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EXHIBIT 10.64
UICI
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March 14, 2001
PERSONAL AND CONFIDENTIAL
Xx. Xxxxxxx X. Xxxxxx
0000 Xxxxxxx Xxx
Xxxxxx, XX 00000
Dear Charlie:
This letter will set forth the terms and conditions of your transition
from certain executive positions with UICI, a Delaware corporation ("UICI" or
the "Company"), and affiliates, and your engagement as a consultant to The MEGA
Life and Health Insurance Company, an Oklahoma corporation ("MEGA"), pursuant to
which MEGA will engage your services (or the services of a corporation or
limited liability company of which you are the sole equity holder) to serve as a
consultant to MEGA from time to time as herein set forth. For purposes of this
agreement, you are sometimes herein referred to as "Xxxxxx."
You currently serve as a Vice President of UICI. You currently hold (a)
options (the "Options") to purchase (i) 42,500 shares of UICI Common Stock at an
exercise price of $6.63 per share, none of which are currently vested and
exercisable; and (ii) 6,000 shares of UICI Common Stock at an exercise price of
$15.00 per share, of which 2,400 shares are subject to currently exercisable
options as of the date hereof; and (b) 6,500 restricted shares of UICI Common
Stock, none of which shares have vested (the "Restricted Stock"). In accordance
with our recent conversations, you and UICI have mutually agreed to terminate
your current relationship with UICI and its affiliates, and you have agreed,
having gained considerable knowledge and experience relating to the business of
UICI and its affiliates as a result of your prior affiliation with UICI as an
executive officer and director, to assist MEGA and its affiliates as a
consultant by providing certain advisory services to MEGA and its affiliates on
a standby, as-needed basis. Accordingly, UICI, MEGA and Xxxxxx hereby agree as
follows:
1. RESIGNATION.
1.1 Resignation Date. Effective as of the close of business on
February 1, 2001 (the "Resignation Date"), you agree to resign as a
Vice President of UICI and each of the executive offices and boards of
directors (and committees thereof) of affiliates of UICI listed on
Exhibit A attached hereto and all such other executive offices,
committees and/or directorships of entities affiliated with UICI upon
which you currently serve or which you currently hold. You shall be
entitled to your regular compensation through February 14, 2001 and
employee benefits accrued to the date of execution of this Agreement
(the "Execution Date").
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March 14, 2001
Page 2
1.2 Unreimbursed Expenses. Xxxxxx has used Xxxxxx'x American
Express credit card for Company-related expenses related to employee
travel and entertainment. The Company agrees to promptly reimburse
Xxxxxx for any such expenses charged on Xxxxxx'x credit card on behalf
of the Company upon submission of written evidence of all such
expenses.
1.3 Office Items. The parties mutually agree that Xxxxxx may
purchase the lap top computer, hand held computer and two golf print
pictures that Xxxxxx used during his tenure with the Company at the
Company's book value (the depreciated value).
2. OTHER ARRANGEMENTS
2.1. Promissory Note. Reference is made to that certain
promissory note, dated January 2, 2001 (the "Note"), payable from you
to UICI in the aggregate principal amount of $45,000, which Note
matures in accordance with its terms on the earlier of January 1, 2007
or upon the occurrence of certain events as therein provided. On the
Execution Date, Company shall deem the Note paid in full and discharge
Xxxxxx from any and all liability thereunder, provided that Xxxxxx
shall have tendered to UICI a check in the amount of $517.00 covering
accrued and unpaid interest to the Execution Date. Xxxxxx shall be
responsible for all applicable federal and state income, FICA and
Medicare taxes associated with the discharge of the Note contemplated
hereby.
