EMPLOYMENT AGREEMENT
EXHIBIT
10.2
THIS
AGREEMENT (the "Agreement"), dated as of July 23, 2007, is by and between
Tower Group, Inc., a Delaware corporation (the "Company"), and Xxxx X. Xxxxx
(the "Executive").
WITNESSETH
THAT
WHEREAS,
the Executive and the Company wish to enter into a written agreement setting
forth the terms and conditions of the Executive's employment with the Company;
and
WHEREAS,
this Agreement is the entire agreement between the parties concerning the
subject matter hereof and supersedes all prior agreements concerning the
same
subject.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein, the Company and. the Executive hereby agree as follows:
1. Term.
(a) Term
of Employment
(i) The
Company shall employ the Executive, and the Executive shall serve the Company,
on the terms and subject to the conditions set forth in this Agreement,
commencing on July 23, 2007 (the "Effective Date") and, unless sooner
terminated pursuant to section 4, continuing until the date that is the one-year
anniversary of the Effective Date or such later date as provided in subsection
1(a)(ii) below (the "Term of Employment").
(ii) The
Term of Employment shall be extended automatically for one additional year
on
the last day before the first anniversary of the Effective Date and for one
additional year on each anniversary thereafter unless and until either party
gives written notice to the other not to extend this Agreement at least six
months before such extension would be effectuated.
(b) Term
of the Agreement. This Agreement shall become effective on the Effective
Date
and shall continue in effect throughout the Term of Employment; provided,
however, the restrictive covenants contained in section 10 of this Agreement
and, as applicable, the Company's and the Executive's obligations under the
other provisions of this Agreement shall survive the Term of Employment and
shall continue in effect through the periods provided therein and/or until
the
Company's and/or the Executive's obligations, as applicable, thereunder are
satisfied.
2. Position
and Duties.
(a) Positions,
Duties, and Responsibilities. The Executive shall serve as Senior Vice
President, Chief Underwriting Officer of the Company and/or in such other
positions as the Chief Executive Officer of the Company (the "CEO"), the
Board
of Directors of the Company (the "Board") or a committee of the Board may
from
time to time prescribe, with such duties and responsibilities as are customarily
assigned to such position(s). The Executive shall report solely to the CEO
unless the CEO, the Board or a committee of the Board determines otherwise.
The
Executive agrees to serve without additional compensation in such capacities
(including, without limitation, as an employee or director) with Company
and its
affiliates as the CEO, the Board or a committee of the Board may in its
discretion prescribe. Upon termination of the Executive's employment with
the
Company, any employment, board membership or other service relationship with
the
Company and any Company affiliate shall automatically terminate unless otherwise
determined by the parties hereto.
(b) Time
and Attention. Excluding any periods of vacation and sick leave to which the
Executive is entitled, the Executive shall devote substantially all of his
attention and time during normal working hours to the business and affairs
of
the Company and its affiliates. It shall not be considered a violation of
the
foregoing, however, for the Executive to (i) serve on corporate, industry,
educational, religious, civic, or charitable boards or committees or (ii)
make
and attend to passive personal investments in such form as will not require
any
material time or attention to the operations thereof during normal working
time
and will not violate the provisions of section 10 hereof, so long as such
activities in clauses (i) and (ii) do not materially interfere with the
performance of the Executive's responsibilities as an employee of the Company
in
accordance with this Agreement or violate section 10 of this
Agreement.
3. Compensation.
Except as otherwise expressly set forth below, the Executive's compensation
shall be determined by, and in the sole discretion of, the Board or a committee
of the Board.
(a) Annual
Base Salary. Subject to adjustment pursuant to this subsection 3(a), the
Executive shall receive an annual base salary of $295,000 during the Term
of
Employment (the annual base salary in effect from time to time, "Annual Base
Salary"). The Annual Base Salary shall be payable in accordance with the
Company's regular payroll practice for its senior officers, as in effect
from
time to time. The Annual Base Salary shall be reviewed. from time to time,
but
not less frequently than annually, and, in the discretion of the Board and/or
the Compensation Committee of the Board (the "Committee”), may be adjusted but
not decreased below the amount set forth in the first sentence of this
subsection 3(a). To the extent Annual Base Salary is adjusted, then such
adjusted salary shall be the Executive's Annual Base Salary for all purposes
of
this Agreement.
