Exhibit 10.18
FORM OF
AMENDMENT TO EMPLOYMENT AGREEMENT
WHEREAS, Everest Reinsurance Company (the "Company"), Everest Reinsurance
Holdings, Inc. ("Holdings") and Xxxxxx X. Xxxxxxx ("Xxxxxxx") are parties to an
employment agreement which is effective as of January 1, 2000 (the "Employment
Agreement");
WHEREAS, a restructuring of Holdings is proposed pursuant to which Holdings
will become a wholly-owned subsidiary of Everest Reinsurance Group, Ltd.
("Everest Group");
WHEREAS, in connection with the restructuring, it is contemplated that
Everest Group will establish a subsidiary, Everest Global Services, Inc.
("Everest Services"); and
WHEREAS, in connection with the restructuring and in anticipation of the
establishment of Everest Services, certain amendments to the Employment
Agreement are desirable;
NOW, THEREFORE, the Employment Agreement is hereby amended in the following
particulars, all effective as of and conditioned upon the consummation of the
restructuring transaction described in the Registration Statement on Form S-4
(File Number 333-87361) filed with the Securities Exchange Commission by Everest
Group:
1. By adding the following new Section 1.1A to the Employment Agreement
immediately preceding Section 1.1 thereof:
"1.1A. For periods on and after the effective date of the
restructuring transaction described in the Registration Statement on Form S-4
(File Number 333-87361) filed with the Securities Exchange Commission by Everest
Reinsurance Group, Ltd. ('Everest Group') pursuant to which Holdings shall
become a wholly-owned subsidiary of Everest Group (the 'Restructuring'), Everest
Group shall be a party to this Agreement. For periods on and after the
Restructuring, Holdings and Everest Group shall have co-extensive rights,
duties, powers and responsibilities to or with respect to Xxxxxxx hereunder,
except as applied to Sections 1.5, 4 and 5 hereof, and Xxxxxxx shall have
rights, duties, powers and responsibilities to or with respect to Holdings and
Everest Group which are the same as those that he had to or with respect to
Holdings immediately prior to the Restructuring."
2. By substituting the following for the second and third paragraphs,
respectively, of Section 1.1 of the Employment Agreement:
"Holdings hereby employs Xxxxxxx and Xxxxxxx hereby agrees to serve during
the term of this Agreement without additional compensation, on similar terms and
conditions as set forth in the preceding paragraph, as Chairman and Chief
Executive Officer of each of Holdings and Everest Group and, subject to his
election, as a director of Everest Reinsurance Company and as
a director and officer of any corporation which is a subsidiary or affiliate of
Everest Reinsurance Company, if elected by the stockholders or the board of
directors of such corporation.
It is the intention of Holdings and Everest Reinsurance Company to cause
Xxxxxxx to continue to be a member of the Board and to continue his appointment
as a member of the Executive Committee of the Board. It is the intention of
Everest Group to cause Xxxxxxx to be a member of the Board of Directors of
Everest Group (the "Group Board") following the Restructuring and to cause his
appointment as a member of the Executive Committee of the Group Board."
3. By adding the following new Sections 1.4 and 1.5 to the Employment
Agreement immediately after Section 1.3 thereof:
"1.4 Notwithstanding the foregoing provisions of this Section 1, in
the event that Everest Group establishes a subsidiary or affiliate (referred to
herein as 'Everest Services') that employs individuals who perform services for
more than one member of the group of companies consisting of Everest Group and
its subsidiaries, Xxxxxxx agrees that he will, at the request of the Group
Board, transfer to employment with Everest Services. For periods after Xxxxxxx
becomes an employee of Everest Services, he shall, as an employee of Everest
Services, provide services for Everest Reinsurance Company, Everest Group and
Holdings as described in the foregoing provisions of this Section 1. In the
event that Xxxxxxx transfers to employment with Everest Services pursuant to the
preceding sentence, (i) Everest Services shall be substituted for the Company
hereunder without any further action of the parties being required, (ii) neither
Xxxxxxx'x transfer of employment to Everest Services nor the substitution of
Everest Services for the Company hereunder shall constitute a 'Termination for
Good Reason' within the meaning of Section 8.6 hereof or a termination of
employment with the Company for any other purpose hereunder, (iii) Xxxxxxx
agrees to continue to serve during the term of this Agreement, without
additional compensation, as the Chairman and Chief Executive Officer of Everest
Reinsurance Company, and (iv) Everest Group will cause Everest Services to
become a party to this Agreement.
1.5 Xxxxxxx understands that, in connection with the restructuring,
Everest Group will assume all of the rights and obligations of Holdings under
the Everest Reinsurance Holdings, Inc. 1995 Stock Incentive Plan, Everest
Reinsurance Holdings, Inc. Executive Performance Annual Incentive Plan and
Everest Reinsurance Holdings, Inc. Annual Incentive Plan. Xxxxxxx agrees that,
following the Restructuring, all references in this Agreement to such plans or
arrangements (or benefits thereunder) shall be to the plans or arrangements as
assumed by Everest Group."
4. By adding the following new Section 6.4 to the Employment Agreement
immediately after Section 6.3 thereof:
"6.4 In the event that Everest Group establishes Everest Services and
in the event that Xxxxxxx transfers to employment with Everest Services, Everest
Group shall cause Everest Services to provide Xxxxxxx with employee benefit
plans, policies, programs and arrangements
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(including perquisites) which are substantially similar to those provided to
similarly situated employees of Everest Reinsurance Company from time to time."
