Exhibit 10(kkk)
DATED January 10, 2002
OVERSEAS PARTNERS LTD.
- and -
XXX XXXXXX
_______________________________________
EMPLOYMENT AGREEMENT
________________________________________
2
T H I S A G R E E M E N T is made the 10th day of January 0000
X X X X X X N :
OVERSEAS PARTNERS LTD. whose registered office is situated at Cumberland House,
One Victoria Street, Xxxxxxxx XX GX, Bermuda (the "Company"); and
XXX XXXXXX of "Belair" 00 Xxxx'x Xxxx Xxxx, Xxxxx (the "Executive").
W H E R E B Y I T I S AGREED as follows:
1. Definitions and Interpretations
-------------------------------
In addition to the words and expressions hereinbefore defined the
following words and expressions shall have the meanings hereinafter
ascribed to them;
"Associated Company" means any company which is from time to
time a subsidiary or a holding company (as those
expressions are defined by Section 86 of the
Companies Act 1981) of the Company.
the "Board" means the Board of Directors from time to time of
the Company.
"Commencement Date" means the 1st day of December 2000.
"Employment" means the employment of the Executive with the
Company pursuant to this Agreement.
3
"Common Share Capital" means all the Common Shares of the Company in
issue from time to time.
"Termination Date" means the date on which the Employment with the
Company ceases either for reason of the
conclusion of the fixed term of the Employment or
for reason of the termination of the Employment
in accordance with the provisions of this
Agreement.
2. Term of Appointment
-------------------
a. The Company hereby appoints the Executive and the Executive hereby
agrees to act as Executive Vice President-Reinsurance of Overseas
Partners Re Ltd. and President of OP Finite for an initial Term of
Appointment of a period of three (3) years unless this Agreement is:
(i) sooner terminated in accordance with paragraph 5 below, or (ii)
extended as provided in paragraph 2(b) below.
b. Commencing on the third anniversary of the Commencement Date and on
each annual anniversary of such date, (each a "Renewal Date"), this
Agreement, and the Term of Appointment herein granted, shall be
automatically extended so as to terminate on the first annual
anniversary of each Renewal Date, unless either the Company or the
Executive shall give the other written notice, not less than 60 days
prior to any Renewal Date, of the election not to so extend this
Agreement, in which case this Agreement shall terminate on such
Renewal Date.
4
3. Powers and Duties
-----------------
During the period of Employment under this Agreement the Executive:
(a) shall report to the Chief Executive Officer of the Company (the
"CEO") and shall exercise such powers and perform such duties
(not being duties inappropriate to his status) as Executive Vice
President-Reinsurance of Overseas Partners Re Ltd. and President
of OP Finite as may from time to time be vested in or assigned to
him by the CEO and shall comply with all reasonable directions
from time to time given to him by the CEO and with all rules and
regulations from time to time laid down by the Company concerning
its employees as the CEO or the Board of Directors of the Company
(the "Board") may from time to time determine.
(b) shall devote his full attention and business time to the business
and affairs of the Company, provided, however, that nothing in
-------- -------
this Agreement shall preclude the Executive from engaging in
activities involving professional, educational, charitable,
religious and community organizations, managing his personal
investments, and serving on the board of directors of such
companies and organizations as agreed to from time to time by the
Board, to the extent that the foregoing do not materially inhibit
the performance of the Executive's duties under this Agreement or
conflict in any material way with the business and affairs of the
Company.
(c) use his best efforts to perform faithfully and efficiently, and
to discharge the dealings and responsibilities assumed by him
under this Agreement.
4. Remuneration and Benefits
-------------------------
The Executive shall be paid by way of remuneration a salary and bonus
and such other benefits (if any) as the CEO and the Compensation
Committee of the Board (the "Compensation Committee") may from time to
time determine as follows:
5
a) The Executive shall be paid by way of remuneration for his
services during the Employment hereunder: (i) a base salary at
the rate of $25,000.00 per month through February 28, 2001 and at
the rate of $33,333.33 per month thereafter and (ii) such bonuses
or additional remuneration (if any) as the CEO, with ratification
by the Compensation Committee, may from time to time determine in
accordance with the "Overseas Partners Ltd. Incentive Plan" (in
development at the Commencement Date) based upon a target award
of 100% of annual base salary, a minimum award of 50% of annual
base salary, and a maximum award of 150% of annual base salary
(using the Executive's annual base salary in effect at the end of
the calendar year to which the bonus relates), determined by the
performance of the Company and the Executive as adjudged by the
CEO and ratified by the Compensation Committee. The CEO and
Compensation Committee shall review the Executive's base salary
and potential bonus award, on an annual basis to determine, in
its sole discretion, if and to what extent an increase in base
salary and/or the awarding of a bonus or additional remuneration
is warranted. The annual review will be completed by March 1 of
each year.