(b) Annual
Bonus. The Executive shall have an opportunity to receive annual bonuses
during the Term of Employment (the "Annual Bonus"), subject to such terms
and
conditions as the Board, the Committee or a delegatee thereof shall prescribe.
The Executive's target Annual Bonus opportunity shall be equal to 30% of
his
Annual Base Salary, it being understood that the actual Annual Bonus received
by
the Executive will depend on the level of attainment of performance and other
factors used by the Company to determine Annual Bonus amounts and that there
is
no guarantee that an Annual Bonus will be earned. The Executive's target
Annual
Bonus opportunity shall be reviewed from time to time, but not less frequently
than annually, and, in the discretion of the Board and/or the Committee,
may be
adjusted but not decreased below the amount set forth in the second sentence
of
this subsection 3(b).
(c) Employee
Benefits; Fringe Benefits. In addition to the foregoing, during the Term of
Employment,
(i) to
the extent not duplicative of the specific benefits provided herein, the
Executive shall be eligible to participate in all incentive compensation,
retirement, supplemental retirement, and deferred compensation plans, policies
and arrangements that are provided generally to other senior officers of
the
Company;
(ii) the
Executive and, as applicable, the Executive's covered dependents shall be
eligible to participate in all of the Company's health and welfare benefit
plans
(within the meaning of Section 3(1) of the Employee Retirement Income Security
Act of 1974, as amended); and
(iii) the
Executive shall be entitled to receive fringe benefits provided for senior
officers of the Company, and shall be entitled to avail himself of paid
holidays, as determined from time to time by the Company.
(d) Vacation.
The Executive shall be entitled to not less than 4 weeks of paid vacation
per
calendar year during the Term of Employment. Vacation days not used within
the
year shall be carried forward to subsequent years, as determined by the Company
and subject to such conditions or restrictions as the Company may
prescribe.
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(e) Expenses.
The Executive shall be reimbursed by the Company for reasonable business
expenses actually incurred in rendering to the Company the services provided
for
hereunder during the Term of Employment, payable in accordance with customary
Company practice, after the Executive presents written expense statements
or
such other supporting information as the Company may require of its senior
officers for reimbursement of such expenses.
4. Termination
of Employment.
(a) Termination
of Employment and Term of Employment. The Company or the
Executive may terminate the Executive's employment at any time and for any
reason in accordance with subsection 4(b) below. The Term of Employment shall
be
deemed to have ended on the last day of the Executive's employment. The Term
of
Employment shall terminate upon the Executive's death.
(b) Notice
of Termination. Any purported termination of the Executive's employment
(other than by reason of death) shall be communicated by written Notice of
Termination from one party hereto to the other party hereto in accordance
with
the notice provisions contained in subsection 15(b) below. For purposes of
this
Agreement, a "Notice of Termination" shall mean a notice that indicates the
Date
of Termination and, with respect to a termination due to Disability, Cause
or
Good Reason, sets forth in reasonable detail the facts and circumstances
that
are alleged to provide a basis for such termination. A Notice of Termination
from the Company shall specify whether the termination is with or without
Cause
or due to the Executive's Disability. A Notice of Termination from the Executive
shall specify whether the termination is with or without Good Reason and,
if the
termination is without Good Reason, whether the termination is due to his
Disability or retirement. For avoidance of doubt, the Executive shall not
be
deemed to have retired for purposes of this Agreement if his employment is
terminated by the Company (whether or not such termination is with or without
Cause or due to the Executive's Disability), by the Executive with Good Reason,
due to a Disability or due to the Executive's death.
(c) Date
of Termination. For purposes of this Agreement, "Date of
Termination" shall mean the date specified in the Notice of Termination (but
in
no event shall such date be earlier than the 30th day following the date
the
Notice of Termination is given, unless expressly agreed to by the parties
hereto) or the date of the Executive's death.
