CHANGE IN CONTROL SEVERANCE AGREEMENT
AGREEMENT by and between UNUMProvident Corporation, a Delaware
corporation having its principal executive offices in Portland, Maine and
Chattanooga, Tennessee (the "Company"), and (the "Executive")
dated as of the day of.
The Company has determined that it is in the best interests of its
shareholders to provide the Company with continuity of management, including the
continued dedication of Executive. Therefore, in order to accomplish these
objectives, the Executive and the Company desire to enter into this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Effective Date. The "Effective Date" shall mean September 30,
1999, provided the Executive is employed by the Company on such date. As of the
date hereof, the prior Severance Agreement effective October 30, 1997 ("Former
Severance Agreement") between the Executive and the Company (or Provident
Companies, Inc. or UNUM Corporation) shall terminate and become null and void.
2. Term of Agreement. The Company hereby agrees that the term of
this Agreement shall be for the period commencing on the Effective Date and
ending on the second anniversary of the Effective Date (the "Initial Term").
Beginning on the second anniversary of the Effective Date, the Initial Term
shall be automatically extended for one year terms unless either the Company or
the Executive shall give the other party not less than ninety (90) days prior
written notice of the intention to terminate this Agreement.
3. Termination of Employment.
(a) Death or Disability. The Executive's employment shall
terminate automatically upon the Executive's death. If the Company determines in
good faith that the Disability of the Executive has occurred (pursuant to the
definition of Disability set forth below), it may give to the Executive written
notice in accordance with Section 10(b) of this Agreement of its intention to
terminate the Executive's employment. In such event, the Executive's employment
with the Company shall terminate effective on the 30th day after receipt of such
notice by the Executive (the "Disability Effective Date"), provided that, within
the 30 days after such receipt, the Executive shall not have returned to full-
time performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's duties
with the Company on a full-time basis for 180 business days during any
consecutive twelve month period as a result of incapacity due to mental or
physical illness which is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Executive or the
Executive's legal representative.
(b) Cause. The Company may terminate the Executive's
employment for Cause. For purposes of this Agreement, "Cause" shall mean:
(i) the continued failure of the Executive to perform
substantially the Executive's duties with the Company or one of its
affiliates (other than any such failure resulting from incapacity due to
physical or mental illness), after a written demand for substantial
performance is delivered to the Executive by the Chief Executive Officer of
the Company ("CEO") or the Chief Operating Officer of the Company ("COO")
which specifically identifies the manner in which the CEO or COO believes
that the Executive has not substantially performed the Executive's duties,
or
(ii) the willful engaging by the Executive in illegal
conduct (as determined by the Company after due inquiry) or gross
misconduct which is materially and demonstrably injurious to the Company,
or
(iii) conviction of a felony or guilty or nolo
contendere plea by the Executive with respect thereto.
For purposes of this provision, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of the CEO or COO or based upon
the advice of counsel for the Company shall be conclusively presumed to be done,
or omitted to be done, by the Executive in good faith and in the best interests
of the Company. The cessation of employment of the Executive shall not be deemed
to be for Cause unless and until there shall have been delivered to the
Executive written notice signed by the CEO or COO of the Company of an event
constituting cause within ninety days of the Company's knowledge of its
existence.
