1
Exhibit 10.29
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (the "Agreement") entered into as of January
1, 2000, by and between Nationwide Mutual Insurance Company (the "Company") and
Xxxxxx Xxxxxx ("Executive").
WHEREAS, both parties desire to enter into an agreement to reflect
Executive's executive capacities in the Company's business and to provide for
Executive's continued employment by the Company, upon the terms and conditions
set forth herein.
WHEREAS, Executive has agreed to certain confidentiality,
non-competition and non-solicitation covenants contained hereunder, in
consideration of the additional benefits provided to Executive under this
Agreement.
WHEREAS, certain capitalized terms shall have the meanings given those
terms in Section 4 of this Agreement.
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. EMPLOYMENT. The Company hereby agrees to employ Executive, and
Executive hereby accepts such employment and agrees to perform Executive's
duties and responsibilities, in accordance with the terms, conditions and
provisions hereinafter set forth.
1.1. EMPLOYMENT TERM. This Agreement shall be effective as of the date
set forth above, and shall continue until December 31, 2001, unless the
Agreement is terminated sooner in accordance with Section 2 or 3 below. In
addition, the term of the Agreement shall automatically renew for periods of one
year unless either party gives written notice to the other party, at least 60
days prior to the end of the initial term or at least 60 days prior to the end
of any one-year renewal period, that the Agreement shall not be further
extended. The period commencing on the effective date and ending on the date on
which the term of Executive's employment under the Agreement shall terminate is
hereinafter referred to as the "Employment Term." If a Change of Control (as
defined in Section 4) occurs, the Employment Term shall be automatically
extended to the later of (i) the end of the then existing initial or renewal
period or (ii) the date that is two years after the Change of Control, unless
the Employment Term is sooner terminated according to Section 2 or 3 below. The
failure of the Company to renew this Agreement shall not be considered a
termination of Executive's employment under this Agreement and shall not give
Executive grounds to terminate employment for Good Reason (as defined in Section
4) under this Agreement.
2
1.2. DUTIES AND RESPONSIBILITIES. During the Employment Term, Executive
shall serve as the Executive Vice President, Chief Financial Officer of the
Company, or in such other executive positions as the Board of Directors of the
Company (the "Board") determines. Executive shall perform all duties and accept
all responsibilities incident to such position or as may be reasonably assigned
to him by the Board.
1.3. EXTENT OF SERVICE. During the Employment Term, Executive agrees to
use Executive's full and best efforts to carry out Executive's duties and
responsibilities under Section 1.2 hereof with the highest degree of loyalty and
the highest standards of care and, consistent with the other provisions of this
Agreement, Executive agrees to devote substantially all of Executive's business
time, attention and energy thereto. The foregoing shall not be construed as
preventing Executive from making investments in other businesses or enterprises,
provided that Executive agrees not to become engaged in any other business
activity which, in the reasonable judgment of the Board, is likely to interfere
with Executive's ability to discharge Executive's duties and responsibilities to
the Company. The Executive will not serve on the board of directors of an entity
unrelated to the Company (other than a non-profit charitable organization)
without the consent of the Board.
1.4. BASE SALARY. During the Employment Term, for all the services
rendered by Executive hereunder, the Company shall pay Executive a base salary
("Base Salary"), at the annual rate in effect on the date on this Agreement,
payable in installments at such times as the Company customarily pays its other
employees. Executive's Base Salary shall be reviewed periodically for
appropriate increases by the Board (or a committee of the Board) pursuant to the
Board's normal performance review policies for senior level executives.
1.5. RETIREMENT, WELFARE AND OTHER BENEFIT PLANS AND PROGRAMS. During
the Employment Term, Executive shall be entitled to participate in all employee
retirement and welfare benefit plans and programs made available to the
Company's senior level executives as a group, as such retirement and welfare
plans may be in effect from time to time and subject to the eligibility
requirements of such plans. During the Employment Term, Executive shall be
provided with a Company automobile and other executive fringe benefits and
perquisites under the same terms as those made available to the Company's senior
level executives as a group, as such programs may be in effect from time to
time. During the Employment Term, Executive shall be entitled to vacation and
sick leave in accordance with the Company's vacation, holiday and other pay for
time not worked policies. Nothing in this Agreement shall prevent the Company
from amending or terminating any retirement, welfare or other employee benefit
plans, programs, policies or perquisites from time to time as the Company deems
appropriate.
1.6. REIMBURSEMENT OF EXPENSES. During the Employment Term, Executive
shall be provided with reimbursement of reasonable expenses related to
Executive's employment by the Company on a basis no less favorable than that
which may be authorized from time to time for senior level executives as a
group.
-2-
3
1.7. INCENTIVE COMPENSATION. During the Employment Term, Executive
shall be entitled to participate in all short-term and long-term incentive
programs established by the Company for its senior level executives generally,
at levels commensurate with the benefits provided to other senior executives and
Executive's position with the Company. Executive's incentive compensation shall
be subject to the terms of the applicable plans and shall be determined based on
Executive's individual performance and Company performance as determined by the
Board (or a committee of the Board).
2. TERMINATION. Executive's employment shall terminate upon the
occurrence of any of the following events:
2.1. TERMINATION WITHOUT CAUSE.The Company (by action of the Board) may
remove Executive at any time without Cause (as defined in Section 4) from the
position in which Executive is employed hereunder (in which case the Employment
Term shall be deemed to have ended) upon not less than 60 days' prior written
notice pursuant to Section 15 to Executive; provided, however, that, in the
event that such notice is given, Executive shall be under no obligation to
render any additional services to the Company and shall be allowed to seek other
employment.
2.2. RESIGNATION FOR GOOD REASON AFTER A SUBSTANTIAL REORGANIZATION. If
the Board determines for purposes of this Agreement that a substantial
reorganization of the Company has occurred, the Board may establish a period of
time during which Executive may elect to resign if an event constituting Good
Reason (as defined in Section 4) occurs. In that event, Executive may initiate
termination of employment by resigning under this Section 2.2 for Good Reason
during the period specified by the Board. Executive shall give the Company not
less than 60 days prior written notice pursuant to Section 15 of such
resignation.
2.3. BENEFITS PAYABLE UPON TERMINATION WITHOUT CAUSE OR RESIGNATION FOR
GOOD REASON AFTER A SUBSTANTIAL REORGANIZATION.
(a) Upon any removal or resignation described in Section 2.1
or 2.2 above, Executive shall be entitled to receive only the amount due to
Executive under the Company's then current severance pay plan for employees, if
any. No other payments or benefits shall be due under this Agreement to
Executive, but Executive shall be entitled to any benefits accrued or earned in
accordance with the terms of any applicable benefit plans and programs of the
Company.
(b) Notwithstanding the provisions of Section 2.3(a), in the
event of a removal or resignation described in Section 2.1 or 2.2 during the
Employment Term, if Executive executes and does not revoke a written release
upon such removal or resignation, substantially in the form attached hereto as
EXHIBIT A (the "Release"), of any and all claims against the Company and all
related parties with respect to all matters arising out of Executive's
employment by the Company, or the termination thereof (other than claims based
upon any severance entitlements under the
-3-
4
terms of this Agreement or entitlements under any plans or programs of the
Company under which Executive has accrued a benefit), Executive shall be
entitled to receive the severance benefits described below, in lieu of the
payment described in Section 2.3(a). Payment of the lump sum benefits described
below (other than as described in subsections (ii) and (iv) below) shall be made
within 30 days after Executive's Termination Date (as defined in Section 4) or
the end of the revocation period for the Release, if later.