3. MUTUAL RELEASE
3.1 Release of UICI Affiliates. In consideration of the
payments and promises contained in this Agreement, and in full
compromise and settlement of any of Xxxxxx'x potential claims and
causes of action relating to or arising out of termination of his
employment relationship with UICI, and any and all other claims or
causes of action that Xxxxxx has or may have against the UICI
Affiliates (as defined below) up to the date of execution of this
Agreement, Xxxxxx hereby:
(a) Knowingly and voluntarily agrees to irrevocably
and unconditionally waive and release UICI and any other
entity controlled by, controlling or under common control with
UICI, its predecessors and successors and directors, officers,
employees, representatives, attorneys, including all persons
acting by, through, under or in concert with any of them
(collectively, the "UICI Affiliates"), from any and all
charges, complaints, claims, liabilities, obligations,
promises, sums of money, agreements, controversies, damages,
actions, lawsuits, rights, demands, sanctions, costs
(including attorneys' fees), losses, debts and expenses of any
nature whatsoever, existing on, or at any time prior to, the
date hereof in law, in equity or otherwise, which Xxxxxx, his
successors, heirs or assigns had or have upon or by reason of
any fact, matter, cause, or thing whatsoever, AND SPECIFICALLY
INCLUDING ANY MATTER THAT MAY BE BASED ON THE SOLE OR
CONTRIBUTORY NEGLIGENCE (WHETHER ACTIVE, PASSIVE OR GROSS) OF
ANY UICI AFFILIATE. This release includes, but is not limited
to, a release of all claims or causes of action arising out of
or relating to termination of the employer-employee
relationship of Xxxxxx and the Company, and any other claim,
including, without limitation, alleged contract and tort
claims or claims or causes of action arising under any
federal, state, or local law, including, but not limited to,
the Age
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March 14, 2001
Page 3
Discrimination in Employment Act, 29 U.S.C. Section 621, et
seq., the Fair Labor Standards Act, 29 U.S.C. Section 201, et
seq., the Employee Retirement Income Security Act, 29 U.S.C.
Section 1001, et seq., and any claim under the statutes of the
State of Oklahoma, or other jurisdictions, and the facts,
circumstances, allegations, and controversies relating or
giving rise thereto that have accrued to the date of execution
of this Agreement; and
(b) Agrees that he will not commence, maintain,
initiate, or prosecute, or cause, encourage, assist,
volunteer, advise or cooperate with any other person to
commence, maintain, initiate or prosecute, any action,
lawsuit, proceeding, investigation, or claim before any court,
legislative body or committee, or administrative agency
(whether state, federal or otherwise) against the UICI
Affiliates relating to any claims, liabilities, obligations,
promises, sums of money, agreements, controversies, damages,
actions, lawsuits, rights, demands, sanctions, costs
(including attorneys' fees), losses, debts and expenses
described in the foregoing subparagraph (a);
provided, however, that, notwithstanding anything to the contrary in
the foregoing, nothing hereunder shall be deemed to affect, impair or
diminish in any respect (i) any rights to which Xxxxxx may be entitled
in his capacity as an officer and past or present director of UICI or
any other UICI Affiliate to indemnification, advancement of expenses
and/or reimbursement under Delaware law (or the corporate law of any
other jurisdiction that may govern UICI or any other UICI Affiliate) or
UICI's or any other UICI Affiliate's Certificate of Incorporation or
bylaws (including without limitation Xxxxxx'x rights to indemnification
for costs and expenses associated with the litigation captioned
Xxxxxxxx v. UICI, et al and any other litigation to which Xxxxxx is
made a party in his capacity as an officer and/or director of UICI or
any UICI Affiliate) (ii) any rights Xxxxxx may have under that certain
Indemnification Agreement, dated as of September 1, 1999, between UICI
and Xxxxxx, (iii) any vested rights as of the Resignation Date or
entitlement Xxxxxx may have under the UICI Employee Savings and Stock
Ownership Plan, (iv) any other vested rights as of the Resignation Date
Xxxxxx may have under any employee plan or program in which Xxxxxx has
participated in his capacity as an employee of UICI or any other UICI
Affiliate, including without limitation rights under the UICI Medical
Savings Account program, and (v) the rights of Xxxxxx under this
Agreement and under the Options as hereby amended.
