Exhibit 10.8
THE MACMANUS GROUP, INC.
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
June 21, 1999
Mr. Xxx Xxxxxxx
South Manursing Island
Xxx, Xxx Xxxx 00000
Dear Xxx:
Reference is made to your Amended and Restated Salary Continuation
Agreement dated as of December 29, 1995 (the "Salary Continuation Agreement")
with The MacManus Group, Inc. (formerly D'Arcy Xxxxxx Xxxxxx & Xxxxxx, Inc.,
"the Company"). This will confirm that as part of your new employment
arrangements with the Company, the Salary Continuation Agreement is amended as
follows:
(i) The "Benefit Commencement Date," as set forth in Section 2(a) of the
Agreement, will be January 1, 2002 or the first day of the calendar
month following your retirement from the Company, whichever occurs
later.
(ii) The "Salary Continuation Payment" as described in Sections 2(c) and
(d) of the Salary Continuation Agreement will be a total of
$3,500,000, payable at the rate of $350,000 per annum for a period of
10 years -- i.e., a total of one hundred twenty (120) equal monthly
installments of $29,166.67.
(iii) For so long as you or your estate are receiving payments under the
Salary Continuation Agreement, the Company agrees that it will
continue to provide you and/or your estate, as the case may be, with
tax preparation and financial planning services, consistent with those
currently being provided to you.
This also confirms that your Salary Continuation Payment benefits under the
Salary Continuation Agreement are fully vested in respect of your past services
and will not be forfeitable upon the termination of your employment for any
reason -- i.e., regardless of whether such termination is voluntary or
involuntary and with or without cause, and regardless of when such termination
occurs. The only grounds for forfeiture of such benefits are as specifically set
forth in paragraph 4 of the Salary Continuation Agreement relating to a breach
of the restrictive covenants set forth therein.
Except as expressly modified by this letter, all of the terms and
conditions of the Salary Continuation Agreement shall remain in full force and
effect.
Very truly yours,
THE MACMANUS GROUP, INC.
By: /S/ XXXXX X. XXXXX
--------------------------------
AGREED:
/S/ Xxx X. Xxxxxxx
----------------------------
Xxx X. Xxxxxxx
2
SALARY CONTINUATION AGREEMENT
-----------------------------
AMENDED AND RESTATED AGREEMENT, made as of the 29th day of December, 1995,
by and between D'ARCY XXXXXX XXXXXX & XXXXXX, INC., a Delaware corporation
(hereinafter called the "Company"), and XXX X. XXXXXXX (hereinafter called the
"Employee").
WITNESSETH:
WHEREAS, the Employee is employed by the Company; and
WHEREAS, the Company desires the Employee to remain in its service and is
willing to offer the Employee an incentive to do so in the form of compensation
payable upon the death, permanent disability or retirement of the Employee, on
the terms and conditions set forth herein, and
WHEREAS, the Company and the Employee currently are parties to a Salary
Continuation Agreement dated as of June 13, 1990, and wish to amend and restate
such agreement in its entirety
NOW, THEREFORE, in consideration of the mutual promises of the parties
hereto.
IT IS AGREED as follows:
1. Salary Continuation Payments Upon Death, Retirement or Disability.
-----------------------------------------------------------------
Upon the terms and conditions hereinafter set forth, the Company shall pay
the Employee the Salary Continuation Payment to which he is entitled pursuant to
paragraph 2 hereof,
in equal monthly installments on the first business day of each calendar month
during the ten year period commencing on the Benefit Commencement Date (as
defined below).
Notwithstanding anything to the contrary, the Company shall have the option
at any time to pay the Employee the unpaid portion of the Salary Continuation
Payment to which the Employee is entitled pursuant to paragraph 2 hereof in a
lump sum payment discounted to the then present value at 8% per annum.
2. Calculation and Timing of the Salary Continuation Payment.
---------------------------------------------------------
(a) The "Benefit Commencement Date" shall be January 1, 1999, or a mutually
agreed later date. Notwithstanding the foregoing, in the event of the Employee's
death or permanent disability prior to the Benefit Commencement Date, the
Company agrees to pay to the beneficiary designated by the Employee in writing
on the form provided by the Company or the disabled Employee, as the case may
be, the Salary Continuation Payment, payable upon the first business day of the
month following the month in which the Employee dies or becomes disabled and
continuing until a total of one hundred twenty (120) monthly installments have
been paid.