(d) No
Waiver. The failure to set forth any fact or circumstance in a Notice of
Termination, which fact or circumstance was not known to the party giving
the
Notice of Termination when the notice was given, shall not constitute a waiver
of the right to assert such fact or circumstance in an attempt to enforce
any
right under or provision of this Agreement.
(e) Cause.
For purposes of this Agreement, the term "Cause" means: (i) the Executive's
gross negligence or gross misconduct or (ii) the Executive's having been
convicted of, or entered a plea of nolo contendere to, a crime involving
moral
turpitude or a felony. No act or failure to act directly related to Company
action or inaction that constitutes Good Reason shall constitute Cause under
this Agreement if the Executive has provided a Notice of Termination based
on
such Good Reason event prior to the Company's giving of the Notice of
Termination for Cause. The Executive's termination for Cause shall be effective
when and if a resolution is duly adopted by an affirmative vote of the entire
Board (less the Executive), stating that, in the good faith opinion of the
Board, the Executive is guilty of the conduct described in the Notice of
Termination, and such conduct constitutes Cause under this Agreement; provided,
however, that the Executive shall have been given the opportunity (i) to
cure
any act or omission that constitutes Cause if capable of cure and (ii), together
with counsel, during the 30-day period following the receipt by the Executive
of
the Notice of Termination and prior to the adoption of the Board's resolution,
to be heard by the Board.
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(f) Disability.
For purposes of this Agreement, the Executive shall be deemed to have a
Disability if the Executive is entitled to long-term disability benefits
under
the Company's long-term disability plan or policy, as the case may be, as
in
effect on the Date of Termination.
(g) Good
Reason. For purposes of this Agreement, the term "Good Reason" means the
occurrence (without the Executive's express written consent) of any of the
following acts or failures to act by the Company:
(i) any
reduction in the Executive's Annual Base Salary or target Annual Bonus
opportunity;
(ii) requiring
the Executive to be based more than 50 miles away from the Company's
headquarters in New York, New York;
(iii) the
material breach by the Company of any of its other obligations under this
Agreement; or
(iv) the
failure of the Company to obtain the assumption of this Agreement as
contemplated in subsection 13(b) hereof.
The
Executive's continued employment shall not constitute consent to, or a waiver
of
rights with respect to, any act or failure to act constituting Good Reason
hereunder; provided, however, that no such event described above shall
constitute Good Reason unless the Executive has given a Notice of Termination
to
the Company specifying the condition or event relied upon for such termination
within 90 days from the Executive's actual knowledge of the occurrence of
such
event and, if capable of cure, the Company has failed to cure the condition
or
event constituting Good Reason within the 30 day period following receipt
of the
Executive's Notice of Termination.
5. Obligations
of the Company upon Termination.
(a) Termination
by the Company for other than Cause or by the Executive for Good
Reason. If the Executive's employment is terminated by the
Company for any reasons other than Cause or Disability or by the Executive
for
Good Reason:
(i) The
Company shall pay to the Executive, within thirty business days of the Date
of
Termination, any earned but unpaid Annual Base Salary;
(ii) The
Company shall pay to the Executive, within thirty business days of the Date
of
Termination, a prorated Annual Bonus based on (A) the target Annual Bonus
opportunity in the year in which the Date of Termination occurs or the prior
year if no target Annual Bonus opportunity has yet been determined (disregarding
any reduction in target Annual Bonus opportunity that was the basis for a
termination by the Executive for Good Reason) and (B) the fraction of the
year
the Executive was employed.
