EXHIBIT 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT made and entered into by and between MUTUAL
ASSURANCE SOCIETY OF ALABAMA, an Alabama mutual insurance company (the
"Employer"), and A. XXXXXXX XXXXX, M.D., an individual (the "Employer");
WITNESSETH THAT:
WHEREAS, Employer desires to employ Employee, and Employee is willing to
accept employment, on the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual covenants and conditions
herein contained, Employer and Employee hereby agree as follows:
1. Prior Agreements. This Agreement supersedes all prior agreements and
understandings, including, without limitation, any and all Consultant
Agreements and Employment Agreements, oral or written, between the parties
hereto relative to the employment of Employee by Employer.
2. Employment. Employer hereby employs Employee, and Employee hereby
accepts employment, upon the terms and conditions hereinafter set forth.
3. Term. This Agreement shall extend for an initial term of one (1) year
from January 1, 1982 and ending December 31, 1982. The Agreement shall be
automatically renewed for a second term of two (2) years, commencing January 1,
1983, and ending December 31, 1984, unless on or before December 1, 1982,
either party shall elect not to renew the Agreement by giving written notice to
the other party of such election. Thereafter, the Agreement shall be
automatically renewed for successive terms of three (3) calendar years each,
unless either party hereto shall have elected not to renew the Agreement for any
additional term by giving written notice to the other party of such election at
least thirty (30) days prior to the commencement of any such renewal term.
The above provisions notwithstanding, however, this Agreement may be terminated
during any term hereof on the conditions set forth in paragraph 10 of this
Agreement.
4. Duties. Employee is engaged as President and Principal
Executive Officer of Employer to provide, subject to control of the Board of
Directors of Employer, supervision, coordination and control of the business and
insurance activities of Employer and its subsidiaries, their executive and
supervisory personnel, and the outside firms, consultants and the like who have
been engaged to furnish services and advice to Employer and its subsidiaries
("Primary Duties") and to perform such other duties related to the Primary
Duties as may be required by the Board of Directors or as set forth in the
By-Laws of Employer. The precise duties of Employee may be expanded or curtailed
to a reasonable extent under the direction of the Board of Directors of
Employer. However, the Primary Duties of Employee shall not be substantially
modified except by amendment to this Agreement.
5. Extent of Services.
(a) Employee agrees to devote his full time, attention,
skill and efforts during normal working hours of Employer and of Employee's
medical practice employer(s) to the performance of his duties under this
Agreement and to the practice of medicine, with due allowance to Employer for
time off for vacation, continuing education and illness and for the performance
of services for reasonable amounts of time for civic, charitable and
professional organizations.
(b) It is understood and agreed that the principal
occupation of Employee is currently the practice of medicine. This Agreement has
been made and entered into with full understanding that Employee may continue to
engage in the practice of medicine and that nothing herein shall be construed to
limit Employee in carrying on the practice of medicine or to require him to
carry on the practice of medicine so long as he shall faithfully perform
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his duties under this Agreement with energy, skill and diligence commensurate
with his responsibilities.
6. Working Facilities. Employee shall be furnished with a private
office, stenographic help, and such other facilities and services as shall be
suitable to his position and adequate for the performance of his duties.
7. Expenses. Employer shall pay and be responsible for, or
reimburse Employee if he pays for, all expense reasonably and necessarily
incurred by Employee in the performance of his duties as set forth in this
Agreement. Such expenses shall include, but shall not be limited to, the
following:
(a) Expense of furnishing, repairing, maintaining and
operating an automobile for use by Employee in connection with his
employment hereunder;
(b) Reasonable and accountable entertainment expenses
incurred or expended by Employee in promotion of Employer's business
and in the performance of Employee's duties hereunder.
(c) Reasonable and accountable expenses for
transportation, lodging, accommodations, meals and other expenses
incurred by Employee when his duties require him to travel out of
Jefferson County, Alabama.
8. Compensation.
(a) For each calendar year during the term of this
Agreement, Employee's annual compensation from Employer ("Basic Annual
Compensation") shall equal the difference between $300,000.00 and
Employee's "Medical Practice Earnings" (as defined in paragraph (b)
below) for such year; provided, however, that Employee's Basic Annual
Compensation shall not be less than $60,000.00 nor more than
$100,000.00 for any such calendar year.
