Exhibit 10(b)
EMPLOYMENT AGREEMENT
AGREEMENT, dated as of the 30th day of April, 1999, between
Republic New York Corporation, a Maryland corporation having its principal
executive offices in New York, New York (including as successor thereto, the
"Company"), and Xxxx X. Xxxxxxx (the "Executive").
WHEREAS, Executive currently serves as a senior executive
officer of the company;
WHEREAS, the Company recognizes the Executive's substantial
contribution to the growth and success of the Company, desires to provide for
the continued employment of the Executive and to make certain changes in the
Executive's employment arrangements with the Company, which the Board has
determined will reinforce and encourage the continued attention and dedication
to the Company of the Executive as a member of the Company's senior management
in the best interests of the Company and its shareholders;
WHEREAS, the Executive is willing to continue to serve the
Company on the terms and conditions set forth below;
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. The Company hereby agrees to continue to
employ the Executive, and the Executive hereby agrees to continue in the employ
of the Company, subject to the terms and conditions of this Agreement, for the
period commencing on the date hereof (the "Effective Date") and ending on April
30, 2003 (the "Employment Period").
2. Terms of Employment.
(a) Position and Duties.
(i) During the Employment Period, the
Executive shall serve as Vice Chairman of Republic New York Corporation
and Vice Chairman of Republic National Bank of New York with the
appropriate authority, duties and responsibilities attendant to such
position. Prior to a change in control (as defined in the Company
Supplemental Executive Retirement Plan) ("Change in Control"), the
Company shall use its best efforts to cause the Executive to be
nominated for
election to the Company's Board of Directors (the
"Board") during the Employment Period.
(ii) During the Employment Period, and
excluding any periods of vacation and sick leave to which the Executive
is entitled, the Executive agrees to devote substantially all of his
attention and time during normal business hours to the business and
affairs of the Company and, to the extent necessary to discharge the
responsibilities assigned to the Executive hereunder, to use the
Executive's reasonable best efforts to perform faithfully and
efficiently such responsibilities. During the Employment Period it
shall not be a violation of this Agreement for the Executive, in
accordance with the Company's Standards of Conduct, to (A) serve, with
prior approval of the Board, on corporate, civic or charitable boards
or committees, (B) deliver lectures, fulfill speaking engagements or
teach on a limited basis at educational institutions and (C) manage
Executive's personal investments, so long as such activities described
in clauses (A), (B) and (C) do not significantly interfere with the
performance of the Executive's responsibilities as an employee of the
Company in accordance with this Agreement. It is expressly understood
and agreed that to the extent that any such activities have been
conducted by the Executive prior to the Effective Date in accordance
with the Company's Standards of Conduct, the continued conduct of such
activities (or the conduct of activities similar in nature and scope
thereto) subsequent to the Effective Date shall not thereafter be
deemed to interfere with the performance of the Executive's
responsibilities to the Company.
(b) Compensation.
(i) Annual Base Salary. Effective
January 1, 1999, a nd during the Employment Period, the Executive shall
receive an annual base salary ("Annual Base Salary") of at least
$375,000. Any increase in Annual Base Salary shall not serve to limit
or reduce any other obligation to the Executive under this Agreement.
Annual Base Salary shall not be reduced after any such increase and the
term Annual Base Salary as utilized in this Agreement shall refer to
Annual Base Salary as so increased.
