Exhibit 10.4
AGREEMENT
This Agreement by and between Eastern Enterprises, a Massachusetts business
trust with its principal offices in Weston, Massachusetts ("Eastern"), and
Walter J. Flaherty (the "Executive"), is entered into as of the 22nd day of
July, 1998:
WITNESSETH THAT:
WHEREAS the Executive is an executive employee of Eastern; and
WHEREAS the Board of Trustees of Eastern (the "Board") has determined that
it is in the best interests of Eastern, its shareholders and the Executive to
assure continuity in the management of Eastern's administration and operations
by entering into an agreement to provide the Executive with certain assurances
pertaining to compensation and benefits in the event that a Change of Control,
as defined below, should be under consideration or should have occurred.
NOW, THEREFORE, it is hereby agreed by and between the parties hereto as
follows:
1. EMPLOYMENT. Eastern agrees that from and after the Effective Date as
hereinafter defined it shall continue the Executive in its employ and the
Executive agrees that from and after the Effective Date he shall remain in the
employ of Eastern, in each case for the period described in Section 4 hereof and
upon the other terms and conditions herein provided.
2. CERTAIN DEFINITIONS: For purposes of this Agreement, the following
terms shall have the meanings set forth below:
(a) "Cause" shall mean, subject to the provisions of this definition,
(i) conviction of the Executive for (or a plea of nolo contendere by
the Executive with respect to) a felony, or (ii) an act by the
Executive of fraud or dishonesty which has resulted or is likely to
result in material economic damage to Eastern or its subsidiaries. No
purported termination of Executive shall be deemed a termination for
Cause unless the Board shall have made a determination that Cause
exists nor unless, in the case of Cause asserted under clause (a)(ii)
above, the Board shall have given the Executive the opportunity, upon
at least thirty (30) days' prior written notice, to appear and be heard
with counsel before the Board.
(b) "Change of Control" shall mean the occurrence of any of the
following after January 1, 1998:
(i) any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) or
group of "persons" (as so defined), other than Eastern,
becomes a beneficial owner directly or indirectly of
securities representing twenty-five percent (25%) or more of
the combined voting power of the then outstanding voting
securities of Eastern; or
(ii) there is consummated a merger or consolidation ("merger")
involving Eastern and immediately after such merger the
beneficial owners immediately prior to such merger of the then
outstanding voting securities of Eastern do not continue to
own beneficially at least sixty percent (60%) of the voting
securities of the entity or entities resulting from such
merger; or
(iii) there is consummated a sale, lease, exchange, spin-off
or other transfer (any of the foregoing, a "transfer") of all
or substantially all of the assets or business of Eastern and
its subsidiaries, other than any such transfer resulting in
beneficial ownership of not less than sixty percent (60%) of
the assets or business so transferred or not less than sixty
percent (60%) of the voting securities of the entity or
entities to which such assets were transferred by the owners
immediately prior to the transfer of the then outstanding
voting securities of Eastern; or
(iv) within any two-year period, individuals who at the
beginning of such period constituted the Board of Trustees of
Eastern cease for any reason to constitute a majority thereof;
provided, that any trustee who is not in office at the
beginning of such two-year period but whose election or
nomination for election was approved by a vote of at least
two-thirds of the trustees in office at the time of such
approval who were either trustees of Eastern at the beginning
of such period or who were elected to the Board of Trustees
pursuant to an election which was, or for which the nomination
for election was, previously so approved shall be deemed to
have been in office at the beginning of such two-year period.
(c) "Code" shall mean the federal Internal Revenue Code of 1986, as
amended.
(d) "Disability" shall mean the Executive's demonstrated inability,
over a continuous period of at least twelve (12) months, to perform the
Executive's duties and responsibilities by reason of a disabling injury
or condition that would qualify the Executive for benefits under
Eastern's long term disability program.
(e) "Effective Date" shall mean the date specified in Section 4(a)
below.