(b) For purposes of this Agreement, the Employee shall be deemed to be
disabled on the first date that the Employee meets the definition of permanent
disability under a disability income insurance policy issued on the Employee's
life by New England Life, Policy No. ID245958, or any other policy that may be
substituted in its place and stead. It is understood that such policy contains
an elimination period clause during which time the Company in its sole
discretion shall determine if the definition of permanent disability is met.
After the conclusion of the elimination period, the determination of permanent
disability for purposes of this Agreement shall be made exclusively by the
insurance company in its decision to pay disability income benefits under the
policy.
2
(C) The aggregate benefit payment (the "Salary Continuation Payment")
payable hereunder shall be equal to $3,000,000. The Employee is eligible for
100% of the Salary Continuation Payment by virtue of his past full-time
employment with the Company for a period in excess of ten years.
(d) Upon the Benefit Commencement Date, the Salary Continuation Payment
shall be payable to the Employee at a rate of $300,000 per annum for ten years
-- i.e., a total of one hundred twenty (120) equal monthly installments of
$25,000.
(e) Notwithstanding anything contained herein to the contrary, the
Company's payment obligations under this Agreement shall be reduced to the
extent of any disability income insurance proceeds receivable by the Employee,
resulting from any policy or policies paid for, in whole or in part by the
Company. Such obligations shall not be reduced by any benefits receivable by the
Employee through Social Security or any Company sponsored group long-term
disability plan, for which the Employee either directly or indirectly pays the
premium.
In the event that the Employee becomes disabled but then ceases to be
deemed permanently disabled as determined above, all further payments under this
Agreement shall cease immediately. When payments resume upon the occurrence of
the Employee's subsequent death, the Benefit Commencement Date or a new
disability date, the Salary Continuation Payment shall be reduced by the
aggregate amount of payments made hereunder during the prior period or periods
of permanent disability against (such prior payments being applied against the
monthly installments in the inverse order of maturity).
If the Company shall find that any person to whom any payment is payable
under this Agreement is unable to care for his/her affairs because of illness
or accident, or is a minor, any payment due (unless a prior claim therefor shall
have been made by a duly appointed guardian, committee or other legal
representative) may be paid to the spouse, a child, a parent, or a brother or
3
sister, or to any person deemed by the Company to have incurred expense for such
person otherwise entitled to payment, in such manner and proportions as the
Company may determine. Any such payment shall be a complete discharge of the
liabilities of the Company under this Agreement.
3. Restrictive Covenants.
---------------------
(a) The Employee agrees that his services to the Company are of a special,
unique, extraordinary and intellectual character, that his position with the
Company places him in a position of confidence and trust with clients and
employees of the Company, and that in the course of his employment, the Employee
has and will continue to develop a personal acquaintanceship and relationship
with the Company's clients, and a knowledge of those clients' affairs and
requirements which may constitute the Company's primary or only contact with
such clients. The Employee further acknowledges that the rendering of services
to the clients of the Company necessarily requires the disclosure or use of
confidential information and trade secrets of the Company. The Employee
consequently agrees that it is reasonable and necessary for the protection of
the goodwill and business of the Company that the Employee make the covenants
contained herein. As a further condition to receiving the Salary Continuation
Payment as set forth herein, the Employee agrees that while he is in the
Company's employ and for a two-year period after the termination of the
Employee's employment with the Company for any reason whatsoever, the Employee
shall not directly or indirectly:
(i) attempt in any manner to solicit from any client (except on behalf
of the Company) business of the type performed by the Company or to
persuade any client of the Company to cease to do business or to reduce the
amount of business which any such client has customarily done or
contemplated doing with the Company, whether or not the relationship
between the Company and such client was originally established in whole or
in part through his efforts;
4
(ii) employ or attempt to employ or assist anyone else to employ
(except on behalf of the Company) any person who is then in the Company's
employ, or who was in the Company's employ at any time during the then
immediately preceding two years; or
(iii) render any services of the type rendered by the Company to its
clients to or for any client of the Company unless such services are
rendered as an employee or consultant of the Company.