(i) Executive shall receive a lump sum cash payment
equal to two times Executive's annual Base Salary in effect immediately before
the Termination Date (including salary reduction amounts of Base Salary under
the Company's benefit plans and programs).
(ii) Executive shall receive Executive's annual
short-term incentive bonus (PIP) for the year in which Executive's Termination
Date occurs, at the time that annual bonuses for the year are paid to other
executives, based on the Company's actual performance for the year, but in an
amount not less than Executive's target annual bonus in effect for the year.
(iii) The Company shall pay Executive an amount equal
to the after-tax cost to the Executive of continuing the medical and dental
coverage under COBRA or the Company's retiree medical plan, if applicable, for
Executive, and, where applicable, his or her spouse and dependents, for the
greater of (x) the 18-month period following the Termination Date or (y) the
Severance Period (as defined in Section 4). The COBRA health care continuation
coverage period under Section 4980B of the Code (as defined in Section 4) shall
run concurrently with the period described in the preceding sentence.
(iv) Executive shall receive the following lump sum
payments with respect to the long-term incentive awards (LTPP) in effect for
Executive at his or her Termination Date:
(x) Executive shall receive a pro rated
portion of each outstanding long-term incentive award for which
Executive's Termination Date does not occur in the final year of the
award period (for example, if the award period is three years, the
awards for which the Termination Date occurs in year one or two). The
pro rated payment for each such long-term incentive award shall be
computed as the target incentive award in effect for Executive
multiplied by a fraction, the numerator of which is the number of years
that the incentive award has been outstanding (including the year in
which the Termination Date occurs as a whole year) and the denominator
of which is the number of years in the incentive award period.
(y) Executive shall receive each long-term
incentive award for which Executive's Termination Date occurs in the
final year of the award period, at the time that such long-term
incentive awards are paid to other executives, based on the Company's
actual performance for the award period, but in an amount not less than
Executive's target long-term incentive award in effect for such period.
-4-
5
The foregoing payments shall be made under the Company's long-term incentive
plan, to the extent consistent with the terms of such plan. If the payments
calculated above exceed the payments actually made to Executive under the
Company's long-term incentive plan with respect to the foregoing awards, any
such excess amount shall be paid to Executive under this Agreement.
(v) Executive's outstanding stock options and
restricted stock with respect to stock of Nationwide Financial Services, Inc. or
any Affiliate of the Company which were granted after March 5, 1997 shall become
vested and exercisable on the Termination Date to the extent that such options
and restricted stock would have become vested and exercisable on the next
vesting date had Executive remained an employee of the Company. All other
unvested stock options and restricted stock shall be forfeited, except to the
extent that the applicable grant agreement requires otherwise. No additional
grants shall be made to Executive after Executive's termination of employment.
(vi) Executive shall receive supplemental benefits
under this Agreement equal to:
(A) the benefits that Executive would have received under the
Nationwide Retirement Plan, Nationwide Supplemental Retirement Plan,
Nationwide Excess Benefit Plan, Nationwide Savings Plan, Nationwide
Supplemental Defined Contribution Plan and Nationwide Individual
Deferred Compensation Plan, as in effect at Executive's Termination
Date, had Executive's benefits under those Plans been fully vested as
of Executive's Termination Date, reduced by
(B) the benefits that Executive actually receives under the
Nationwide Retirement Plan, Nationwide Supplemental Retirement Plan,
Nationwide Excess Benefit Plan, Nationwide Savings Plan, Nationwide
Supplemental Defined Contribution Plan and Nationwide Individual
Deferred Compensation Plan.
The benefits under this subsection (vi) shall be paid in the same forms and at
the same times as Executive's benefits under the applicable Plans described
above are paid (or would have been paid had Executive's interests in the
applicable Plans been fully vested); provided that payments with respect to
benefits under the Nationwide Retirement Plan, Nationwide Supplemental
Retirement Plan and Nationwide Excess Benefit Plan shall not begin until after
the end of the Severance Period. The benefits payable under this subsection (vi)
and subsection (vii) below shall not result in any duplication of benefits.
(vii) If Executive's Termination Date occurs within
three years of the date on which Executive would have been first eligible to
retire under the Nationwide Retirement Plan, Executive shall receive a
supplemental benefit under this Agreement equal to:
-5-
6
(A) the benefits that Executive would have received under the
Nationwide Retirement Plan, Nationwide Supplemental Retirement Plan and
Nationwide Excess Benefit Plan as in effect at Executive's Termination
Date, had Executive earned service and age credit for the period ending
on the first to occur of (i) three years after the Termination Date or
(ii) the earliest date on which Executive would have been eligible to
retire under the Nationwide Retirement Plan, and had Executive been
fully vested in his or her benefit under such Plans, reduced by
(B) the benefits that Executive actually receives under the
Nationwide Retirement Plan, Nationwide Supplemental Retirement Plan and
Nationwide Excess Benefit Plan, and the benefits payable under
subsection (vi) above with respect to the Nationwide Retirement Plan,
Nationwide Supplemental Retirement Plan and Nationwide Excess Benefit
Plan.
The benefits under this subsection (vii) shall be paid after the end of the
Severance Period in the same forms and at the same times as Executive's benefits
under the applicable Nationwide Plans are paid (or would have been paid had
Executive's interests in the applicable Plans been fully vested).
(viii) The Company shall pay Executive a lump sum
cash payment equal to the matching contributions that the Company would have
made for Executive under the Nationwide Savings Plan and the Nationwide
Supplemental Defined Contribution Plan, as in effect at Executive's Termination
Date, had Executive continued in employment for the Severance Period, receiving
compensation at a rate equal to Executive's covered compensation amount for the
calendar year prior to the year in which the Termination Date occurs and making
the same level of contributions to the applicable plans as in effect for
Executive immediately before Executive's Termination Date.
(ix) The Company shall cause Executive to receive
service and age credit for purposes of eligibility under the Company's retiree
medical plan, and service credit for purposes of cost-sharing, until the end of
the Severance Period, as if Executive had continued in employment during the
Severance Period.
(x) During the Severance Period, the Company shall
pay or reimburse Executive for the cost of outplacement assistance services (not
to exceed a total of $11,000) provided by any outplacement agency selected by
Executive.
(xi) During the Severance Period, the Company shall
pay or reimburse Executive for financial counseling services from the Company's
financial counseling vendor in an annual amount equal to the value of the
financial counseling services provided by the Company annually to Executive
immediately before Executive's Termination Date.
-6-
7
(xii) Executive shall have the right to purchase from
the Company the Company-provided automobile used by Executive at Executive's
Termination Date, at a price equal to the then fair market value of the
automobile.
(xiii) Executive shall have the right to retain the
computer, printer, fax machine and office furniture that was provided by the
Company for use by Executive at his or her residence at the Termination Date.
(xiv) Executive can elect to have the Company
transfer to Executive the country club membership that Executive received in
connection with his or her employment with the Company, or Executive can elect
to have the Company provide a loss of membership payment to Executive under the
terms of the Company's country club membership program in effect for senior
level executives at Executive's Termination Date.