(b) The term "Medical Practice Earnings" shall mean (A)
the aggregate amount of salary and bonuses received by Employee during
the applicable calendar year from his medical practice employers,
before deductions for income taxes or other withholdings, as
compensation for services rendered in the practice of medicine; (B)
the aggregate amount of any disability insurance benefits received by
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Employee during such year from such disability insurance or plans as may have
been provided for Employee by his medical practice employers; and, (C) an amount
equal to the aggregate amount of any profit sharing or pension plan
contributions that will be required to be credited, or that shall have been
credited, to Employee's accounts under the provisions of any qualified profit
sharing or pension plan of which Employee shall be an eligible participant with
respect to his Medical Practice Earnings. As soon as practicable after December
15 in each calendar year, commencing with the year 1982, Employee will send to
Employer a statement of Employee's Medical Practice Earnings for such year, as
calculated and verified by the independent auditor then serving the practice
group with which Employee practices.
(c) During the 1982 calendar year, subject to his
continued employment for the full year, Employee's Basic Annual Compensation
will be paid as follows:
(i) Current compensation in the aggregate amount of
Twenty-Four Thousand Dollars ($24,000.00), payable at the rate of Eight
Thousand Dollars ($8,000.00) per month for the months of January,
February and March, has been paid to Employee, receipt of which salary
for said months is hereby acknowledged by Employee;
(ii) Additional current compensation in the amount of Six
Thousand Dollars ($6,000.00), payable at the rate of Two Thousand
Dollars ($2,000.00) per month will be payable for the months of April,
May, and June, 1982;
(iii) Additional current compensation in the amount of
Twenty-Five Thousand Dollars ($25,000.00), payable at the rate of Five
Thousand Dollars ($5,000.00) per month will be payable for the months
of July, August, September, October, and November, 1982; and
(iv) As of December 31, 1983, Employee will receive
additional compensation in an amount equal to the difference between
his Basic Annual Compensation for the year 1982 and amounts theretofore
paid to Employee by Employer pursuant to subparts (i), (ii) and
(iii) above.
(d) During 1983 and each successive calendar year of
Employee's employment hereunder, subject to his continued employment for the
full year. Employee's Basic Annual Compensation will be paid as follows:
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(i) Current Compensation in the amount of Fifty-Five
Thousand Dollars ($55,000.00), payable at the rate of Five Thousand
Dollars ($5,000.00) per month, will be payable for the first eleven
(11) months of such calendar year; and
(ii) As of December 31 of such calendar year, Employee
will receive additional compensation in an amount equal to the
difference between his Basic Annual Compensation for such calendar year
and amounts theretofore paid to Employee by Employer pursuant to
subpart (i) above for such calendar year.
(e) If the termination of Employee's employment relation
with Employer ("Termination of Employment") occurs during the month of December
of any year, Employee's Basic Annual Compensation will be determined pursuant to
subparagraph (c) or (d) above, as the case may be, as if the Termination of
Employment had occurred on December 31 of such year. If such Termination of
Employment should occur in a month other than December, the Basic Annual
Compensation for such year ("Termination Year") will be determined pursuant to
this subparagraph (e), notwithstanding anything to the contrary herein, as
follows:
(i) The following terms shall be used to determine
Employee's Basic Annual Compensation for such Termination Year; (A)
"Fraction" shall be a fraction in which the numerator is the number of
months elapsed from January 1 of the Termination Year through the last
day of the calendar month in which the Termination of Employment
occurs and the denominator of which is twelve; (B) "Termination Year
Medical Practice Earnings" means the amount of Employee's Medical
Practice Earnings for the period beginning on January 1 of the
Termination Year and ending on the last day of the calendar month in
which Termination of Employment occurs; and (C) "Termination Year
Basic Annual Compensation" means the difference between (1)
$300,000.00 times the Fraction and (2) Employee's Termination Year
Medical Practice Earnings; provided, however, that Employee's
Termination Year Basic Annual Compensation shall not be less than
$60,000.00 times the Fraction or more than $100,000.00 times the
Fraction.
(ii) Employee and Employer shall ascertain the amount of
the difference between (A) Termination Year Basic Annual Compensation
and (B) the sum of the amounts of Basic Annual Compensation theretofore
paid to Employee for such calendar year pursuant to paragraph 8(c) or
8(d) hereof, and Employer will pay such amount to Employee on the last
day of the calendar month in which Termination of Employment occurs.