Such salary shall be paid by equal monthly installments in
arrears on the last day of every month and shall accrue from day
to day.
b) The Executive shall be entitled to receive grants of restricted
stock, stock options and/or stock appreciation rights on an
annual basis under the Company's Incentive Compensation Plan for
the time being in force, subject to the rules applicable to the
Plan as established, amended or varied from time to time by the
Board or such other Plan as is in force from time to time, and as
amended from time to time, as the case may be. The grants
referred to in the preceding sentence shall be based on a target
future value of 200% of annual base salary then in effect.
6
c) In addition to public holidays the Executive will be entitled to
thirty (30) days vacation in every calendar year. Unless and
until his Employment under this Agreement terminates under any
provision herein, salary will continue to be payable during
vacations. Vacation days not taken in any calendar year may be
carried forward at the sole discretion of the Compensation
Committee.
d) Subject to production, if requested, of medical certificates
satisfactory to the Company, salary will not cease to be payable
by reason only of the Executive's incapacity to work due to
sickness or accident (unless and until his Employment under the
Agreement shall be terminated under any provision herein) but the
Company may reduce salary during incapacity by an amount equal to
the benefit (excluding any lump sum benefit) which the Executive
would be entitled to claim during such incapacity under any
sickness or accident insurance policy paid for entirely by the
Company (whether or not such benefit is claimed by the
Executive).
e) The Executive shall be entitled to participate in the Overseas
Partners Ltd And Subsidiaries Retirement Plan (401(k)).
f) The Executive is entitled to all other benefits outlined in the
Overseas Partners Ltd./Overseas Partners Re Ltd. Company
Handbook, which are not specifically identified in this
Agreement.
g) The Company shall, during the continuance of the Employment of
the Executive (including any period of notice), pay a housing
allowance of $16,666.66 per month to defray the Executive's
housing cost here in Bermuda. If during the continuance of the
Employment of the Executive, the Executive's housing cost exceeds
$16,666.66 per month, the Executive's housing allowance will be
increased by an amount necessary to defray such increased
expense; provided, however, that in no event shall the
Executive's housing allowance ever exceed $20,666.66 per month.
7
The first of such payment shall be made on the 25/th/ day of
December 2000 representing the housing allowance for December in
arrears. All subsequent payments shall be on the 25/th/ day of
each month, in arrears for the month in question.
h) The Company shall pay to the Executive a bonus of $500,000.00
upon the earlier of (i) July 1, 2002, or (ii) the date of the
consummation of an acquisition which constitutes a change in
control, as defined in paragraph 5(g)(ii), provided that the
Executive remains continuously employed by the Company through
and including the applicable date.
i) The Company shall reimburse the Executive for all reasonable
expenses, fees, and costs incurred in connection with the
negotiation, legal review, and execution of the lease of his
Bermuda residence. The amount of any such reimbursements shall
not reduce the housing allowance otherwise provided Executive
pursuant to paragraph 4(g).
j) During the Employment hereunder, the Executive shall be entitled
to AYCO (or similar) tax and financial counseling and planning
services.
k) During the Employment hereunder, the Company shall pay all the
Executive's costs incurred in connection with the storage of his
personal effects in an amount not to exceed $447.40 per month;
provided, however, that in the event the Executive's housing
allowance is increased to an amount which exceeds $16,666.66 per
month, the Company shall no longer be obligated to pay the
Executive's storage costs.