(c) Good Reason. The Executive's employment may be terminated
by the Executive for Good Reason. For purposes of this Agreement, "Good Reason"
shall mean in the absence of a written consent of the Executive:
(i) the assignment to the Executive of any duties
inconsistent with the Executive's position (including status, offices,
titles and reporting requirements), authority, duties or responsibilities,
or any other action by the Company which results in a diminution in such
position, authority, duties or responsibilities, excluding for this purpose
an isolated, insubstantial and
-2-
inadvertent action not taken in bad faith and which is remedied by the
Company promptly after receipt of written notice thereof given by the
Executive within 30 days of knowledge of such action;
(ii) reduction in annual base salary or annual target
bonus as in effect prior to a Change in Control other than an isolated,
insubstantial and inadvertent failure not occurring in bad faith and which
is remedied by the Company promptly after receipt of written notice thereof
given by the Executive within 30 days of knowledge of such action;
(iii) the failure of the Company to (A) continue in
effect any employee benefit plan, compensation plan, welfare benefit plan
or material fringe benefit plan in which Executive is participating
immediately prior to such Change in Control or the taking of any action by
the Company which would adversely affect Executive's participation in or
reduce Executive's benefits under any such plan, unless Executive is
permitted to participate in other plans providing Executive with
substantially equivalent benefits in the aggregate (at substantially
equivalent cost with respect to welfare benefit plans), or (B) provide
Executive with paid vacation in accordance with the most favorable
vacation, policies of the Company as in effect for Executive immediately
prior to such Change in Control, including the crediting of all service for
which Executive had been credited under such vacation policies prior to the
Change in Control;
(iv) any failure by the Company to comply with and
satisfy Section 9(c) of this Agreement; or
(v) any required relocation of the Executive
following a Change in Control (as defined herein) of more than 50 miles
from Executive's principal business office shall be considered to
constitute Good Reason.
(d) Change in Control. For purposes of this Agreement,
"Change of Control" shall mean the occurrence of any one of the following
events, with the exception of the merger of Unum Corporation and Provident
Companies pursuant to the Agreement and Plan of Merger dated as of November 22,
1998 as amended as of May 25, 1999 and consummated on June 30, 1999:
(i) during any period of two consecutive years,
individuals who, at the beginning or such period, constitute the Board (the
"Incumbent Directors") cease for any reason to constitute at least a
majority of the Board, provided that any person becoming a director and
whose election or
-3-
nomination for election was approved by a vote of at least two-thirds of
the Incumbent Directors then on the Board (either by a specific vote or by
approval of the proxy statement of the Company in which such person is
named as a nominee for director, without written objection to such
nomination) shall be an Incumbent Director; provided, however, that no
-------- -------
individual initially elected or nominated as a director of the Company as a
result of an actual or threatened election contest (as described in Rule
14a-11 under the Act) ("Election Contest") or other actual or threatened
solicitation of proxies or consents by or on behalf of any "person" (as
such term is defined in Section 3(a)(9) of the Act and as used in Sections
13(d)(3) and 14(d)(2) of the Act) other than the Board ("Proxy Contest"),
including by reason of any agreement intended to avoid or settle any
Election or Contest or Proxy Contest, shall be deemed an Incumbent
Director;
(ii) any person is or becomes a "beneficial owner" (as
defined in Rule 13d-3 under the Act), directly or indirectly, of securities
of the Company representing 20% or more of the combined voting power of the
Company's then outstanding securities eligible to vote for the election of
the Board (the "Company Voting Securities"); provided, however, that the
-------- -------
event described in this paragraph (ii) shall not be deemed to be a Change
in Control of the Company by virtue of any of the following acquisitions:
(A) by the Company of any subsidiary, (B) by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any subsidiary,
(C) by an underwriter temporarily holding securities pursuant to an
offering of such securities, (D) pursuant to a Non-Qualifying Transaction
(as defined in paragraph (iii), or (E) a transaction (other than one
described in (iii) below) in which Company Voting Securities are acquired
from the Company, if a majority of the Incumbent Directors approve a
resolution providing expressly that the acquisition pursuant to this clause
(E) does not constitute a Change in Control of the Company under this
paragraph (ii);
(iii) the consummation of a merger, consolidation,
statutory share exchange or similar form of corporate transaction involving
the Company or any of its subsidiaries that requires the approval of the
Company's stockholders, whether for such transaction or the issuance of
securities in the transaction (a "Reorganization"), or sale or other
disposition of all or substantially all of the Company's assets to an
entity that is not an affiliate of the Company (a "Sale"), unless