(f) The compensation payable to Employee hereunder will
be subject to required withholding for taxes and other
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like sums and will be payable monthly or on such other more frequent basis as
will conform with Employer's payroll practices from time to time in effect.
(g) The parties agree that any fees paid to Employee by virtue of
his service as a member of the Board of Directors of Employer and/or as a member
of the Board of Directors of Employer and/or as a member of any committees or
sub-committees of said Board shall not be taken into account in any
determinations of the amount of compensation that shall be due Employee for his
services under this Agreement.
(h) In addition to the compensation that shall be due Employee in
accordance with the provisions of subparagraphs 8(c), 8(d) and 8(e) above,
Employee shall be entitled to participate in such group life, disability and
health insurance plans and qualified profit sharing or pension plans of Employer
as shall from time to time be in effect for the benefit of Employer's management
and executive employees. The value of any such benefits shall not be taken into
account by Employer in determining the amount of compensation that shall be due
Employee under any other provision of this Agreement.
(i) Employer agrees to provide and maintain for the benefit of
Employee and Employee's beneficiaries, at no cost to Employee, disability
insurance coverage providing disability insurance benefits to Employee for a
period of five (5) years, commencing with the one hundred eighty-first (181st)
day of any disability of Employee rendering him unable to perform the duties of
his employment for Employer, and for such additional period thereafter as
Employee may be unable to engage in any gainful employment commensurate with his
age, qualifications and experience, until he shall have attained the maximum age
for which disability insurance benefits are normally paid by established
companies offering such insurance coverage. The amount of disability insurance
benefits to be so provided by such disability insurance coverage shall be the
maximum amount obtainable with respect
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to Employee at regular or group rates from time to time through any reputable
and well established insurer or loss of earnings of individuals due to total
and permanent physical and/or mental disability.
9. Disputes. In the event of a dispute between Employer and Employee
concerning the amount of Basic Annual Compensation payable to Employee, such
dispute shall be referred to the managing partner of the Birmingham, Alabama,
office of a mutually agreed-upon national firm of certified public accountants
not then serving as the independent public accountants for Employee, and such
individual (the "Arbiter") shall resolve such dispute as herein provided. Each
party shall submit to the Arbiter the dollar or percentage figure it believes
to be correct as to the disputed item or items, and the Arbiter shall resolve
the dispute by selecting the dollar or percentage figure submitted by either
one of the parties, or any other figure determined by the Arbiter to be
correct. The determination by such party shall be final, and Employer and
Employee agree to be bound thereby. If the dispute between the parties is
resolved wholly in favor of Employer or Employee, the party losing in such
dispute shall bear the fees and expenses of the Arbiter. If the dispute is
resolved between the figures submitted by the parties, the parties shall bear
such fees and expenses in proportion to the respective differences between the
figures submitted by them and the figure determined by the Arbiter. The Arbiter
will designate to the parties their respective shares of its fees and expenses,
and such determination shall be binding upon the parties.
10. Termination of Agreement.
(a) Except for termination of this Agreement by either party as
provided in paragraph 3 hereof, or by reason of any "voluntary termination of
employment" of Employee, as defined in subparagraph (d) below, Employer shall
not terminate this Agreement or Employee's employment hereunder except for
"good cause," as that term is hereinafter defined. For good
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cause, Employer may terminate this Agreement and Employee's employment
hereunder as of the end of any calendar month if it gives at least thirty (30)
days prior written notice to the Employee of such termination; provided, that
this Agreement shall not be so terminated and the Employee shall not be so
discharged unless the Board of Directors of the Employer by a majority of the
whole Board then in office (except that Employee shall not be counted in
determining either the number of the whole Board that shall be in office or the
number necessary to constitute a majority thereof, nor shall his vote be
counted), finds that good cause exists for such termination and discharge.
(b) "Good cause" shall mean any one or more of the following:
(i) Employee's failure or refusal to faithfully or diligently
perform as agreed in paragraph 3 of this Agreement or his failure to
perform the usual and customary duties of his employment and the
continuance of such failure or refusal within a reasonable time after
Employee's receipt of written notice from the Board of Directors of
Employer directing Employee to remedy such failure or refusal, provided,
that any such failure or refusal by Employee that shall be attributable to
Employee's "disability" (as that term is defined in subparagraph (d) of
this paragraph 10) during the first one hundred eighty (180) days thereof
shall not constitute good cause for termination of Employee's employment;
(ii) Any breach by the Employee of the covenants set forth in
paragraph 11 of this Agreement;
(iii) Embezzlement, theft, misappropriation or conversion of any
assets of the Employer by Employee alone or while acting in concert with
others; or
(iv) If Employee is charged with the commission of a crime classified
as a felony under any federal or state criminal statutes and is arraigned
for trial in connection with any such charge regardless of whether Employee
shall actually be tried on any such charge.
