07-30-1993 ERMU MIN ELK RIVER MUNICIPAL UTILITIES
322 King Avenue
A/11 " Elk River, Minnesota 55330
Phone (612) 441-2020
UTILITIES COMMISSION MINUTES
July 30, 1993
11:00 A.M.
Present Were: James Tralle President
James Simpson Vice Chairman
George Zabee Trustee
Others Present: Bill Birrenkott General Manager
1) The meeting was called to order at 11:00 A.M. by
President Tralle.
2 ) The employment agreement with the General Manager was
discussed in detail by the Commissioners. Motion by Mr.
Simpson, seconded by Mr. Zabee to ratify the employment
agreement as negotiated with the General Manager. The Motion
carried.
3) The General Manager discussed with the Commissioners the
problem with the roof of the building and that the costs of
repairs have not been budgeted. Motion by Mr. Zabee, seconded
by Mr. Simpson to proceed with repairs on the roof at a cost
not to exceed $7800. The motion carried.
4 ) Motion by Mr. Simpson , seconded by Mr. Zabee to adjourn. The
motion Carried. Meeting adjourned at 11:30 A.M.
Bill Birrenkott
General Manager
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made effective as of September 1 , 1992, by and between
Elk River Municipal Utilities, a Minnesota municipal utility corporation ("ERMU")
and William Birrenkott, (the "Executive") .
RECITALS:
A. ERMU has retained the services of the Executive; and
B. The Executive has been employed by ERMU since May, 1986;
C. ERMU and the Executive desire to set forth the employment arrangement
between them in writing; and
D. This Agreement sets forth the terms and conditions of the employment
agreement between the parties.
AGREEMENT:
NOW THEREFORE, in consideration of the foregoing and the terms and conditions
herein, the Executive and ERMU agree as follows :
1 . TERM. ERMU hereby employs the Executive for an indefinite term.
2. DUTIES. The Executive accepts said employment in the position of
General Manager and agrees to perform for ERMU such duties as ERMU shall from
time to time determine, including but not limited to the duties generally asso-
ciated with the Chief Executive Officer of an electric distribution utility and
municipal water department.
3. COMPENSATION AND OTHER BENEFITS. ERMU, at its own expense shall :
(a) Salary. Pay Basic Compensation as determined by mutual agreement.
Payment of Basic Compensation shall be made in increments that conform
to ERMU' s normal payroll practice. All payments to the Executive shall
be subject to withholding and other deductions and employer payment
required by law.
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(b) Health Insurance, Vacation, Life Insurance, etc. Provide to the
Executive all other standard fringe benefits in accordance with the
usual practice of ERMU.
(c) Car Allowance. Reimburse Executive for automobile expenses asso-
ciated with his duties as general manager. To qualify for reimbur-
sement: (1) must be business connected expense; (2) the Executive must
substantiate or be deemed to have substantiated the expense; and
(3) the Executive must return to ERMU any amounts in excess of the
substantiated (or deemed substantiated) expenses. The substantiated
requirement will be satisfied if enough information is submitted to
ERMU to satisfy the substantiated requirement of §274 of the Internal
Revenue Code.
(d) Additional Life Insurance. Provide a Life Insurance plan for the
Executive consisting of the Flexible Premium Adjustible Life policy
issued by American Family Insurance Company, Policy Number U1O3O82-0,
or an equivalent policy issued by insurance carriers licensed to do
business in the State of Minnesota. Said Plan shall , at a minimum,
provide to the Executive :
(1) Capital development to create a 15 year $25,000 per year
retirement income beginning at age 62.
(2) Life insurance protection to provide Executive' s beneficiary
with a 15 year, $25,000 per year income.
(3) Benefit coverage to satisfy (1) and (2) above plus coverage
to recover all or most of ERMU's costs upon the death of the
Executive.
Ownership of the policy shall remain with ERMU.
(e) Retirement. Executive may retire from active employment on the
first day of the calendar month following the month in which he reaches
age 62.
(1) Upon his retirement, ERMU shall transfer ownership of the
above described life insurance policy fully paid to the Executive.
(2) Executive vested interest in the cash surrender value of the
life insurance policy shall be the amount calculated in accordance
with the table set forth in Schedule A attached hereto.
4. SALARY NEGOTIATIONS. The parties mutually understand and agree that
salary negotiations presume that the parties are bargaining in good faith. In
the event the parties reach an impass, an arbitrator, mutually agreeable to both
sides, shall be appointed to assist in negotiating a resolution. The cost of
the arbitration shall be shared equally by the parties. Should the parties fail
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to reach an agreement, the Executive may resign from his employment. In that
event, ERMU agrees to immediately pay to the Executive severance pay in an
amount equal to one year of his then existing gross annual salary. ERMU also
agrees to transfer to the Executive the total cash surrender value of the life
insurance policy referenced in paragraph 3(d) adjusted in accordance with
Schedule A.