(xv) Executive shall receive any other amounts
earned, accrued or owing but not yet paid under Section 1 above and any other
benefits in accordance with the terms of any applicable plans and programs of
the Company.
2.4. RETIREMENT OR OTHER VOLUNTARY TERMINATION. Executive may
voluntarily terminate employment for any reason, including voluntary retirement,
upon 60 days' prior written notice pursuant to Section 15. In such event, after
the effective date of such termination, except as provided in Section 2.2 or 3.3
(with respect to a resignation for Good Reason), no further payments shall be
due under this Agreement. However, Executive shall be entitled to any benefits
due in accordance with the terms of any applicable benefit plans and programs of
the Company.
2.5. DISABILITY. The Company (by action of the Board) may terminate
Executive's employment if Executive has been unable to perform the essential
functions of his or her position with the Company, with or without reasonable
accommodation, by reason of physical or mental incapacity for a period of six
consecutive months ("Disability"); provided, however, that the Company shall
continue to pay Executive's Base Salary until the Company acts to terminate
Executive's employment. Executive agrees, in the event of a dispute under this
Section 2.5 relating to Executive's Disability, to submit to a physical
examination by a licensed physician selected by the Board. Executive
acknowledges that the provisions of this Section 2.5 supersede the employment
termination provisions otherwise applied to disabled employees. If Executive's
employment terminates on account of Disability, no further payments shall be due
under this Agreement. However, Executive shall be entitled to (i) any benefits
due in accordance with the terms of any applicable benefit plans and programs of
the Company and (ii) a pro rated bonus for the year in which Executive's
Disability occurs, which bonus shall be calculated according to Section
2.3(b)(ii) above.
2.6. DEATH. If Executive dies while employed by the Company, the
Company shall pay to Executive's executor, legal representative, administrator
or designated beneficiary, as applicable, (i) any amounts earned, accrued or
owing but not yet paid under Section 1 above and
-7-
8
any benefits accrued or earned under the Company's benefit plans and programs
according to the terms of such plans and (ii) a pro rated bonus for the year in
which Executive's death occurs, which bonus shall be calculated according to
Section 2.3(b)(ii) above. Otherwise, the Company shall have no further liability
or obligation under this Agreement to Executive's executors, legal
representatives, administrators, heirs or assigns.
2.7. CAUSE. The Company (by action of the Board) may terminate
Executive's employment at any time for Cause upon written notice to Executive,
in which event all payments under this Agreement shall cease, except for Base
Salary to the extent already accrued. Executive shall be entitled to any
benefits accrued or earned before his or her termination in accordance with the
terms of any applicable benefit plans and programs of the Company; provided that
Executive shall not be entitled to receive any unpaid short-term or long-term
cash incentive payments or unvested options.
3. CHANGE OF CONTROL.
3.1. EFFECT OF CHANGE OF CONTROL. If a Change of Control occurs and
Executive's employment terminates under the circumstances described below, the
provisions of this Section 3 shall apply, instead of the provisions of Section
2.1, 2.2 and 2.3.
3.2. TERMINATION WITHOUT CAUSE UPON OR AFTER A CHANGE OF CONTROL. Upon
or after a Change of Control, the Company (by action of the Board) may remove
Executive at any time without Cause from the position in which Executive is
employed hereunder (in which case the Employment Term shall be deemed to have
ended) upon not less than 60 days' prior written notice pursuant to Section 15
to Executive; provided, however, that, in the event that such notice is given,
Executive shall be under no obligation to render any additional services to the
Company and shall be allowed to seek other employment.
3.3. RESIGNATION FOR GOOD REASON UPON OR AFTER A CHANGE OF CONTROL.
Upon or after a Change of Control, Executive may initiate termination of
employment by resigning under this Section 3 for Good Reason (as defined in
Section 4). Executive shall give the Company not less than 60 days' prior
written notice pursuant to Section 15 of such resignation.
3.4. BENEFITS PAYABLE UPON TERMINATION WITHOUT CAUSE OR RESIGNATION FOR
GOOD REASON UPON OR AFTER A CHANGE OF CONTROL.
(a) Upon any removal or resignation described in Section 3.2
or 3.3 above, Executive shall be entitled to receive only the amount due to
Executive under the Company's then current severance pay plan for employees, if
any. No other payments or benefits shall be due under this Agreement to
Executive, but Executive shall be entitled to any benefits accrued or
-8-
9
earned in accordance with the terms of any applicable benefit plans and programs
of the Company.
(b) Notwithstanding the provisions of Section 3.4(a), in the
event of a removal or resignation described in Section 3.2 or 3.3 that occurs
upon or after a Change of Control and during the Employment Term, if Executive
executes and does not revoke a written Release upon such removal or resignation,
Executive shall be entitled to receive the severance benefits described below,
in lieu of the payment described in Section 3.4(a). Payment of the lump sum
benefits described below (other than as described in subsection (ii) below)
shall be made within 30 days after Executive's Termination Date or the end of
the revocation period for the Release, if later.
(i) Executive shall receive a lump sum cash payment
equal to three times Executive's Compensation.
(ii) Executive shall receive Executive's annual
short-term incentive bonus (PIP) for the year in which Executive's Termination
Date occurs, at the time that annual bonuses for the year are paid to other
executives, based on the Company's performance for the year but in an amount not
less than Executive's target annual bonus in effect for the year in which the
Termination Date occurs.
(iii) During the Severance Period, the Company shall
cause Executive, and, where applicable, his or her spouse and dependents, to
continue to be eligible for the medical, dental and life insurance coverage in
effect immediately before the Change of Control (or generally comparable
coverage) as if Executive had continued in employment during the Severance
Period, and the Company shall pay the cost of such coverage; or, as an
alternative, at the Company's election, the Company may pay Executive cash in
lieu of such coverage in an amount equal to Executive's after-tax cost of
continuing such coverage. The COBRA health care continuation coverage period
under Section 4980B of the Code shall run concurrently with the Severance
Period. If Executive qualifies for retiree medical coverage from the Company
during any portion of the Severance Period, the Company may provide such retiree
medical coverage during such portion of the Severance Period in lieu of the
foregoing coverage.
(iv) Executive shall receive a lump sum payment equal
to the long-term incentive awards (LTPP) in effect for Executive on the
Termination Date, based on the Company's actual performance through the
Termination Date, but in an amount not less than the total target long-term
incentive awards in effect for Executive on the Termination Date. The foregoing
payment shall be made under the Company's long-term incentive plan, to the
extent consistent with the terms of such plan. If the payment calculated above
exceeds the payment actually made to Executive under the Company's long-term
incentive plan with respect to the foregoing awards, any such excess benefit
shall be paid to Executive under this Agreement.
(v) All stock options and restricted stock with
respect to stock of Nationwide Financial Services, Inc. or any Affiliate of the
Company that are held by Executive
-9-
10
and were granted after March 5, 1997 shall become fully vested and exercisable
as of the Termination Date (if not already vested and exercisable pursuant to
the terms of the applicable plan).