immediately following such Reorganization or Sale: (A) more than 50% of the
total voting power of (x) the corporation resulting from such
Reorganization or the corporation which has acquired all or substantially
all of the assets of the Company (in either case, the "Surviving
Corporation"), or (y) if applicable, the ultimate parent corporation that
directly or indirectly has beneficial
-4-
ownership of 100% of the voting securities eligible to elect directors of
the Surviving Corporation (the "Parent Corporation"), is represented by the
Company Voting Securities that were outstanding immediately prior to such
Reorganization or Sale (or, if applicable, is represented by shares into
which such Company Voting Securities were converted pursuant to such
Reorganization or Sale), and such voting power among the holders thereof is
in substantially the same proportion as the voting power of such Company
Voting Securities among the holders thereof immediately prior to the
Reorganization or Sale, (B) no person (other than any employee benefit plan
(or related trust) sponsored or maintained by the Surviving Corporation or
the Parent Corporation) is or becomes the beneficial owner, directly or
indirectly, of 20% or more of the total voting power of the outstanding
voting securities eligible to elect directors of the Parent Corporation
(or, if there is no Parent Corporation, the Surviving Corporation) and (C)
at least a majority of the members of the board of directors of the Parent
Corporation (or, if there is no Parent Corporation, the Surviving
Corporation) following the consummation of the Reorganization or Sale were
Incumbent Directors at the time of the Board's approval of the execution of
the initial agreement providing for such Reorganization or Sale (any
Reorganization or Sale which satisfies all of the criteria specified in
(A), (B) and (C) above shall be deemed to be a "Non-Qualifying
Transaction"); or
(iv) the stockholders of the Company approve a plan of
complete liquidation or dissolution of the Company.
Notwithstanding the foregoing, a Change in Control of the Company shall not be
deemed to occur solely because any person acquires beneficial ownership of more
than 20% of the Company Voting Securities as a result of the acquisition of
Company Voting Securities by the Company which reduces the number of Company
Voting Securities outstanding; provided, that if after such acquisition by the
-------- ----
Company such person becomes the beneficial owner of additional Company Voting
Securities that increases the percentage of outstanding Company Voting
Securities beneficially owned by such person, a Change in Control of the Company
shall then occur.
(e) Notice of Termination. Any termination by the Company or
by the Executive shall be communicated by Notice of Termination to the other
party hereto given in accordance with Section 11(b) of this Agreement. For
purposes of this Agreement, a "Notice of Termination" means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, sets forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if
-5-
the Date of Termination (as defined below) is other than the date of receipt of
such notice, specifies the termination date (which date shall be not more than
thirty days after the giving of such notice). The failure by the Executive or
the Company to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason or Cause shall not waive any right
of the Executive or the Company, respectively, hereunder or preclude the
Executive or the Company, respectively, from asserting such fact or circumstance
in enforcing the Executive's or the Company's rights hereunder.
(f) Date of Termination. "Date of Termination" means if the
Executive's employment is terminated by the Company other than for Disability,
or by the Executive, the date of receipt of the Notice of Termination or any
later date specified therein within 30 days of such notice, and if the
Executive's employment is terminated by reason of death or Disability, the Date
of Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.
4. Obligations of the Company upon Termination.
(a) Good Reason; Other Than for Cause, Death or Disability. If,
within two years of a Change in Control, the Company shall terminate the
Executive's employment other than for Cause, Disability or death, or the
Executive shall terminate employment for Good Reason:
(i) the Company shall pay to the Executive in a lump
sum in cash within 30 days after the Date of Termination:
A. the product of two (2) times the sum of (1)
the Executive's annual bonus (based upon the higher of the Executive's
current bonus or the bonus he received prior to the Change in Control)
and (2) the Executive's annual base salary (based upon the higher of
the Executive's current annual base salary or the annual base salary
he received prior to the Change in Control);
B. the sum of (x) the Executive's annual base
salary through the Date of Termination to the extent not theretofore
paid, and (y) the product of (1) the Executive's current annual bonus
assuming that Executive achieved his target and (2) a fraction, the
numerator of which is the number of days in the fiscal year in which
the Date of Termination occurs through the Date of Termination and the
denominator of which is 365, to the extent not theretofore paid (the
sum of the amounts
-6-
described in clauses (x) and (y) shall be hereinafter referred to as
the "Accrued Obligations"); and
C. any compensation previously deferred by
Executive other than pursuant to a tax-qualified plan (together with
any earnings and interest thereon).