(c) Employee's right to Basic Annual Compensation hereunder shall
end at the close of the calendar month in which his employment hereunder shall
be terminated for any reason, and this Agreement shall thereafter be null, void
and of no effect, except the provisions of paragraphs 10(c) and 11(c) which
shall survive any termination of Employee's employment hereunder regardless of
the cause therefor:
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provided, that, subject to the provisions of subpart (iii) of this
subparagraph, in the event Employer shall terminate the Employee's employment
hereunder for reasons other than as provided in paragraph 3 hereof, or for
reasons other than the death, disability or retirement of Employee, or for
reasons other than good cause, Employer shall be liable to Employee for
liquidated damages for such termination of Employee's employment ("Early
Termination") and such damages shall be determined and paid as follows:
(i) Said liquidated damages shall be an amount that shall equal the
product obtained by multiplying the number of full calendar months
remaining, after such Early Termination shall occur, in the term of
employment during which such Early Termination shall occur, by an amount
that shall equal one-twelfth (1/12th) of the Basic Annual Compensation of
Employee payable to Employee for the calendar year immediately preceding
the year in which such Early Termination shall occur.
(ii) The amount so determined to be payable to Employee as liquidated
damages for such Early Termination shall be paid to Employee in equal
monthly installments, without interest, during each calendar month that
shall remain in the term in which any such Early Termination shall occur.
(iii) Notwithstanding anything to the contrary in the above, however,
if at the regular annual meeting of the Board of Directors of Employer,
said Board shall refuse or fail to re-elect Employee to the office of
President of Employer, or should substantially change his Primary Duties
without his written consent or by amendment to this Agreement, except for
good cause, Employee's employment with Employer shall be deemed to have
terminated as of the end of the calendar month in which such annual meeting
shall be held, and Employee shall be entitled to liquidated damages for
such termination. Said liquidated damages shall be determined and paid in
accordance with the provisions of sub-paragraphs (i) and (ii) of this
sub-paragraph 10(c), except that Employee's right to receive the monthly
payments provided for in said sub-paragraph (iii) shall expire on and as of
the last day of the eighth calendar month following the month to which such
termination of employment shall occur.
(d) "VOLUNTARY TERMINATION OF EMPLOYMENT," or words of like import,
shall mean any termination by Employee of his employment hereunder, whether by
written notice, letter of resignation, verbal pronouncement, or otherwise, and
shall also mean any termination of Employee's employment hereunder by reason of
his death or disability, or his retirement at normal retirement age, which is as
specified in subparagraph 10(a) of this Agreement. For purposes of
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this Agreement, "disability" of the Employee shall mean the inability of the
Employee to perform the duties of his employment hereunder for a continuous
period of one hundred eighty (180) days or more by reason of any mental or
physical impairment of Employee necessitating his confinement either to a
hospital or other facility for the treatment of mental or physical diseases,
disorders, or other impairments, or to the place of his residence or other
place for the purpose of treatment or recovery of or from any such physical or
mental impairment, for a continuous period of one hundred eighty (180) days or
more or of such severity as would entitle Employee to disability insurance
benefits under any disability insurance policy maintained by Employer and of
which policy Employee or others designated by him shall be a named beneficiary
or beneficiaries.
(e) Notwithstanding any other provision of this
Agreement, Employee shall be deemed to have retired, and this Agreement shall
terminate, as of the last day of the calendar month in which Employee shall
attain the age of seventy (70) years, or as of the last day of the term of his
employment hereunder during which term he shall have attained the age of
sixty-eight (68) years, whichever day shall be the last to occur.
