EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into effective as
of the 1st day of January, 1998 (the "Effective Date"), between HCC INSURANCE
HOLDINGS, INC. ("HCC" or "Company"), and XXXXXX XXXXXX XXXXX, XX.
("Executive"), sometimes collectively referred to herein as the "Parties".
R E C I T A L S:
WHEREAS, Executive is to be employed as Senior Vice President and
Chief Financial Officer ("CFO") until June 30, 2001, and, as an integral part
of its management who participates in the decision-making process relative to
short and long-term planning and policy for the Company, will serve on the
Company's Senior Management Committee;
WHEREAS, it is the desire of the Board of Directors of HCC (the
"Board") to (i) directly engage Executive as an officer of HCC and its
subsidiaries; and
WHEREAS, Executive is desirous of committing himself to serve HCC on
the terms herein provided.
NOW, THEREFORE, in consideration of the foregoing and of the
respective covenants and agreements set forth below, the Parties agree as
follows:
1. TERM. The Company hereby agrees to employ Executive as a Senior
Vice President and CFO, and Executive hereby agrees to accept such
employment, on the terms and conditions set forth herein, for the period
commencing on the Effective Date and expiring as of 11:59 p.m. on September
30, 2001 (the "Basic Term") (unless sooner terminated as hereinafter set
forth).
2. DUTIES.
(a) DUTIES AS EMPLOYEE OF THE COMPANY. Executive shall, subject
to the supervision of the Board of Directors, act as Chief Financial Officer
of HCC in the ordinary course of its business with all such powers with
respect to such management and control as may be reasonably incident to such
responsibilities. During normal business hours, Executive shall devote his
full time and attention to diligently attending to the business of the
Company during the Basic Term. During the Basic Term, Executive shall not
directly or indirectly render any services of a business, commercial, or
professional nature to any other person, firm, corporation, or organization,
whether for compensation or otherwise, without the prior written consent of
the Board of Directors of HCC. However, Executive shall have the right to
engage in such activities
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as may be appropriate in order to manage his personal investments so long as
such activities do not materially interfere or conflict with the performance
of his duties to the Company hereunder. The conduct of such activity shall
not be deemed to materially interfere or conflict with Executive's
performance of his duties until Executive has been notified in writing
thereof and given a reasonable period in which to cure the same.
(b) OTHER DUTIES. If elected, Executive agrees to serve as a
member of the Senior Management Committee of HCC and of any of its
subsidiaries and in one or more executive offices of any of HCC's
subsidiaries, provided Executive is indemnified for serving in any and all
such capacities in a manner acceptable to the Company and Executive. If
elected, Executive agrees that he shall not be entitled to receive any
compensation for serving as a director of HCC, or in any capacities of HCC's
subsidiaries other than the compensation to be paid to Executive by the
Company pursuant to this Agreement.
3. COMPENSATION AND RELATED MATTERS.
(a) BASE SALARY. Executive shall receive a base salary paid by
the Company at the annual rate of $225,000, during each calendar year of the
Basic Term, payable in substantially equal monthly installments. For purposes
of this Agreement, "Base Salary" shall mean the Executive's initial base
salary or, if increased, then the increased base salary.
(b) BONUS PAYMENTS. Executive shall be eligible to receive, in
addition to the Base Salary, an annual cash and/or stock bonus payment in
amount, which may be zero, to be determined at the sole discretion of the
Compensation Committee.
(c) STOCK OPTIONS. In addition to stock options previously
granted to Executive, Executive shall be entitled to receive, in addition to
the Base Salary, options to purchase HCC shares, which may be zero, to be
determined at the sole discretion of the Board of Directors or the HCC
Compensation Committee.
(d) EXPENSES. During the Basic Term, Executive shall be entitled
to receive prompt reimbursement for all reasonable expenses incurred by him
(in accordance with the policies and procedures established by the Board for
the Company's senior executive officers) in performing services hereunder,
provided that Executive properly accounts therefor in accordance with Company
policy.