3.2 Release of Xxxxxx. In consideration of the mutual promises
contained in this Agreement, and in full settlement of any of the UICI
Affiliates' potential claims and causes of action relating to or
arising out of Xxxxxx'x employee relationship with the UICI Affiliates'
and/or termination of such relationship and all claims and causes of
action that any of the UICI Affiliates has or may have against Xxxxxx
up to and through the date of execution of this Agreement, the UICI
Affiliates hereby:
(a) Knowingly and voluntarily agree to irrevocably
and unconditionally waive and release Xxxxxx, and his heirs,
executors, administrators and assigns (collectively the
"Xxxxxx Releasees"), from any and all charges, complaints,
claims, liabilities, obligations, promises, sums of money,
agreements, controversies, damages, actions, lawsuits, rights,
demands, sanctions, costs (including attorneys' fees) losses,
debts and expenses of any nature whatsoever, existing on, or
at any time prior to the date of execution of this Agreement
arising
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March 14, 2001
Page 4
in law, in equity or otherwise, which any of the UICI
Affiliates, their successors or assigns had or have upon or by
reason of any fact, matter, cause, or thing whatsoever, AND
SPECIFICALLY INCLUDING ANY MATTER THAT MAY BE BASED ON THE
SOLE OR CONTRIBUTORY NEGLIGENCE (WHETHER ACTIVE, PASSIVE OR
GROSS) OF XXXXXX. This release includes, but is not limited
to, a release of all claims or causes of action arising out of
termination of the employment relationship, or any other
contractual relationship with UICI Affiliates, including,
without limitation, alleged contract and tort claims or claims
arising under any federal, state or local law and any claim
under the statutes of the State of Oklahoma, or other
jurisdictions, and the facts, circumstances, allegations, and
controversies relating or giving rise thereto that have
accrued to the date of execution of this Agreement; and
(b) Agrees that they will not commence, maintain,
initiate or prosecute, or cause, encourage, assist, volunteer,
advise or cooperate with any other person to commence,
maintain, initiate or prosecute, any action, lawsuit,
proceeding, investigation, or claim before any court,
legislative body or committee, or administrative agency
(whether state, federal or otherwise) against the Xxxxxx
Releasees relating to any such claims, liabilities,
obligations, promises, sums of money, agreements,
controversies, damages, actions, lawsuits, rights, demands,
sanctions, costs (including attorneys' fees), losses, debts
and expenses described in the foregoing subparagraph (a).
3.3 No Admission. Nothing contained in this Section 3 shall in
any way be construed as an admission by Xxxxxx or the UICI affiliates
of any acts of wrongdoing, retaliation, defamation, harassment,
negligence, breach of contract, discrimination or violation of any
statute, law, or legal right. Each party hereto specifically denies and
disclaims that they have any liability to any other party hereto for
any of such acts occurring prior to the execution of this Agreement.
4. CONSULTING ARRANGEMENT AND SEVERANCE PAYMENT. Effective
April 1, 2001, MEGA hereby engages Xxxxxx (or a corporation, limited
liability company or partnership, the sole equity holder of which is
Xxxxxx and/or his immediate family) on an independent contractor basis
as a consultant to MEGA, and Xxxxxx hereby accepts such engagement and
agrees to perform his duties and responsibilities hereunder in
accordance with the terms and conditions hereinafter set forth.
4.2 Term of Consulting Arrangement. The term of engagement
(the "Consulting Arrangement") shall commence April 1, 2001, and shall
continue for a term ending on March 31, 2002, unless earlier terminated
pursuant to Section 4.6 of this Agreement or unless extended in
accordance with Section 4.8 hereof (the "Term").