(ii) Annual Bonus. During the Employment
Period, the Executive shall be paid an annual cash bonus ("Annual
Bonus") with a target level of not less than 3.75 times Annual Base
Salary ("Target Bonus"), or such greater amount as determined by the
Human Resources Committee of the Board (the "HR Committee"); provided,
however, that a minimum annual bonus shall be paid in any event to the
Executive equal to the difference between one million dollars and the
Annual Base Salary; and further provided, that (A) the formula for
determining Executive's 1999 Award under the Company's 1994 Performance
Based Incentive Compensation Plan (the "Performance Plan") that was
adopted
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by the HR Committee at its meeting of March 30, 1999 and
attached hereto as Annex I will not be modified without Executive's
written consent and (B) the formula for determining Executive's Award
under the Performance Plan
and any successor plan for each subsequent year during the Employment
Period shall use a "Base Year" and "Award Multiple" (as such terms are
defined in the Performance Plan as in effect on the Effective Date)
which shall result in an award that is no less than the amount that
would have been paid had the Base Year and Award Multiple used for 1999
been applied. The Annual Bonus shall be paid within two months of the
end of the fiscal year of the Company to which it relates. If any
extraordinary event, such as a reorganization, recapitalization,
spinoff, stock split, stock dividend, merger of the Company, or sale of
substantially all of the assets of the Company, occurs in any fiscal
year, the Company shall equitably adjust the terms of the award under
the Performance Plan. If a Change in Control occurs and the Company has
"net income" (as defined in the Performance Plan as in effect on the
Effective Date and determined consistently with past practice) from its
continuing operations, the Executive shall be paid at least the Target
Bonus for the year in which such Change in Control occurs and in each
subsequent year until the end of the Employment Period. If because of a
merger or other corporate reorganization, it is not possible to
determine whether the Company has net income from its continuing
operations, such net income shall be presumed unless there is
conclusive proof to the contrary.
(iii) Other Employee Benefit Plans. During
the Employment Period, except as otherwise expressly provided herein,
the Executive shall be entitled to participate in all employee benefit,
welfare and other plans, practices, policies and programs and fringe
benefits (including the use of an automobile of his selection with an
approximate retail price not in excess of $50,000, which automobile
shall be replaced every three years at which time it may be purchased
by the Executive at its wholesale value as reflected in the Xxxxx Blue
Book Auto Market Report, if the Company owns the car, or, if the car is
leased, the purchase price specified in the Company's lease agreement)
(collectively, "Employee Benefit Plans") on a basis no less favorable
than that provided to the Chief Executive Officer prior to any Change
in Control.
3. Termination of Employment.
(a) Death or Disability. The Executive's
employment shall terminate automatically upon the Executive's death during the
Employment Period. If the Company determines in good faith that the Disability
of the Executive has occurred during the Employment Period (pursuant to the
definition of Disability set forth below), it may give to the Executive written
notice in accordance with Section 10(b) of this Agreement of its intention to
terminate the Executive's employment. In such event, the
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Executive's employment with the Company shall terminate effective on the 30th
day after receipt of such notice by the Executive (the "Disability Effective
Date"), provided that,within the 30 days after such receipt, the Executive shall
not have returned to
full-time performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's duties
with the Company on a full-time basis for 180 business days during any
consecutive twelve month period as a result of incapacity due to mental or
physical illness which is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Executive or the
Executive's legal representative.
(b) With or Without Cause. The Company may
terminate the Executive's employment during the Employment Period with or
without Cause. For purposes of this Agreement, "Cause" shall mean:
(i) the willful engaging by the
Executive in illegal conduct or gross misconduct hich is materially and
demonstrably injurious to the Company or the willful engaging in
conduct which materially interferes with any Change in Control
Transaction approved by the Board, or
(ii) conviction of a felony or guilty or
nolo contendere plea by the Executive with respect thereto or any event
requiring the consent of the Federal Deposit Insurance Corporation Act
under 12 U.S.C. ss.1829(a).
For purposes of this provision, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of the Chief Executive Officer
(while the Executive does not serve as such) or based upon the advice of counsel
for the Company shall be conclusively presumed to be done, or omitted to be
done, by the Executive in good faith and in the best interests of the Company.
The cessation of employment of the Executive shall not be deemed to be for Cause
unless and until there shall have been delivered to the Executive a copy of a
resolution duly adopted by the affirmative vote of not less than 75% of the
entire membership of the Board (excluding the Executive) at a meeting of the
Board called and held for such purpose (after reasonable notice is provided to
the Executive and the Executive is given an opportunity, together with counsel,
to be heard before the Board) finding that, in the good faith opinion of the
Board, the Executive is guilty of the conduct described in subparagraph (i) or
(ii) above, and specifying the particulars thereof in detail.