(e) OTHER BENEFITS. Executive shall be entitled to participate
in or receive benefits under any compensation employee benefit plan or other
arrangement made available by the Company now or in the future to its senior
executive officers, subject to and on a basis consistent with the terms,
conditions, and overall administration of such plan or arrangement. Nothing
paid to Executive under any plan or arrangement presently in effect or made
available in the future shall be deemed to be in lieu of the Base Salary
payable to Executive pursuant to Paragraph (a) of this Section. The Company
shall not make any changes in any employee benefit plans or other
arrangements in effect on the date hereof or subsequently in effect in which
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Executive currently or in the future participates (including, without
limitation, each pension and retirement plan, supplemental pension and
retirement plan, savings and profit sharing plan, stock or unit ownership
plan, stock or unit purchase plan, stock or unit option plan, life insurance
plan, medical insurance plan, disability plan, dental plan, health and
accident plan, or any other similar plan or arrangement) that would adversely
affect Executive's rights or benefits thereunder, unless such change occurs
pursuant to a program applicable to substantially all executives of the
Company and does not result in a proportionately greater reduction in the
rights of or benefits to Executive as compared with any other executive of
the Company.
(f) VACATIONS. Executive shall be entitled to twenty (20) paid
vacation days per year during the Basic Term. There shall be no carryover of
unused vacation from year to year. For purposes of this Paragraph, weekends
shall not count as vacation days, and Executive shall also be entitled to all
paid holidays given by the Company to its senior executive officers.
(g) PERQUISITES. Executive shall be entitled to receive the
perquisites and fringe benefits appertaining to an executive officer of HCC
in accordance with any practice established by the Board.
(h) PRORATION. Any payments or benefits payable to Executive
hereunder in respect of any calendar year during which Executive is employed
by the Company for less than the entire year, unless otherwise provided in
the applicable plan or arrangement, shall be prorated in accordance with the
number of days in such calendar year during which he is so employed.
Notwithstanding the foregoing, any payments pursuant to Paragraph 4(c) or
4(d) this Agreement shall not be subject to proration.
4. TERMINATION.
(a) DEFINITIONS.
(1) "CAUSE" shall mean:
(i) Material dishonesty which is not the result of
an inadvertent or innocent mistake of Executive with respect to
the Company or any of its subsidiaries;
(ii) Willful misfeasance or nonfeasance of duty by
Executive intended to injure or having the effect of injuring in some
material fashion the reputation, business, or business relationships
of the Company or any of its subsidiaries or any of their respective
officers, directors, or employees;
(iii) Material violation by Executive of any material
term of this Agreement;
(iv) Conviction of Executive of any felony, any crime
involving moral turpitude or any crime other than a vehicular offense
which could reflect in some
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material fashion unfavorably upon the Company or any of its
subsidiaries.
(2) A "CHANGE OF CONTROL" shall be deemed to have occurred if:
(i) Any "person" or "group" (within the meaning of
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934)
other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Company becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Securities Exchange Act of
1934), directly or indirectly, of 50% or more of the Company's then
outstanding voting common stock; or
(ii) At any time during the period of three (3)
consecutive years (not including any period prior to the date
hereof), individuals who at the beginning of such period constituted
the Board (and any new director whose election by the Board or whose
nomination for election by the Company's shareholders were approved
by a vote of at least two-thirds of the directors then still in
office who either were directors at the beginning of such period or
whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority thereof; or
(iii) The shareholders of the Company approve a merger
or consolidation of the Company with any other corporation, other
than a merger or consolidation (a) in which a majority of the
directors of the surviving entity were directors of the Company
prior to such consolidation or merger, and (b) which would result in
the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or
by being changed into voting securities of the surviving entity)
more than 50% of the combined voting power of the voting securities
of the surviving entity outstanding immediately after such merger or
consolidation; or
(iv) The shareholders approve a plan of complete
liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the
Company's assets.
