EXHIBIT 10(i)
EMPLOYMENT AGREEMENT AMONG
NEW ENGLAND INVESTMENT COMPANIES, L.P.,
NEW ENGLAND INVESTMENT COMPANIES, INC.
AND XXXXX X. XXXX
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THIS AGREEMENT made as of the sixteenth day of August, 1995, by and among
New England Investment Companies, L.P., a Delaware limited partnership
(hereinafter referred to as the "Limited Partnership"), New England Investment
Companies, Inc., a Massachusetts corporation which is the general partner of the
Limited Partnership (hereinafter referred to as the "General Partner"), parties
of the first part, and Xxxxx X. Xxxx (hereinafter referred to as "Employee"),
party of the second part.
WITNESSETH:
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WHEREAS:
A. Employee is currently employed by the Limited Partnership and the
General Partner as Chairman, Chief Executive Officer and President; and
B. The Limited Partnership and the General Partner wish to assure
themselves of the continued services of Employee so that they will have the
continued benefit of his ability, experience and services, and Employee is
willing to enter into an agreement to that end, upon the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby covenant and agree as follows:
1. Employment Agreement
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As used in this Agreement, the term "Company" means and includes the
Limited Partnership and the General Partner, or either of them. The Company
hereby agrees to continue to employ Employee, and Employee hereby agrees to
remain in the employ of the Company, on and subject to the terms and conditions
of this Agreement.
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2. Term of Employment
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(a) The term of Employee's employment under this Agreement (the "Term of
Employment") shall commence as of the date hereof (the "Effective Date") and
shall expire at the close of business on the third anniversary of that date
unless sooner terminated in accordance with the terms and conditions of this
Agreement (including without limitation paragraphs 2(c), 6(d) and 6(e) hereof)
or extended as hereinafter provided in this section 2.
(b) The Term of Employment shall be extended, automatically and without
action by the Company or Employee, for an additional two year period ending on
the fifth anniversary of the Effective Date unless either party gives the other
party written notice, in the manner set forth in section 13 below and prior to
the close of business on the second anniversary of the Effective Date, that the
party giving the notice does not wish to extend the Term of Employment beyond
the third anniversary of the Effective Date.
(c) If either party gives the other party timely written notice of non-
extension in accordance with paragraph 2(b) above, then in that event the party
receiving such notice may thereafter terminate the Term of Employment at any
time prior to the third anniversary of the Effective Date by giving the other
party written notice, in the manner set forth in section 13 below, of such
termination at least 90 days in advance of the effective date of such
termination.
3. Position, Duties and Responsibilities
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(a) During the Term of Employment, Employee shall serve as, and with the
title, office and authority of, Chairman of the Board, Chief Executive Officer
and President of the Company, shall report only to the Board of Directors of the
Company (the "Board"), and shall have effective supervision and control over,
and responsibility for, the strategic direction and general and active day-to-
day leadership and management of the business and affairs of the Company and the
direct and indirect subsidiaries of the Company, subject to the authority of the
Board (any direct or indirect subsidiary of the Company, including
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partnerships, limited liability companies, business trusts and other entities as
well as corporations, being hereinafter referred to as a "subsidiary" or,
collectively, as "subsidiaries"), and shall have all of the powers, authority,
duties and responsibilities usually incident to the positions and offices of
Chairman of the Board, Chief Executive Officer and President of the Company,
including but not limited to the authority to employ and discharge all employees
of the Company and subsidiaries of the Company.
(b) During the Term of Employment, the Company shall use its best efforts
to cause Employee to be elected and re-elected (i) as a member of the Board,
(ii) as a member of the board of directors of any subsidiary on which board of
directors Employee is serving on the date of this Agreement, and (iii) as a
member of the board of directors of any entity which becomes a subsidiary after
the date of this Agreement on which board of directors the Chairman of the
Board, Chief Executive Officer and President of the Company would customarily
serve. Employee agrees to serve on the foregoing boards of directors during the
Term of Employment, without compensation in excess of that provided under this
Agreement.
(c) During the Term of Employment, Employee agrees to devote substantially
all of his business time, efforts and skills to the performance of his duties
and responsibilities under this Agreement, and to refrain from rendering
services for any enterprise other than the Company and subsidiaries of the
Company, but nothing in this Agreement shall preclude Employee from devoting
reasonable periods required for (i) managing his personal investments, (ii)
participating in professional, educational, philanthropic, public interest,
charitable, social or community activities, or (iii) serving as a director or
member of an advisory committee of any corporation or other entity not in
competition with the Company or any subsidiary of the Company, provided that
such activities do not materially interfere with Employee's regular performance
of his duties and responsibilities hereunder.