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(c) Good Reason. The Executive's employment may
be terminated by the Executive for Good Reason. For purposes of this Agreement,
"Good Reason" shall mean in the absence of a written consent of the Executive:
(i) the assignment to the Executive of
any duties inconsistent with the Executive's title and position
(including status, offices and reporting requirements), authority,
duties or responsibilities as contemplated by Section 2(a)(i) of this
Agreement, or any other action by the Company which results in a
diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated, insubstantial and inadvertent
action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the Executive;
(ii) any failure by the Company to comply
with any of the provisions of Section 2 (b) of this Agreement, other
than an isolated, insubstantial and inadvertent failure not occurring
in bad faith and which is remedied by the Company promptly after
receipt of notice thereof given by the Executive;
(iii) any purported termination by the
Company of the Executive's employment otherwise than as expressly
permitted by this Agreement for Cause, death or Disability, or any
failure by the Company to renew this Agreement;
(iv) any failure by the Company to comply
with and satisfy Section 9(c) of this Agreement;
(v) failure of the Company to appoint
the Executive to, and retain the Executive in, any of the positions as
specified in Section 2(a)(i) or equivalent positions (it being
understood that equivalent positions may have different titles);
(vi) any requirement that the Executive (A)
be based anywhere more than fifty (50) miles from the office where the
Executive is currently located or (B) travel on Company business to an
extent substantially greater than the Executive's current travel
obligations;
(vii) any failure of the Company to use
its best efforts to assist the Executive in obtaining or retaining a
visa to work in the United States;
(viii) any failure of the Company to retain
the Executive in a position with respect to the Company's operations in
the United States that is
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comparable to the Executive's position with the Company as of the
Effective Date; and
(ix) any failure of the Executive to be
elected to, or to remain a member of, the Company's Board of Directors;
provided, however, that after a Change in Control, failure of the
Executive to be nominated to the Board of Directors of a successor that
is a publicly traded company shall not constitute Good Reason.
For purposes of this Section 3(c), any good faith determination of "Good Reason"
made by the Executive shall be conclusive. Without limiting the generality of
the foregoing, the Executive shall for all purposes of this Agreement be deemed
to have terminated his employment for Good Reason if he voluntarily terminates
his employment within sixty (60) days following the first anniversary of the
occurrence of a Change in Control due to an event described in Section 3(c)(i),
(v), (viii) or (ix) which occurs prior to the first anniversary of such Change
in Control.
(d) Notice of Termination. Any termination by
the Company or by the Executive shall be communicated by Notice of Termination
to the o ther party hereto given in accordance with Section 10(b) of this
Agreement. For purposes of this Agreement, a "Notice of Termination" means a
written notice which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated and (iii) if the
Date of Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more than thirty
days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive any right of
the Executive or the Company, respectively, hereunder or preclude the Executive
or the Company, respectively, from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights hereunder.
(e) Date of Termination. "Date of Termination"
means if the Executive's employment is terminated by the Company other than for
Disability, o r by the Executive, the date of receipt of the Notice of
Termination or any later date specified therein within 30 days of such notice,
and if the Executive's employment is terminated by reason of death or
Disability, the Date of Termination shall be the date of death of the Executive
or the Disability Effective Date, as the case may be.
4. Obligations of the Company upon Termination.
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(a) Good Reason; Death; Disability; Other Than for Cause. If,
during the Employment Period, the Company shall terminate the Executive's
employment other than for Cause, or the Executive shall terminate employment for
Good Reason or the Executive's employment shall terminate on account of death or
Disability:
(i) the Company shall pay to the
Executive or his estate in a lump sum in cash within 30 days after the
Date of Termination:
(A) the amount equal to the
product of (x) three (3) and (y) the sum of the Executive's
current Annual Base Salary and the Target Bonus; and
(B) the sum of (x) the
Executive's Annual Base Salary through the Date of Termination
to the extent not theretofore paid, and (y) the product of (1)
the Target Bonus and (2) a fraction, the numerator of which is
the number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365, to the extent not theretofore
paid (the sum of the amounts described in clauses (x) and (y)
hall be hereinafter referred to as the "Accrued Obligations").
