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EXHIBIT 10.16u
AMENDMENT NO. 1 TO TERMINATION AGREEMENT
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AMENDMENT NO. 1, dated as of December 31, 1998 among SELECTIVE INSURANCE
GROUP, INC., a New Jersey corporation ("Selective"), having an office at 00
Xxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxx Xxxxxx 00000, SELECTIVE INSURANCE COMPANY
OF AMERICA, a New Jersey corporation ("XXXX"), having an office at 00
Xxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxx Xxxxxx 00000, and XXXXXX X. XXXXXXXX,
having an address of X.X. Xxx 000, Xxxxxxxxxxx, Xxx Xxxxxx 00000 (the
"Executive"), to Termination Agreement dated as of August 1, 1995 among XXXX
and the Executive (the "Termination Agreement").
WHEREAS, XXXX and the Executive have executed and delivered the
Termination Agreement, and Selective has guaranteed all of the obligations
of XXXX under the Termination Agreement; and
WHEREAS, the parties hereto desire to amend the Termination Agreement as
provided herein.
THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
1. Subsection 5(f) of the Termination Agreement is hereby
deleted in its entirety, and replaced with a new subsection 5(f) to read in
its entirety as follows:
(f) In the event that any payments or benefits which
the Executive is entitled to receive from the Company
under this Agreement, together with any other
payments or benefits which the Executive is entitled
to receive from the Company (including, without
limitation, any amounts payable under any employment
contract with the Company or any stock option, stock
bonus, incentive compensation or other employee benefit
plan of the Company), in the aggregate would constitute
an "excess parachute payment" (as defined in
Section 280G(b) of the Code), the Company shall pay
to the Executive an amount constituting the greater to
the Executive on a net after-tax basis (as hereinafter
provided) of (i) the amount of payments and benefits
which the Executive is
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entitled to receive from the Company under this
Agreement, together with any other payments and
benefits which the Executive is entitled to receive
from the Company, reduced, in such order of
priority and amounts as the Executive shall
elect, to the largest amount as will result in no
portion of the aggregate of such payments being subject
to the excise tax imposed by Section 4999 of the Code,
or any successor or substitute provision of the Code
(the "Section 4999 Tax"), or (ii) the amount of
payments and benefits to which the Executive is
entitled to receive from the Company under this
Agreement, together with such other payments and
benefits which the Executive is entitled to receive
from the Company, plus an amount in cash equal to (x)
the amount of such "excess parachute payment"
multiplied by (y) twenty percent (20%). The aggregate
amounts described in clause (i) and in clause (ii) of
this subsection 5(f) shall be calculated on a net after-
tax basis giving effect to the obligation of the
Executive to pay any applicable taxes on such aggregate
amounts (including, without limitation, all federal,
state and local income taxes at the maximum applicable
rates, any Section 4999 Tax and any other tax payable
thereon at the maximum applicable rate).
2. Subsection 5(g) of the Termination Agreement is hereby
deleted in its entirety and replaced with a new subsection 5(g) to read in
its entirety as follows:
(g) In the event that the Executive shall receive from
the Company the amount specified in clause (i) of
subsection 5(f) and the Internal Revenue Service (the
"IRS") or a court of competent jurisdiction shall
determine that any portion of the payments and
benefits paid or payable to the Executive pursuant to
this Agreement shall constitute an "excess parachute
payment" subject to a Section 4999 tax, the Company
shall pay to the
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Executive in cash such additional amount as is
necessary so that the aggregate amounts received by
the Executive under this Agreement, after giving
effect to the obligation of the Executive to pay any
applicable taxes on such aggregate amounts (including,
without limitation all federal, state and local income
taxes, any Section 4999 Tax and any other taxes
payable thereon), shall not be less than the net after-
tax amount which the Executive would have been
entitled to receive under clause (i) of subsection
5(f) had such Section 4999 Tax not been imposed. The
Company shall pay such additional amount to the
Executive within thirty (30) days after the Executive
gives written notice to the Company that such
determination has been made by the IRS or a court of
competent jurisdiction.
3. The following new Section 5(h) is hereby added to the
Agreement:
(h) Any dispute or controversy between the Executive
and the Company regarding payments under this
Section 5 of this Agreement shall be conclusively
settled by an independent accounting firm acceptable
to each of the parties hereto, or, if no firm is
acceptable to both parties hereto, each of the
Executive and the Company shall select an
accounting firm acceptable to it, and such
accounting firms shall together designate an
independent accounting firm to settle such dispute
or controversy, and such settlement shall be binding
upon both parties, provided, however, that any
accounting firm designated to settle any dispute or
controversy hereunder shall not have been previously
retained by either party for a period of at least two
(2) years subsequent to the date of this settlement
of such dispute or controversy. The
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Company or the Escrow Agent, as the case may be,
may withhold from any benefits payable under this
Agreement all federal, state, city or other taxes
as shall be required pursuant to any law or
governmental regulation or ruling.
4. The capitalized defined terms used in this Amendment shall
have the same meanings as are ascribed to them in the Termination Agreement
unless otherwise defined herein.
5. Except as amended herein, the Termination Agreement shall
continue in full force and effect on and after the date hereof.
IN WITNESS WHEREOF, this Amendment has been duly executed by the
Executive and on behalf of Selective and XXXX by their duly authorized
officers, as of the date and year first above written.
SELECTIVE INSURANCE GROUP, INC.
By:/s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx
Title: Chairman and Chief
Executive Officer
SELECTIVE INSURANCE COMPANY
OF AMERICA
By:/s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx
Title: Chairman and Chief
Executive Officer
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
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