(f) "Good Reason" means any of the following unless promptly, fully and
retroactively corrected by Eastern or unless waived in writing by the
Executive: (i) any reduction in the annual rate of base salary payable
to the Executive below the higher of the annual rate at which base
salary is then being paid to the Executive or the annual rate at which
base salary was being paid to the Executive immediately prior to the
Effective Date; (ii) the elimination of or any reduction in the bonus
opportunities made available to the Executive under any bonus or
incentive program; (iii) the elimination of or any reduction in any
other employee or executive benefit, benefit program or perquisite then
available to the Executive or the Executive's family or that was
available to the Executive or the Executive's family immediately prior
to the Effective Date, or any change in any such employee or executive
benefit, benefit program or perquisite that would result in additional
cost to the Executive or the Executive's family, in each case except
for changes in broad-based employee benefit programs (that is, employee
benefit programs available to non-officer employees generally as well
as officers) that have a similar effect on both officer and non-officer
participants generally in such programs; (iv) any material change in
the Executive's duties, functions or responsibilities (including
without limitation reporting lines); (v) any action resulting in a
relocation of the Executive's regular place of employment to a location
that is more than thirty-five (35) miles from the place where the
Executive was regularly employed immediately prior thereto or
immediately prior to the Effective Date; and (vi) any other material
breach of this Agreement by Eastern.
3. POSITION AND RESPONSIBILITIES. During the period of employment
hereunder, the Executive agrees to serve Eastern in an executive capacity,
subject to the terms of this Agreement.
4. TERM AND DUTIES.
(a) The period of the Executive's employment under this Agreement shall
be deemed to have commenced as of the date (the "Effective Date") which
precedes by six (6) months the date of a Change of Control and shall
continue for a period which ends on the last day of the twenty-four
(24) calendar month period which begins on the date of such Change of
Control.
(b) During the period of employment hereunder and except for illness or
incapacity and reasonable vacation periods, the Executive's business
time, attention, skill and efforts shall be exclusively devoted to the
business and affairs of Eastern and its subsidiaries; provided,
however, that nothing in this Agreement shall preclude the Executive
from engaging in the following:
(i) serving as a director, trustee or committee member in any
company or organization,
(ii) delivering lectures and fulfilling speaking engagements,
and
(iii) engaging in charitable and community activities.
provided that such activities do not materially adversely affect or interfere
with the performance of the Executive's obligations to Eastern.
5. COMPENSATION AND BENEFITS. During the Executive's employment
under this Agreement, Eastern shall pay, Provide and make available the
following:
(a) Eastern shall pay the Executive base salary at an annual rate that
is not less than the annual rate at which base salary was being paid to
the Executive by Eastern immediately prior to the Effective Date.
(b) In addition to the salary payable under subsection (a) above,
Eastern shall provide or make available to the Executive, from and
after the Effective Date and during the term of the Executive's
employment hereunder, bonus opportunities, benefits, and perquisites
not less favorable, and on terms not less favorable, to the Executive
than the bonus opportunities, benefits and perquisites provided or made
available and on the terms provided or made available to the Executive
immediately prior to the Effective Date.
6. BUSINESS EXPENSE. Eastern shall pay or reimburse the Executive for all
reasonable travel or other expenses incurred in connection with the performance
of the Executive's duties under this Agreement in accordance with such
procedures as Eastern may from time to time establish.
7. TERMINATION OF EMPLOYMENT. Notwithstanding any other provision
of this Agreement, the Executive's employment under this Agreement may be
terminated:
(a) by Eastern for Cause (but only if such termination is
accomplished in the manner specified in Section 2(a));
(b) by Eastern other than for Cause pursuant to Section 7(a) and
other than on account of Disability or death;
(c) by the Executive for Good Reason;
(d) by the Executive other than for Good Reason, Disability or death;
or
(e) by Eastern or the Executive by reason of the Executive's
Disability or death.
Except in the case of termination by reason of the Executive's death or
termination for Cause pursuant to Section 7(a), any termination by Eastern of
the Executive's employment under this Agreement shall take effect only after
thirty (30) days' prior written notice by Eastern to the Executive.