(ii) for the remainder of the Executive's
life and that of his spouse, the Company shall continue to provide
medical and dental benefits to the Executive, his spouse and children
under age 25 on the same basis, including without limitation employee
contributions, as such benefits are then currently provided to the
Executive ("Medical Benefits"); provided that such Medical Benefits
shall be secondary to any other coverage obtained by the Executive and
further provided that the aggregate cost to the Company for such
coverage shall not exceed $1,000,000.
(iii) all stock options shall vest and
remain exercisable for at least ninety days from the Date of
Termination or the earlier expiration of their term and all restricted
stock awards and other awards shall vest and become immediately
payable;
(iv) to the extent not theretofore paid
or provided, the Company shall timely pay or provide to the Executive
any other amounts or benefits required to be paid or provided or which
the Executive is eligible to receive under any plan, program, policy or
practice or contract or agreement of the Company and its affiliated
companies through the Date of Termination, and the Executive shall be p
ermitted to retain the Company automobile as provided in Section
2(b)(iv) (such other amounts and benefits shall be hereinafter referred
to as the "Other Benefits").
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Notwithstanding the foregoing provisions of this Section 4(a), if the Executive
terminates employment for Good Reason within one year of a Change in Control,
only the payment specified in paragraph (i)(B) shall be made unless (i) the
basis for such
termination is the occurrence of one or more of the circumstances set forth in
each of Section 3(c)(ii), (iii), (iv), (vi) or (vii), or (ii) the Executive's
title with the Company during such period is not that of Executive Vice
President (or such other title as shall be mutually agreed upon) or the
Executive is assigned duties inconsistent with the duties normally assigned to
an executive with such title in a financial organization of comparable size (it
being understood that no duties need be assigned to the Executive).
(b) Cause; Other than for Good Reason. If the Executive's
employment shall be terminated for Cause or the Executive terminates his
employment without Good Reason during the Employment Period, this Agreement
shall terminate without further obligations to the Executive other than the
obligation to pay to the Executive (i) his Annual Base Salary through the Date
of Termination to the extent theretofore unpaid and (ii) the Other Benefits,
provided, however that the Medical Benefits shall be paid if the Executive's
employment is terminated other than for Cause.
5. Non-exclusivity of Rights. Except as specifically provided
and subject to Section 10, nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any plan, program, policy or
practice provided by the Company or any of its affiliated companies and for
which the Executive may qualify, nor, subject to Section 10(f), shall anything
herein limit or otherwise affect such rights as the Executive may have under any
contract or agreement with the Company or any of its affiliated companies.
Amounts which are vested benefits or which the Executive is otherwise entitled
to receive under any plan, policy, practice or program of or any contract or
agreement with the Company or any of its affiliated companies at or subsequent
to the Date of Termination shall be payable in accordance with such plan,
policy, practice or program or contract or agreement except as explicitly
modified by this Agreement; provided that the Executive shall not be eligible
for severance benefits under any other program or policy of the Company.
6. Full Settlement. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement, and such amounts
shall not be reduced whether or not the Executive obtains other employment. The
Company agrees to pay as incurred, to the full extent permitted by law, all
legal fees and expenses which the Executive may reasonably incur as a result
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of
any contest (regardless of the outcome thereof) pursued or defended against in
good faith by the Executive regarding the validity or enforceability of, or
liability under, any provision of this Agreement or any guarantee of performance
thereof (including as a result of any contest by the Executive about the amount
of any payment pursuant to this Agreement), plus in each case interest on any
delayed payment at the applicable
Federal rate provided for in Section 7872(f)(2)(A) of the Internal Revenue Code
of 1986, as amended (the "Code").
7. Certain Additional Payments by the Company.
(a) Anything in this Agreement (other than in
Section 10) to the contrary notwithstanding and except as set forth below, in
the event it shall be determined that any payment or distribution by the Company
to or for the benefit of the Executive (whether paid or payable or distributed
or distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this Section
7) (a "Payment") would be subject to the excise tax imposed by Section 4999 of
the Code or any interest or penalties are incurred by the Executive with respect
to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments. Notwithstanding the foregoing provisions of this
Section 7(a), no Gross-Up Payment shall be made to the Executive if the
Executive terminates employment within one year of a Change in Control, unless
(i) such termination is by the Company without Cause, (ii) the basis for such
termination is the occurrence of one or more of the circumstances set forth in
each of Section 3(c)(ii), (iii), (iv), (vi) or (vii), or (iii) the Executive's
title with the Company during such period is not Executive Vice President (or
such other title as shall be mutually agreed upon) or the Executive is assigned
duties inconsistent with the duties normally assigned to an executive with such
title in a financial organization of comparable size (it being understood that
no duties need be assigned to the Executive).