4.3 Duties and Responsibilities. Xxxxxx'x position shall be as
a consultant to MEGA, in which capacity he agrees to consult with and
assist senior management of MEGA, including the rendering of advice and
consultations with respect to premium rates, new product design,
attendance at A.M. Best rating meetings and presentations, state
insurance department regulatory matters, risk analysis, acquisitions,
litigation support and assessment and such other matters as are
reasonably requested by MEGA from time to time during Term of the
Consulting Arrangement. Xxxxxx shall report to the assigning
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March 14, 2001
Page 5
individual on a regular, periodic basis and keep such
individual reasonably informed as to the status and progress
of each assignment. MEGA acknowledges and agrees that the
consulting relationship created hereby is not exclusive, and
Xxxxxx may perform similar services for other clients so long
as he is otherwise in compliance with the terms of this
Agreement. Xxxxxx shall accept assignments from one or more of
three individuals at MEGA: Xxxxxxx X. Xxxx, Xxxxxxx XxXxxxxxxx
and/or Xxxxx Xxxx. Xxxxxx shall report to the assigning
individual on a regular, periodic basis and keep such
individual reasonably informed as requested concerning the
status and progress of each assignment. Xxxxxx shall dedicate
such time and devote such attention to his consulting duties
hereunder as he deems necessary and sufficient to complete his
consulting assignments hereunder, provided, however, that
Xxxxxx shall not be required to devote more than 10 hours per
month during the Consulting Arrangement hereof, which shall
not be cumulative from month to month.
4.4 Consulting Fee. For his services hereunder during the
first year of the Consulting Arrangement, MEGA agrees to pay to Xxxxxx
the amount of $135,000 in monthly installments (a) in the amount of
$12,000, payable on the first day of each month, commencing June 1,
2001, and ending December 1, 2001 and (b) in the amount of $17,000,
payable on the first day of each month, commencing January 1, 2002,
with the last installment payable on March 1, 2002. If MEGA elects to
extend the Term of the Consulting Arrangement as provided in Section
4.8 hereof, for his services hereunder during the second year of the
Consulting Arrangement, MEGA agrees to pay to Xxxxxx the amount of
$120,000 in twelve equal monthly installments in the amount of $10,000,
payable on the first day of each month, commencing April 1, 2002, with
the last installment payable on March 1, 2003. All reasonable out of
pocket expenses incurred by Xxxxxx in connection with the services
required under the Consulting Arrangement shall be promptly reimbursed
by MEGA upon submission of written evidence of all such expenses to
MEGA.
4.5 Taxes. Xxxxxx is an independent contractor hereunder and
shall be responsible for payment of all federal and state taxes due on
amounts paid hereunder and MEGA shall not withhold any amounts for
federal, state or local income taxes or taxes or assessments that might
be payable or be required to be withheld if Xxxxxx were an employee of
MEGA. Xxxxxx shall indemnify MEGA for and hold MEGA harmless from and
against any costs, damages or liabilities relating to taxes or
tax-related assessments or penalties arising from Xxxxxx'x engagement
as an independent contractor hereunder.
4.6 Termination of Consulting Arrangement. The Term of the
Consulting Arrangement created hereby may be terminated as follows:
(a) by MEGA at any time for "cause;" upon not
less than 10 days prior written notice to
Xxxxxx,
(b) upon the death of Xxxxxx; or
(c) by MEGA or Xxxxxx without cause upon not
less than 30 days' prior written notice.
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March 14, 2001
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For purposes of this Agreement, termination for "cause" shall mean; (1)
termination for reason of the failure of Xxxxxx to materially observe
the provisions of Section 5, 8 or 9 of this Agreement, provided in such
case that the Company shall have first made a written demand for
compliance with Section 5, 8 or 9 of the Agreement, which demand shall
set forth the specific nature of such non-compliance, and Xxxxxx shall
have 30 days after receipt of such notice to cure such non-compliance;
or (2) termination for reason of theft, proven dishonesty, gross
misconduct, embezzlement, fraud, conviction of a felony involving
fraud, theft, bodily harm or damage to property (whether connected with
the consulting relationship or not), or use of the facilities or
premises of MEGA or a subsidiary for the conduct of unlawful activities
or transactions.