8. VESTING OF CERTAIN AWARDS AND BENEFITS. In the event of a Change of
Control, the Executive shall be immediately vested in all shares of restricted
stock of Eastern then held by Executive, and all stock options then held by the
Executive that were awarded under Eastern's 1982 Stock Option Plan or 1995 Stock
Option Plan (or any successor plan or plans) and that were not then exercisable
shall become immediately exercisable. If the Executive's employment under this
Agreement shall have been terminated under Section 7(b) or Section 7(c) above
after the Effective Date but before the Change of Control, all shares of
restricted stock held by the Executive immediately prior to termination of
employment shall be vested and all stock options held by the Executive
immediately prior to termination of employment (including replacement options,
if any, issued in substitution for such stock options in connection with the
Change of Control), whether or not otherwise exercisable, shall be exercisable
for a period ending not earlier than the later of (i) the date such options
would have been exercisable without regard to this Section 8, or (ii) thirty
days following the Change of Control, subject in each case to consummation of
the Change of Control; provided, that if stock options are not assumed (and no
replacement options are issued) in connection with the Change of Control, clause
(ii) shall not apply and Eastern shall provide the Executive the opportunity to
exercise all of the stock options held by the Executive immediately prior to
termination of employment (whether or not then exercisable) on the same basis as
options held by active employees that become exercisable in connection with the
Change of Control. The provisions of this Section 8 shall be in addition to, and
not in limitation of, any rights that Executive may otherwise have to the
vesting of benefits upon a Change of Control. Without limiting the foregoing,
this Agreement shall be treated as a "COC Agreement" for purposes of the Eastern
Enterprises Supplemental Executive Retirement Plan and the Eastern Enterprises
Supplemental Retirement Plan for Certain Officers, each as from time to time
amended.
9. PAYMENTS UPON TERMINATION OF EMPLOYMENT.
(a) In the event of any termination of the Executive's employment
during the term of this Agreement, if such termination is (1) by the
Executive pursuant to Section 7(c), above, or (2) by Eastern pursuant
to Section 7(b) above, Eastern shall pay to the Executive the sum of
the following amounts within 30 days of such termination (provided,
that if such termination of employment occurs after the Effective Date
but before the Change of Control, the Executive shall be entitled to
the payments described at (i), (ii) and (iii) below only upon
consummation of the Change of Control):
(i) a lump sum cash amount equal to the product of three (3)
times the annual rate at which the Executive was being paid
base salary immediately prior to such termination or
immediately prior to the Effective Date, if greater;
(ii) a lump sum cash amount equal to the product of three (3)
times the Executive's target benefit or benefits under the
annual bonus or incentive plan or plans in which the Executive
was participating for the period including the date of
termination or times the Executive's target benefit or
benefits under the annual bonus or incentive plan or plans in
which the Executive was participating for the period including
the Effective Date if higher; and
(iii) a lump sum cash amount equal to the product of (A) the
Executive's target benefit or benefits for the bonus or
incentive period or periods that include the date of
termination (under the annual bonus or incentive plan or plans
in which the Executive was participating at the time of
termination), times a (B) a fraction, the numerator of which
is the number of days elapsed in such bonus or incentive
period or periods prior to the date of termination, and the
denominator of which is three hundred sixty-five (365).
In addition, upon termination of employment Eastern shall promptly pay
to the Executive any salary, bonuses, or other payments earned by the
Executive but not yet paid as of the date of termination.
(b) For a period of thirty-six (36) months commencing with the month in
which a termination described in (a)(1) or (a)(2) above shall have
occurred, the Executive and the Executive's family shall continue to be
entitled to participate in Eastern's medical, dental, life-insurance,
disability and other welfare benefit plans and programs at a level of
benefits at least as favorable to the Executive and the Executive's
family, and on terms at least as favorable to the Executive and the
Executive's family, as were available to the Executive and the
Executive's family immediately prior to termination or immediately
prior to the Effective Date (whichever is more favorable to the
Executive and the Executive's family). For purposes of any such benefit
that is based on the Executive's length of employment, the Executive
shall be deemed credited with three (3) additional years of employment.