(vi) Executive shall receive a supplemental benefit
under this Agreement equal to:
(A) the benefits that Executive would have received under the
Nationwide Savings Plan, Nationwide Supplemental Defined Contribution
Plan and Nationwide Individual Deferred Compensation Plan, as in effect
immediately before the Change of Control had Executive's benefits under
those Plans been fully vested as of Executive's Termination Date,
reduced by
(B) the benefits that Executive actually receives under the
Nationwide Savings Plan, Nationwide Supplemental Defined Contribution
Plan and Nationwide Individual Deferred Compensation Plan.
The benefits under this subsection (vi) shall be paid in the same forms and at
the same times as the benefits under the applicable Plans described above are
paid (or would have been paid had Executive's interests in the applicable Plans
been fully vested), as in effect immediately before the Change of Control. The
benefits under this subsection (vi) and subsection (vii) below shall not result
in any duplication of benefits.
(vii) Executive shall receive a supplemental benefit
under this Agreement equal to:
(A) the benefits that Executive would have received under the
Nationwide Retirement Plan, Nationwide Supplemental Retirement Plan and
Nationwide Excess Benefit Plan had Executive received credit for
eligibility, age, compensation and benefit accrual purposes during the
Severance Period under the Nationwide Retirement Plan, Nationwide
Supplemental Retirement Plan and Nationwide Excess Benefit Plan, each
as in effect immediately before the Change of Control, calculated as if
Executive had continued in employment during the Severance Period,
receiving compensation at the same times as compensation is normally
paid and in amounts equal to the Compensation, and as if Executive had
been fully vested in his or her benefits under such Plans, reduced by
(B) the benefits that Executive actually receives under the
Nationwide Retirement Plan, Nationwide Supplemental Retirement Plan and
Nationwide Excess Benefit Plan.
The benefits under this subsection (vii) shall be paid after the end of the
Severance Period in the same forms and at the same times as benefits under the
applicable Plans described above are paid
-10-
11
(or would have been paid had Executive's interests in the applicable Plans been
fully vested), as in effect immediately before the Change of Control.
(viii) The Company shall pay Executive a lump sum
cash payment equal to the matching contributions that the Company would have
made for Executive under the Nationwide Savings Plan and the Nationwide
Supplemental Defined Contribution Plan, as in effect immediately before the
Change of Control, had Executive continued in employment for the Severance
Period receiving Executive's Compensation and making the same level of
contributions to the applicable plans as in effect immediately before
Executive's Termination Date.
(ix) The Company shall cause Executive to receive
service and age credit for purposes of eligibility, and service credit for
purposes of cost-sharing, under the Company's retiree medical plan until the end
of the Severance Period, as if Executive had continued in employment during that
period.
(x) During the Severance Period, the Company shall
pay or reimburse Executive for the cost of outplacement assistance services (not
to exceed a total of $11,000) provided by any outplacement agency selected by
Executive.
(xi) During the Severance Period, the Company shall
pay or reimburse Executive for financial counseling services from the Company's
financial counseling vendor in an annual amount equal to the value of the
financial counseling services provided by the Company annually to Executive
immediately before the Change of Control.
(xii) Executive may continue to use the
Company-provided automobile used by Executive at Executive's Termination Date
during the Severance Period. At the end of the Severance Period, Executive shall
have the right to purchase the automobile from the Company, at a price equal to
the then fair market value of the automobile.
(xiii) Executive shall have the right to retain the
computer, printer, fax machine and office furniture that was provided by the
Company for use by Executive at his or her residence at the Termination Date.
(xiv) During the Severance Period, the Company shall
continue to pay the dues on the country club membership that Executive received
in connection with his or her employment with the Company. At the end of the
Severance Period, Executive can elect to have the Company transfer the country
club membership to Executive, or Executive can elect to have the Company provide
a loss of membership payment to Executive under the terms of the Company's
country club membership program in effect for senior level executives at
Executive's Termination Date.
-11-
12
(xv) Executive shall receive any other amounts
earned, accrued or owing but not yet paid under Section 1 above and any other
benefits in accordance with the terms of any applicable plans and programs of
the Company.
3.5. INCREASE IN PAYMENTS UPON A CHANGE OF CONTROL.
(a) Anything in this Agreement to the contrary
notwithstanding, in the event that it shall be determined that any payment or
distribution by the Company to or for the benefit of Executive, whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise (a "Payment"), would constitute an "excess parachute payment"
within the meaning of Section 280G of the Code, the Company shall pay Executive
an additional amount (the "Gross-Up Payment") such that the net amount retained
by Executive after deduction of any excise tax imposed under Section 4999 of the
Code, and any federal, state and local income tax, employment tax and excise tax
imposed upon the Gross-Up Payment, shall be equal to the Payment. For purposes
of determining the amount of the Gross-Up Payment, unless Executive specifies
that other rates apply, Executive shall be deemed to pay federal income tax and
employment taxes at the highest marginal rate of federal income and employment
taxation in the calendar year in which the Gross-Up Payment is to be made and
state and local income taxes at the highest marginal rate of taxation in the
state and locality of Executive's residence on Executive's Termination Date, net
of the maximum reduction in federal income taxes that may be obtained from the
deduction of such state and local taxes.
(b) All determinations to be made under this Section 3.5 shall
be made by the Company's independent public accountant immediately prior to the
Change of Control (the "Accounting Firm"), which firm shall provide its
determinations and any supporting calculations both to the Company and Executive
within 20 days after Executive's Termination Date. Any such determination by the
Accounting Firm shall be binding upon the Company and Executive. Within ten days
after the Accounting Firm's determination, the Company shall pay the Gross-Up
Payment to Executive.
(c) 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 a Gross-Up Payment. Such notification shall be given as soon
as practicable but no later than ten business days after Executive knows 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. Executive shall not pay such claim
prior to the expiration of the 30-day period following the date on which
Executive 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 Executive in writing prior to the expiration of such period
that it desires to contest such claim, Executive shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
-12-
13
(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 respect to
such claim by an attorney reasonably selected by the Company,
(iii) cooperate with the Company in good faith in
order to contest such claim effectively, and
(iv) permit the Company to participate in any
proceedings relating to such claim;
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 Executive harmless, on an
after-tax basis, for any excise tax, income tax or employment 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 3.5, the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forego any and all administrative appeals, proceedings, hearing and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct Executive to pay the tax claimed and xxx for a refund
or contest the claim in any permissible manner, and Executive agrees to
prosecute such contest to a termination before any administrative tribunal, in a
court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine. If the Company directs Executive to pay such claim and
xxx for a refund, the Company shall advance the amount of such payment to
Executive, on an interest-free basis and shall indemnify and hold Executive
harmless, on an after-tax basis, from any excise tax, income tax or employment
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. Any extension of the statute of limitations relating to payment of
taxes for the taxable year of Executive with respect to which such contested
amount is claimed to be due shall be limited solely to such contested amount.
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 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 Executive of an amount advanced
by the Company pursuant to this Section, Executive becomes entitled to receive
any refund with respect to such claim, Executive shall (subject to the Company's
complying with the requirements of subsection (b)) 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 Executive of an amount
advanced by the Company pursuant to this Section, a determination is made that
Executive shall not be entitled to any refund with respect to such claim and the
Company does not notify 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
-13-
14
repaid and the amount of such advance shall offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid.