(iii) The
Company shall pay to the Executive, within thirty business days of the Date
of
Termination, a lump-sum payment equal to the sum of 100% of (x) the Executive's
Annual Base Salary in effect immediately prior to the Date of Termination
(disregarding any reduction in Annual Base Salary that was the basis for
a.
termination by the Executive for Good Reason), and (y) the Executive's target
Annual Bonus opportunity for the year in which the Date of Termination occurs
or
the prior year if no target Annual Bonus opportunity has yet been determined
(disregarding any reduction in target Annual Bonus opportunity that was the
basis for a termination by the Executive for Good Reason);
(iv) For
a one (1) year period after the Date of Termination, the Company will arrange
to
provide the Executive (and any covered dependents), without cost to the
Executive, with life, accident and health insurance benefits substantially
similar to those the Executive and any covered dependents were receiving
immediately prior to the Notice of Termination, except for any such benefits
that were waived by the Executive in writing. If the Company arranges
to
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provide
the Executive and covered dependents with life, accident and health insurance
benefits, those benefits will be reduced to the extent comparable benefits
are
actually received by, or made available to, the Executive by a subsequent
employer without cost during the one (1) year period following the Executive's
Date of Termination. The Executive must report to the Company any such benefits
that he actually receives or are made available. In lieu of the benefits
described in this subsection 5(a)(iv), the Company, in its sole discretion,
may
elect to pay to the Executive a lump sum cash payment equal to the total
premiums that would have been paid by the Company to provide such benefits
to
the Executive (determined based on the premiums paid by the Company immediately
prior to the Date of Termination). Nothing in this subsection 5(a)(iv) will
affect the Executive's right to elect COBRA continuation coverage in accordance
with applicable law or extend the COBRA. continuation coverage period;
and
(v) The
Executive shall have at least three (3) months (or until the last day of
the
stock option term; whichever occurs first) to exercise any then vested
outstanding stock options and all of the Executive’s other outstanding
equity-based awards shall become fully vested on the Date of
Termination.
(b) Termination
in Connection with a Change in Control.
(i) if,
in anticipation of or within the 24 month period following a Change in Control
(as defined below), the Executive's employment is terminated by the Company
for
any reason other than Cause or Disability or by the Executive for Good Reason,
the Executive shall receive the payments and benefits described in subsection
5(a), except that the payment described in section 5(a)(iii) shall be equal
to
100% of the amounts described in (x) and (y) thereof, the continuation period
described in section 5(a)(iv) shall be one (1) years, regardless of how long
the
Executive has been employed, and all of the Executive's outstanding equity-based
awards shall become fully vested on the Date of Termination.
(ii) For
purposes of this Agreement, the term "Change in Control" means the occurrence
of
any of the following events:
(A) any
"person" (within the meaning ascribed to such term in Section 3(a)(9) of
the
Securities Exchange Act of 1934, as amended from time to time (the "Exchange
Act") and used in Sections 13(d) and 14(d) thereof, including a "group" as
used
in Section 13 (d) thereof), other than the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the Company,
or
any corporation owned directly or indirectly by the stockholders of the Company
in substantially the same proportion as the ownership of stock of the Company,
(a "Person") that is not on the Effective Date the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing more than 20% of the combined voting
power of the Company's then outstanding securities becomes after the Effective
Date the beneficial owner, directly or indirectly, of securities of the Company
representing more than 20% of the combined voting power of the Company's
then
outstanding securities;
(B) individuals
who, as of the Effective Date, constitute the Board (the "Incumbent Board")
cease for any reason to constitute at least a majority of the Board of the
Company, provided that any person becoming a director subsequent to the date
hereof whose election, or nomination for election by the Company's stockholders,
was approved by a vote of at least a majority of the directors then comprising
the Incumbent Board (other than an election or nomination of an individual
whose
initial assumption of office is in connection with an actual or threatened
election contest relating to the election of the directors of the Company)
shall
be, for purposes of this definition, considered as though such person were
a
member of the Incumbent Board;
(C) consummation
of a merger, consolidation, reorganization, share exchange or similar
transaction (a "Transaction") of the Company with any other entity, other
than
(I) a Transaction that would result in the voting securities of the Company
outstanding immediately prior thereto directly or indirectly continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or a parent company) more than 80% of
the
combined voting power of the voting securities of the Company or such surviving
entity or parent company outstanding immediately after such Transaction or
(II)
a Transaction effected to implement a recapitalization of the Company (or
similar transaction) in which no Person acquires more than 20% of the combined
voting power of the Company's then outstanding securities;
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(D) the
sale, transfer or other disposition (in one transaction or a series of related
transactions) of more than 50% of the operating assets of the Company;
or
(E) the
approval by the shareholders of a plan or proposal for the liquidation or
dissolution of the Company.