For purposes of any such benefit that is based on the Executive's
average compensation, the average taken into account shall not be less
than the average that would be determined by assuming continued base
salary and bonus or incentive payments for a period of three (3) years
at the rates described at Section 9(a) above, and for purposes of any
such benefit that is based on the Executive's compensation at
termination of employment, there shall be taken into account the higher
of the Executive's compensation at termination or the Executive's
compensation immediately prior to the Effective Date. To the extent the
continuation of benefits described in this paragraph cannot be
accommodated under the plans or programs of Eastern then in effect,
Eastern shall provide for substantially equivalent alternative coverage
and benefits for the Executive and the Executive's family.
Notwithstanding the foregoing, Eastern shall not be obligated to
provide a benefit or coverage under this paragraph to the extent an
equivalent or better benefit or coverage is available to the Executive
or the Executive's family, on a basis that is at least as favorable to
the Executive and the Executive's family, under a plan or program of
another employer. Nothing in this paragraph shall be construed as
requiring Eastern to pay severance in addition to the payments and
benefits otherwise provided for in this Agreement.
10. CERTAIN TAX-RELATED PAYMENTS.
(a) In the event it shall be determined that any "payment in the nature
of compensation" (as that term is used in Section 280G of the Code) to
or for the benefit of the Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise (a "Payment"), would be subject to the excise tax imposed by
Section 4999 of the Code or comparable state or local tax or any
interest or penalties with respect to such excise tax or comparable
state or local tax (such excise tax, together with any such interest
and penalties, are hereinafter collectively referred to as the "Excise
Tax"), then, subject to the following sentence, the cash payments
described at Section 9(a)(i), (ii) and (iii) hereof (but excluding, for
the avoidance of doubt, any payments referred to in the last sentence
of Section 9(a)) shall be reduced, but not below zero, to the extent
(and only to the extent) necessary to avoid the imposition of an Excise
Tax. Notwithstanding the foregoing, if the preceding sentence would
result in a reduction of more than ten percent (10%) in the Executive's
total "parachute payments" (as that term is defined in Section
280G(b)(2) of the Code), or if the reduction described in the preceding
sentence would not eliminate the Excise Tax, no reduction shall be made
in the payments or benefits due to the Executive under this Agreement
or otherwise and instead the Executive shall be entitled to receive an
additional payment (a "Gross-Up Payment"). The Gross-Up Payment shall
be equal to the sum of the Excise Tax and all taxes (including any
interest or penalties imposed with respect to such taxes) imposed upon
the Gross-Up Payment.
(b) If the Executive determines that a Gross-Up Payment is required,
the Executive shall so notify Eastern in writing, specifying the amount
of Gross-Up Payment required and details as to the calculation thereof.
Eastern shall, within 30 days, either pay such Gross-Up Payment (net of
applicable wage withholding) to the Executive or furnish an unqualified
opinion from Independent Tax Counsel (as defined below), addressed to
the Executive and Eastern, that there is substantial authority (within
the meaning of Section 6661 of the Code) for the position that no
Gross-Up Payment is required. "Independent Tax Counsel" means a lawyer
with expertise in the area of executive compensation tax law, who shall
be selected by the Executive and shall be reasonably acceptable to
Eastern, and whose fees and disbursements shall be paid by Eastern.