Executive may not be terminated for Cause unless and until there has
been delivered to Executive written notice from the Board supplying the
particulars of his acts or omissions that the Board believes constitute
Cause, a reasonable period of time (not less than 30 days) has been
given to Executive after such notice to either cure the same or to meet
with the Board with his attorney if so desired by Executive, and
following which the Board by action of not less than two-thirds of its
members furnishes to Executive a written resolution specifying in
detail its findings that Executive has been terminated for Cause as of
the date set forth in the notice to Executive.
(3) A "DISABILITY" shall mean the absence of Executive from
Executive's duties with the Company on a full-time basis for 180 consecutive
days, or 180 days
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in a 365-day period, as a result of incapacity due to mental or physical
illness which results in the Executive being unable to perform the essential
functions of his position, with or without reasonable accommodation.
(4) A "GOOD REASON" shall mean any of the following (without
Executive's express written consent):
(i) Following a change of control, a material
alteration in the nature or status of Executive's title, duties or
responsibilities, or the assignment of duties or responsibilities
inconsistent with, Executive's status title, duties and
responsibilities;
(ii) A failure by the Company to continue in effect any
employee benefit plan in which Executive was participating, or the
taking of any action by the Company that would adversely affect
Executive's participation in, or materially reduce Executive's
benefits under, any such employee benefit plan, unless such failure
or such taking of any action adversely affects the senior members of
corporate management of the Company generally;
(iii) A relocation of the Company's executive offices,
or Executive's relocation to any place other than the executive
offices, exceeding a distance of fifty (50) miles from the Company's
current executive office located in Houston, Texas, except for
reasonably required travel by Executive on the Company's business;
(iv) Any material breach by the Company of any
provision of this Agreement; or
(v) Any failure by the Company to obtain the
assumption and performance of this Agreement by any successor (by
merger, consolidation, or otherwise) or assign of the Company.
However, Good Reason shall exist with respect to an above specified matter only
if such matter is not corrected by the Company within thirty (30) days of its
receipt of written notice of such matter from Executive and in no event shall a
termination by Executive occurring more than ninety (90) days following the date
of the event described above be a termination for Good Reason due to such event.
(5) "TERMINATION DATE" shall mean the date Executive is
terminated for any reason pursuant to this Agreement.
(6) "TERMINATION FOLLOWING A CHANGE OF CONTROL" shall
mean failure of any successor/surviving company to adopt this Agreement.
(b) TERMINATION WITHOUT CAUSE OR FOR GOOD REASON:
BENEFITS. In the event there is a termination by the Company without Cause,
or if Executive terminates for Good
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Reason (a "Termination Event"), this Agreement shall terminate and Executive
shall be entitled to the following severance benefits:
(1) For the remainder of the Basic Term after the
Termination Date, Base Salary (as defined in Paragraph 3(a)), at the
rate in effect immediately prior to the Termination Event, payable in a
lump sum;
(2) If there is a Change of Control or if there is a
termination by the Company without Cause or by Executive for Good
Reason any stock options and other stock-related grants ("Stock
Awards") which Executive has received under any of the HCC Stock Option
Plans shall vest immediately provided, however, if there is a
termination for Good Reason, or by the Company other than for Cause,
all options shall be exercisable for one year or the remainder of that
term, whichever is less;
(3) To the extent not theretofore paid or provided,
the Company shall timely pay or provide to Executive any other amounts
or benefits required to be paid or provided or which Executive is
eligible to receive under any plan, program, policy or practice, or
contract or agreement of the Company and its affiliated companies for
the period of time equal to the remainder of the Basic Term and through
December 31, 2001 the Company, at its sole expense, shall continue to
provide (through its own plan and/or individual policies) Executive
(and Executive's dependents) with health benefits no less favorable
than the group health plan benefits provided during such period to any
senior executive officer of the Company or any affiliated company (to
