial projections and other financial data
included in the filings;
(e) liaising with the Group's independent accountants and internal
auditors and the Company's Audit Committee, and promptly
preparing and communicating all information requested by the
independent accountants, internal auditors and the Audit
Committee during the course of the annual audit, quarterly
reviews, or any other review;
3
(f) preparing monthly management accounts and analytical analysis
of monthly performance versus projections and prior periods
for presentation to management;
(g) preparing financial and other reports for various local
government and regulatory agencies as required in the
operating licences of these reporting entities, and
communicating that information to the CEO and the applicable
regulatory bodies;
(h) preparing bank covenant compliance calculations for the Group,
as required in the Company's loan agreements from time to
time, and communicating that information to the CEO and the
applicable banks;
(i) preparing and maintaining the consolidated budget for the
Group;
(j) assessing and maintaining the Group's disclosure controls and
procedures (as defined in Rule 15d-15(e) of the Securities
Exchange Act of 1934, as amended (the "1934 Act");
(k) assessing and maintaining the Group's internal control over
financial reporting (as defined in Rule 15d-15(f) of the 1934
Act;
(l) overseeing the supervision of subordinate accounting and
administrative personnel, including work allocation, training,
and problem resolution; evaluating performance and making
recommendations for personnel actions; motivating employees to
achieve peak productivity and performance;
(m) preparing corporate filings and corporate meeting minutes;
(n) providing such information to the Company's auditors as they
may require in the course of their duties;
(o) maintaining the Company's share register, for all classes of
shares, outstanding stock options, and warrants, and liaising
with the Company's stock transfer agent; and
(p) carrying out all duties reasonably required of and assigned to
him by the CEO, which he shall discharge in accordance with
directions of the CEO.
The Senior Vice President shall perform his duties under this Agreement
during normal business hours from Monday to Friday inclusive (save on
bank holidays) but he accepts that his duties, which include travelling
on the Company's business both within the United States of America and
abroad, may, from time to time, require work to be undertaken on
Saturdays, Sundays and bank and public holidays.
4
The Senior Vice President shall directly report to the CEO, diligently
follow and implement all management policies and decisions which the
CEO communicates to him, prepare and forward in a timely manner all
reports and accountings requested by the CEO, the Board of Directors,
or any statutory body having regulatory authority over the Company
and/or its subsidiaries, and shall generally be responsible for the
Company's financial management and administrative functions.
Except when required to do so by law, the Senior Vice President shall
not directly or indirectly knowingly engage in any activities or work
which are deemed by the Board to be detrimental to the best interests
of the Company.
The Company and the Senior Vice President will enter into an
indemnification agreement identical to that approved at the August 11,
2004 Annual General Meeting of the Company.
10. In case of inability to work due to illness or injury, the Senior Vice
President shall notify the Company immediately and produce a medical
certificate for any absence longer than ten working days.
11. The Senior Vice President is entitled to up to ten (10) days sick leave
per year without a medical certificate.
12. This Agreement is conditional upon the Senior Vice President undergoing
a medical examination in such form as is usual and customary in the
Cayman Islands or the United States, the results of which must
demonstrate to the CEO's satisfaction that the Senior Vice President is
capable of performing the responsibilities set forth in Clauses 8 and
9. The Company will meet the cost of such medical examination, or any
amounts not covered by the Company's health insurance plan.
HOLIDAYS
13. The Senior Vice President is entitled, during every calendar year to
the following holidays during which his remuneration will continue to
be payable:
(a) all public holidays in the United States of America but not in
the Cayman Islands unless the Senior Vice President is in the
Islands on Company business over a Cayman public holiday, and
(b) four (4) weeks vacation to be taken at a time to be approved
by the CEO.