(e) All of the fees and expenses of the Accounting Firm in
performing the determinations referred to in subsections (b), (c) and (d) above
shall be borne solely by the Company. The Company agrees to indemnify and hold
harmless the Accounting Firm from any and all claims, damages and expenses
resulting from or relating to its determinations pursuant to subsections (b),
(c) and (d) above, except for claims, damages or expenses resulting from the
gross negligence or wilful misconduct of the Accounting Firm.
4. DEFINITIONS. For purposes of this Agreement, the following terms
shall have the meanings specified in this Section 4:
(a) "AFFILIATE" shall mean any subsidiary of the Company and
any other entity that, directly or indirectly, through one or more
intermediaries, is controlled by or is under common control with the Company, as
determined by the Board.
(b) "CAUSE" shall mean any of the following grounds for
termination of Executive's employment:
(i) Executive shall have been convicted of a felony;
(ii) Executive neglects, refuses or fails to perform
his or her material duties to the Company (other than a failure
resulting from Executive's incapacity due to physical or mental
illness), which failure has continued for a period of at least 30 days
after a written notice of demand for substantial performance, signed by
a duly authorized officer of the Company, has been delivered to
Executive specifying the manner in which Executive has failed
substantially to perform;
(iii) Executive engages in misconduct in the
performance of his or her duties;
(iv) Executive engages in public conduct that is
harmful to the reputation of the Company;
(v) Executive breaches any written non-competition,
non-disclosure or non-solicitation agreement in effect with the
Company, including without limitation the provisions of Section 6 or 7
of this Agreement; or
(vi) Executive breaches the Company's written code of
business conduct and ethics.
(c) "CHANGE OF CONTROL" shall mean the happening of any of the
following events with respect to the Company, as described in subsections (i)
and (ii) below:
-14-
15
(i) The following events shall constitute a Change of
Control:
(A) A sale or other disposition of all or substantially all of
the assets of the Company;
(B) A liquidation or dissolution of the Company;
(C) A change in the composition of 50% or more of the members
of the Board as a result of a merger, financial arrangement (such as
the sale of surplus notes of the Company) or other corporate
transaction, such that the directors who were members of the Board
immediately before the transaction cease, within two years after the
transaction, to constitute 50% or more of the board of directors of the
Company or the successor corporation;
(D) Entry into an affiliation agreement giving any individual,
entity or group, other than policyholders, the power to direct or cause
the direction of the management and policies of the Company;
(E) Entry into an agreement reinsuring all or substantially
all the business of the Company (other than through an Affiliate of the
Company); or
(F) Consummation of a sale or other disposition of a
controlling interest in the Company, other than to a direct or indirect
wholly owned subsidiary of the Company.
(ii) In addition to the foregoing, the Board may
determine, in its sole discretion, that any of the events described below shall
constitute a Change of Control for purposes of this Agreement. None of the
events described in this Section 4(c)(ii) shall be considered a Change of
Control for purposes of this Agreement unless the Board determines, in a written
resolution, that the event shall be considered a Change of Control for purposes
of this Agreement, and nothing in this Agreement shall obligate the Board to
make any such determination. The following events may constitute a Change of
Control if so designated by the Board:
(A) A demutualization of the Company;
(B) Establishment of a mutual holding company structure for
the Company; or
(C) Any reorganization or other event that the Board considers
appropriate to characterize as a Change of Control for purposes of this
Agreement.
(d) "CODE" shall mean the Internal Revenue Code of 1986, as
amended.
-15-
16
(e) "COMPENSATION" shall mean (i) Executive's annualized Base
Salary in effect at Executive's Termination Date (or immediately before a Change
of Control, if greater), plus (ii) the target annual bonus in effect for
Executive for the year in which the Termination Date occurs (or the year in
which a Change of Control occurs, if greater), together with (iii) all salary
reduction authorized amounts of such compensation under any of the Company's
benefit plans or programs for such calendar year. "Compensation" shall not
include the value of any long-term incentive compensation, restricted stock or
stock options or any exercise thereunder.
(f) "EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as amended.
(g) "GOOD REASON" shall mean the occurrence of any of the
following events, except in connection with the termination of Executive's
employment for Disability, Cause, as a result of death or by Executive other
than for Good Reason and except as provided in the last sentence of this
subsection (g):
(i) A change in Executive's position and
responsibilities (including reporting responsibilities) that represents
a substantial diminution, as reasonably determined by the Board, of
Executive's position and responsibilities as in effect immediately
prior thereto;
(ii) The relocation of the offices of the Company at
which Executive is principally employed to a location more than 50
miles from the location of such offices immediately prior to the
relocation, or the Company's requiring Executive to be based anywhere
other than such offices, except for required travel on the Company's
business to an extent substantially consistent with the Executive's
business travel obligations at the date of this Agreement;
(iii) The failure of the Company to provide Executive
with aggregate compensation (Base Salary and target long-term and
short-term incentive compensation) or aggregate benefits that are at
least equal (in terms of benefit levels and reward opportunities) to
those provided by the Company to Executive immediately before the
change; provided, however, that a change in compensation or benefits
for all executives of the Company, in which Executive is treated
similarly as all other executives of a comparable responsibility level,
shall not constitute Good Reason under this Agreement; or
(iv) The failure of the Company to obtain from its
successors the express assumption and agreement required under Section
16 hereof.
Notwithstanding the foregoing, Executive shall not have Good Reason for
termination if, within 60 days after the date on which Executive gives notice of
his or her termination, as provided in
-16-
17
Section 5, the Company corrects the action or failure to act that constitutes
the grounds for termination for Good Reason as set forth in Executive's notice
of termination.
(h) "TERMINATION DATE" shall mean the effective date of the
termination of Executive's employment relationship with the Company pursuant to
this Agreement.
(i) "SEVERANCE PERIOD" shall mean (x) in the event of a
termination of employment before a Change of Control, the period beginning on
Executive's Termination Date and ending two years after the Termination Date and
(y) in the event of a termination of employment at or after a Change of Control,
the period beginning on Executive's Termination Date and ending three years
after the Termination Date.
5. NOTICE OF TERMINATION. Any termination of Executive's employment
shall be communicated by a written notice of termination to the other party
hereto given in accordance with Section 15. The notice of termination shall (i)
indicate the specific termination provision in this Agreement relied upon, (ii)
briefly summarize the facts and circumstances deemed to provide a basis for a
termination of employment and the applicable provision hereof, and (iii) specify
the Termination Date in accordance with the requirements of this Agreement.
6. CONFIDENTIAL INFORMATION. Executive recognizes and acknowledges
that, by reason of Executive's employment by and service to the Company during
and, if applicable, after the Employment Term, Executive will continue to have
access to certain confidential and proprietary information relating to the
business of the Company, which may include, but is not limited to, trade
secrets, trade "know-how", customer information, supplier information, cost and
pricing information, marketing and sales techniques, strategies and programs,
computer programs and software and financial information (collectively referred
to as "Confidential Information"). Executive acknowledges that such Confidential
Information is a valuable and unique asset of the Company and Executive
covenants that Executive will not, unless expressly authorized in writing by the
Board, at any time during the course of Executive's employment, use any
Confidential Information or divulge or disclose any Confidential Information to
any person, firm or corporation except in connection with the performance of
Executive's duties for the Company and in a manner consistent with the Company's
policies regarding Confidential Information. Executive also covenants that at
any time after the termination of such employment, directly or indirectly,
Executive will not use any Confidential Information or divulge or disclose any
Confidential Information to any person, firm or corporation, unless such
information is in the public domain through no fault of Executive or except when
required to do so by law or legal process, in which case Executive will inform
the Company in writing promptly of such required disclosure, but in any event at
least two business days prior to disclosure. All written Confidential
Information (including, without limitation, in any computer or other electronic
format) which comes into Executive's possession during the course of Executive's
employment shall remain the property of the Company. Except as required in the
performance of Executive's duties for the Company, or unless expressly
authorized in writing by the Board, Executive shall not remove any written
Confidential Information from the Company's premises, except in connection with
the
-17-
18
performance of Executive's duties for the Company and in a manner consistent
with the Company's policies regarding Confidential Information. Upon termination
of Executive's employment, Executive agrees immediately to return to the Company
all written Confidential Information in Executive's possession. For the purposes
of this Section 6, the term "Company" shall be deemed to include the Company,
its Affiliates and their successors.