the extent any such coverage or benefits are taxable to Executive by
reason of being provided under a self-insured health plan of the
Company or an affiliate, the Company shall make Executive "whole" for
the same on an after-tax basis), provided, however, such coverage shall
be secondary to any group health plan coverage Executive (or his
dependents) receive from another employer, (such other amounts and
benefits shall be hereinafter referred to as the "Other Benefits");
(4) If Executive receives any payments whether or not
pursuant to this Agreement which are subject to an excise tax imposed
under Section 4999 of the Internal Revenue Code of 1986, as amended, or
any similar tax imposed under federal, state, or local law
(collectively, "Excise Taxes"), the Company shall pay to Executive (on
or before the date on which the Company is required to withhold such
Excise Taxes), 1) an additional amount equal to all Excise Taxes then
due and payable, and 2) the amount necessary to defray Executive's
increased (federal, state, and local) tax liability arising due to
payment of the amounts specified in this Subsections (4) of this
Paragraph 4, which shall include any costs and expenses, including
penalties and interest incurred by Executive in connection with any
audit, proceedings, etc. related to the payment of such Excise Taxes or
this payment. For purposes of calculating the amount payable to
Executive under this Paragraph, the federal and state income tax rates
used shall be the highest marginal federal and state rates applicable
to ordinary income in Executive's state of residence, taking into
account any federal income tax deductions or credits available to
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Executive for state income taxes. The Company shall cause its
independent auditors to calculate such amount and provide Executive a
copy of such calculation at least ten (10) days prior to the date
specified above for payment of such amount. It is the intent of the
Parties that this Subsection (4) shall place Executive in the same net
after-tax position Executive would have been in had no payment been
subject to an Excise Tax and, notwithstanding anything herein to the
contrary, it shall be construed to effectuate said result;
(5) All accrued compensation and unreimbursed
expenses through the Termination Date. Such amounts shall be paid to
Executive in a lump sum in cash within thirty (30) days after the
Termination Date; and
(6) Executive shall be free to accept other
employment during such period, and there shall be no offset of any
employment compensation earned by Executive in such other employment
during such period against payments due Executive under this Paragraph
(4), and there shall be not offset in any compensation received from
such other employment against the Base Salary set forth above.
(c) TERMINATION IN EVENT OF DEATH: BENEFITS. If
Executive's employment is terminated by reason of Executive's death during
the Basic Term, this Agreement shall terminate without further obligation to
Executive's legal representatives under this Agreement, other than for
payment of all accrued compensation, unreimbursed expenses, the timely
payment or provision of Other Benefits through the date of death. Such
amounts shall be paid to Executive's estate or beneficiary, as applicable, in
a lump sum in cash within ninety (90) days after the date of death. With
respect to the provision of Other Benefits, the term Other Benefits as used
in this Paragraph 4(c) shall include, without limitation, and Executive's
estate and/or beneficiaries shall be entitled to receive, benefits at least
equal to the most favorable benefits provided by the Company to the estates
and beneficiaries of other executive level employees of the Company under
such plans, programs, practices, and policies relating to death benefits, if
any, as in effect with respect to other executives and their beneficiaries at
any time during the 120-day period immediately preceding the date of death.
Additionally, all Stock Awards for which Executive would have been eligible
had he completed the Basic Term shall be accelerated, and Executive's estate
or beneficiary shall be vested in such Stock Awards as of the date of
Executive's termination.
(d) TERMINATION IN EVENT OF DISABILITY: BENEFITS. If
Executive's employment is terminated by reason of Executive's Disability
during the Basic Term, this Agreement shall continue in full force for a
period of one (1) year following such Disability. Following such one (1) year
period, this Agreement shall continue in full force except that (a) the Base
Salary shall be reduced by 50% and (b) Executive shall, not be entitled to
any subsequent cash or stock bonuses. In addition, all outstanding Stock
Awards shall vest immediately upon such termination due to Disability.