(c) If the Internal Revenue Service or other tax authority proposes in
writing an adjustment to the income tax of the Executive which would
result in a Gross-Up Payment, the Executive shall promptly notify
Eastern in writing and shall refrain for at least thirty days after
giving such notice, if so permitted by law, from paying any tax
(including interest, penalties and additions to tax) asserted to be
payable as a result of such proposed adjustment. Before the expiration
of such period, Eastern shall either pay the Gross-Up Payment or
provide an opinion from Independent Tax Counsel to the Executive and
Eastern as to whether it is more likely than not that the proposed
adjustment would be successfully challenged if the matter were to be
litigated. If the opinion provides that a challenge would be more
likely than not to be successful if the issue were litigated, and
Eastern requests in writing that the Executive contest such proposed
adjustment, then the Executive shall contest the proposed adjustment
and shall consult in good faith with Eastern with respect to the nature
of all action to be taken in furtherance of the contest of such
proposed adjustment; provided that the Executive, after such
consultation with Eastern, shall determine in his sole discretion the
nature of all action to be taken to contest such proposed adjustment,
including (A) whether any such action shall initially be by way of
judicial or administrative proceedings, or both (B) whether any such
proposed adjustment shall be contested by resisting payment thereof or
by paying the same and seeking a refund thereof, and (C) if the
Executive shall undertake judicial action with respect to such proposed
adjustment, the court or other judicial body before which such action
shall be commenced and the court or other judicial body to which any
appeals should be taken. The Executive agrees to take appropriate
appeals of any judicial decision that would require Eastern to pay a
Gross-Up Payment, provided Eastern requests in writing that the
Executive do so and provides an opinion from Independent Tax Counsel to
the Executive and Eastern that it is more likely than not that the
appeal would be successful. The Executive further agrees to settle,
compromise or otherwise terminate a contest with the Internal Revenue
Service or other tax authority with respect to all or a portion of the
proposed adjustment giving rise to the Gross-Up Payment, if requested
by Eastern in writing to do so at any time, in which case the Executive
shall be entitled to receive from Eastern the Gross-Up Payment. In no
event shall the Executive compromise or settle all or any portion of a
proposed adjustment which would result in a Gross-Up Payment without
the written consent of Eastern, which consent shall not be unreasonably
withheld.
The Executive shall not be required to take or continue any action
pursuant to this Section 10 unless Eastern acknowledges its liability
under this Agreement in the event that the Internal Revenue Service or
other tax authority prevails in the contest. Eastern hereby agrees to
indemnify the Executive in a manner reasonably satisfactory to the
Executive for any fees, expenses, penalties, interest or additions to
tax which the Executive may incur as a result of contesting the
validity of any Excise Tax and to reimburse the Executive promptly upon
receipt of a written demand of the Executive for all costs and expenses
which the Executive may incur in connection with contesting such
proposed adjustment (including reasonable fees and disbursements of
Independent Tax Counsel).
If the Executive shall have contested any proposed adjustment as above
provided, and for so long as the Executive shall be required under the
terms of this Section 10(c) to continue such contest, Eastern shall not
be required to pay a Gross-Up Payment until there occurs a Final
Determination (as defined below) of the liability of the Executive for
the tax and any interest, penalties and additions to tax asserted to be
payable as a result of such proposed adjustment. A "Final
Determination" shall mean (A) a decision, judgment, decree or other
order by any court of competent jurisdiction, which decision, judgment,
decree or other order has become final after all allowable appeals by
either party to the action have been exhausted, the time for filing
such appeal has expired or the Executive has no right under the terms
hereof to request an appeal, (B) a closing agreement entered into under
Section 7121 of the Code or any other settlement agreement entered into
in connection with an administrative or judicial proceeding and with
the consent of the Executive, or (C) the expiration of the time for
instituting a claim for refund, or if such a claim was filed, the
expiration of the time for instituting suit with respect thereto.
(d) In the event the Executive receives any refund from the Internal
Revenue Service or other tax authority on account of an overpayment of
Excise Tax, such amount, together with that part of any Gross-Up
Payment attributable to such amount, shall be promptly paid by the
Executive to Eastern.
11. SOURCE OF PAYMENTS. All payments provided for under this Agreement
shall be paid or provided from the general assets of Eastern and its
subsidiaries or affiliates (to the extent not provided by insurance). Eastern
shall not be required to establish a special or separate fund or other
segregation of assets to assure such payments. Nothing in this Section, however,
shall be construed as restricting Eastern's ability to establish or fund a
so-called "rabbi trust" or similar arrangement to help Eastern meet its
liabilities hereunder, provided that the establishment or funding of such a
trust or arrangement does not by its terms or by operation of law limit or
purport to limit Eastern's liabilities hereunder or otherwise adversely affect
the Executive.