(c) Termination
by the Company for Cause or by the Executive without Good Reason. If the
Executive's employment is terminated by the Company for Cause the Company
shall
pay to the Executive, within thirty business days of the Date of Termination,
any earned but unpaid Annual Base Salary and all outstanding stock options
(whether or not then exercisable), restricted stock and other incentive awards
shall be forfeited. If the Executive's employment is terminated by the Executive
without Good Reason (and not due to death, Disability or retirement), the
Company shall pay to the Executive, within thirty business days of the Date
of
Termination, any earned but unpaid Annual Base Salary, the Executive shall
have
three months (or until the last day of the stock option term, whichever occurs
first) to exercise any outstanding vested stock options and all of the
Executive's unvested equity-based awards shall be forfeited as of the Date
of
Termination.
(d) Termination
due to Death or Disability. If the Executive's employment is
terminated due: to death or Disability, (i) the Company shall pay to the
Executive (or to the Executive's estate or personal representative in the
case
of the Executive's death), within thirty business days after the Date of
Termination, (A) any earned but unpaid Annual Base Salary and (B) a prorated
Annual Bonus based on (I) the target Annual Bonus opportunity in the year
in
which the Date of Termination occurs or the prior year if no target Annual
Bonus
opportunity has yet been determined and (II) the fraction of the year the
Executive was employed, and (ii) all of the Executive's outstanding equity-based
awards shall vest on the Date of Termination and the Executive's outstanding
stock options shall remain exercisable for one year following the Date of
Termination (or until the last day of the stock option term, whichever occurs
first).
(e) Retirement. If
the Executive retires with at least 15 years of service and after having
attained age 55, (i) the Company shall pay to the Executive, within thirty
business days after the Date of Termination, any earned but unpaid Annual
Base
Salary, (ii) the Company shall pay to the Executive, within thirty business
days
after the Date of Termination, a prorated Annual Bonus based on (A) the target
Annual Bonus opportunity in the year in which the Date of Termination occurs
or
the prior year if no target Annual Bonus opportunity has yet been determined
and
(B) the fraction of the year the Executive was employed, (iii) the Executive
shall receive applicable retiree benefits, if any, provided at such time
by the
Company to retirees or as the Company shall determine, (iv) the Executive's
outstanding equity-based awards shall vest on the Date of Termination, and
(v)
the Executive's stock options shall remain exercisable until the last day
of the
option term thereof The Executive shall only be deemed to have retired for
purposes of this Agreement if he has satisfied the conditions set forth in
this
Section 5(e) and the Executive specifies in the Notice of Termination that
the
termination is due to retirement. For avoidance of doubt, the Executive shall
not be entitled to receive benefits pursuant to this Section 5(e) if he receives
benefits under Section 5(a), (b), (c) or (d).
6. Certain
Tax Consequences.
(a) The
Excise Tax and Gross-Up Payment. If any payments or benefits paid or
provided or to be paid or provided to the Executive or for his benefit pursuant
to the terms of this Agreement or otherwise in connection with, or arising
out
of, his employment with the Company (a "Payment" or "Payments")
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would
be subject to any excise tax (the "Excise Tax") imposed by section 4999
of the
Internal Revenue Code of 1986, as amended (the "Code"), then the Executive
will
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,
penalties, additional tax, or similar items imposed with respect thereto
and the
Excise Tax), including any such taxes 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.