5
REIMBURSEMENT OF EXPENSES/FEES EARNED
14. (a) All expenses for which the Senior Vice President claims
reimbursement shall be in accordance with any policies
established by the Company from time to time and shall be
within the operating budgets approved by the Board of
Directors. The Company shall reimburse the Senior Vice
President for the costs incurred by the Senior Vice President
in his performance of his duties and responsibilities under
this Agreement upon production of the necessary vouchers or,
if he is unable to produce vouchers, on the Senior Vice
President proving, to the CEO's satisfaction, the amount he
has spent for those purposes.
(b) All fees and payments received by the Senior Vice President
for or in relation to acting as director or officer of a
subsidiary or affiliate of the Company shall be the property
of the Company and the Senior Vice President shall account to
the Company for the same.
NON-COMPETITION
15. The Senior Vice President agrees, as a separate and independent
agreement, that he will not during any period for which he has been
remunerated hereunder, and for a period of one (1) year thereafter,
whether for his own account or for the account of any other person,
firm or company during the term of this Agreement, either alone or
jointly with or as manager, agent for or employee of or as consultant
to any person, company or firm, directly or indirectly, carry on or be
engaged or concerned or interested in any person firm or entity who
conducts business identical to or similar to that conducted by the
Company in any jurisdiction in which the Company carries on business
(whether directly or indirectly).
COMPANY INFORMATION, DOCUMENTS, CONFIDENTIALITY, AND NON-SOLICITATION
16. (a) All information, documents, books, records, notes, files,
memoranda, reports, customer lists and other documents, and
all copies of them, relating to the Company's business or
opportunities which the Senior Vice President keeps, prepares
or conceives or which become known to him or which are
delivered or disclosed to him or which, by any means come into
his possession, and all the Company's property and equipment
are and will remain the Company's sole and exclusive property
both during the term of this Agreement and after the
termination or expiration hereof;
6
(b) If this Agreement is terminated for any reason, or if the
Company at any time requests, the Senior Vice President must
promptly deliver to the Company the originals and all copies
of all relevant documents that are in his possession, custody
or control together with any other property belonging to the
Company, provided, however, that should the Senior Vice
President require access to copies of such documents for any
reasonable purpose, the Company shall provide the same at his
request;
(c) The Senior Vice President shall not, at any time during the
term of this Agreement or within one year after its
termination or expiration, either for his own account or for
the account of any other person, firm or company, solicit,
interfere with or endeavour to entice away from the Company
any person, firm or company who, at any time during the
currency of this Agreement were employees, customers or
suppliers of or were in the habit of dealing with the Company.
17. Except where such information is a matter of public record or when
required to do so by law, the Senior Vice President must not, either
before or after this Agreement ends, disclose to any person any
information relating to the Company or its customers of which he
becomes possessed while acting as Senior Vice President.
TERMINATION
18. At the option of the Company, this Agreement shall terminate and,
except to the extent previously accrued, all rights and obligations of
both parties under it shall cease if the Senior Vice President:
(a) dies; or
(b) is adjudicated bankrupt or makes any arrangement or
composition with his creditors; or
(c) is convicted of any felony (whether or not against the Company
or its subsidiaries or affiliates).
19. (a) The Company may terminate this Agreement forthwith if the
Senior Vice President knowingly commits any act or omission
that could reasonably be expected to result in material harm
to the business or reputation of the Company or any of its
subsidiaries or affiliates, which failure and/or conduct
continues un-remedied for ten (10) days after written notice
from the CEO to the Senior Vice President setting forth in
7
reasonable detail a description of such conduct, and, except
to the extent previously accrued, all rights and obligations
of both parties under this Agreement shall cease.
(b) If through physical or mental illness, the Senior Vice
President is unable to discharge his duties for sixty (60)
successive days, as to which a certificate by any doctor
appointed by the Company will be conclusive, then
1. the Senior Vice President will be relieved of his
duties, his salary reduced to US$1,000.00 per annum
and his bonus entitlement suspended, but
2. the Company will continue to pay the full cost of
providing medical insurance for the Senior Vice
President and his wife and dependants,
until the Senior Vice President is able once again to resume
his duties in full.