(ii) the Company shall continue to provide, for a
period of two (2) years following the Executive's Date of Termination, the
Executive (and the Executive's dependents, if applicable) with the same
level of medical, dental, accident, disability and life insurance benefits
upon substantially the same terms and conditions (including contributions
required by the Executive for such benefits) as existed immediately prior
to the Executive's Date of Termination (or, if more favorable to the
Executive, as such benefits and terms and conditions existed immediately
prior to the Change in Control); provided that, if the Executive cannot
continue to participate in the Company plans providing such benefits, the
Company shall otherwise provide such benefits on the same after-tax basis
as if continued participation had been permitted. Notwithstanding the
foregoing, in the event the Executive becomes reemployed with another
employer and becomes eligible to receive welfare benefits from such
employer, the welfare benefits described herein shall be secondary to such
benefits during the period of the Executive's eligibility, but only to the
extent that the Company reimburses the Executive for any increased cost and
provides any additional benefits necessary to give the Executive the
benefits provided hereunder.
(iii) all stock options, restricted stock awards and
other equity based awards granted on or after the date hereof (the "Equity
Awards") shall vest and shall remain exercisable for a period of ninety
days from the Date of Termination or the earlier expiration of their
initial term; provided, that, if the Executive would be prohibited from
-------- ----
exercising any stock option due to pooling of interests or other restraints
imposed under applicable accounting rules or securities laws, such option
shall remain exercisable for thirty days after such restriction ceases to
apply.
(iv) the Executive's benefit under the Company's tax-
qualified defined benefit pension plan and the supplemental defined benefit
pension plan shall be determined assuming the Executive had two (2)
additional years of service credit and the resulting amount shall be paid
outside such plan.
-7-
(v) to the extent not theretofore paid or provided,
the Company shall timely pay or provide to the Executive any other amounts
or benefits required to be paid or provided or which the Executive is
eligible to receive under any plan, program, policy or practice or contract
or agreement of the Company and its affiliated companies through the Date
of Termination (such other amounts and benefits shall be hereinafter
referred to as the "Other Benefits").
(vi) the Company shall provide individual outplacement
services to the Executive in accordance with the practices and policies of
the Company in effect immediately prior to the Change in Control of the
Company.
Notwithstanding anything in this Agreement to the contrary, if (i) Executive's
employment is terminated prior to a Change in Control for reasons that would
have constituted a Good Reason or without Cause termination if they had occurred
following a Change in Control; (ii) Executive reasonably demonstrates that such
termination (or Good Reason event) was at the request of a third party who had
indicated an intention or taken steps reasonably calculated to effect a Change
in Control; and (iii) a Change in Control involving such third party (or a party
competing with such third party to effectuate a Change in Control) does occur,
then for purposes of this Agreement, the date immediately prior to the date of
such termination of employment or event constituting Good Reason shall be
treated as a Change in Control. For purposes of determining the timing of
payments and benefits to Executive under this Section 4(a), the date of the
actual Change in Control shall be treated as Executive's Date of Termination
under Section 3(f).
(b) Death or Disability. If the Executive's employment is
terminated by reason of the Executive's death or disability, this Agreement
shall terminate without further obligations to the Executive's legal
representatives or to the Executive, as the case may be, under this Agreement,
other than for payment of Accrued Obligations and the timely payment or
provision of Other Benefits. Accrued Obligations shall be paid to the Executive,
the Executive's estate or beneficiary, as applicable, in a lump sum in cash
within 30 days of the Date of Termination.
(c) Cause; Other than for Good Reason. If the Executive's
employment shall be terminated for Cause or the Executive terminates his
employment without Good Reason, this Agreement shall terminate without further
obligations to the Executive other than the obligation to pay to the Executive
(i) his Annual Base Salary through the Date of Termination to the extent
theretofore unpaid and, (ii) the Other Benefits.