(b) Subject to the provisions of Section 7(c),
all determinations required to be made under this Section 7, including whether
and when a Gross-Up Payment is required and the amount of such Gross-Up Payment
and the assumptions to be utilized in arriving at such determination, shall be
made by the Company's independent auditors or such other certified public
accounting firm reasonably acceptable to the Executive as may be designated by
the Company (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Company and the Executive
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within 15 business days of
the receipt of notice from the Executive that there has been a Payment, or such
earlier time as is requested by the Company. All fees and expenses of the
Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as
determined pursuant to this Section 7, shall be paid by the Company to the
Executive not
later than the due date for the payment of any Excise Tax. Any determination by
the Accounting Firm shall be binding upon the Company and the Executive. As a
result of the uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments which will not have been made by the Company
should have been made ("Underpayment"), consistent with the calculations
required to be made hereunder. In the event that the Company exhausts its
remedies pursuant to Section 7(c) and the Executive thereafter is required to
make a payment of any Excise Tax, the Accounting Firm shall determine the amount
of the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Company to or for the benefit of the Executive.
(c) The Executive shall notify the Company in
writing of any claim by the Internal Revenue Service that, if successful, would
require the payment by the Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable but no later than ten business days after
the Executive is informed in writing of such claim and shall apprise the Company
of the nature of such claim and the date on which such claim is requested to be
paid. The Executive shall not pay such claim prior to the expiration of the
30-day period following the date on which it gives such notice to the Company
(or such shorter period ending on the date that any payment of taxes with
respect to such claim is due). If the Company notifies the Executive in writing
prior to the expiration of such period that it desires to contest such claim,
the Executive shall:
(i) give the Company any information
reasonably requested by the Company relating to such claim,
(ii) take such action in connection with
contesting such claim as the Company shall reasonably request in
writing from time to time, including, without limitation, accepting
legal representation with respec to such claim by an attorney
reasonably selected by the Company,
(iii) cooperate with the Company in good
faith in order effectively to contest such claim, and
(iv) permit the Company to participate in
any proceedings relating to such claim;
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provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation on
the foregoing provisions of this Section 7(c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and xxx for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs the
Executive to pay such claim and xxx for a refund, the Company shall advance the
amount of such payment to the Executive, on an interest-free basis and shall
indemnify and hold the Executive harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any imputed income with
respect to such advance; and further provided that any extension of the statute
of limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore, the Company's control of
the contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.
(d) If, after the receipt by the Executive of an
amount advanced by the Company pursuant to Section 7(c), the Executive becomes
entitled to receive any refund with respect to such claim, the Executive shall
promptly pay to the Company the amount of such refund (together with any
interest paid or credited thereon after taxes applicable thereto). If, after the
receipt by the Executive of an amount advanced by the Company pursuant to
Section 7(c), a determination is made that the Executive shall not be entitled
to any refund with respect to such claim and the Company does not notify the
Executive in writing of its intent to contest such denial of refund prior to the
expiration of 30 days after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the amount of such advance
shall offset, to the extent thereof, the amount of Gross-Up Payment required to
be paid.
8. Covenants Not to Compete or Solicit Company Clients
and Employees; Confidential Information.
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(a) During the term of this Agreement, and for a
one year period after the Date of Termination by the Company or by the Executive
for any reason, the Executive shall not directly or indirectly, own, manage,
operate, join, control, or participate in the ownership, management, operation
or control of, or be employed by or connected in any manner with, any competing
business, whether for compensation or otherwise, without the prior written
consent of the Company. For the purposes of this
Agreement, a "competing business" shall be any business which is a significant
competitor of the Company in the New York area and has at least five (5) billion
dollars in deposits or at least five (5) billion dollars in assets under
management, unless the Executive's primary duties and responsibilities with
respect to such business are not related to the Executive's activities engaged
in for the Company within the one year period prior to the Date of Termination.