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4. Office Location and Required Business Travel
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During the Term of Employment, (a) Employee shall be based at the principal
executive offices of the Company, which shall be located at their present
location or within 35 miles thereof, and (b) the Company shall not substantially
increase the business travel required of Employee above present levels unless
the additional travel is both appropriate for Employee's positions described
above and substantially related to the business and affairs of the Company or a
subsidiary of the Company.
5. Compensation and Related Matters
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In consideration of all services rendered by Employee in any capacity
during the Term of Employment, the Company shall pay or provide Employee the
amounts and benefits set forth in this section 5.
(a) Salary. The Company shall pay Employee a salary at an annual rate
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which shall be established from time to time by the Board, but which shall not
be less than $440,000. Employee's salary shall be paid in substantially equal
installments at monthly or more frequent intervals, in accordance with the
normal payroll practices of the Company. Employee's salary rate shall be
reviewed by the Board at least annually following the date of this Agreement to
ascertain whether, in the sole, good faith judgment of the Board, such rate
should be increased in light of Employee's performance, competitive pay levels
or such other factors (if any) as the Board may deem relevant. Any increase in
salary shall not limit or reduce any other obligation of the Company under this
Agreement and, once established at an increased specified rate, Employee's
salary shall not thereafter be reduced. Employee's annual salary under this
Agreement, at the rate specified above and including any increases, is hereafter
referred to as his "Salary".
(b) Bonus. The Company shall provide Employee with the opportunity to earn
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an annual bonus for each calendar year that coincides with the Term of
Employment, in whole or in part, equal to at least 125% of his Salary for such
year if the Company attains the target bonus performance objective designated by
the Board (or a committee thereof)
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for such calendar year, and equal to at least 250% of his Salary for such year
if the Company attains the maximum bonus performance objective designated by the
Board (or a committee thereof) for such calendar year. Such performance
objectives shall be determined by the Board in its discretion acting in good
faith and upon consultation with Employee. In making such determinations, the
Board shall take into account the Company's business plan for the applicable
year, historical performance objectives for Employee's annual bonus opportunity,
and the annual bonus opportunities for other senior executives of the Company
and similarly situated senior executives of other companies comparable in size
and character to the Company. If the Term of Employment terminates (i) on the
third anniversary of the Effective Date in accordance with paragraphs 2(a) and
2(b) above, (ii) before such third anniversary in accordance with paragraph 2(c)
above, or (iii) on the fifth anniversary of the Effective Date in accordance
with paragraph 2(b) above, then, in full satisfaction of any bonus obligation
under this paragraph 5(b) in respect of the last calendar year that coincides in
whole or in part with the Term of Employment, the Company shall pay Employee a
prorated bonus for such calendar year, such prorated bonus award to be paid
within ten days after such termination and to be determined by multiplying the
"Bonus Amount" as defined in paragraph 7(d) below by a fraction the numerator of
which is the number of days in the calendar year of termination that precede the
date of termination and the denominator of which is the number 365.
(c) Other Incentive Plans. During the Term of Employment, Employee shall
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participate in all other compensation or incentive plans of a long or short term
nature in which other senior executives of the Company then participate, subject
to the terms and conditions of such plans. Employee's incentive compensation
opportunities under such plans shall be determined by the Board in its
discretion acting in good faith and upon consultation with Employee. In making
such determinations, the Board shall take into account the aggregate incentive
compensation opportunities for other senior executives of the Company and the
aggregate incentive compensation opportunities typically offered to CEOs of
companies similar in size and character to the Company.
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(d) Perquisites; Reimbursement of Expenses. During the Term of
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Employment, Employee shall be entitled to perquisites of office, including
without limitation air travel privileges, office facilities and secretarial
staff, and to fringe benefits, at least equal to and on the same terms and
conditions as those provided to Employee on the date of this Agreement, as well
as to reimbursement, upon proper accounting, of all reasonable expenses and
disbursements incurred by him in the course of his duties.