-8-
5. Non-exclusivity of Rights. Except as specifically provided,
nothing in this Agreement shall prevent or limit the Executive's continuing or
future participation in any plan, program, policy or practice provided by the
Company or any of its affiliated companies and for which the Executive may
qualify, nor, subject to Sections 1 and 11(f), shall anything herein limit or
otherwise affect such rights as the Executive may have under any contract or
agreement with the Company or any of its affiliated companies. Amounts which are
vested benefits or which the Executive is otherwise entitled to receive under
any plan, policy, practice or program of or any contract or agreement with the
Company or any of its affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such plan, policy, practice or
program or contract or agreement except as explicitly modified by this
Agreement; provided that the Executive shall not be eligible for severance
benefits under any other program or policy of the Company.
6. Full Settlement. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement, and such amounts
shall not be reduced whether or not the Executive obtains other employment. The
Company agrees to pay as incurred, to the full extent permitted by law, all
legal fees and expenses which the Executive may reasonably incur as a result of
any contest (regardless of the outcome thereof) pursued or defended against in
good faith by the Executive regarding the validity or enforceability of, or
liability under, any provision of this Agreement or any guarantee of performance
thereof (including as a result of any contest by the Executive about the amount
of any payment pursuant to this Agreement), plus in each case interest on any
delayed payment at the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the "Code").
7. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the event it shall be
determined that any payment or distribution by the Company 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, but determined without
regard to any additional payments required under this Section 7) (a "Payment"),
would be subject to the excise tax imposed by Section 4999 of
-9-
the Code or any interest or penalties are incurred by the Executive with respect
to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments. Notwithstanding the foregoing provisions of this
Section 7(a), if it shall be determined that the Executive is entitled to a
Gross-Up Payment, but that the Payments do not exceed 110% of the greatest
amount (the "Reduced Amount") that could be paid to the Executive such that the
receipt of Payments would not give rise to any Excise Tax, then no Gross-Up
Payment shall be made to the Executive and the Payments, in the aggregate, shall
be reduced to the Reduced Amount.
(b) Subject to the provisions of Section 7(c), all
determinations required to be made under this Section 7, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by the Company's independent auditors or such other certified public accounting
firm reasonably acceptable to the Executive as may be designated by the Company
(the "Accounting Firm") which shall provide detailed supporting calculations
both to the Company and the Executive within 15 business days of the receipt of
notice from the Executive that there has been a Payment, or such earlier time as
is requested by the Company. All fees and expenses of the Accounting Firm shall
be borne solely by the Company. Any Gross-Up Payment, as determined pursuant to
this Section 7, shall be paid by the Company to the Executive within five days
of the later of (i) the due date for the payment of any Excise Tax, and (ii) the
receipt of the Accounting Firm's determination. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a result
of the uncertainty in the application of Section 4999 of the Code at the time of
the initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments which will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations required to be made
hereunder. In the event that the Company exhausts its remedies pursuant to
Section 7(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive.
-10-
(c) The Executive shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment. Such notification shall be given
as soon as practicable but no later than ten business days after the Executive
is informed in writing of such claim and shall apprise the Company of the nature
of such claim and the date on which such claim is requested to be paid. The
Executive shall not pay such claim prior to the expiration of the 30-day period
following the date on which it gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim
is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with contesting
such claim as the Company shall reasonably request in writing from time to
time, including, without limitation, accepting legal representation with
respect to such claim by an attorney reasonably selected by the Company,
(iii) cooperate with the Company in good faith in order
effectively to contest such claim, and
(iv) permit the Company to participate in any
proceedings relating to such claim;
provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation on the foregoing provisions of
this Section 7(c), the Company shall control all proceedings taken in connection
with such contest and, at its sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
the Executive to pay the tax claimed and xxx for a refund or contest the claim
in any permissible manner, and the Executive agrees to prosecute such contest to
a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that, if the Company directs the Executive to pay
such claim and xxx for a refund, the Company shall advance the amount of such
payment to the Executive, on an interest-free basis and shall indemnify and hold
the Executive harmless, on an after-tax basis, from any Excise Tax or income
-11-
tax (including interest or penalties with respect thereto) imposed with respect
to such advance or with respect to any imputed income with respect to such
advance; and further provided that any extension of the statute of limitations
relating to payment of taxes for the taxable year of the Executive with respect
to which such contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company's control of the contest shall be
limited to issues with respect to which a Gross-Up Payment would be payable
hereunder and the Executive shall be entitled to settle or contest, as the case
may be, any other issue raised by the Internal Revenue Service or any other
taxing authority.