Should the Executive, directly or indirectly, own, manage, operate, join,
control or participate in the ownership, management, operation or control of, or
be employed by or connected in any manner with, any competing business, all
payments under this Agreement shall cease.
(b) During the term of this Agreement, and for a
one year period after the Date of Termination by the Company or the Executive
for any reason, the Executive shall not, in any manner, directly or indirectly,
(i) solicit any client or prospective client of the Company to whom the
Executive provided services, or for whom the Executive transacted business, or
whose identity became known to the Executive in connection with the Executive's
employment with the Company to transact business with a competing business or
reduce or refrain from doing any business with the Company or (ii) interfere
with or damage (or attempt to interfere with or damage) any relationship between
the Company and any such client or prospective client. During the term of this
Agreement and for a period of one year after the Date of Termination by the
Company or the Executive for any reason, the Executive further agrees that the
Executive shall not, in a ny manner, directly or indirectly, solicit any person
who is an employee of the Company to apply for or accept employment with any
competing business. The term "solicit" as used in this Agreement eans any
communication of any kind whatsoever, regardless of by whom initiated, inviting,
encouraging or requesting any person or entity to take or refrain from taking
any action.
(c) The Executive hereby acknowledges that, as
an employee of the Company, he will be making use of, acquiring and adding to
confidential information of a special and unique nature and value relating to
the Company and its strategic plan and financial operations. The Executive
further recognizes and acknowledges that all confidential information is the
exclusive property of the Company, is material and confidential, and is critical
to the successful conduct of the business of the Company. Accordingly, the
Executive hereby covenants and agrees that he will use confidential information
for the benefit of the Company only and shall not at any time, directly or
indirectly, during the term of this Agreement and thereafter divulge, reveal
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or
communicate anyconfidential information to any person firm, corporation or
entity whatsoever, or use any confidential information for his own benefit or
for the benefit of others. In no event shall an asserted violation of the
provisions of this Section 8(c) constitute a basis for deferring or withholding
any amounts otherwise payable to the Executive under this Agreement.
(d) Any termination of the Executive's
employment or of this Agreement shall have no effect on the continuing operation
of this Section 8.
(e) The Executive acknowledges and agrees that
the Company will hav e no adequate remedy at law, and could be irreparably
harmed, if the Executive breaches or threatens to breach any of the provisions
of this Section 8. The Executive agrees that the Company shall be entitled to
equitable and/or injunctive relief to prevent any breach or threatened breach of
this Section 8, and to specific performance of each of the terms hereof in
addition to any other legal or equitable remedies that the Company may have. The
Executive further agrees that he shall not, in any equity proceeding relating to
the enforcement of the terms of this Section 8, raise the defense that the
Company has an adequate remedy at law.
(f) The terms and provisions of this Section 8
are intended to be separate and divisible provisions and if, for any reason, any
one or more of them is held to be invalid or unenforceable, neither the validity
nor the enforceability of any other provision of this Agreement shall thereby be
affected. The parties hereto acknowledge that the potential restrictions on the
Executive's future employment imposed by this Section 8 are reasonable in both
duration and geographic scope and in all other respects. If for any reason any
court of competent jurisdiction shall find any provisions of this Section 8
unreasonable in duration or geographic scope or otherwise, the Executive and the
Company agree that the restrictions and prohibitions contained herein shall be
effective to the fullest extent allowed under applicable law in such
jurisdiction.
(g) The parties acknowledge that this Agreement
would not have been entered into and the benefits described in Sections 2 or 4
would not have been promised in the absence of the Executive's promises under
this Section 8.
9. Successors.
(a) This Agreement is personal to the Executive
and without the prior written consent of the Company shall not be assignable by
the Executive otherwise than by will or the laws of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by the
Executive's legal representatives.
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(b) This Agreement shall inure to the benefit of
and be binding upon the Company and its successors and assigns.
(c) 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 to assume
expressly 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. As used in this
Agreement, "Company" shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid.
10. No "Golden Parachute Payments" Required. Anything in this
Agreement to the contrary notwithstanding, the Company shall not be obligated to
make any payment hereunder that would be prohibited as a "golden parachute
payment" or "indemnification payment" under 12 U.S.C. ss.1828(k).