4.7 Effect of Termination of Consulting Arrangement.
4.7.1 In the event the Consulting Arrangement is terminated
for cause by MEGA prior to the end of the Consulting Arrangement as
provided in Section 4.6(a) or terminated by Xxxxxx without cause as
provided in Section 4.6(c), then in such event (i) 50% of all shares of
Restricted Stock not theretofore vested shall vest, (ii) Xxxxxx shall
have 30 days to exercise all or any portion of Options otherwise vested
on the date of termination, and (iii) Xxxxxx shall be entitled only to
such portion of the compensation set forth in Section 4.4 of this
Agreement for the portion of the Term of the Consulting Arrangement for
which he continued as a consultant hereunder.
4.7.2 In the event the Consulting Arrangement provided herein
is terminated as a result of Xxxxxx'x death as provided in Section
4.6(b), then in such event Xxxxxx'x estate or successors shall be
entitled to the balance of the compensation set forth in Section 4.4 of
this Agreement otherwise payable over the balance of the Term of the
Consulting Arrangement (including the Term of the Consulting
Arrangement if extended, but only if extended, as provided in Section
4.8 hereof), payable in monthly installments as provided in Section 4.4
hereof. Upon termination as a result of Xxxxxx'x death as provided in
Section 4.6(b), all Restricted Stock not otherwise vested on the date
of termination shall vest as of the date of termination and 100% of all
Options which are otherwise unvested shall vest, and the estate of, or
other successor to, Xxxxxx'x representatives shall thereafter have 90
days to exercise all vested Options held by such estate or successor.
4.7.3 In the event the consulting arrangement provided herein
is terminated by MEGA without cause as provided in Section 4.6(c), (i)
100% of all shares of Restricted Stock not theretofore vested shall
vest; (ii) 50% of all Options which are otherwise unvested shall vest,
and Xxxxxx shall have 90 days to exercise all vested options; and (iii)
Xxxxxx shall be immediately entitled to the balance of the consulting
compensation set forth in Section 4.4 of this Agreement otherwise
payable over the balance of the Term of Consulting Arrangement
(including the Consulting Arrangement if extended, but only if
extended, as provided in Section 4.8 hereof), payable in one lump sum
payment within 30 calendar days of the date of termination, together
with any reimbursable expenses not theretofore paid incurred by Xxxxxx
to enforce this provision of the Agreement.
4.8 Extension of Consulting Arrangement. During the period
commencing on January 1, 2002 and ending February 28, 2002 upon written
notice to Xxxxxx, UICI shall elect either (a) to purchase from Xxxxxx
7,500 shares of UICI Common Stock at $16.00 per share or (b) to extend
the Term of the Consulting Arrangement for an additional year
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March 14, 2001
Page 7
ending March 31, 2003 (in which case Xxxxxx shall be entitled to the
consulting compensation as provided in Section 4.4 hereof). If UICI
shall have elected to purchase from Xxxxxx 7,500 shares of UICI Common
Stock as provided in the preceding sentence, Xxxxxx shall be obligated
to sell such 7,500 shares at a purchase price of $16.00 per share and a
closing therefor shall occur not more than 10 business days following
UICI's election, at which closing UICI shall deliver cash in the amount
of $120,000 against delivery to UICI by Xxxxxx of a certificate for
7,500 shares of UICI common stock, which shares shall be free and clear
of any and all liens, charges and encumbrances whatsoever.