As used in this paragraph 3(a), the term "client" shall mean (1) any
person, corporation or entity which is a client of the Company at the date of
termination of the Employee's employment or, if the employment shall not have
terminated, at the time of the alleged prohibited conduct; (2) any person,
corporation or entity which was a client of the Company at any time during the
one year period immediately preceding the date of termination of the Employee's
employment or, if the Employee's employment shall not have terminated, during
the one year period immediately preceding the alleged prohibited conduct; and
(3) any prospective clients to whom the Company had made a formal presentation
(or similar offering of services) within a period of one year immediately
preceding the date of such termination of employment or, if the Employee's
employment shall not have terminated, during the one year period immediately
preceding the alleged prohibited conduct.
(b) The Employee also agrees that he will not at any time (whether during
or after termination of his employment) disclose to anyone any confidential
information or trade secrets of the Company or any client of the Company, or
utilize such confidential information or trade secrets for his own benefit, or
for the benefit of third parties and all memoranda, notes, records or other
documents compiled by him or made available to him during the term of his
employment concerning the business of the Company and/or its clients shall be
the property of the Company and shall be delivered to the Company on the
termination of his employment or at any other time upon request.
5
(c) If the Employee commits a breach or threatens to commit a breach, of
any of the provisions of (a) or (b) above, the Company (and/or any division,
parent, subsidiary or affiliate thereof), in addition to the forfeiture
provisions of paragraph 4 below, shall have the right to have the provisions of
this Agreement specifically enforced by any court having equity jurisdiction
without being required to post bond or other security and without having to
prove the inadequacy of the available remedies at law, it being acknowledged and
agreed that any such breach or threatened breach will cause irreparable injury
to the Company and that money damages will not provide an adequate remedy to the
Company. In addition, the provisions of this paragraph 3 shall in no way impair
or derogate the rights or remedies which the Company may otherwise have under
any employment contract or other agreement with Employee, or which the Company
may have at law or in equity, to prevent the disclosure of confidential
information or trade secrets or to recover damages for disclosure thereof, or to
prevent Employee from engaging in competition with the Company, or to recover
damages therefor, or for any breach of any other of his duties and
responsibilities to the Company.
4. Forfeiture of Payments.
----------------------
In the event that the Employee shall violate the terms and conditions
set forth in paragraph 3, and such violation remains uncured for a thirty (30)
day period following the delivery of notice to perform by the Company, then such
violation shall constitute a breach of this Agreement, and no further Salary
Continuation Payment shall be due or payable by the Company thereafter and the
Company shall have no further liability or obligation under this Agreement
whatsoever.
5. Assignment, Benefit, Etc.
------------------------
This Agreement shall be binding upon and inure to the benefit of the
Company, its successors and assigns and the Employee and the Employee's heirs,
executors, administrators and legal representatives. The rights of the Employee
or any person designated to receive payments
6
hereunder shall not be subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge or encumbrance, except by will or by the laws of
descent and distribution.
6. Miscellaneous.
-------------
(a) Nothing contained herein shall be construed as conferring upon the
Employee the right to continue in the employ of the Company as an executive or
in any other capacity.
(b) Any payment made pursuant to this Agreement shall not be deemed
salary or other compensation to the Employee for the purpose of computing
benefits to which the Employee may be entitled under any pension plan or other
arrangement of the Company for the benefit of its employees. All payments
hereunder shall be reduced by all applicable withholdings, contributions and
payroll taxes in effect from time to time.
(c) The provisions set forth in this document shall not be subject to
the provisions of any other agreement to which any of the parties hereto are
party, unless explicitly provided for otherwise herein or in any subsequent
agreement. This Agreement amends, restates and supercedes in its entirety the
Salary Continuation Agreement dated as of June 13, 1990 between the Company and
the Employee.
(d) This Agreement may only be altered, amended or terminated in
writing signed by the Employee and the Company.
7
(e) This Agreement has been made and shall be interpreted in accordance
with the laws of the State of New York applicable to contracts made and to be
performed entirely therein.
IN WITNESS WHEREOF, the Employee has signed this Agreement and the Company
has executed these presents by its officer thereunto duly authorized, on the day
and year first above written.
D'ARCY XXXXXX XXXXXX & XXXXXX, INC.
By /S/ Xxxxx X. Xxxxx
---------------------------------------
/S/ Xxx X. Xxxxxxx
---------------------------------------
Xxx X. Xxxxxxx
8