11. Miscellaneous.
(a) This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without
reference to principles of conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.
(b) All notices and other communications
hereunder shall be in writing and shall be given by hand delivery to the other
party or by registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Executive:
Xxxx X. Xxxxxxx
0 Xxxxxxxx Xxxx
Xxxxxxxx, X.X. 00000
If to the Company:
Republic New York Corporation
000 Xxxxx Xxxxxx
Xxx Xxxx, X.X. 00000
Telecopy Number: (000) 000-0000
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Attention: Xxx X. Xxxxxxx
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) The invalidity or unenforceability of any
provision of this Agreement shall not affec t the validity or enforceability of
any other provision of this Agreement.
(d) The Company may withhold from any amounts
payable under this Agreement such Federal, state, local or foreign taxes as
shall be required to be withheld pursuant to any applicable law or regulation.
(e) The Executive's or the Company's failure to
insist upo n strict compliance with any provision of this Agreement or the
failure to assert any right the Executive or the Company may have hereunder,
including, without limitation, the right of the Executive to terminate
employment for Good Reason pursuant to Section 3(c)(i)-(iv) of this Agreement,
shall not be deemed to be a waiver of such provision or right or any other
provision or right of this Agreement.
(f) From and after the Effective Date this
Agreement shall supersede any other employment agreement between the parties
with respect to the subject matter hereof.
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(g) Subject to the provisions of Section 4(a),
there shall be no limitation on the ability of the Company to terminate the
Executive at any time with or without Cause.
IN WITNESS WHEREOF, the Executive has hereunto set the
Executive's hand and, pursuant to the authorization from its Board of Directors,
the Company has caused these presents to be executed in its name on its behalf,
all as of the day and year first above written.
/s/ Xxxx X. Xxxxxxx
-------------------
REPUBLIC NEW YORK CORPORATION
By: /s/ Xxx X. Xxxxxxx
----------------------
Title: Chairman & Chief
Executive Officer
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REPUBLIC NEW YORK CORPORATION
000 XXXXX XXXXXX
XXX XXXX, X.X. 00000
XXX X. XXXXXXX
Chairman and
Chief Executive Officer
TEL (000) 000-0000
Bonuses Payable Under Employment Agreement
Dear Veto X. Xxxxxxx:
This is to confirm the understanding of the parties regarding the proper
interpretation of Section 2(b)(ii) of the Employment Agreement (the "Agreement")
by and between Republic New York Corporation (the "Company") and you, dated as
of April 30, 1999, in the event that there is a Change in Control (as defined in
such Agreement).
We have agreed that, the consummation of the transaction contemplated
under the Transaction Agreement and Plan of Merger by and among HSBC Holdings
plc, Republic New York Corporation and Safra Republic Holdings S.A., dated as of
May 10, 1999, (the "Merger") would result in a Change in Control of the Company.
Further, we have agreed that under such Section 2(b)(ii), in the event such
Change in Control pursuant to the Merger occurs and the Company has "net income"
(as defined in the Performance Plan as in effect on April 30, 1999 and
determined consistently with past practice) from it continuing operations, you
will be paid a bonus for the year in which such Change in Control occurs and in
each subsequent year until the end or the Employment Period (as defined in the
Agreement) equal to the target level of bonus specified in such Section 2(b)(ii)
and that no additional bonus would be due under the Performance Plan. This
interpretation shall not preclude the Company from paying you a bonus in excess
of such targeted amount if, in its discretion and in accordance with the
applicable governing procedures then in effect, the Company determines that an
additional amount is warranted.
To indicate your agreement with this interpretation of Section 2(b)(ii)
of the Agreement in connection with the Merger, please sign your name where
indicated below and return one copy of this letter to the undersigned. Keep the
other copy for your records.
REPUBLIC NEW YORK CORPORATION
/s/ Xxx X. Xxxxxxx
------------------
By: Xxx X. Xxxxxxx
AGREED AND ACCEPTED:
/s/ Xxxx X. Xxxxxxx
-------------------
Dated: Sept. 28, 1999