5. CONFIDENTIALITY.
5.1 Confidential Information. Xxxxxx acknowledges that, by
reason of his prior employment by MEGA and of his engagement as a
consultant to MEGA under this Agreement, he will or may have access to
confidential and proprietary information of UICI and/or MEGA,
including, without limitation, client and customer lists, developments,
information pertaining to services and products, improvements of new or
existing services and products, know-how, specifications, profit and
other financial figures, and other information treated as proprietary
or confidential by UICI and/or MEGA which is not otherwise readily
available from public or published sources. Xxxxxx agrees that he will
maintain in confidence all such confidential or proprietary information
and that he will not, for any reason, during his engagement by MEGA or
thereafter, directly or indirectly, use for his benefit, or for any
person, firm, corporation, partnership, joint venture or other entity
whatsoever, or disclose to any person, firm, corporation, partnership,
joint venture or other entity whatsoever, any confidential or
proprietary information relating to the business or affairs of UICI
and/or MEGA without the prior written authorization of UICI and/or
MEGA. Notwithstanding the foregoing, nothing hereunder shall prohibit
Xxxxxx from disclosing (i) information that has become generally
available to the public other than as a result of disclosure by Xxxxxx
or (ii) information required to be disclosed by applicable law or legal
process, provided that UICI and MEGA shall have been afforded not less
than 10 days' notice in advance of such disclosure and had the
opportunity to contest the scope of any legal request to require such
disclosure.
5.2 Return of Materials. Upon termination of Xxxxxx'x
engagement as a consultant hereunder, for whatever reason, Xxxxxx
agrees promptly to surrender to MEGA all notes, memoranda, customer
lists, records, reports, computer programs and all other documents and
material, and all copies thereof, whether prepared by Xxxxxx or others,
which contain or relate to confidential or proprietary information of
MEGA of which the Xxxxxx has obtained possession during the course of
performing Xxxxxx'x obligations hereunder.
6. REPRESENTATIONS AND WARRANTIES.
6.1 Representation of Xxxxxx. Xxxxxx hereby represents and
warrants to the Company and MEGA that, as of the Execution Date, he is
not a party or otherwise subject to any employment or similar other
agreement or subject to any duty or duties to another person or entity
of which the subject matter hereof could be in violation.
6.2 Representation of UICI. UICI hereby represents and
warrants to Xxxxxx that (a) this Agreement has been duly authorized,
executed and delivered by UICI
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March 14, 2001
Page 8
and MEGA and (b) UICI has given due authority to the undersigned
officers to execute this Agreement on behalf of UICI and the UICI
Affiliates.
7. DISCLOSURE. Xxxxxx acknowledges that the arrangement contemplated by
this Agreement must be disclosed under the rules and regulations of the
Securities and Exchange Commission promulgated under the Securities Act of 1933,
as amended, and the Securities Exchange Act of 1934, as amended.
8. INDEMNIFICATION.
8.1 Indemnification by Xxxxxx. Xxxxxx hereby agrees to
indemnify and hold the Company and MEGA harmless from and against any
claim, cost, expense, damage, liability or loss incurred by the Company
or MEGA (including, without limitation, reasonable attorneys' fees and
other reasonable costs and expenses incident to any suit, action,
proceeding or claim) arising out of or resulting from, and will pay the
Company or MEGA on written demand the full amount of any sum which the
Company or MEGA, as the case may be, may pay or may become obligated to
pay in respect of, (i) any inaccuracy in any representation or the
breach of any warranty made by Xxxxxx pursuant to this Agreement or
(ii) any failure by Xxxxxx duly to perform or observe any material
provision, covenant, agreement or condition in this Agreement to be
performed or observed by Xxxxxx.
8.2 Indemnification by the Company and MEGA. Each of the
Company and MEGA hereby agrees to indemnify and hold Xxxxxx harmless
from and against any claim, cost, expense, damage, liability or loss
incurred by Xxxxxx (including, without limitation, reasonable
attorneys' fees and other reasonable costs and expenses incident to any
suit, action, proceeding or claim, arising out of or resulting from,
and will pay Xxxxxx on written demand the full amount of any sum which
Xxxxxx may pay or may become obligated to pay in respect of, (i) any
inaccuracy in any representation or the breach of any warranty made by
the Company pursuant to this Agreement, (ii) any failure by the Company
or any UICI Affiliate duly to perform or observe any term, provision,
covenant, agreement or condition in this Agreement to be performed or
observed by the Company or any UICI Affiliate, (iii) any claim, cost,
expense, damage, liability or loss arising from any activities of
Xxxxxx undertaken on behalf of UICI and the UICI Affiliates by Xxxxxx
in good faith during the period February 1, 2001 through and including
February 14, 2001, or (iv) any other such claim, cost, expense, damage,
liability or loss arising out of Xxxxxx'x services to be provided to
MEGA as a consultant hereunder (except to the extent that such other
claim, cost, expense, damage, liability or loss arises primarily from
Xxxxxx'x gross negligence, IT BEING EXPRESSLY UNDERSTOOD THAT THE
INDEMNITY SET FORTH IN THIS CLAUSE (III) INCLUDES MATTERS BASED ON
XXXXXX'X ORDINARY NEGLIGENCE).