(b) Determination
of Excise Tax and Gross-Up Payment. An initial determination as to whether a
Gross-Up Payment is required pursuant to this Agreement and the amount of
such
Gross-Up Payment will be made at the Company's expense by an accounting firm
selected by the Company. The accounting firm will provide its determination,
together with detailed supporting calculations and documentation, to the
Company
and the Executive within 10 days after the Date of Termination, or such other
time as requested by the Company or by the Executive. If the accounting firm
determines that no Excise Tax is payable by the Executive with respect to
a
Payment or Payments, it will furnish the Executive with an opinion reasonably
acceptable to the Executive to that effect. The Gross-Up Payment, if any,
will
be paid by the Company to the Executive within thirty business days of the
receipt of the accounting firm's determination. Within 10 days after the
accounting firm delivers its determination to the Executive, the Executive
will
have the right to dispute the determination. The existence of a dispute will
not
in any way affect the Executive's right to receive the Gross-Up Payment in
accordance with the determination. If there is no dispute, the determination
will be binding, final, and conclusive upon the Company and the Executive.
If
there is a dispute, the Company and the Executive will together select a
second
accounting firm, which will review the determination and the Executive's
basis
for the dispute and then will render its own determination, which will be
binding, final, and conclusive on the Company and on the Executive. The Company
will bear all costs associated with that determination, unless the determination
is not greater than the initial determination, in which case all such costs
will
be borne by the Executive.
(c) Tax
Rate. For purposes of determining the amount of the Gross Up Payment,
the Executive will be deemed to pay federal income taxes at the highest marginal
rate of federal income taxation in the calendar year in which the Gross-Up
Payment is to be made and applicable state and local income taxes at the
highest
marginal rate of taxation in the state and locality of the Executive's residence
on the Date of Termination, net of the maximum reduction in federal income
taxes
that would be obtained from deduction of those state and local
taxes.
(d) Withholding.
Notwithstanding anything contained in this Agreement to the contrary, in
the
event that, according to the accounting firm's determination, an Excise Tax
will
be imposed on any Payment or Payments, the Company will pay to the applicable
government taxing authorities as Excise Tax withholding, the amount of the
Excise Tax that the Company has actually withheld from the Payment or Payments
in accordance with law.
7. Release.
Notwithstanding any provision herein to the contrary, the Company will require
that, prior to payment of any amount under section 5 of this
Agreement (other than due to the Executive's death), the Executive shall
have
executed a complete release of the Company and its affiliates and related
parties in such form as is reasonably required by the Company, and any waiting
periods contained in such release shall have expired.
8. Non-Exclusivity
of Rights. Except as otherwise provided in this Agreement, 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 for which the Executive may qualify (other
than severance policies). Vested benefits and other amounts that the Executive
is otherwise entitled to receive under any other plan, program, policy, or
practice of, or any contract or agreement with, the Company or any of its
affiliated companies on or after the Date of Termination shall be payable
in
accordance with the terms of each such plan, program, policy, practice, contract
or agreement, as the case may be, except as expressly modified by this
Agreement.
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9. Full
Settlement. 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, except
as
otherwise provided in subsections 5(a)(iv) and 5(e), the amount of any payment
or benefit provided for in this Agreement shall not be reduced by any
compensation earned by the Executive as the result of employment by another
employer, by retirement benefits, by offset against any amount claimed to
be
owed by the Executive to the Company, or otherwise.
10. Non-Competition;
Confidential Information; and Non-Solicitation.
(a) Non-Competition.
During the Term of Employment and for the one year period following the
Date of Termination for any reason , the Executive shall not, without the
prior
written consent of the Company, as a shareholder, officer, director, partner,
consultant, employee or otherwise, engage in any business or enterprise which
is
"in competition" (as defined below) with the Company, its affiliates, or
their
successors or assigns (such entities collectively referred to hereinafter
in
this section 10 as the "Company") in the states of New York and New Jersey;
provided, however, that the Executive's ownership of less than five percent
of
the issued and outstanding voting securities of a publicly traded company
shall
not, in and of itself, be deemed to constitute such competition. A business
or
enterprise is deemed to be "in competition" if it is engaged in any business
in
which the Company either (i) is engaged in as of the Date of Termination
or (ii)
as of the Date of Termination, contemplates engaging in within one (1) year
following the Date of Termination.