5. By substituting the following for Section 8.8 of the Employment
Agreement:
"8.8 GENERAL; GUARANTY. The obligations of the Everest Reinsurance
Company, Holdings, Everest Group and, to the extent applicable, Everest Services
to pay Xxxxxxx the compensation and other benefits specified herein shall be
absolute and unconditional and shall not be affected by any circumstances,
including without limitation, any set off, counterclaim, recoupment, defense or
other right which any of them may have against Xxxxxxx or anyone else. In no
event shall Xxxxxxx be obligated to seek other employment or take any other
action by way of mitigation of the amounts payable to him under this Agreement.
To the extent that Everest Services fails, for any reason, to meet its financial
obligations under this Agreement, the Everest Reinsurance Company shall have
full responsibility and liability for all such obligations."
6. By substituting the following for Section 9.1 of the Employment
Agreement:
"9.1 Xxxxxxx acknowledges that as a result of the services to be
rendered to the Company, Everest Reinsurance Company and their affiliated
entities hereunder, Xxxxxxx will be brought into close contact with many
confidential affairs of the Company, its subsidiaries and affiliates not readily
made available to the public. Xxxxxxx further acknowledges that the services to
be performed under this Agreement are of a special, unique, unusual,
extraordinary and intellectual character; that the business of the Company, its
subsidiaries and its affiliated entities is international in scope; that their
goods and services are marketed through the United States and other countries;
and that Everest Reinsurance Company competes with other organizations that are
could be located in any part of the United States or the world."
7. By substituting the phrase "the Company, its subsidiaries and
affiliated entities either" for the phrase "the Company either" where the latter
phrase appears in the first sentence of Section 9.2 of the Employment Agreement;
and by substituting the phrase "the Company, its subsidiaries and affiliated
entities means" for the phrase "the Company means" where the latter phrase
appears in the second sentence of Section 9.2 of the Employment Agreement.
8. By substituting the phrase "while employed by the Company, its
subsidiaries and affiliated entities" for the phrase "while employed by the
Company" where the latter phrase appears in Section 9.3 of the Employment
Agreement.
9. By substituting the phrase "termination of employment with the Company,
its subsidiaries and affiliated entities" for the phrase "termination of
employment with the Company" where the latter phrase occurs in Section 9.4 of
the Employment Agreement.
10. By substituting the following for Section 9.5 of the Employment
Agreement:
"Xxxxxxx will promptly disclose to the Company all inventions, processes,
original works of authorship, trademarks, patents, improvements and discoveries
related to the business of the Company, its subsidiaries and affiliated entities
(collectively 'Developments'), conceived or developed during Xxxxxxx'x
employment with the Company, its subsidiaries or affiliated entities and based
upon information to which he had access during such employment, whether or not
conceived during regular working hours, through the use of Company time,
material or facilities (or those of the Company's subsidiaries or affiliated
entities) or otherwise. All such Developments shall be the sole and exclusive
property of the Company, its subsidiaries and its affiliated entities, and upon
request, Xxxxxxx shall deliver to the Company, its subsidiaries or its
affiliated entities, as applicable, all outlines, descriptions and other data
and records relating to such Developments and shall execute any documents deemed
necessary by the Company, its subsidiaries or its affiliated entities to protect
their rights hereunder. Xxxxxxx agrees, upon request, to assist the Company, its
subsidiaries and its affiliated entities to obtain United States or foreign
letters patent and copyright registrations covering inventions and original
works of authorship belonging to the Company, its subsidiaries or its affiliated
entities hereunder. If the Company, its subsidiaries or its affiliated entities
are unable because of Xxxxxxx'x mental or physical incapacity to secure
Xxxxxxx'x signature or apply for or to pursue any application for any United
States or foreign letters patent or copyright registrations covering inventions
and original works of authorship belonging to the Company, its subsidiaries or
its affiliated entities hereunder, then Xxxxxxx hereby irrevocably designates
and appoints the Company, its subsidiaries and affiliated entities, and their
duly authorized officers and agents, or any of them, as his agent and attorney
in fact, to act for and on his behalf and in his stead to execute and file any
such applications and to do all other lawfully permitted actions to further the
prosection and issuance of letters patent or copyright registrations thereon
with the same legal force and effect as if executed by him. Xxxxxxx hereby
waives and quitclaims to the Company, its subsidiaries and its affiliated
entities any and all claims, of any nature whatsoever, that he may hereafter
have for infringement of any patents or copyright resulting from any such
application for letters patent or copyright registrations belonging to the
Company, its subsidiaries or its affiliated entities hereunder."
11. By substituting the phrase "the Company, its subsidiaries and its
affiliated entities, in addition to any other remedies that as may be available
to any of them," for the phrase "the Company, in addition to any other remedies
as may be available to it," where the latter phrase appears in Section 9.6 of
the Plan.
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12. By substituting the following for Section 14 of the Employment
Agreement:
"14. Amendment or Modification; Waiver.
No provision of this Agreement may be amended or modified unless such
amendment or modification is agreed to in writing, signed by Xxxxxxx and by a
duly authorized officer of each of the other parties. Except as otherwise
specifically provided in this Agreement, no waiver by either party hereto of any
breach by any other party of any condition or provision of the Agreement to be
performed by such other party shall be deemed a waiver of a similar or
dissimilar provision or condition at the same or any prior or subsequent time."
IN WITNESS WHEREOF, the parties have executed this amendment to the
Employment Agreement as of the date set forth above.
Everest Reinsurance Company
By:_____________________________________
Its:____________________________________
Everest Reinsurance Holdings, Inc.
By:_____________________________________
Its:____________________________________
Everest Reinsurance Group, Ltd.
By:_____________________________________
Its:____________________________________
________________________________________
Xxxxxx X. Xxxxxxx
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