12. LITIGATION EXPENSES. In the event of any litigation or other proceeding
between Eastern and the Executive with respect to the subject matter of this
Agreement and the enforcement of rights asserted in good faith hereunder, or, in
the event of termination of employment pursuant to Section 7(b) or Section 7(c)
above, with respect to any other remuneration or benefits with respect to the
Executive (including, without limitation, payments or benefits with respect to
the Executive under any qualified or nonqualified pension or retirement
agreement, plan, policy, program or arrangement), Eastern shall reimburse the
Executive for all costs and expenses relating to such litigation or other
proceeding, including reasonable attorneys fees and expenses, promptly upon
receipt of a written demand therefor and regardless of whether such litigation
results in any settlement or judgment or order in favor of any party.
Notwithstanding any provision of Massachusetts law to the contrary, in no
event shall the Executive be required to reimburse Eastern for any of the costs
and expenses relating to such litigation or other proceeding.
13. INCOME TAX WITHHOLDING. Eastern may withhold from any payments
made under this Agreement all federal, state, city or other taxes as shall be
required pursuant to any law or governmental regulation or ruling.
14. AGREEMENT NOT TO COMPETE, ETC. The Executive agrees that during the
36-month period beginning on the date the Executive's employment with Eastern
and its subsidiaries is terminated during the term hereof pursuant to Section
7(b) or Section 7(c) above, he will not, within the states in which Eastern
operates its business or in which any of Eastern's subsidiaries operates its
business, engage, either as a principal, employee, partner, consultant or
investor (other than through a 1% or smaller interest in a publicly traded
entity) in a business which competes with any such business of Eastern or its
subsidiaries.
The Executive further agrees that, following any such termination of his
employment, he will continue to comply with Eastern's policies and procedures
regarding confidential information, as that term is hereinafter defined, and
will never directly or indirectly use or disclose, except to the Executive's
attorney or as required by judicial or regulatory process or order, any
confidential information as so defined. For purposes of this paragraph, the term
"confidential information" means any and all information (including without
limitation information related to the development and implementation of business
strategy, financial and operating forecasts, business policies and practices,
and all other information related to the future conduct of business) (i) that
the Executive has acquired in connection with his employment with Eastern and
its subsidiaries, (ii) that is not generally known or available to others with
whom Eastern or its subsidiaries do, or plan to, compete or do business, and
(iii) that pertains to the business of, or belongs to, Eastern or its
subsidiaries or a person described in clause (ii).
The Executive agrees that if, at any time, pursuant to action of any court
of competent jurisdiction, the operation of any part of this Section 14 shall be
determined to be unlawful or otherwise unenforceable, then the coverage of this
Section 14 shall be deemed to be restricted as to duration, geographical scope
or otherwise, to the extent, but only to the extent, necessary to make this
paragraph lawful and enforceable in the particular jurisdiction in which such
determination is made.
The Executive acknowledges and agrees that, were he to breach the
provisions of this Section 14, the harm to Eastern and its subsidiaries would be
irreparable. The Executive therefore agrees that in the event of such a breach
or threatened breach, Eastern or its subsidiaries shall have the right to obtain
preliminary and permanent injunctive relief against any such breach without
having to post bond. Nothing herein shall prohibit Eastern or its subsidiaries
from seeking damages for a breach by the Executive of this Section 14, but
neither Eastern nor any other person shall withhold or offset any payments or
benefits due or owing to the Executive under the terms of this Agreement or
otherwise (including, without limitation, payments or benefits with respect to
the Executive under any qualified or nonqualified pension or retirement
agreement, plan, policy, program or arrangement), and all such payments and
benefits shall he promptly paid or provided to the Executive in accordance with
the terms of this Agreement (or such other agreement, plan, policy, program or
arrangement, as the case may be) without regard to any breach or alleged or
threatened breach by Executive of any provision of this Section 14.