7. NON-COMPETITION; NON-SOLICITATION.
(a) During Executive's employment by the Company and for a
period of one year after Executive's termination of employment for any reason,
Executive will not, except with the prior written consent of the Board, directly
or indirectly, own, manage, operate, join, control, finance or participate in
the ownership, management, operation, control or financing of, or be connected
as an officer, director, employee, partner, principal, agent, representative,
consultant or otherwise with, or use or permit Executive's name to be used in
connection with, any business or enterprise which is engaged in any financial
services, insurance or other business that is competitive with any business or
enterprise in which the Company is engaged, anywhere in the world, during
Executive's employment or (with respect to the application of this covenant
after Executive's termination of employment) during the two year period
preceding Executive's termination of employment. The parties acknowledge that
the Company engages in its business on a worldwide basis, and Executive
acknowledges that his or her responsibilities extend to the Company's worldwide
operations.
(b) The foregoing restrictions shall not be construed to
prohibit the ownership by Executive of less than five percent of any class of
securities of any corporation which is engaged in any of the foregoing
businesses having a class of securities registered pursuant to the Exchange Act,
provided that such ownership represents a passive investment and that neither
Executive nor any group of persons including Executive in any way, either
directly or indirectly, manages or exercises control of any such corporation,
guarantees any of its financial obligations, otherwise takes any part in its
business, other than exercising Executive's rights as a shareholder, or seeks to
do any of the foregoing.
(c) Executive further covenants and agrees that during
Executive's employment by the Company and for a period of one year thereafter,
Executive will not, except with the prior written consent of the Board, directly
or indirectly, solicit or hire, or encourage the solicitation or hiring of, any
person who was a managerial or higher level employee of the Company at any time
during the term of Executive's employment by the Company by any employer other
than the Company for any position as an employee, independent contractor,
consultant or otherwise. The foregoing covenant of Executive shall not apply to
any person after 12 months have elapsed after the date on which such person's
employment by the Company has terminated.
(d) An amount equal to one-half of the severance benefits
payable under this Agreement is specifically designated as additional
consideration for the covenants described in this
-18-
19
Section 7. The covenants described in this Section 7 shall continue to apply
during the period specified herein after Executive's termination of employment
for any reason, without regard to whether Executive executes a Release or
receives any severance benefits as a result of such termination. If Executive
breaches any of the covenants described in this Section 7, the applicable period
during which the covenant applies shall be tolled during the period of the
breach.
(e) For the purposes of this Section 7, the term "Company"
shall be deemed to include the Company, its Affiliates and their successors.
8. EQUITABLE RELIEF.
(a) Executive acknowledges and agrees that the restrictions
contained in Sections 6 and 7 are reasonable and necessary to protect and
preserve the legitimate interests, properties, goodwill and business of the
Company, that the Company would not have entered into this Agreement in the
absence of such restrictions and that irreparable injury will be suffered by the
Company should Executive breach any of the provisions of those Sections.
Executive represents and acknowledges that (i) Executive has been advised by the
Company to consult Executive's own legal counsel in respect of this Agreement,
and (ii) Executive has had full opportunity, prior to execution of this
Agreement, to review thoroughly this Agreement with Executive's counsel.
(b) Executive further acknowledges and agrees that a breach of
any of the restrictions in Sections 6 and 7 cannot be adequately compensated by
monetary damages. Executive agrees that the Company shall be entitled to
preliminary and permanent injunctive relief, without the necessity of proving
actual damages, as well as an equitable accounting of all earnings, profits and
other benefits arising from any violation of Sections 6 or 7 hereof, which
rights shall be cumulative and in addition to any other rights or remedies to
which the Company may be entitled. In the event that any of the provisions of
Sections 6 or 7 hereof should ever be adjudicated to exceed the time,
geographic, service, or other limitations permitted by applicable law in any
jurisdiction, it is the intention of the parties that the provision shall be
amended to the extent of the maximum time, geographic, service, or other
limitations permitted by applicable law, that such amendment shall apply only
within the jurisdiction of the court that made such adjudication and that the
provision otherwise be enforced to the maximum extent permitted by law.
(c) Notwithstanding anything in this Agreement to the
contrary, if Executive breaches any of Executive's obligations under Sections 6
or 7 hereof, the Company shall thereafter be obligated only for the compensation
and other benefits provided in any Company benefit plans, policies or practices
then applicable to Executive in accordance with the terms thereof, and all
payments under Sections 2 and 3 of this Agreement shall cease.
(d) Executive irrevocably and unconditionally (i) agrees that
any suit, action or other legal proceeding arising out of Section 6 or 7 hereof,
including without limitation, any action commenced by the Company for
preliminary and permanent injunctive relief and other
-19-
20
equitable relief, may be brought in a United States District Court for Ohio, or
if such court does not have jurisdiction or will not accept jurisdiction, in any
court of general jurisdiction in Columbus, Ohio, (ii) consents to the
non-exclusive jurisdiction of any such court in any such suit, action or
proceeding, and (iii) waives any objection which Executive may have to the
laying of venue of any such suit, action or proceeding in any such court.
Executive also irrevocably and unconditionally consents to the service of any
process, pleadings, notices or other papers in a manner permitted by the notice
provisions of Section 15 hereof.
(e) Executive agrees that for a period of three years
following the termination of Executive's employment for any reason, Executive
will provide, and at all times after the date hereof the Company may similarly
provide, a copy of Sections 6 and 7 hereof to any business or enterprise (i)
which Executive may directly or indirectly own, manage, operate, finance, join,
control or in which Executive may participate in the ownership, management,
operation, financing, or control, or (ii) with which Executive may be connected
as an officer, director, employee, partner, principal, agent, representative,
consultant or otherwise, or in connection with which Executive may use or permit
to be used Executive's name; provided, however, that this provision shall not
apply in respect of Section 7 after expiration of the time periods set forth
therein.
(f) For the purposes of this Section 8, the term "Company"
shall be deemed to include the Company, its Affiliates and their successors.
9. INDEMNIFICATION. The Company shall indemnify Executive with respect
to his or her actions in the performance of his or her duties as set forth in
Section 1.2 to the fullest extent permitted by the Company's Amended and
Restated Code of Bylaws as in effect from time to time.