5. TERMINATION. This Agreement shall be terminated as follows :
(a) Death. Effective the date of the death of the Executive.
(b) Agreement. By mutual agreement in writing of ERMU and the
Executive.
(c) With cause. ERMU shall have the right to terminate the services
of the Executive for cause, which shall mean any cause for which the
Executive would be ineligible for unemployment compensation under
Minnesota law. The effective date of termination shall be the date of
receipt by the Executive of written notice thereof.
(d) Without Cause. ERMU shall have the right to terminate the ser-
vices of the Executive without cause, but in such event, ERMU agrees to
immediately pay to the Executive severance pay in an amount equal to
two times his then existing gross annual salary and the cash surrender
value of the life insurance policy described above adjusted in accor-
dance with Schedule A.
6. NOTICES. All communications, demands, notices or objections permitted
or required to be given or served under this Agreement shall be in writing and
shall be deemed to have been duly given or made if delivered in person or de-
posited in the United States mail , postage prepaid , for mailing by certified or
registered mail , return receipt requested, and addressed to a party at the
address set forth at the end of this Agreement.
Any party may change his or its address by giving notice in writing, stating
his or its new address, to any other party as provided in the foregoing manner.
Commencing on the tenth day after the giving of such notice, such newly
designated address shall be such party' s address for the purposes of all commun-
ications, demands, notices or objections permitted or required to be given or
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served under this Agreement.
7. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their assigns, executors, heirs or suc-
cessors.
8. AMENDMENT, MODIFICATION OR WAIVER. No amendment, modification or waiver
of any condition, provision or term of this Agreement shall be valid or of any
effect unless made in writing, signed by the party or parties to be bound or
such party's duly authorized representative and specifying with particularity
the nature and extend of such amendment, modification or waiver. Any waiver by
any party of any default of another party shall not affect or impair any right
arising from any subsequent default. Nothing herein shall limit the remedies
and rights of the parties hereto under and pursuant to this Agreement.
9. SALE OF UTILITY TO THIRD PARTY. In the event ERMU sells or transfers
its operations and assets to a third party, ERMU shall pay to the Executive a
severance package, including the Life Insurance Policy fully paid and an amount
equal to the amount three times his then existing gross salary.
10. SEVERABLE PROVISIONS. Each provision of this Agreement is intended to
be severable. If any provision hereto is illegal or invalid for any reason
whatsoever, such illegality or invalidity shall not affect the validity of the
remainder of this Agreement.
11. ENTIRE AGREEMENT. This Agreement contains the entire understanding of
the parties hereto in respect of the transactions contemplated hereby and super-
sedes all prior agreements and understandings between the parties with respect
to such subject matter.
12. CAPTIONS, HEADINGS OR TITLES, AND REFERENCES TO GENDER. All captions,
headings or titles in the paragraphs or sections of this Agreement are inserted
for convenience of reference only and shall not constitute a part of this
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Agreement or a limitation of the scope of the particular paragraphs or sections
to which they apply. Wherever appropriate, the masculine gender may be read as
the feminine gender or the neuter gender, the feminine gender may be read as the
masculine gender or the neuter gender, and the neuter gender may be read as the
masculine gender or the feminine gender.
13. COUNTERPARTS. This Agreement may be executed in two or more counter-
parts, each of which shall be considered one and the same Agreement and shall
become effective when one or more counterparts have been signed by each of the
parties and delivered to the other parties.
14. MINNESOTA LAW. This Agreement shall be construed and enforced in
accordance with the laws of the State of Minnesota.
15. ARBITRATION. Any disputes arising hereunder shall be resolved and
settled by arbitration. The parties shall agree upon and appoint one arbitra-
tor, except as set forth in paragraph 4, the decision of the arbitrator shall
be binding upon the Executive and ERMU. An Arbitrator's decisions related to
salary shall not be binding upon the parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
effective the day and year first set forth above.
Names and Signatures Addresses
12343 Ridgewood Drive NW
Elk River, MN 55330
William Birrenkott, "Executive"
ELK RIVER MUNICIPAL UTILITIES
ELK RIVER MUNICIPAL UTILITIES COMMISSION 322 King Avenue NW
Elk River, MN 55330
By . ._
Ja Tralle, `resident
By :rr6, .�1► j
I,James Simpson, ice Chairman George Z -'.ee, Estee
3:EA-ERMU
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SCHEDULE A
Additional Life Insurance
Vesting
Number of Full Years of
Service Completed Since Amount of Cash
Date of Employment Surrender Value
1 5%
2 10%
3 15%
4 20%
5 25%
6 32%
7 39%
8 46%
9 53%
10 60%
11 67%
12 74%
13 81%
14 88%
15 95%
16 100%
3:EA-ERMU2