If this incapacity continues for a period of two years
(including the 60-day period referred to above) the Senior
Vice President's employment will be deemed to have been
terminated by mutual consent at the expiration of that period.
(c) The Senior Vice President may give six (6) months written
notice of termination to the Company and if he does so, this
Agreement shall terminate at the expiration of that period
and, except to the extent previously accrued, all rights and
obligations of both parties under it shall cease.
EXTENSION
20. On or before September 30th of each year during the term of this
Agreement (or any extension thereof), the CEO shall determine whether
to extend the term of this Agreement, and if the CEO so determines, the
term of this Agreement shall be extended such that the term shall
continue for two (2) years from January 1st of the next following year.
In the event that the CEO determines not to extend the Agreement in any
year, the term of this Agreement shall expire on December 31st of the
next following year and the Company shall, no later than December 31st
of the current year, (i) pay to the Senior Vice President, in cash, his
total unearned remuneration, including vacation pay, for the remainder
8
of the term as set out in Clause 2 as adjusted by Clause 5 hereof, and
(ii) require the Senior Vice President to leave the Company's
employment forthwith.
NOTICES
21. Any notice to be served under this Agreement must be in writing and
shall be deemed to be duly served if it is handed personally to the
Secretary of the Company or to the Senior Vice President as the case
may be, or if it is sent by registered post to the address at the head
of this Agreement. A notice sent by post shall be deemed to be served
on the third day following the date on which it was posted.
PREVIOUS AGREEMENTS SUPERSEDED
22. This Agreement supersedes all prior contracts and understandings
between the parties save that benefits earned or accrued under prior
contracts shall not be extinguished or affected.
WAIVER
23. No change or attempted waiver of any of the provisions hereof shall be
binding unless in writing and signed by the party against whom it is
sought to be enforced.
SEVERABILITY OF PROVISIONS
24. Whenever possible, each provision of this Agreement must be interpreted
in such manner as to be effective and valid. If any provision of this
Agreement or the application of it is prohibited or is held to be
invalid, that prohibition or invalidity will not affect any other
provision, or the application of any other provision which can be given
effect without the invalid provision or prohibited application and, to
this end, the provisions of this Agreement are declared to be
severable.
HEADINGS
25. The headings herein are included for convenience only and have no legal
effect.
APPLICABLE LAW AND JURISDICTION
26. This Agreement shall be construed and the legal relations between the
parties determined in accordance with the laws of the Cayman Islands to
9
the jurisdiction of the courts of which the parties hereby agree to
submit. The Senior Vice President appoints XXXXX XXXXXX ("the Process
Agent") whose address at the date of this Agreement is XX XXX 00000
XXX, XXXXX XXXXXX, XXXXXX XXXXXXX his agent in the Cayman Islands to
receive on his behalf service of copies of the summons and complaint
and any other process which may be served in any action or proceeding
under this Agreement. Such service may be made by personally serving
the Process Agent at the Process Agent's above address, with a copy to
the Senior Vice President at his address above, and the Senior Vice
President irrevocably authorises and directs the Process Agent to
accept such service on his behalf.
EXECUTED FOR AND ON BEHALF OF CONSOLIDATED WATER CO.
CONSOLIDATED WATER CO. LTD. LTD.
BY:
IN THE PRESENCE OF:
/s/ Xxx Xxxxxxx /s/ Xxxxxxxxx X. XxXxxxxxx
----------------------------- -----------------------------------
WITNESS XXXXXXXXX X. XXXXXXXXX
DIRECTOR
EXECUTED BY XXXXXX XXXXXXXX
IN THE PRESENCE OF:
/s/ Xxxxxx Xxxxxx /s/ Xxxxxx Xxxxxxxx
----------------------------- -----------------------------------
WITNESS XXXXXX XXXXXXXX
10