11. Covenant Not to Compete. In further consideration of the
salary and other compensation to be paid to the Employee hereunder, Employee
agrees as follows:
(a) During any term of his employment, he shall not,
directly or indirectly, either as principal, agent, stockholder, or as partner,
officer, director, employee, consultant, or member of the board of directors or
board of trustees of any person, firm or corporation, or otherwise, or in any
other capacity, engage in, have a financial interest in, or carry on any
business that is similar to, or substantially similar to, or competitive with,
the business of Employer or any of its subsidiaries. For the purpose hereof, a
business will be deemed competitive if it involves issuance,
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distribution, or sale of any products or services similar to those now or
hereafter issued, distributed, or sold by Employer or any of its subsidiaries.
(b) We shall hold in confidence and not disclose to others (other
than in connection with Employee's duties under this Agreement) any information
received by him in the course of rendering the services herein contracted for
relating to the business and affairs of Employer and the business and affairs of
the clients of Employer, and Employee confirms that all such information,
policyholder lists, invoice copies, policies, correspondence, quotations,
expiration records, and other records representing the insurance business of
Employer constitute and shall remain the exclusive property of Employer.
(c) For a period of two (2) years immediately following any
voluntary termination by Employee of his employment hereunder or following any
termination of Employee's employment by Employer for good cause, or, in the
event Employee's employment hereunder shall be terminated under circumstances as
would entitle Employee to liquidated damages under the provisions of paragraph
10(c) hereof, for the period of time during which Employer shall be obligated to
pay such liquidated damages to Employee, Employee shall not, directly or
indirectly, alone, or as an Employee or member of any partnership, or as an
officer, director, stockholder, employee, consultant, or representative of any
company, corporation or other business entity, engage in or carry on the
business of selling or offering for sale professional liability insurance for
medical doctors, or any phase thereof, within any county of the State of Alabama
in which Employer shall then be actively soliciting or doing business or in
which any of its policyholders shall be located, nor during such time will
Employee sell or attempt to provide or sell to any policyholder of Employer any
insurance or insurance service which Employer shall be selling or providing, or
offering to sell or provide, at the time Employee's employment
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hereunder shall have been so terminated. This subparagraph shall not be
construed so as to prohibit ownership by Employee of shares of capital stock, or
other securities for which there is an established public trading market, of
insurance companies, or his ownership of policies of insurance issued by
so-called "mutual" insurance companies; provided, that while this subparagraph
shall remain in force, the aggregate number of shares of said stock of any
single insurance company of which Employee may be a stockholder shall not amount
to more than five percent (5%) of the issued and outstanding voting shares of
said company.
(d) Employee recognizes and understands that any award to
Employer of damages, or any other relief available to Employer at law, would not
be adequate in connection with any breach or threatened breach by the Employee
alone, or in conjunction with any other person, of any provision of this
paragraph 11, and Employee agrees that in the event of any such breach or
threatened breach, Employer may, in addition to any other remedies which may be
available to it, file suit to enjoin the Employee, together with all other
persons associated with him, from the breach of any such provisions.
12. Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of Employer, its successors and assigns, and Employee and
his heirs, executors, administrators and legal representatives.
13. Severability. The provisions of this Agreement shall be
severable and in the event that any provision hereof shall be found by any court
to be unenforceable in whole or in part, the remainder of this Agreement shall
nevertheless be enforceable and binding on the parties.
14. Waiver. Waiver of any term or provision of this Agreement or
of any breach of this Agreement or any term or provision hereof shall not be
construed as a waiver of any other term or provision or of any other breach nor
shall any such waiver be deemed or construed as a continuing waiver of any such
term, provision, or breach. The failure of either
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party to require strict performance of any provisions shall not diminish such
party's right thereafter to require strict performance of any provision.
15. Notice. All notices under this Agreement shall be in writing
and shall be given to the party entitled thereto by personal service or by
depositing the notice in the United States mail, postage prepaid, addressed as
follows:
If to Employer:
Mutual Assurance Society of Alabama
X.X. Xxx 0000X
Xxxxxxxxxx, Xxxxxxx 00000
If to Employee:
A. Xxxxxxx Xxxxx, M.D.
0000 Xxxxxx Xxxx
Xxxxxxxx Xxxxx, Xxxxxxx 00000
or to such other address as may be specified in writing to the other party.
All notices shall be deemed to have been delivered when personally served or
deposited in the mail as provided in this paragraph; provided, that a notice or
demand not given as above, if it is in writing, shall be deemed to have been
given if and when actually received by the person to whom it is required or
permitted to be given.
16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Alabama.