(b) Confidential
Information. The Executive shall hold in a fiduciary capacity for the benefit
of
the Company all secret or confidential information, knowledge, trade secrets,
methods, know-how or data relating to the Company or its affiliates and their
businesses or acquisition :prospects that the Executive obtained or obtains
during the Executive's employment by the Company ("Confidential Information"),
provided that "Confidential Information" shall not include any secret or
confidential information, knowledge, trade secrets, methods, know-how or
data
that is or becomes generally known to the public (other than as a result
of the
Executive's violation of this section 10). Except as may be required and
appropriate in connection with carrying out his duties under this Agreement,
the
Executive shall not communicate, divulge, or disseminate any material
Confidential Information at any time during or after the Executive's employment
with the Company, except with the prior written consent of the Company or
as
otherwise required by law or legal process; provided, however, that if so
required, the Executive will provide the Company with reasonable notice to
contest such disclosure.
(c) Non-Solicitation.
During the Term of Employment and for the one (1) year period following the
Date
of Termination for any reason, the executive will not, directly or indirectly,
initiate any action to solicit or recruit anyone who is then an employee
of the
Company for the purpose of being employed by him or by any business, individual,
partnership, firm, corporation or other entity on whose behalf he is acting
as
an agent, representative, employee or otherwise.
(d) Non-Interference
with Customers or Producers. During the Term of Employment and for the one
(1) year period following the Date of Termination for any reason, the Executive
will not interfere with any business relationship between the Company and
any of
its customers or agents or brokers that produce insurance business for the
Company.
(e) Remedies;
Severability.
(i) The
Executive acknowledges that if the Executive shall breach or threaten to
breach
any provision of subsections 10(a) through (d), the damages to the Company
may
be substantial, although difficult to ascertain, and money damages will not
afford the Company an adequate remedy.Therefore, if the provisions of
subsections 10(a) through (d) are violated, in whole or in part, the Company
shall be entitled to specific performance and injunctive relief, without
prejudice to other remedies the Company may have at law or in
equity.
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(ii) If
any term or provision of this section 10, or the application thereof to any
person or circumstances shall, to any extent, be invalid or unenforceable,
the
remainder of this section 10, or the application of such term or provision
to
persons or circumstances other than those as to which it is held invalid
or
unenforceable, shall not be affected thereby, and each term and provision
of
this section 10 shall be valid and enforceable to the fullest extent permitted
by law. Moreover, if a court of competent jurisdiction deems any provision
of
subsections 10(a) through (d) to be too broad in time, scope, or area, it
is
expressly agreed that such provision shall be reformed to the maximum degree
that would not render it unenforceable.
11. Attorneys'
Fees. Each party shall pay its own legal fees, court costs, litigation
expenses and/or arbitration expenses (as applicable) in connection with any
dispute, litigation or arbitration regarding the validity or enforceability
of,
or liability under or otherwise involving;, any provision of this Agreement,
except that if the Executive prevails on the majority of material claims
disputed, the Company shall pay all reasonable legal fees, court cost,
litigation expenses and/or arbitration expenses.
12. Indemnification. The
Executive shall be indemnified by the Company for actions taken in his position
as an officer, director, employee and agent of the Company to the greatest
extent permitted by applicable law. The Executive shall also be covered as
an
insured by a liability insurance policy secured by and maintained by the
Company
covering acts of officers and members of the Board.
13. Successors.
(a) Assignment
of Agreement. 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.
(b) Successors
of the Company. No rights or obligations of the
Company under this Agreement may be assigned or transferred except that 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 expressly assume 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 herein before defined and
any
successor that executes and delivers the agreement provided for in this section
13 or which otherwise becomes bound by all the terms and provisions of this
Agreement by operation of law.