9. NONDISPARAGEMENT. The parties hereto mutually agree, from the date
of each party's execution of this Agreement, that neither will make any
statements, either oral, written, telephonic, electronic or by in other method
or in any other format, that in any way disparage, damage or undermine the
character or reputation of the other parties hereto. Any party who suffers
disparagement in violation of this provision will be entitled to recover
attorney fees and expenses. Notwithstanding the foregoing, no party hereto shall
be in breach of this provision if any such statement is made in response or in
answer to a judicially or governmentally mandated order or subpoena.
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March 14, 2001
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10. SPECIAL BENEFITS.
10.2 Healthcare Benefits. For the period commencing on the
Execution Date and ending on the first to occur of (i) the first
anniversary of the Execution Date or (ii) the date upon which Xxxxxx
shall first be employed on a full-time basis with health and dental
insurance coverage (the "Exit Date"), UICI will provide to Xxxxxx and
his family at UICI's expense health and dental insurance coverage under
the terms and conditions existing immediately prior to his resignation
under this Agreement. For a period commencing on the Exit Date and
ending 18 months following the Exit Date, UICI will make available to
Xxxxxx at Xxxxxx'x expense health insurance coverage in accordance with
COBRA.
10.3 Options and Restricted Stock. For purposes of the
Company's 1986 Amended and Restated Stock Option Plan, the Company's
1998 Stock Option Plan, the Options, the Company's 2000 Restricted
Stock Plan and the Restricted Stock, Xxxxxx shall be deemed to be an
"employee" of the Company during the Term of the Consulting Arrangement
(including any extension thereof), and his Options shall become
exercisable in accordance with such plans and the Restricted Stock
shall vest as if he were such an employee of the Company during such
period.
11. GENERAL PROVISIONS.
11.1 Survival. Notwithstanding the termination of the
consulting arrangement hereby created upon or prior to expiration of
the Arrangement for any reason, the covenants contained in Sections 3,
5, 8 and 9 hereof shall survive and remain in full force and effect.
11.2 Binding Effect; Assignment. This Agreement shall be
binding upon and inure to the benefit of Xxxxxx, the Company, the UICI
Affiliates and their respective heirs, executors, administrators,
successors and assigns; provided, however, that (i) Xxxxxx may not
assign either his rights or obligations hereunder and (ii) neither the
Company nor any UICI Affiliate may assign their rights or obligations
hereunder (other than (x) to any affiliated entity (in which case such
assignor shall not be relieved from liability hereunder) or (y) to any
successor to substantially all of the assets or business of the
Company) without the consent of Xxxxxx, which consent shall not be
unreasonably withheld.
11.3 Entire Agreement; Amendments. This Agreement contains the
entire agreement and understanding between the Company, MEGA and Xxxxxx
relating to the termination of Xxxxxx'x employment and the engagement
of Xxxxxx by MEGA as a consultant and supersedes all prior agreements
between the Company, MEGA and Xxxxxx relating to the subject matter
hereof. This Agreement may not be amended, modified or supplemented in
any respect except by a subsequent written agreement executed by the
party affected thereby.