17. Amendments. No modification of or addition to this Agreement
shall be valid or effective for any purpose unless provided in an endorsement
of addendum to this Agreement signed by an authorized officer of the Employer
and by the Employee.
18. Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original but all
of which shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
as of the 1st day of January, 1982, on this 14th day of Dec., 1982.
EMPLOYER:
MUTUAL ASSURANCE SOCIETY OF ALABAMA
ATTEST: BY: /s/
----------------------------------
Its Senior Vice President
----------------------------------
/s/
------------------------
Its
---------------------
EMPLOYEE:
/s/ /s/ A. Xxxxxxx Xxxxx, M.D.
------------------------ -------------------------------------
Witness A. Xxxxxxx Xxxxx, M.D.
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FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AGREEMENT, dated as of January 1, 1985, by and between MUTUAL
ASSURANCE SOCIETY OF ALABAMA, an Alabama mutual insurance corporation
("Employer"), and A. XXXXXXX XXXXX, M.D., an individual ("Employee").
RECITALS
A. Employer and Employee are parties to that certain Employment
Agreement, dated as of January 1, 1982 (the "Employment Agreement"). Pursuant
to the Employment Agreement, Employee will begin a three-year term of
employment as of the date hereof.
B. Employer and Employee desire to amend the Employment
Agreement on the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, the parties agree as follows:
1. Section 7(a) of the Employment Agreement is hereby deleted in
its entirety and replaced by the following:
(a) Expenses of operating his private automobile in
connection with his employment hereunder, in accordance with the
policies in effect for executive employees of Employer from time to
time;
2. Section 8(a) of the Agreement is hereby deleted in its
entirety and replaced by the following:
(a) For each calendar year during the term of this
Agreement, Employee's annual compensation from Employer ("Basic Annual
Compensation") shall equal the difference between $325,000 and
Employee's
"Medical Practice Earnings" (as defined in paragraph (b) below) for
such year; provided, however, that Employee's Basic Annual Compensation
shall not be less than $75,000 nor more than $125,000 for any such
calendar year.
3. Section 8(d)(i) of the Agreement is hereby deleted in its
entirety and replaced by the following:
(i) Current Compensation in the amount of Sixty-Eight
Thousand Seven Hundred Fifty Dollars ($68,750), payable at the rate of
Six Thousand Two Hundred Fifty Dollars ($6,250) per month, will be
payable for the first eleven (11) months of such calendar year; and
4. The foregoing amendments to the Employment Agreement shall
take effect as of January 1, 1985. Except as herein amended, the Employment
Agreement shall remain in full force and effect, and the Employment Agreement,
as so amended, is hereby ratified and affirmed.
IN WITNESS WHEREOF, Employer and Employee have executed this Agreement
as of the date and year first above written.
MUTUAL ASSURANCE SOCIETY OF ALABAMA
BY: /s/
-------------------------------------------
Its
-------------------------------------------
/s/ A. Xxxxxxx Xxxxx
----------------------------------------------
A. Xxxxxxx Xxxxx, M.D.
SECOND AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AGREEMENT, dated as of January 1, 1988, by and between MUTUAL
ASSURANCE, INC. (formerly Mutual Assurance Society of Alabama), an Alabama
mutual insurance corporation ("Employer"), and A. XXXXXXX XXXXX, M.D., an
individual ("Employee").
RECITALS
A. Employer and Employee are parties to that certain Employment
Agreement, dated as of January 1, 1982, as amended by First Amendment to
Employment Agreement, dated as of January 1, 1985 (the "Employment Agreement").
Pursuant to the Employment Agreement, Employee will begin a three-year term of
employment as of the date hereof.
B. Employer and Employee desire to amend the Employment
Agreement on the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, the parties agree as follows:
1. Section 8 of the Employment Agreement is hereby deleted in
its entirety, as of the date hereof, and replaced by the following:
8. Compensation.
(a) Employee's annual compensation from
Employer ("Basic Annual Compensation") for the calendar year
1988 shall be $125,000.
(b) For each calendar year during the term of
this Agreement, beginning with the year 1989, Employee's
Basic Annual Compensation will be as determined by the Board
of Directors of Employer and communicated to Employee by
written
notice delivered no later than December 15 of the preceding
calendar year; provided that,
(1) Within any three-year term of this
Agreement, Employee's Basic Annual Compensation may not be
reduced without his written consent; and
(2) If Employer fails to give such
notice to Employee on or before December 15 of any year,
Employee's Basic Annual Compensation for the following year
will remain the same as in the preceding year.