10. NON-EXCLUSIVITY OF RIGHTS; RESIGNATION FROM BOARDS.
(a) Nothing in this Agreement shall prevent or limit
Executive's continuing or future participation in or rights under any benefit,
bonus, incentive or other plan or program provided by the Company and for which
Executive may qualify; provided, however, that if Executive becomes entitled to
and receives the payments described in Section 2.3(b) or 3.4(b) of this
Agreement, Executive hereby waives Executive's right to receive payments under
any severance plan or similar program applicable to all employees of the
Company.
(b) If Executive's employment with the Company terminates for
any reason, Executive shall immediately resign from all boards of directors of
the Company, any Affiliates and any other entities for which Executive serves as
a representative of the Company.
11. SURVIVORSHIP. The respective rights and obligations of the parties
under this Agreement (including without limitation Sections 6, 7 and 8) shall
survive any termination of
-20-
21
Executive's employment to the extent necessary to the intended preservation of
such rights and obligations.
12. MITIGATION. Executive shall not be required to mitigate the amount
of any payment or benefit provided for in this Agreement by seeking other
employment or otherwise, and there shall be no offset against amounts due
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment that Executive may obtain.
13. BENEFIT PLANS; OUTSTANDING AWARDS. All references in this Agreement
to specific retirement or other benefit plans of the Company shall be deemed to
include any successor retirement or other benefit plans. The terms of
Executive's outstanding stock options, restricted stock and long-term incentive
awards are hereby amended to provide that, without adversely affecting any
rights that Executive has under such award agreements, the award agreements are
amended to provide for the accelerated vesting and payments upon termination of
employment as provided in Sections 2.3(b)(iv), 2.3(b)(v), 3.4(b)(iv) and
3.4(b)(v) of this Agreement, to the extent consistent with the applicable plans.
In all respects not amended, the provisions of such outstanding awards shall
remain in effect according to their terms.
14. ARBITRATION; EXPENSES. In the event of any dispute under the
provisions of this Agreement, other than a dispute in which the primary relief
sought is an equitable remedy such as an injunction, the parties shall be
required to have the dispute, controversy or claim settled by arbitration in
Columbus, Ohio in accordance with the National Rules for the Resolution of
Employment Disputes then in effect of the American Arbitration Association,
before a panel of three arbitrators, two of whom shall be selected by the
Company and Executive, respectively, and the third of whom shall be selected by
the other two arbitrators. Any award entered by the arbitrators shall be final,
binding and nonappealable and judgment may be entered thereon by either party in
accordance with applicable law in any court of competent jurisdiction. This
arbitration provision shall be specifically enforceable. The arbitrators shall
have no authority to modify any provision of this Agreement or to award a remedy
for a dispute involving this Agreement other than a benefit specifically
provided under or by virtue of the Agreement. In the event of a dispute, each
party shall be responsible for its own expenses (including attorneys' fees)
relating to the conduct of the arbitration, and the parties shall share equally
the fees of the American Arbitration Association. Each party shall give the
other party written notice as described in Section 15 of its intent to submit a
claim under this Agreement to arbitration and a description of the basis of such
claim, within six months after the event giving rise to the claim occurs.
15. NOTICES. All notices and other communications required or permitted
under this Agreement or necessary or convenient in connection herewith shall be
in writing and shall be deemed to have been given when hand delivered or mailed
by registered or certified mail, as follows (provided that notice of change of
address shall be deemed given only when received):
If to the Company, to:
-21-
22
Nationwide Mutual Insurance Company
Xxx Xxxxxxxxxx Xxxxx, 0-00-00
Xxxxxxxx, XX 00000
Attention: Senior Vice President - Chief Human Resources Officer
Senior Vice President - General Counsel
With a required copy to:
Xxxxxx, Xxxxx & Xxxxxxx LLP
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxx
If to Executive, to:
Xxxxxx Xxxxxx
000 Xxxxxxx Xxx
Xxxxxxxxxxx, XX 00000
or to such other names or addresses as the Company or Executive, as the case may
be, shall designate by notice to each other person entitled to receive notices
in the manner specified in this Section.
16. CONTENTS OF AGREEMENT; AMENDMENT AND ASSIGNMENT.
(a) This Agreement sets forth the entire understanding between
the parties hereto with respect to the subject matter hereof and cannot be
changed, modified, extended or terminated except upon written amendment approved
by the Board and executed on its behalf by a duly authorized officer of the
Company and by Executive.
(b) All of the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
heirs, executors, administrators, legal representatives, successors and assigns
of the parties hereto, except that the duties and responsibilities of Executive
under this Agreement are of a personal nature and shall not be assignable or
delegatable in whole or in part by Executive. The Company shall require any
successor (whether direct or indirect, by purchase, merger, consolidation,
reorganization or otherwise) to all or substantially all of the business or
assets of the Company, within 15 days of such succession, expressly to assume
and agree to perform this Agreement in the same manner and to the same extent as
the Company would be required to perform if no such succession had taken place.
-22-
23
17. SEVERABILITY. If any provision of this Agreement or application
thereof to anyone or under any circumstances is adjudicated to be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect any other provision or application of this Agreement which can be given
effect without the invalid or unenforceable provision or application and shall
not invalidate or render unenforceable such provision or application in any
other jurisdiction. If any provision is held void, invalid or unenforceable with
respect to particular circumstances, it shall nevertheless remain in full force
and effect in all other circumstances.
18. REMEDIES CUMULATIVE; NO WAIVER. No remedy conferred upon a party by
this Agreement is intended to be exclusive of any other remedy, and each and
every such remedy shall be cumulative and shall be in addition to any other
remedy given under this Agreement or now or hereafter existing at law or in
equity. No delay or omission by a party in exercising any right, remedy or power
under this Agreement or existing at law or in equity shall be construed as a
waiver thereof, and any such right, remedy or power may be exercised by such
party from time to time and as often as may be deemed expedient or necessary by
such party in its sole discretion.
19. BENEFICIARIES/REFERENCES. Executive shall be entitled, to the
extent permitted under any applicable law, to select and change a beneficiary or
beneficiaries to receive any compensation or benefit payable under this
Agreement following Executive's death by giving the Company written notice
thereof. In the event of Executive's death or a judicial determination of
Executive's incompetence, reference in this Agreement to Executive shall be
deemed, where appropriate, to refer to Executive's beneficiary, estate or other
legal representative.
20. MISCELLANEOUS. All section headings used in this Agreement are for
convenience only. This Agreement may be executed in counterparts, each of which
is an original. It shall not be necessary in making proof of this Agreement or
any counterpart hereof to produce or account for any of the other counterparts.
21. WITHHOLDING; TAXES. All payments under this Agreement shall be made
subject to applicable tax withholding, and the Company shall withhold from any
payments under this Agreement all federal, state and local taxes as the Company
is required to withhold pursuant to any law or governmental rule or regulation.
Except as specifically provided otherwise in this Agreement, Executive shall be
responsible for all taxes applicable to amounts payable under this Agreement and
payments under this Agreement shall not be grossed up for taxes.
22. GOVERNING LAW. This Agreement shall be governed by and interpreted
under the laws of the State of Ohio without giving effect to any conflict of
laws provisions.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have executed this Agreement as of the date first above written.