(e) VOLUNTARY TERMINATION BY EMPLOYEE AND TERMINATION
FOR CAUSE:
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BENEFITS. Executive may terminate his employment with the Company without
Good Reason by giving written notice of his intent and stating an effective
Termination Date at least ninety (90) days after the date of such notice;
provided, however, that the Company may accelerate such effective date by
paying Executive through the proposed Termination Date and also vesting
awards that would have vested but for this acceleration of the proposed
Termination Date. Upon such a termination by Executive or upon termination
for Cause by the Company, this Agreement shall terminate and the Company
shall pay to Executive all accrued compensation, unreimbursed expenses and
the Other Benefits through the Termination Date. Such amounts shall be paid
to Executive in a lump sum in cash within thirty (30) days after the date of
termination.
(f) DIRECTOR POSITIONS. Executive agrees that upon termination
of employment, for any reason, at the request of the Chairman of the Board,
Executive will immediately tender his resignation from any and all Board
positions held with the Company and/or any of its subsidiaries and affiliates.
5. NON-COMPETITION, NON-SOLICITATION, AND CONFIDENTIALITY.
Executive recognizes and agrees that the benefit of not being employed
at-will, is provided in consideration for, among other things, the agreements
contained in this Section. The Company agrees that while employed pursuant to
this Agreement, Executive will be provided with confidential information of
Company; specialized training on how to perform his duties; and contact with
the Company's customers and potential customers.
(a) NON-COMPETITION DURING EMPLOYMENT. Executive agrees that
during the Basic Term, he will not compete with the Company by engaging in
the conception, design, development, production, marketing, or servicing of
any product or service that is substantially similar to the products or
services which the Company provides, and that he will not work for, in any
capacity, assist, or become affiliated with as an owner, partner, etc.,
either directly or indirectly, any individual or business which offers or
performs services, or offers or provides products substantially similar to
the services and products provided by Company, provided, Executive shall not
be prevented from owning no more than 2% of any Company whose stock is
publicly traded.
(b) CONFLICTS OF INTEREST. Executive agrees that during the
Basic Term, he will not engage, either directly or indirectly, in any
activity (a "Conflict of Interest") which might adversely affect the Company
or its affiliates, including ownership of a material interest in any
supplier, contractor, distributor, subcontractor, customer or other entity
with which the Company does business or accepting any material payment,
service, loan, gift, trip, entertainment, or other favor from a supplier,
contractor, distributor, subcontractor, customer or other entity with which
the Company does business, and that Executive will promptly inform the
President of the Company as to each offer received by Executive to engage in
any such activity. Executive further agrees to disclose to the Company any
other facts of which Executive becomes aware which in Executive's good faith
judgment could reasonably be expected to involve or give rise to a Conflict
of Interest or potential Conflict of Interest.
Page 8
(c) CONFIDENTIAL INFORMATION. Executive further agrees that he
will not, except as the Company may otherwise consent or direct in writing,
reveal or disclose, sell, use, lecture upon, publish or otherwise disclose to
any third party any Confidential Information or proprietary information of
the Company, or authorize anyone else to do these things at any time either
during or subsequent to his employment with the Company. This Section shall
continue in full force and effect after termination of Executive's employment
and after the termination of this Agreement. Executive's obligations under
this Paragraph with respect to any specific Confidential Information and
proprietary information shall cease when that specific portion of the
Confidential Information and proprietary information becomes publicly known,
in its entirety and without combining portions of such information obtained
separately. It is understood that such Confidential Information and
proprietary information of the Company include matters that Executive
conceives or develops, as well as matters Executive learns from other
employees of Company. Confidential Information is defined to include
information: (1) disclosed to or known by the Executive as a consequence of
or through his employment with the Company; (2) not generally known outside
the Company; and (3) which relates to any aspect of the Company or its
business, finances, operation plans, budgets, research, or strategic
development. "Confidential Information" includes, but is not limited to the
Company's trade secrets, proprietary information, financial documents, long
range plans, customer lists, employer compensation, marketing strategy, data
bases, costing data, computer software developed by the Company, investments
made by the Company, and any information provided to the Company by a third
party under restrictions against disclosure or use by the Company or others.