(d) If, after the receipt by the Executive of an amount
advanced by the Company pursuant to Section 7(c), the Executive becomes entitled
to receive any refund with respect to such claim, the Executive shall promptly
pay to the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto). If, after the receipt by the
Executive of an amount advanced by the Company pursuant to Section 7(c), a
determination is made that the Executive shall not be entitled to any refund
with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such advance shall offset,
to the extent thereof, the amount of Gross-Up Payment required to be paid.
8. Confidential Information and Non-Solicitation.
-12-
(a) The Executive hereby acknowledges that, as an employee of
the Company, he will be making use of, acquiring and adding to confidential
information of a special and unique nature and value relating to the Company and
its strategic plan and financial operations. The Executive further recognizes
and acknowledges that all confidential information is the exclusive property of
the Company, is material and confidential, and is critical to the successful
conduct of the business of the Company. Accordingly, the Executive hereby
covenants and agrees that he will use confidential information for the benefit
of the Company only and shall not at any time, directly or indirectly, during
the term of this Agreement, and thereafter for all periods during which
severance or other amount is paid, divulge, reveal or communicate any
confidential information to any person, firm, corporation or entity whatsoever,
or use any confidential information for his own benefit or for the benefit of
others. The Executive also agrees not to hire or solicit for hire, directly or
indirectly, any employee on the payroll of the Company for any third party
during the term of this Agreement and for one year after the Date of Termination
without the prior written consent of the Company. In no event shall an asserted
violation of the provisions of this Section 8 constitute a basis for deferring
or withholding any amounts otherwise payable to the Executive under this
Agreement.
(b) Any termination of the Executive's employment or of this
Agreement shall have no effect on the continuing operation of this Section 8.
(c) The Executive acknowledges and agrees that the Company
will have no adequate remedy at law, and could be irreparably harmed, if the
Executive breaches or threatens to breach any of the provisions of this Section
8. The Executive agrees that the Company shall be entitled to equitable and/or
injunctive relief to prevent any breach or threatened breach of this Section 8,
and to specific performance of each of the terms hereof in addition to any other
legal or equitable remedies that the Company may have. The Executive further
agrees that he shall not, in any equity proceeding relating to the enforcement
of the terms of this Section 8, raise the defense that the Company has an
adequate remedy at law.
9. Successors.
(a) This Agreement is personal to the Executive and without
the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.
-13-
(b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.
(c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of
law, or otherwise.
10. Miscellaneous.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. 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.
(b) 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:
-14-
If to the Executive:
If to the Company:
UNUMProvident Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxx 00000
or
0 Xxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Chief Executive Officer
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(d) The Company may withhold from any amounts payable under
this Agreement such Federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.
(e) The Executive's or the Company's failure to insist upon
strict compliance with any provision of this Agreement or the failure to assert
any right the Executive or the Company may have hereunder, including, without
limitation, the right of the Executive to terminate employment for Good Reason
pursuant to Section 4(c)(i)-(iv) of this Agreement, shall not be deemed to be a
waiver of such provision or right or any other provision or right of this
Agreement.
(f) From and after the Effective Date this Agreement shall
supersede any other employment, severance or change of control agreement between
the parties with respect to the subject matter hereof.
-15-
11. General Release. All payments under this Agreement to be made
in connection with the Executive's termination of employment will be conditioned
on the Executive signing a general form of release.
IN WITNESS WHEREOF, the Executive has hereunto set the Executive's
hand and, pursuant to the authorization from its Board of Directors, the Company
has caused these presents to be executed in its name on its behalf, all as of
the day and year first above written.
Executive
-------------------------------
Name:
UNUMProvident Corporation
By
-------------------------------
Name:
-16-