NATIONWIDE MUTUAL INSURANCE COMPANY
-23-
24
By:
-------------------------------
Name:
Title:
Executive
-24-
25
EXHIBIT A
SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE
WHEREAS ______________ ("Executive") has been employed by
_________________ (the "Company"), and because the Executive's employment with
the Company will terminate effective _____________, Executive and the Company
agree as follows:
1. In consideration of the promises of the Company set forth
in paragraph 3 below, Executive, and his or her heirs, executors and
administrators, intending to be legally bound, hereby permanently and
irrevocably agrees to the termination of Executive's employment with the Company
effective on _____________ (or such earlier date as may be communicated in
writing by ___________) (the "Termination Date") and hereby REMISE, RELEASE and
FOREVER DISCHARGE the Company and any individual or organization related to the
Company and against whom or which Executive could assert a claim, including
_____________________ (hereinafter referred to collectively as "Releasees"), of
and from any and all causes of action, suits, debts, claims and demands
whatsoever, which he had, has, or may have against Releasees up until the date
of his execution of this Agreement and General Release, other than the Release
Exclusions (as defined below). Particularly, but without limitation, Executive
so releases all claims relating in any way to his employment or the termination
of his employment relationship with the Company, including without limitation
claims under the Ohio Fair Employment Practice Law, Ohio Rev. Code Xxx. ss.
4112.01 ET SEQ. ("Ohio Fair Employment Practice Law"), Title VII of the Civil
Rights Act of 1964, AS AMENDED, ss. 42 U.S.C. 2000e ET SEQ. ("Title VII"), the
Americans with Disabilities Act, 42 U.S.C. ss. 12101 ET SEQ. (thE "ADA"), the
Employee Retirement Income Security Act 29 U.S.C. ss. 1001 ET SEQ. ("ERISA"),
the Age Discrimination in Employment Act, AS AMENDED 29 U.S.C. ss. 621 ET SEQ.
(the "ADEA"), any common law claims and all claims for counsel fees and costs.
Executive agrees that Executive will not file any charge of discrimination
against the Company or any of Releasees under the Ohio Fair Employment Practice
Law, Title VII, ERISA, the ADA or the ADEA, or any other federal, state or local
law. Executive further agrees and covenants that should any person,
organization, or other entity file, charge, claim, xxx, or cause or permit to be
filed any civil action, suit or legal proceeding involving any matter occurring
at any time in the past, Executive will not seek or accept any personal relief
in such civil action, suit or legal proceeding. This release also does not give
up Executive's rights, if any, to the following claims that Executive has or may
have (the "Release Exclusions"): (i) to seek indemnification pursuant to
applicable state law and the Company's By-Laws and (ii) to seek coverage under
directors' and officers' liability insurance policies maintained or required to
be maintained by the Company.
2. Executive shall promptly take all steps necessary to
dismiss with prejudice any and all pending complaints, charges and grievances
against the Company or Releasees, regardless of whether they are or have been
filed internally or externally. Executive waives his or her right to institute
or have pursued on his behalf any further complaints or grievances against the
Company or Releasees for any matter occurring up to the present,
A-1
26
regardless of the forum, other than the Release Exclusions. Executive also
agrees that the payment in Paragraph 3 is in full satisfaction of any liability
or obligation to Executive under the Employment Agreement, dated as of January
1, 2000, between the Company and Executive.
3. In full consideration of Executive's execution of this
Separation of Employment Agreement and General Release, and his or her agreement
to be legally bound by its terms, the Company will provide Executive with the
following consideration, to which Executive acknowledges he or she would not
otherwise be entitled:
(a)-(b) [Refer to applicable sections of Employment Agreement]
Executive understands and expressly agrees that each benefit
enhancement and payment under paragraphs (a) and (b) above is expressly
contingent on Executive's continued employment through _________________, or
such earlier date as may be communicated in writing by the Company.
Except as set forth in this Agreement, it is expressly agreed
and understood that Releasees do not have, and will not have, any obligation to
provide Executive at any time in the future with any payments, benefits or
considerations other than those recited in this paragraph, or those required by
law, other than under the terms of any benefit plans which provide benefits or
payments to former employees according to their terms and other than the Release
Exclusions.
4. If Executive brings a legal action against the Company or
Releasees in contravention of any part of this Agreement and General Release,
including paragraph 1 of this Agreement, Executive agrees and acknowledges that
he or she will reimburse the Company or Releasees for all their reasonable
attorneys' fees in defending such action.
5. The parties acknowledge that the performance of the
promises of each are expressly contingent upon the fulfillment and satisfaction
of the obligations of the other party as set forth in this Agreement and General
Release.
6. Executive hereby agrees and recognizes that, as of his or
her Termination Date, Executive's employment relationship with the Company or
Releasees will be permanently and irrevocably severed and that Executive waives
his or her right to be hired or rehired in the future by the Company and any of
its affiliates. It is further agreed and understood that Executive will continue
to be available and cooperate in a reasonable manner in providing assistance to
the Company in concluding any matters which are reasonably related to the duties
and responsibilities which Executive had while employed by the Company, provided
that such cooperation and assistance does not interfere with any subsequent
employment obtained by Executive.
X-0
00
0. Executive agrees and acknowledges that this Agreement is
not and shall not be construed to be an admission of any violation of any
federal, state or local statute or regulation, or of any duty owed by Releasees.
8. Executive agrees, covenants and promises that Executive
will not communicate or disclose the terms of this Agreement and General Release
to any persons with the exception of members of Executive's immediate family and
Executive's attorney and financial advisor. Executive further agrees to refrain
from using or disclosing for the benefit of any person, business or entity other
than the Company, any confidential information relating to the Company's
business, which includes but is not limited to information relating to the
Company's employees, processors, suppliers, customers, services, plans,
marketing studies or analyses, and financial or business affairs. Executive
represents that any and all documents containing such confidential information
will be returned to the Company upon termination of employment.
9. This Agreement and General Release, and the provisions of
the Employment Agreement that survive Executive's termination of employment,
constitute the complete and entire understanding between the parties, and
supersede any and all prior agreements and understandings between the parties to
the extent they are inconsistent with this Agreement.
10. Executive hereby certifies that Executive has read the
terms of this Agreement and General Release, that Executive has been advised by
the Company to consult with an attorney of his or her own choice prior to
executing this Agreement, that Executive has had an opportunity to do so, and
that Executive understands this Agreement's terms and effects. Executive further
certifies that neither Releasees nor any representative of Releasees has made
any representations to Executive concerning this Agreement and General Release
other than those contained herein.
11. Executive acknowledges that Executive has been informed
that this Agreement and General Release includes a waiver of claims under the
ADEA, and that Executive has the right to consider this Agreement and General
Release for a period of 21 days. Executive also understands that he or she has
the right to revoke this Agreement and General Release for a period of seven
days following his execution of this Agreement and General Release by giving
written notice to the Company in care of ___________________, Xxx Xxxxxxxxxx
Xxxxx, Xxxxxxxx, XX 00000.
12. If any provision of this Agreement and General Release is
deemed invalid, the remaining provisions shall not be affected.
A-3
28
IN WITNESS WHEREOF, and intending to be legally bound hereby,
the parties have executed the foregoing Agreement and General Release on the
dates indicated below.
WITNESS:
------------------------ --------------------------------
Executive
DATE:
---------------------------
WITNESS: BY:
------------------------ -----------------------------
TITLE:
--------------------------
DATE:
---------------------------
A-4