(e) Employee Benefits. Employee, his dependents and beneficiaries,
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including without limitation any beneficiary of a joint and survivor or other
optional method of payment applicable to the payment of benefits under the
Company's tax-qualified retirement plans, shall be entitled to all payments,
coverages, benefits and age, pay and service credit for benefits as a result of
employment during the Term of Employment to which other senior officers of the
Company, their dependents and beneficiaries are then entitled under the employee
benefit plans and practices of the Company and subsidiaries of the Company,
including without limitation any qualified or non-qualified pension, profit
sharing and savings plans, death benefit plans (including split dollar life
insurance plans and group life insurance plans providing group term life
insurance, accidental death and dismemberment insurance, and travel accident
insurance), sickness and disability benefit plans, vacation pay plans, and
medical, dental, health and welfare plans. Nothing in this Agreement shall
preclude the Company from amending or terminating any employee benefit plan or
practice, but it being the intent of the parties that Employee, his dependents
and beneficiaries shall continue to be entitled during the Term of Employment to
payments, coverages, benefits and age, pay and service credit for benefits under
employee benefit plans substantially equivalent to those attached to his
position on the date of this Agreement, in the event of any amendment or other
change in any employee benefit plan or practice that would substantially reduce
such payments, coverages, benefits or age, pay or service credit for benefits
from their present levels, the Company shall itself pay or provide Employee, his
dependents and beneficiaries with tax- equivalent payments, coverages, benefits
and age, pay and service credit for benefits or make other arrangements
reasonably satisfactory to
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Employee.
(f) Loan. If the vesting of any restricted units heretofore or hereafter
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granted to Employee under the Company's Restricted Unit Plan (the "RUP") is
accelerated as a result of the provisions of Section 8.2 of the RUP, then in
that event the Company shall simultaneously lend Employee, on substantially the
terms and conditions set forth in this paragraph, funds equal to Employee's full
Federal, state and local income tax and employment tax liabilities (including
Medicare tax liability) with respect to the units whose vesting is accelerated.
Such loan shall be evidenced by a promissory note signed by Employee, which
shall bear interest at the lowest rate that, in the judgment of the Company's
counsel, will not result in imputed income to Employee under applicable tax
rules, which shall be secured by a pledge of the units in question entitling the
Company to the rights and remedies of a secured creditor under the applicable
provisions of the Uniform Commercial Code, but which shall otherwise be without
recourse to Employee, and under which principal and interest shall be due and
payable in a single lump sum on the first to occur of (i) the second anniversary
of the accelerated vesting of the units, (ii) sale or other disposition of the
units, (iii) any termination of Employee's employment for Cause as defined in
this Agreement, (iv) any voluntary termination by Employee of his employment in
violation of the terms and conditions of this Agreement (it being understood
that a termination by Employee in accordance with the provisions of section 6(d)
hereof [relating to Constructive Discharge] or pursuant to a notice given by
Employee in accordance with the provisions of paragraph 2(b) or 2(c) of this
Agreement shall not be deemed to constitute such a voluntary termination), (v)
Employee's filing of a bankruptcy petition, and (vi) the appointment of a
receiver for Employee or his property. Any provision of this paragraph to the
contrary notwithstanding, the Company's obligation to make the loan provided for
in this paragraph shall be subject to any applicable regulations of the Board of
Governors of the Federal Reserve System and any other agency having jurisdiction
of the subject matter, provided that the Company and its affiliates shall have
taken all such actions on their part as are necessary to comply therewith.
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(g) Indemnification. The Company shall indemnify and hold harmless
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Employee from and against any claim, loss or cause of action arising from or out
of Employee's performance as an officer, director or employee of the Company or
any subsidiary of the Company or in any other capacity, including serving as a
fiduciary, in which Employee serves at the request of, or for the benefit of,
the Company (including without limitation serving as administrator under other
employment or severance agreements of the Company), to the maximum extent
permitted under applicable law. During the Term of Employment and for six years
thereafter (or, if less, throughout the period of any applicable statute of
limitations) the Company shall maintain appropriate directors and officers
liability insurance which shall cover Employee, unless the Board shall determine
that such insurance cannot be maintained at commercially reasonable rates.
(h) Parachute Tax Indemnity. If any payment (within the meaning of
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Section 280G(b)(2) of the Internal Revenue Code of 1986 as amended) or
distribution by or on behalf of the Company to or for the benefit of Employee,
whether paid or distributed pursuant to the terms of this Agreement or otherwise
(a "Payment"), including any payment pursuant to this paragraph, is subject to
the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986 as
amended, or any interest or penalties are incurred by Employee with respect to
such excise tax (such excise tax, together with any such interest and penalties,
being hereinafter collectively referred to as the "Excise Tax"), then Employee
shall be entitled to receive on demand an additional payment from the Company
under this Agreement (a "Tax Payment") in an amount such that after payment by
Employee of all taxes (including any interest and penalties imposed with respect
to such taxes), including but not limited to any Excise Tax, imposed upon the
Tax Payment, Employee retains an amount of the Tax Payment equal to the Excise
Tax imposed upon the Payment.