15. ENTIRE UNDERSTANDING. This Agreement contains the entire understanding
between Eastern and the Executive with respect to the subject matter hereof and
supersedes any prior Change of Control or similar severance or salary
continuation agreement between Eastern and the Executive.
16. SEVERABILITY. If, for any reason, any one or more of the provisions or
part of a provision contained in this Agreement shall be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a provision of
this Agreement not held so invalid, illegal or unenforceable, and each other
provision or part of a provision shall to the full extent consistent with law
continue in full force and effect.
17. CONSOLIDATION, MERGER OR SALE OF ASSETS. Nothing in this Agreement
shall preclude Eastern from consolidating or merging into or with, or
transferring all or substantially all of its assets to, another person that
assumes this Agreement and all obligations and undertakings of Eastern
hereunder. Upon such a consolidation, merger or transfer of assets and
assumption, the term "Eastern", as used herein shall mean such other person and
this Agreement shall continue in full force and effect.
18. SURVIVAL OF OBLIGATIONS. The obligations of Eastern under this
Agreement shall survive the termination for any reason of this Agreement
(whether such termination is by Eastern, by the Executive, upon the
expiration of this Agreement or otherwise).
19. NOTICES. All notices, requests, demands and other communications
required or permitted hereunder shall be given in writing and shall be deemed to
have been duly given if delivered or mailed, registered or certified, postage
prepaid with return receipt requested, as follows:
(a) To Eastern:
Eastern Enterprises
9 Riverside Road
Weston, MA 02493
Attention: Legal Department
(b) To the Executive:
Walter J. Flaherty
76 Old Post Road
East Walpole, MA 02032
or to such other address as either party shall have previously specified in
writing to the other pursuant to this Section 19.
20. NO ATTACHMENT. Except as required by law, no right to receive payments
under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge or hypothecation or to execution,
attachment, levy or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to effect any such action shall be null, void
and of no effect.
21. BINDING AGREEMENT. This Agreement shall be binding upon and shall
inure to the benefit of the Executive and Eastern and their respective
successors and assigns.
22. MODIFICATION AND WAIVER.
(a) Prior to the Effective Date this Agreement may be modified, amended
or terminated by the Board of Trustees of Eastern. From and after the
Effective Date this Agreement may not be modified, amended or
terminated except by an instrument in writing signed by the parties
hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any
provision of this Agreement except by written instrument signed by the
party charged with such waiver or estoppel. No such written waiver
shall be deemed a continuing waiver unless specifically stated therein,
and each such waiver shall operate only as to the specific term or
condition waived and shall not constitute a waiver of such term or
condition for the future or as to any act other than that specifically
waived.
23. HEADINGS OF NO EFFECT. The paragraph headings contained in this
Agreement are included solely for convenience of reference and shall not in
any way affect the meaning or interpretation of any of the provisions
of this Agreement.
24. GOVERNING LAW. This Agreement and its validity, interpretation,
performance and enforcement shall be governed by the laws of the
Commonwealth of Massachusetts, without giving effect to the choice of law
provisions in effect in such State.
25. MISCELLANEOUS. Reference is hereby made to the declaration of trust
establishing Eastern Enterprises dated July 18, 1929, as amended, a copy of
which is on file in the office of the Secretary of State of The Commonwealth of
Massachusetts. The name "Eastern Enterprises" refers to the trustees under said
declaration as trustees and not personally, and no trustee, shareholder, officer
or agent of Eastern Enterprises shall be held to any personal liability in
connection with the affairs of said Eastern Enterprises, but the trust estate
only is liable.
IN WITNESS WHEREOF, Eastern has caused this Agreement to be executed by its
officers thereunto duly authorized, and the Executive has signed this Agreement,
all as of the date first above written.
EASTERN ENTERPRISES
By: /s/ J. Atwood Ives CEO
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By: /s/ Walter J. Flaherty
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Walter J. Flaherty