(d) RETURN OF DOCUMENTS, EQUIPMENT, ETC. All writings,
records, and other documents and things comprising, containing, describing,
discussing, explaining, or evidencing any Confidential Information, and all
equipment, components, parts, tools, and the like in Executive's custody or
possession that have been obtained or prepared in the course of Executive's
employment with the Company shall be the exclusive property of the Company,
shall not be copied and/or removed from the premises of the Company, except
in pursuit of the business of the Company, and shall be delivered to the
Company, without Executive retaining any copies, upon notification of the
termination of Executive's employment or at any other time requested by the
Company. The Company shall have the right to retain, access, and inspect all
property of Executive of any kind in the office, work area, and on the
premises of the Company upon termination of Executive's employment and at any
time during employment by the Company to ensure compliance with the terms of
this Agreement.
(e) REAFFIRM OBLIGATIONS. Upon termination of his employment
with the Company, Executive, if requested by Company, shall reaffirm in
writing Executive's recognition of the importance of maintaining the
confidentiality of the Company's Confidential Information and proprietary
information, and reaffirm any other obligations set forth in this Agreement.
(f) PRIOR DISCLOSURE. Executive represents and warrants that
he has not used or disclosed any Confidential Information he may have
obtained from Company prior to signing this Agreement, in any way
inconsistent with the provisions of this Agreement.
Page 9
(g) CONFIDENTIAL INFORMATION OF PRIOR COMPANIES. Executive
will not disclose or use during the period of his employment with the Company
any proprietary or Confidential Information or Copyright Works which
Executive may have acquired because of employment with an employer other than
the Company or acquired from any other third party, whether such information
is in Executive's memory or embodied in a writing or other physical form.
(h) BREACH. Executive agrees that any breach of Paragraphs
5(a) or (c) above cannot be remedied solely by money damages, and that in
addition to any other remedies Company may have, Company is entitled to
obtain injunctive relief against Executive. Nothing herein, however, shall be
construed as limiting Company's right to pursue any other available remedy at
law or in equity, including recovery of damages and termination of this
Agreement and/or any payments that may be due pursuant to this Agreement.
(i) RIGHT TO ENTER AGREEMENT. Executive represents and
covenants to Company that he has full power and authority to enter into this
Agreement and that the execution of this Agreement will not breach or
constitute a default of any other agreement or contract to which he is a
party or by which he is bound.
(j) ENFORCEABILITY. The agreements contained in Section 5 are
independent of the other agreements contained herein. Accordingly, failure of
the Company to comply with any of its obligations outside of this Paragraph
do not excuse Executive from complying with the agreements contained herein.
(k) SURVIVABILITY. The agreements contained in Paragraphs
5(c)-(d) shall survive the termination of this Agreement for any reason.
6. ASSIGNMENT. This Agreement cannot be assigned by Executive.
The Company may assign this Agreement only to a successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and assets of the Company provided such
successor expressly agrees in writing reasonably satisfactory to Executive to
assume and 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 and
assignment had taken place. Failure of the Company to obtain such written
agreement prior to the effectiveness of any such succession shall be a
material breach of this Agreement.
7. BINDING AGREEMENT. Executive understands that his obligations
under this Agreement are binding upon Executive's heirs, successors, personal
representatives, and legal representatives.
8. NOTICES. All notices pursuant to this Agreement shall be in
writing and sent certified mail, return receipt requested, addressed as set
forth below, or by delivering the same in person to such party, or by
transmission by facsimile to the number set forth below (which shall not
constitute notice). Notice deposited in the United States Mail, mailed in the
manner
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described hereinabove, shall be effective upon deposit. Notice given in any
other manner shall be effective only if and when received:
If to Executive: Xxxxxx Xxxxxx Xxxxx, Xx.