6. Termination of Employment
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(a) Death. The Term of Employment shall terminate upon the death of
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Employee.
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(b) Disability. The Term of Employment shall terminate in the event of
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Disability of Employee. As used in this Agreement, the term "Disability" means
an accident or physical or mental illness which prevents Employee from
substantially performing his duties and responsibilities hereunder for six
consecutive calendar months. The Term of Employment shall terminate at the
close of business on the last day of such six month period, but without
prejudice to any payments due Employee in respect of disability under any
pension or welfare plan. The amount of any Salary or other compensation payable
to Employee during such six month period as a result of this paragraph may be
reduced by any payments which Employee receives for the same period because of
disability under any disability or pension plan of the Company or any subsidiary
of the Company.
(c) Cause. The Company may terminate the Term of Employment for Cause.
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For purposes of this Agreement, Employee shall be considered to be terminated
for "Cause" only
(i) if Employee is convicted of a felony under the laws of the
United States or any state thereof;
(ii) if Employee engages in willful malfeasance having a material
adverse effect on the Company; or
(iii) if Employee willfully and repeatedly fails to substantially
perform his duties and responsibilities described in section 3 above, except by
reason of total or partial incapacity due to accident or physical or mental
illness.
However, in no event (other than clause 6(c)(i) above) shall Employee be
considered to be terminated for "Cause" unless and until the following
conditions are satisfied:
(A) Employee is given reasonable notice of and a reasonable opportunity to
be heard at a meeting of the Board called for the purpose of determining whether
"Cause" exists for termination of Employee's employment;
(B) A resolution is duly adopted at such meeting by the affirmative vote
of not less than two-thirds of the
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entire membership of the Board directing the Secretary of the Company to give
Employee written notice (the "Warning Notice") of the Board's determination to
terminate Employee's employment for "Cause" if the acts or omissions specified
in the Warning Notice are not discontinued, and the Secretary of the Company
gives Employee such written notice;
(C) Employee does not discontinue the acts or omissions in question within
30 days of his receipt of the Warning Notice;
(D) Employee is given reasonable notice of and a reasonable opportunity to
be heard at a meeting of the Board after such 30 day period called for the
purpose of determining whether to terminate Employee's employment for "Cause";
(E) A resolution is duly adopted at such meeting by the affirmative vote
of not less than two-thirds of the entire membership of the Board directing the
Secretary of the Company to give Employee written notice of the Board's decision
to terminate Employee's employment for "Cause" and of the specific acts or
omissions in question, and the Secretary of the Company gives Employee such
written notice.
Anything in this paragraph 6(c) to the contrary notwithstanding, the employment
of Employee shall in no event be considered to be terminated by the Company for
Cause if termination of his employment takes place (I) as the result of bad
judgment or negligence on the part of Employee other than willful or reckless
misconduct, (II) for any act or omission in respect of which a determination
could properly be made that Employee met the applicable standard of conduct
prescribed for indemnification or reimbursement or payment of expenses of an
officer or director under the Bylaws or Limited Partnership Agreement of the
Company or the laws of Delaware or Massachusetts or the directors' and officers'
liability insurance of the Company, in each case as in effect at the time of
such act or omission, (III) as the result of an act or omission which occurred
more than twelve calendar months prior to Employee's having been given Notice of
Termination for such act or omission unless the commission of such act or
omission was not at the time of such commission or omission known to a member of
the Board (other than Employee), in which case more than twelve calendar months
from the date the commission of such act or
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omission was so known, (IV) as the result of a continuing course of action which
commenced and was known to a member of the Board (other than Employee) more than
twelve calendar months prior to Notice of Termination having been given to
Employee, or (V) because of an act or omission reasonably believed by Employee
in good faith to have been in or not opposed to the interests of the Company.