5. Termination of Employment
-------------------------
8
a) The Employment may be terminated prior to the scheduled expiration of
the Term of Appointment: (i) by the Company with or without "cause"
(as defined below), (ii) by the Executive with or without "good
reason" (as defined below) or (iii) due to the death or total and
permanent disability of the Executive in accordance with the
applicable long-term policies of the Company in which the Executive
participates.
b) In the event that the Executive wishes to resign from the Company
without "good reason" prior to the scheduled expiration of the Term of
Appointment, the Executive shall provide the Company with three (3)
months' advance written notice and, in such case, the Company may
terminate the Executive's employment prior to the end of such three
(3) month period provided that the Company makes the payments to the
Executive described in paragraph (e) below. A termination of the
Employment by the Company as provided in the preceding sentence shall
not be deemed a termination without "cause" or give the Executive
grounds to terminate his employment for "good reason" for purposes of
paragraph (c) below.
c) In the event that the Employment is terminated pursuant to paragraph
(a) above (i) by the Company without "cause" or (ii) by the Executive
with "good reason", the Executive shall be entitled to receive, in
addition to accrued salary and benefits (including a pro-rata
calculation of earned vacation days) payable to the Executive through
the Termination Date, the following payments, each of which shall be
paid in a lump sum within 14 business days from the Termination Date:
(i) an amount equal to the product of 24 times the Executive's monthly
base salary (as determined in paragraph 4(a)), and (ii) an amount
equal to the product of 2 times the Executive's bonus entitlement (as
determined in paragraph 4(a)), based upon the target level set by the
Company for the year in which the Executive's termination occurs. In
addition, the Executive shall be
9
entitled to an amount equal to the Executive's bonus entitlement
(as determined in paragraph 4(a)), based upon the performance of
the Company for the year in which the Executive's termination
occurs and pro-rated for the period from January 1 of the year in
which the termination occurs to the Termination Date, payable
within 60 days of the end of such year. In addition, in the event
of a termination of Employment described in this paragraph 5(c),
the Executive shall receive continuation of his monthly housing
allowance (as that amount is determined in paragraph 4(g) above)
for 24 months; provided, however that such continued payment of
the Executive's monthly housing allowance shall cease if the
Executive obtains full-time employment or leaves Bermuda.
The Company's obligation to make the payments in this paragraph
5(c) shall be conditioned on the Executive's execution of a
General Release Agreement in accordance with the Company's
customary practice.
d) In the event of the termination of the Employment for one of the
reasons described in paragraph (c) above, all outstanding grants
of restricted stock, stock options and stock appreciation rights
previously granted to the Executive by the Company will
automatically become fully vested as of the date of such
termination, notwithstanding anything to the contrary contained
in the terms or provisions of the Company's Incentive
Compensation Plan.
e) In the event that the Employment is terminated pursuant to
paragraph (a) above: (i) by the Company for "cause", (ii) by the
Executive without "good reason" or (iii) due to the death or
disability of the Executive; the Executive shall be entitled to
receive only his accrued salary and benefits (including a
pro-rata calculation of earned vacation days) payable through the
Termination Date or otherwise payable under plans maintained by
the Company in accordance with their terms and nothing else. In
addition, in the event that the Executive terminates his
Employment with the Company
10
without "good reason" in accordance with paragraph 5(b) of this
Agreement, the Company shall be required (even if the Company
subsequently elects to terminate the Employment of the Executive
prior to the effective date of his termination in accordance with
paragraph 5(b) of this Agreement) to continue to provide the
Executive with his salary and benefits until the earlier of the
effective date of his termination and the end of the Term of
Appointment.
F) In the event the Company does not extend this Agreement in
accordance with paragraph 2(b), and the Executive's employment
has not terminated for any other reason, then notwithstanding any
other provision of this paragraph 5, the Executive shall be
entitled to receive, in addition to accrued salary and benefits
(including a pro-rata calculation of earned vacation days)
payable to the Executive through the Termination Date, the
following payments, each of which shall be paid in a lump sum
within 14 business days from the Termination Date: (i) an amount
equal to the product of 12 times the Executive's monthly base
salary (as determined in paragraph 4(a)), and (ii) an amount
equal to the Executive's bonus entitlement (as determined in
paragraph 4(a)), based upon the target level set by the Company
for the year in which the Executive's termination occurs. In
addition, the Executive shall be entitled to an amount equal to
the Executive's bonus entitlement (as determined in paragraph
4(a)), based upon the performance of the Company for the year in
which the Executive's termination occurs and pro-rated for the
period from January 1 of the year in which the termination occurs
to the Termination Date, payable within 60 days of the end of
such year. In addition, in the event of a termination of
Employment described in this paragraph 5(f), the Executive shall
receive continuation of his monthly housing allowance (as that
amount is determined in paragraph 4(g) above) for 12 months;
provided, however, that such continued payment of the Executive's
11
monthly housing allowance shall cease if the Executive obtains
full-time employment or leaves Bermuda.