14. Arbitration.
Except for matters covered under section 10, in the event of any dispute
or
difference between the Company and the Executive with respect to the subject
matter of this Agreement and the enforcement of rights hereunder, either
the
Executive or the Company may, by written notice to the other, require such
dispute or difference to be submitted to arbitration. The arbitrator or
arbitrators shall be selected by agreement of the parties or, if they cannot
agree on an arbitrator or arbitrators within 30 days after the date arbitration
is required by either party, then the arbitrator or arbitrators shall be
selected by the American Arbitration Association upon the application of
the
Executive or the Company. The determination reached in such arbitration shall
be
final and binding on both parties without any right of appeal or further
dispute. Execution of the determination by such arbitrator may be sought
in any
court of competent jurisdiction. The arbitrators shall not be bound by judicial
formalities and may abstain from following the strict rules of evidence and
shall interpret this Agreement as an honorable engagement and not merely
as a
legal obligation. Unless otherwise agreed by the parties, any such arbitration
shall take place in New York, New York.
15. Miscellaneous.
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(a) Governing
Law and Captions. This Agreement shall be governed by, and construed in
accordance with, the laws of New York 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.
(b) Notices.
All notices and other communications under this Agreement shall be in writing
and shall be given by hand delivery or by facsimile (provided confirmation
of
receipt of such facsimile is received) to the other party or by registered
or
certified mail, return receipt requested, postage prepaid, or by Federal
Express
or other nationally-recognized overnight courier that requires signatures
of
recipients upon delivery and provides tracking services, addressed as
follows:
If
to the Executive:
Xxxx
x. Xxxxx
00
Xxxxxxxxx Xxxxx
Xxxxxxx,
Xxx Xxxxxx
00000
If
to the Company:
000
Xxxxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
General Counsel
Facsimile:
000-000-0000
or
to such other address as either party furnishes to the other in writing in
accordance with this subsection 15(b). Notices and communications shall be
effective when actually received by the addressee.
(c) Amendment.
This Agreement may not be amended or modified except by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.
(d) Severability.
The invalidity or unenforceability of any provision of this Agreement shall
not
affect the validity or enforceability of any other provision of this Agreement.
If any provision of this Agreement shall be held invalid or unenforceable
in
part and if the rights and obligations of any to this Agreement will not
be
materially and adversely affected thereby, the remaining portion of such
provision, together with all other provisions of this Agreement, shall remain
valid and enforceable and continue in full force and effect to the fullest
extent consistent with law.
(e) Withholding.
Notwithstanding any other provision of this Agreement, the Company may withhold
from amounts payable under this Agreement all federal, state, local, and
foreign
taxes that are required to be withheld by applicable laws or
regulations.
(f) Waiver.
The Executive's or the Company's failure to insist upon strict compliance
with
any provision of, or to assert any right under, this Agreement (including,
without limitation, the right of the Executive to terminate employment for
Good
Reason) shall not be deemed to be a waiver of such provision or right or
of any
other provision of or right under this Agreement.
(g) Entire
Understanding; Counterparts. The Executive and the Company acknowledge that
this Agreement supersedes and terminates any other severance and/or employment
agreements between the Executive and the Company or any Company affiliates.
This
Agreement may be executed in several counterparts, each of which shall be
deemed
an original, and said counterparts shall constitute but one and the same
instrument.
(h) Rights
and Benefits Unsecured. The rights and benefits of the Executive
under this Agreement may not be anticipated, assigned, alienated, or subject
to
attachment, garnishment, levy; execution, or other legal or equitable process
except as required by law. Any attempts by the Executive to anticipate,
alienate, assign, sell, transfer, pledge or encumber the same shall be void.
Payments hereunder shall not be considered assets of the Executive in the
event
of insolvency or bankruptcy.
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(i) Noncontravention.
The Company represents that the Company is not prevented from entering into,
or
performing this Agreement by the terms of any law, order, rule or regulation,
its by-laws or declaration of trust, or any agreement to which it is a
party.
(j) Section
and Subsection Headings. The section and subsection headings in this
Agreement are for convenience of reference only; they form no part of this
Agreement and shall not affect its interpretation.
IN
WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and,
pursuant to the authorization of the Board, the Company has caused this
Agreement to be executed, all as of the day and year first above
written.
|
/s/
Xxxxxxx X. Xxx
|
||
|
Name: Xxxxxxx
X. Xxx
|
||
|
Title:
CEO & President
|
|
/s/ Xxxx
X. Xxxxx
|
||
|
Xxxx
X. Xxxxx
|
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