(c) The compensation payable to Employee
hereunder will be subject to required withholding for taxes
and other like sums and will be payable monthly or on such
other more frequent basis as will conform with Employer's
payroll practices from time to time in effect.
(d) In addition to the compensation that shall
be due Employee in accordance with the provisions of
subparagraphs 8(a) and 8(b) above, Employee shall be entitled
to participate in such group life, disability and health
insurance plans and qualified profit sharing or pension plans
of Employer as shall from time to time be in effect for the
benefit of Employer's management and executive employees. The
value of any such benefits shall not be taken into account by
Employer in determining the amount of compensation that shall
be due Employee under any other provision of this Agreement.
(e) Employer agrees to provide and maintain for
the benefit of Employee and Employee's beneficiaries, at no
cost to Employee, disability insurance coverage providing
disability insurance benefits to Employee for a period of
five (5) years, commencing with the one hundred eighty-first
(181st) day of any disability of Employee rendering him
unable to perform the duties of his employment for Employer,
and for such additional period thereafter as Employee may be
unable to engage in any gainful employment commensurate with
his age, qualifications and experience, until he shall
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have attained the maximum age for which disability insurance benefits are
normally paid by established companies offering such insurance coverage.
The amount of disability insurance benefits to be so provided by such
disability insurance coverage shall be the maximum amount obtainable with
respect to Employee at regular or group rates from time to time through any
reputable and well established insurer of loss of earnings of individuals
due to total and permanent physical and/or mental disability.
2. The foregoing amendments to the Employment Agreement shall take effect
as of January 1, 1988. Except as herein amended, the Employment Agreement shall
remain in full force and effect, and the Employment Agreement, as so amended, is
hereby ratified and affirmed.
IN WITNESS WHEREOF, Employer and Employee have executed this Agreement as
of the day and year first above written.
MUTUAL ASSURANCE INC.
BY: /s/
---------------------------------
Its Secretary
--------------------------------
/s/ A. XXXXXXX XXXXX, M.D.
------------------------------------
A. Xxxxxxx Xxxxx, M.D.
(MUTUAL ASSURANCE LOGO)
January 1, 1989
A. Xxxxxxx Xxxxx, M.D.
President
Mutual Assurance, Inc.
000 Xxxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Dear Xx. Xxxxx:
Under Section 8(b) of your Employment Agreement with Mutual Assurance, Inc., the
Board of Directors is to determine your "Basic Annual Compensation" for the year
1989, and to communicate the same to you in writing on or before December 15,
1988.
The Board of Directors has established your Basic Annual Compensation for 1989
at $150,000. However, the Board has directed that your Basic Annual Compensation
for 1989 should be subject to review during the year and subject to amendment by
mutual agreement of the parties.
If this letter correctly sets forth our understanding with respect to your Basic
Annual Compensation for 1989, please so indicate by signing a copy of this
letter in the space below provided, and by returning that copy to me.
Very truly yours,
/s/ Norton X. Xxxxxx, M.D.
----------------------------------
Norton X. Xxxxxx, M.D.
Chairman of the Board of Directors
ACCEPTED AND AGREED TO:
/s/ A. Xxxxxxx Xxxxx
--------------------------
A. Xxxxxxx Xxxxx, M.D.
(LETTERHEAD)
(MUTUAL ASSURANCE LOGO)
December 28, 1989
A. Xxxxxxx Xxxxx, M.D.
President
Mutual Assurance, Inc.
000 Xxxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Dear Xx. Xxxxx:
Under Section 8(b) of your Employment Agreement with Mutual Assurance, Inc., the
Board of Directors is to determine your "Basic Annual Compensation" for the year
1990, and to communicate the same to you in writing on or before December 15,
1989.
The Board of Directors has established your Basic Annual Compensation for 1990
at $157,500.
If this letter correctly sets forth our understanding with respect to your Basic
Annual Compensation for 1990, please so indicate by signing a copy of this
letter in the space below provided, and by returning that copy to me.
Very truly yours,
Norton X. Xxxxxx, M.D.
Chairman of the Board of Directors
ACCEPTED AND AGREED TO:
/s/ A. Xxxxxxx Xxxxx
--------------------------
A. Xxxxxxx Xxxxx, M.D.
(LETTERHEAD)