g) For purposes of this Agreement:
(i) "cause" means (a) an act or acts of personal dishonesty
taken by the Executive and intended to result in the
material personal enrichment of the Executive at the expense
of the Company and its Associated Companies, excluding for
this purpose any isolated, insubstantial or inadvertent
action not taken in bad faith which is remedied by the
Executive in a reasonable period of time after receipt of
reasonably prompt written notice thereof from the Company,
(b) repeated violations by the Executive of his obligations
under this Agreement which are demonstrably willful and
deliberate and which are not remedied in a reasonable period
of time by the Executive after receipt of reasonably prompt
written notice thereof from the Company, or, (c) the
Executive's conviction of a felony involving moral
turpitude; and
(ii) "good reason" means (a) the sale or other disposition by the
Company of all or substantially all of its reinsurance
operations, (b) the change in control of the Company through
the acquisition (whether by purchase, transfer, merger,
renunciation or otherwise) of any interest in any shares,
if, upon completion of such acquisition the third party,
together with persons acting in concert with the third
party, would hold more than fifty percent of the Common
Share Capital of the Company, (c) repeated violations by the
Company of its obligations under this Agreement which are
demonstrably willful and deliberate and which are not
remedied in a reasonable period of time by the Company after
receipt of reasonably prompt written notice thereof from the
Executive, (d) without the Executive's consent, the Company
reduces the
12
Executive's current base salary, reduces the
Executive's then current target total annual
compensation, reduces the Executive's housing
allowance, or reduces any of the benefits provided to
the Executive under paragraphs 4(e) or (f) of this
Agreement, (e) a diminution in the Executive's duties
or responsibilities or the assignment of the
Executive of any duties inconsistent in any adverse
respect with the Executive's then current duties and
responsibilities or, (f) the Work Permit of the
Executive is terminated by the Government of Bermuda.
(h) (i) The Employment, following the initial Term of
Appointment and during any extended Term of
Appointment, may be terminated prior to the scheduled
expiration of the extended Term of Appointment: (i)
by the company with or without "cause" (as defined in
paragraph 5(g)(i) above, (ii) by the Executive with
or without "good reason" (as defined in paragraph
5(g)(ii) above), or (iii) due to the death or
disability of the Executive in accordance with the
applicable programs and policies of the Company.
(ii) In the event that the Executive wishes to resign from
the Company without "good reason" prior to the
scheduled expiration of any extended Term of
Appointment, the Executive shall comply with the
provisions of paragraph 5(b) above.
(iii) In the event that Employment is terminated pursuant
to paragraph 5(h)(i) above (i) by the Company without
"cause", or (ii) by the Executive with "good reason",
the Executive shall be entitled to receive, in
addition to accrued salary and benefits (including a
pro-rata calculation of earned vacation days) payable
to the Executive through the Termination Date, the
following payments, each of which shall be paid in a
lump sum within 14 business days from the Termination
Date: (i) an amount equal to the product of 24
13
times the Executive's monthly base salary (as
determined in paragraph 4(a)), and (ii) an amount
equal to the product of 2 times the Executive's bonus
entitlement (as determined in paragraph 4(a)), based
upon the target level set by the Company for the year
in which the Executive's termination occurs. In
addition, the Executive shall be entitled to an
amount equal to the Executive's bonus entitlement (as
determined in paragraph 4(a)), based upon the
performance of the Company for the year in which the
Executive's termination occurs and pro-rated for the
period from January 1 of the year in which the
termination occurs to the Termination Date, payable
within 60 days of the end of such year. In addition,
in the event of a termination of Employment described
in paragraph 5(h)(i), the Executive shall receive
continuation of his monthly housing allowance (as
that amount is determined in paragraph 4(g) above)
for 24 months; provided, however, that such continued
payment of the Executive's monthly housing allowance
shall cease if the Executive obtains full-time
employment or leaves Bermuda.
(iv) In the event that the Employment is terminated during
any additional Term of Appointment, pursuant to
paragraph 5h(i) above: (i) by the Company for
"cause", (ii) by the Executive without "good reason",
or (iii) due to the death or disability of the
Executive, the Executive shall be entitled to receive
only his accrued salary and benefits (including a
pro-rata calculation of earned vacation days) payable
to the Termination Date or otherwise payable under
plans maintained by the Company in accordance with
their terms and nothing else. In all other respects,
the Executive's termination under the provisions of
this paragraph shall be in accordance with provisions
of paragraph 5(e) and (g) above.