(d) Constructive Discharge. Employee may terminate his employment under
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this Agreement on 10 days' advance written notice to the Company given within 90
days after the occurrence of a Constructive Discharge Event. For purposes of
this Agreement, "Constructive Discharge Event" means any act or omission
identified below in this paragraph 6(d) to which Employee does not consent in
writing and which does not occur in connection with termination of Employee's
employment for Cause or Disability as defined in this Agreement; provided that
no such act or omission shall constitute a Constructive Discharge Event, and the
90 day period referred to above in the first sentence of this paragraph 6(d)
shall not commence to run, unless and until Employee shall have given the Board
written notice describing the act or omission in reasonable detail within 60
days after the Employee first knew (or should have known) of the act or omission
and the act or omission shall not have been cured within 45 days after the Board
received such written notice:
(i) Any (A) failure to re-designate Employee as, or (B) removal of Employee
from, or failure to re-elect Employee to, any of the following positions:
(I) Chairman of the Board, President and Chief Executive Officer of
the Company, or
(II) a member of the Board of Directors of (aa) the Company, (bb) any
subsidiary of the Company on whose Board of Directors Employee now serves, and
(cc) any future subsidiary of the Company on whose Board of Directors the
Chairman of the Board, President and Chief Executive Officer of the Company
would customarily serve;
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(ii) (A) Any conduct by the Company, any affiliate of the Company, the
Board, any member of the Board or by any person acting under the authority of
the Board or a member of the Board, or
(B) any assignment to Employee of any duties, functions, authority or
responsibilities,
that in either case (A) or (B) --
(I) is inconsistent with the Employee's positions described in
section 3 above, or
(II) calls for Employee to report to anyone other than the
Board, or
(III) deprives Employee of effective supervision and control
over, and responsibility for, the strategic direction and general and active
day-to-day leadership and management (including the structure and organization
of such leadership and management) of the business and affairs of the Company
and its subsidiaries, subject to the authority of the Board, or
(IV) deprives Employee of any of the duties, functions,
authority or responsibilities usually incident to his positions described above,
including the authority to hire and discharge all employees of the Company and
its subsidiaries, or
(V) gives Employee additional responsibilities that are not
materially related to Company business or do not benefit unitholders of the
Limited Partnership generally, or
(VI) substantially interferes with Employee's ability to
substantially perform the duties, functions or responsibilities, or exercise the
authority, of his positions described in section 3 above;
including, without limitation, in the case of (A) hereof, recurring interference
with the duties, functions, authority or responsibilities of Employee, or
engaging in activities which are materially disruptive to the management or
employees of the Company or its subsidiaries,
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or unrequested participation or attempts to participate in daily operational
matters, by the Company, any affiliate of the Company, the Board, a member of
the Board or by any person acting under the authority of the Board or a member
of the Board, which has one of the results described in clauses (I) through (VI)
hereof;
(iii) any objectively demonstrable failure by the Company to comply with
the provisions of section 4 above (relating to office location and required
business travel) or section 5 above (relating to compensation and related
matters) other than paragraph 5(d) or 5(e) above (relating to perquisites and
employee benefits); or
(iv) any substantial, objectively demonstrable failure by the Company
to comply with the provisions of paragraph 5(d) or 5(e) above.
A termination by Employee in accordance with the provisions of this paragraph
6(d) shall not be deemed a voluntary termination of employment by Employee for
the purpose of this Agreement or any plan or practice of the Company or its
subsidiaries.
(e) Termination by Company Not for Cause. Notwithstanding any provision of
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this Agreement to the contrary, subject to the Bylaws and Limited Partnership
Agreement of the Company, the Board shall have the right to terminate Employee's
employment for any reason other than Cause at any time, subject to the
consequences of such termination as set forth in this Agreement.
(f) Notice of Termination. Any termination by the Company for Disability
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or Cause as defined in paragraph 6(b) and (c) or by Employee pursuant to
paragraph 6(d) hereof (relating to Constructive Discharge Events) shall be
communicated by written Notice of Termination from the Company or the Employee
(as the case may be) to the other party. For purposes of this Agreement, a
"Notice of Termination" shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Employee's employment under the provision so indicated. If any
dispute concerning termination of Employee's employment
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under paragraphs 6(b), (c) or (d) above results in a final determination that a
proper basis for such termination did not exist, Employee's employment hereunder
shall be treated as having been terminated other than pursuant to paragraph
6(b), (c) or (d), as the case may be, by the party who gave Notice of
Termination.