11.4 Notices. All notices, requests, demands and other
communications required or permitted to be given hereunder shall be by
hand-delivery, certified or registered mail; return receipt requested,
telex, telecopier, or air courier to the parties set forth below. Such
notices shall be deemed given: at the time delivered by hand, if
personally delivered; at the time received if sent certified or
registered mail; when
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March 14, 2001
Page 10
answered back, if telexed; when receipt acknowledged, if telecopied;
and the third business day after timely delivery to the courier, if
sent by air courier.
If to the Company:
UICI
0000 XxXxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn.: Xx. Xxxxxxx X. Xxxx
Telephone: (000)-000-0000
Telecopy: (000) 000-0000
If to MEGA:
The MEGA Life and Health Insurance Company
c/o UICI
0000 XxXxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn.: Xx. Xxxxx X. Xxxx
Telephone: (000)-000-0000
Telecopy: (000) 000-0000
If to Xxxxxx:
0000 Xxxxxxx Xxx
Xxxxxx, Xxxxxxxx 00000
11.5 Execution in Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be
deemed an original agreement, but all of which together shall
constitute one and the same instrument.
11.6 Titles and Headings. Titles and headings to sections
herein are for purposes of reference only, and shall in no way limit,
define, or otherwise affect the provisions herein.
11.7 Governing Law; Submission to Jurisdiction. This Agreement
shall be governed by and construed and enforced in accordance with the
laws of the State of Oklahoma. Each of Xxxxxx, the Company, MEGA and
each UICI Affiliate hereby submits to the exclusive jurisdiction of the
United States District Court for the Western District of Oklahoma and
Oklahoma state court the District of Oklahoma County for the purposes
of all legal proceedings arising out of or relating to the Agreement or
the transactions contemplated hereby. Each of Xxxxxx, the Company, MEGA
and each UICI Affiliate irrevocably waives, to the fullest extent
permitted by law, any objection which any of such parties may now or
hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought
in such a court has been brought in an inconvenient forum.
11
Xx. Xxxxxxx X. Xxxxxx
March 14, 2001
Page 11
11.8 Severability. If any provision of this Agreement or
application thereof to anyone or under any circumstances is adjudicated
to be invalid or unenforceable, such invalidity or unenforceability
shall not affect any other provision or application of this Agreement
which can be given effect without the invalid or unenforceable
provision or application.
PLEASE NOTE THE FOLLOWING: You have up to twenty-one (21) days from the
date this Agreement is presented to you to review and consider this Agreement
and the release herein contained prior to executing it. If you have not executed
this Agreement by the 21st day, it will automatically be revoked. You have the
right to consult with an attorney before signing this Agreement. In addition,
you may revoke this Agreement and the release herein contained within seven (7)
days after your execution hereof. YOUR SIGNATURE BELOW CONFIRMS THAT YOU (a)
HAVE READ THIS AGREEMENT AND THE RELEASE HEREIN CONTAINED CAREFULLY AND
COMPLETELY; (b) HAVE BEEN GIVEN A PERIOD OF TWENTY-ONE (21) DAYS TO CONSIDER AND
REVIEW THIS AGREEMENT AND THE RELEASE; (c) ARE AWARE OF YOUR RIGHT TO CONSULT
WITH LEGAL COUNSEL AND ACKNOWLEDGE THAT YOU HAVE HAD AMPLE OPPORTUNITY TO DO SO
IF YOU CHOOSE; AND (d) UNDERSTAND ALL THE PROVISIONS CONTAINED IN THIS AGREEMENT
AND THE RELEASE HEREIN CONTAINED.
Please acknowledge your agreement to the foregoing by signing and
returning to the undersigned the enclosed copy of this letter.
UICI
By: /s/ XXXXX X. XXXX
------------------------------------
Its: Executive Vice President and
General Counsel
The MEGA Life and Health Insurance Company
By: /s/ XXXXX X. XXXX
------------------------------------
Its: Vice President
Agreed and acknowledged this 14th
day of March 2001.
/s/ XXXXXXX X. XXXXXX
---------------------------------
Xxxxxxx X. Xxxxxx