0000 Xxxxxxxxxx
Xxxxxxx Xxxxx 00000
--------------------
If to Company: HCC Insurance Holdings, Inc.
00000 Xxxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000
Fax: (000) 000-0000
with a copy (which shall Xxxxxx X. Xxxxxx, Esq.
not constitute notice) to: Xxxxxxxx Xxxxxxxx & Xxxxxx P.C.
Suite 2400
000 Xxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000-0000
Fax: (000) 000-0000
9. WAIVER. No waiver by either party to this Agreement of any right to
enforce any term or condition of this Agreement, or of any breach hereof, shall
be deemed a waiver of such right in the future or of any other right or remedy
available under this Agreement.
10. SEVERABILITY. If any provision of this Agreement is determined to
be void, invalid, unenforceable, or against public policy, such provisions shall
be deemed severable from the Agreement, and the remaining provisions of the
Agreement will remain unaffected and in full force and effect.
11. ARBITRATION. In the event any dispute arises out of Executive's
employment with or by the Company, or separation/termination therefrom, which
cannot be resolved by the Parties to this Agreement, such dispute shall be
submitted to final and binding arbitration. The arbitration shall be conducted
in accordance with the National Rules for the Resolution of Employment Disputes
of the American Arbitration Association ("AAA"). If the Parties cannot agree on
an arbitrator, a list of seven (7) arbitrators will be requested from AAA, and
the arbitrator will be selected using alternate strikes with Executive striking
first. The cost of the arbitration will be shared equally by Executive and
Company ; provided, however, the Company shall promptly reimburse Executive for
all costs and expenses incurred in connection with any dispute in an amount up
to, but not exceeding 20 percent of Executive's base salary unless such
termination was for Cause in which event Executive shall not be entitled to
reimbursement unless and until it is determined he was terminated other than for
Cause. Arbitration of such disputes is mandatory and in lieu of any and all
civil causes of action and lawsuits either party may have against the other
arising out of Executive's employment with Company, or separation therefrom.
Such arbitration shall be held in Houston, Texas.
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12. ENTIRE AGREEMENT. The terms and provisions contained herein
shall constitute the entire agreement between the parties with respect to
Executive's employment with Company during the time period covered by this
Agreement. This Agreement replaces and supersedes any and all existing
Agreements entered into between Executive and the Company relating generally
to the same subject matter, if any, and shall be binding upon Executive's
heirs, executors, administrators, or other legal representatives or assigns.
13. MODIFICATION OF AGREEMENT. This Agreement may not be changed or
modified or released or discharged or abandoned or otherwise terminated, in
whole or in part, except by an instrument in writing signed by the Executive
and an officer or other authorized executive of Company.
14. UNDERSTAND AGREEMENT. Executive represents and warrants that he
has read and understood each and every provision of this Agreement, and
Executive understands that he has the right to obtain advice from legal
counsel of choice, if necessary and desired, in order to interpret any and
all provisions of this Agreement, and that Executive has freely and
voluntarily entered into this Agreement.
15. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas.
16. JURISDICTION AND VENUE. With respect to any litigation regarding
this Agreement, Executive agrees to venue in the state or federal courts in
Xxxxxx County, Texas, and agrees to waive and does hereby waive any defenses
and/or arguments based upon improper venue and/or lack of personal
jurisdiction. By entering into this Agreement, Executive agrees to personal
jurisdiction in the state and federal courts in Xxxxxx County, Texas.
IN WITNESS WHEREOF, the Parties have executed this Agreement in
multiple copies, effective as of the date first written above.
EXECUTIVE COMPANY
HCC INSURANCE HOLDINGS, INC.
/s/ Xxxxxx X. Xxxxx, Xx. By: /s/ Xxxxxxx X. Way
------------------------ --------------------------------
XXXXXX XXXXXX XXXXX, XX. XXXXXXX X. WAY
Chief Executive Officer and
Chairman of the Board
Dated: 1/23/98 Dated: 1/23/98
------------------ -----------------------------
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