7. Compensation for Termination and Related Matters
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The parties recognize and agree that, if the Company terminates Employee's
employment under this Agreement other than for Disability pursuant to paragraph
6(b) above or Cause pursuant to paragraph 6(c), or if Employee terminates his
employment in accordance with paragraph 6(d) above following a Constructive
Discharge Event, the actual damages to Employee would be difficult if not
impossible to ascertain. Accordingly, the parties agree that, if the Company
terminates Employee's employment under this Agreement other than for Disability
pursuant to paragraph 6(b) above or Cause pursuant to paragraph 6(c), or if
Employee terminates his employment in accordance with paragraph 6(d) above
following a Constructive Discharge Event, then Employee shall thereupon be
relieved of any further obligation under this Agreement (other than section 8A
below, if applicable) and his sole remedy shall be a right to receive from the
Company, as liquidated damages, severance pay or both, the payments and benefits
provided in paragraphs 7(a) through (and including) 7(i) below; provided that no
provision of this section 7 is intended to curtail, reduce or otherwise affect
adversely Employee's rights under section 16 below or any rights Employee may
have in respect of termination of employment under any compensation, incentive
or employee benefit plan (other than a severance pay plan). Employee shall not
be required to mitigate the amount of any payment or benefit provided for in
this section 7 by seeking other employment or otherwise, nor shall any
compensation earned by Employee in other employment or otherwise reduce the
amount of any payment or benefit provided for in this section.
(a) The Company shall pay Employee his Salary (as defined in paragraph
5(a) above) prorated through the date of termination;
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(b) The Company shall pay Employee any accrued but unpaid bonus award for
Employee's services in the calendar year preceding the date of termination, and
a prorated bonus award for the calendar year in which the date of termination
occurs, such prorated bonus award to be determined by multiplying the "Bonus
Amount" as defined in paragraph 7(d) below by a fraction the numerator of which
is the number of days in the calendar year of termination that precede the date
of termination and the denominator of which is the number 365;
(c) The Company shall pay Employee a lump sum amount, on or before the
tenth day after the date of termination, equal to three times his Salary (as
defined in paragraph 5(a) above, based on the highest rate in effect during the
Term of Employment);
(d) The Company shall pay Employee a lump sum amount, on or before the
tenth day after the date of termination, equal to three times the "Bonus Amount"
as hereafter defined. For purposes of this section 7, the "Bonus Amount" shall
mean Employee's Salary (as defined in paragraph 5(a) above, based on the highest
rate in effect during the Term of Employment), multiplied by the greater of (A)
the average annual percentage of salary awarded to Employee as a bonus for
services in each of the three calendar years immediately preceding the effective
date of this agreement (1992 Bonus shall be annualized), and (B) the percentage
of his Salary (as defined in paragraph 5(a) above) which Employee was given the
opportunity to earn as an annual bonus for services in the calendar year in
which the date of termination occurs if the Company attains the target bonus
performance objective designated by the Board (or a committee thereof) for such
calendar year;
(e) The Company shall pay or provide Employee, his dependents and
beneficiaries with the payments, coverages, benefits and age, pay and service
credit for benefits which they would receive under paragraph 5(e) of this
Agreement if the Term of Employment were to continue for three years after the
date of termination and the compensation described in paragraphs 7(c) and (d)
above were paid to him ratably over such three year period; provided, however,
that if and to the extent the Company determines that such payments, coverages,
benefits and age,
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pay and service credit for benefits cannot be paid or provided
under the plans in question due to Internal Revenue Code or other restrictions,
the Company shall provide tax-equivalent payments, coverages, benefits and age,
pay and service credit for benefits through other means reasonably satisfactory
to Employee, and, provided further, that if Employee obtains full time
employment within three years after his date of termination, any payments under
welfare benefit plans to be provided under this paragraph shall be reduced to
the extent Employee receives payments under comparable plans of the successor
employer;
(f) Employee's benefits accrued through the date of termination, and any
benefits accrued pursuant to the provisions of paragraph 7(e) above, under any
and all qualified or non-qualified defined benefit pension plans or defined
contribution pension, profit sharing or stock bonus plans shall become
immediately vested and non-forfeitable on the date of termination; if and to the
extent the Company determines that such vesting cannot be accomplished under the
plan in question due to Internal Revenue Code or other restrictions, the Company
shall provide tax-equivalent benefits to Employee through other means reasonably
satisfactory to Employee;
(g) If Employee's right to retain any restricted units or to retain or
exercise any other equity or long-term incentives heretofore or hereafter
granted to Employee under the Company's Restricted Unit Plan ("RUP") or any
other plan or arrangement shall be subject to continued employment or other
terms or conditions which have not been satisfied on the date of termination
(including but not limited to terms and conditions set forth in Sections 6.4 and
8.1 of the RUP) , then such terms and conditions shall be conclusively deemed to
be satisfied on such date, the intent of this paragraph being to accelerate
vesting and exercisability of any such units and incentives in the event of such
termination; to the extent necessary to effectuate the foregoing provisions of
this paragraph, the terms and conditions of any such units and incentives
(whether heretofore or hereafter granted) shall be deemed amended or
supplemented accordingly;
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(h) The Company will continue to indemnify and hold harmless Employee as
provided in paragraph 5(g) above; and
(i) The Company will make the payments provided for in paragraphs 5(f) and
5(h) hereof, if applicable.