14
6. Non-Competition
---------------
The Executive shall not during the continuance of the Employment
(unless otherwise agreed in writing by the Company) undertake any other
business or profession or be or become an executive or agent of any
other company, firm or person or assist or have any financial interest
in any other business or profession, if such business or profession is
in competition with the business of the Company or any Associated
Company but nothing in this paragraph shall preclude the Executive from
holding or acquiring less than 5% of the voting shares or other equity
securities of any other company which are listed or dealt in on any
recognized stock exchange by way of bona fide investment.
7. Non-Solicitation
----------------
The Executive covenants with the Company that he shall not during the
continuance of the Employment or for a period of two (2) years after
the Termination Date on his own behalf or on the behalf of any other
person, firm or company directly or indirectly endeavor to entice away
from the Company any person who is then employed by the Company and was
so employed by the Company during the continuance of the Employment.
8. Confidential Information
------------------------
The Executive shall not, either during the continuance of his
Employment hereunder and up to two years after the termination of the
Agreement, use to the detriment or prejudice of the Company, except in
the proper course of his duties, divulge to any person any trade secret
or any other information of a confidential nature concerning the
business or affairs of the Company which may have come to his knowledge
during the Employment.
15
9. Board Information
-----------------
The Executive shall at all times promptly give to the Board (in writing
if so requested) all such information and explanations as they may
require in connection with matters relating to his Employment hereunder
or with the business of the Company.
10. Return of Papers etc.
--------------------
The Executive shall promptly upon the request of the Board following
his termination of Employment deliver up to the Company all lists of
clients or customers, correspondence and all other documents, papers
and records which may have been prepared by him or have come into his
possession in the course of his Employment, and the Executive shall not
be entitled to and shall not retain any copies thereof. Title and
copyright therein shall vest in the Company.
11. Misrepresentation
-----------------
The Executive shall not at any time after the termination of his
Employment hereunder wrongfully represent himself as being employed by
or connected with the Company or any Associated Company.
12. Notices
-------
Any notice in writing to be served hereunder shall be given personally
to the Executive or to the Secretary of the Company (as the case may
be) or shall be couriered or posted by registered mail to the Company
(for the attention of its Secretary) at its registered office for the
time being or to the Executive either at his address given above or at
his last known address. Any such notice sent by post shall be deemed
served three days after it is posted and in proving such service it
shall be sufficient to prove that the notice was properly addressed and
put in the post or couriered.
13. Indemnity and Insurance
-----------------------
16
The Company hereby agrees to indemnify and hold the Executive harmless
for any acts or omissions arising out of the course and scope of his
Employment with the Company to the fullest extent permitted by
applicable law.
14. Other Agreements
----------------
The Executive acknowledges and warrants that there are no agreements or
arrangements whether written, oral or implied between the Company and
the Executive relating to the Employment of the Executive other than
those expressly set out in the Agreement and that he is not entering
into the Agreement in reliance on any representation not expressly set
out herein.
15. Successors and Assigns
----------------------
The Company shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially
all of its business or assets to expressly assume this Agreement and
agree to perform under this Agreement in the same manner and to the
same extent that the Company would be required to perform if no such
succession had taken place. In addition, the Company may assign this
Agreement (and all of its rights and obligations hereunder) to any of
its wholly-owned subsidiaries. As used in this Agreement, the term
"Company" shall mean any successor or subsidiary that assumes and
agrees to perform this Agreement or which otherwise becomes bound by
all the terms and provisions of this Agreement by operation of law.
16. Governing Law
-------------
The Agreement shall be governed by and construed under Bermuda law and
each of the parties hereto submits to the jurisdiction of the Bermuda
Courts as regards any claim or matter arising under the Agreement.
17
17. Expenses
--------
The Company will reimburse the Executive for legal fees and expenses
incurred in connection with the negotiation, execution and delivery of
this Employment Agreement for an amount up to $5,000.
IN WITNESS WHEREOF the parties hereto have set their hands and seals the date
first above written.
SIGNED by ) /s/ Xxxx X. Xxxxxxxx
on behalf of the Company ) /s/ X. Xxxxxxxx Leader
in the presence of:- )
SIGNED by the Executive ) /s/ Xxx X. Xxxxxx
in the presence of:- ) /s/ X. Xxxxxxxx Leader