8. Non-Renewal Compensation
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If the Company gives Employee timely written notice in accordance with
paragraph 2(b) above that it does not wish to extend the Term of Employment
beyond the third anniversary of the Effective Date, and Employee's employment
does not terminate before such third anniversary, or is terminated by Employee
before such third anniversary pursuant to a notice given by Employee in
accordance with the provisions of paragraph 2(c) above (or terminates by reason
of Employee's death after such a notice has been given), then the Company shall
pay Employee, in addition to any other amounts payable to Employee hereunder,
the sum of (i) his Salary (as defined in paragraph 5(a) above, based on the
highest rate in effect during the Term of Employment), plus (ii) the Bonus
Amount as defined in paragraph 7(d) above. The Company shall pay such amount on
the third anniversary of the Effective Date, if Employee's employment does not
terminate before such third anniversary (whether Employee's employment actually
terminates at that time or thereafter), or on termination of his employment, if
his employment terminates before such third anniversary because Employee gives
notice in accordance with the provisions of paragraph 2(c) above or by reason of
death after such a notice has been given. The Company shall also continue to
provide Employee, his dependents and beneficiaries, until the third anniversary
of the Effective Date or for such longer period as may be required by law, the
benefits described in paragraph 5(e) above, subject to the last sentence of
paragraph 5(e).
8A. Restrictive Covenants
---------------------
Employee agrees that, if his employment terminates under circumstances that
entitle him to receive payments pursuant to section 7 or section 8 above and the
Company pays all amounts and provides all the benefits to which he
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is entitled pursuant thereto, or if his employment is terminated for Cause, then
for one year after his employment terminates, he will neither (a) solicit
business of the kind engaged in by the Company or any subsidiary at the time of
termination of his employment from any person (which for purposes of this
section 8A shall include an enterprise) who at the time of termination of
Employee's employment was a client of the Company or a subsidiary, nor (b)
induce or attempt to persuade any employee of the Company or a subsidiary to
terminate his employment relationship. Employee agrees that the breach of the
restrictive covenants set forth above in this section 8A may result in immediate
and irreparable injury to the Company for which the Company will not have an
adequate remedy at law, and that the Company shall be entitled to a decree of
specific performance of those covenants and to a temporary and permanent
injunction enjoining the breach thereof.
9. Successors; Binding Agreement
-----------------------------
(a) 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, including without limitation any entity
formed or availed of to hold the interests of the public shareholders 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. Failure of the Company to obtain such
agreement prior to the effectiveness of any such succession shall entitle
Employee to compensation under section 7 above, in the same amount and on the
same terms as he would be entitled to hereunder if his employment were
terminated by the Company other than for Disability or Cause, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed the date of termination.
(b) As used in this Agreement, the "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which executes and delivers an agreement provided for in this section
9 or which otherwise becomes bound by all the terms and
18
provisions of this Agreement by operation of law.
(c) This Agreement and all rights of Employee hereunder shall inure to the
benefit of and be enforceable by Employee's personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. If Employee should die while any amounts are due and payable to him
hereunder, all such amounts, unless otherwise provided herein, shall be paid to
Employee's designated beneficiary or, if there be no such designated
beneficiary, whether because none was designated or because none is alive or in
existence at the time any amount becomes payable hereunder, to the legal
representatives of Employee's estate.
(d) Except as to withholding of any tax under the laws of the United
States or any other country, state or locality, neither this Agreement nor any
right or interest hereunder nor any amount payable at any time hereunder shall
be subject in any manner to alienation, sale, transfer, assignment, pledge,
attachment, or other legal process, or encumbrance of any kind by Employee or
the beneficiaries of Employee or by his legal representatives without the
Company's prior written consent, nor shall there be any right of set-off or
counterclaim in respect of any debts or liabilities of Employee, his
beneficiaries or legal representatives; provided, however, that nothing in this
paragraph shall preclude Employee from designating a beneficiary to receive any
benefit payable on his death, or the legal representatives of Employee from
assigning any rights hereunder to the person or persons entitled thereto under
his will or, in case of intestacy, to the person or persons entitled thereto
under the laws of intestacy applicable to his estate.
10. Agreement Binding
-----------------
This Agreement shall be binding upon and shall inure to the benefit of
Employee, his heirs and legal representative(s), and the Company, its successors
and assigns and any person, firm, corporation or other entity which succeeds to
all or substantially all of the business, assets or property of the Company, as
provided in section 9 hereof.
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11. General
-------
(a) This Agreement contains the entire understanding of the parties with
respect to the subject matter hereof and cancels and supersedes any and all
other agreements between the parties with respect to the subject matter hereof.
(b) Any modification of this Agreement shall not be binding unless in
writing and signed by the Company and Employee.
12. Enforceability
--------------
In the event that any provision of this Agreement is determined to be
invalid or unenforceable, the remaining terms and conditions of this Agreement
shall be unaffected and shall remain in full force and effect, and any such
determination of invalidity or unenforceability shall not affect the validity or
enforceability of any other provision of this Agreement.
13. Notices
-------
All notices which may be necessary or proper for either the Company or
Employee to give to the other shall be in writing and shall be delivered by hand
or sent by registered or certified mail, return receipt requested, or by air
courier, to Employee at:
Xxxxx X. Xxxx
000 Xxxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
with a copy to:
[insert personal attorney's name and address]
and shall be sent in the manner described above to the Company, c/o the General
Partner, at 000 Xxxxxxxx Xxxxxx, 00xx xxxxx, Xxxxxx, XX 00000, Attention:
Secretary, or delivered by hand to the Secretary of the General Partner, and
shall be deemed given when sent, provided that any Notice of Termination or
notice given pursuant to section 2
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hereof shall be deemed given only when received. Any party may by like notice to
the other party change the address at which he or they are to receive notices
hereunder.
14. Arbitration
-----------
Any controversy or claim arising out of, or related to, this Agreement, or
the breach thereof, shall be settled by binding arbitration in the City of
Boston, in accordance with the rules then obtaining of the American Arbitration
Association, and the arbitrator's decision shall be binding and final, and
judgment upon the award rendered may be entered in any court having jurisdiction
thereof, except that, with respect to any controversy or claim arising out of,
or related to, the provisions of paragraph 5(g) or 7(h) above (relating to
indemnification), Employee may have the matter settled by judicial determination
in lieu of arbitration by bringing a court action, if he is the plaintiff, or,
if he is not the plaintiff, by demanding such judicial determination within the
time to answer any complaint in any arbitration action that may be commenced.
15. Governing Law
-------------
This Agreement is executed in the Commonwealth of Massachusetts and shall
be governed by and enforceable in accordance with the laws thereof without
giving effect to the principles of conflict of laws thereof.
16. Legal Fees and Expenses
-----------------------
To induce Employee to execute this Agreement and to provide Employee with
reasonable assurance that the purposes of this Agreement will not be frustrated
by the cost of its enforcement should the Company fail to perform its
obligations under this Agreement or should the Company or any subsidiary,
affiliate or shareholder of the Company contest the validity or enforceability
of this Agreement, the Company shall pay and be solely responsible for ninety
percent (90%) of any attorney's fees and expenses and court costs incurred by
Employee as a result of a claim that the Company has breached or otherwise
failed to perform this Agreement or any provision hereof to be performed by the
Company or as a result of the Company or any subsidiary, affiliate or
shareholder of the Company contesting the
21
validity or enforceability of this Agreement or any provision hereof to be
performed by the Company, in each case regardless of which party, if any,
prevails in the contest.
22
IN WITNESS WHEREOF, the Limited Partnership and the General Partner have
caused this Agreement to be signed by their proper representatives and Employee
has hereunto set his hand as of the date first above written.
NEW ENGLAND INVESTMENT COMPANIES, L.P.
By New England Investment Companies, Inc.
[Seal] as General Partner
Attest:
By Xxxxxx X. Xxxxxx
----------------
Chairman, Compensation Committee of the Board
Xxxxxx X. Xxxxxxxxx New England Investment Companies, Inc.
-------------------
Secretary
NEW ENGLAND INVESTMENT COMPANIES, INC.
[Seal]
Attest: By Xxxxxx X. Xxxxxx
----------------
Chairman, Compensation Committee of the Board
Xxxxxx X. Xxxxxxxxx
-------------------
Secretary
EMPLOYEE
Xxxxx X. Xxxx
-------------
Xxxxx X. Xxxx
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