Exhibit 10.48
Employment Agreement
AGREEMENT (the "Employment Agreement" or this "Agreement") dated as of the 1st
day of November, 2002, between First Allmerica Financial Life Insurance Company,
a corporation having its principal office at 000 Xxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxx 00000 (the "Company") and Xxxxx X. Xxxxxxxx ("Employee") residing
at 0 Xxxxxx Xxxxxxxx, Xxxx Xxxxxxxx, Xxxxxxxxxxxxx 00000.
The Company and Employee hereby agree as follows:
1. Employment. The Company hereby employs Employee and Employee
hereby accepts employment upon the terms and conditions
hereinafter set forth. (As used throughout this Agreement,
"Company" shall mean and include any and all of its present and
future subsidiaries and affiliates.) Employee warrants that
Employee is free to enter into and fully perform this Agreement
and is not subject to any employment, confidentiality,
non-competition or other agreement which would restrict
Employee's performance under this Agreement.
2. Duties. Employee shall devote Employee's full time to the
performance of services for the newly established Office of the
Chairman with duties as determined by the Chairman, to provide
services to the Search Committee of the Board of Directors, to
provide services to Corporate Services as needed and such other
services as may from time to time be designated by the President
of Allmerica Asset Accumulation, the President of Allmerica
Property and Casualty Companies or by the Chairman of the Board
of Allmerica Financial Corporation ("AFC") or by the new
permanent President and Chief Executive Officer of AFC. During
the term of this Agreement, Employee's services shall be
completely exclusive to the Company and Employee shall devote
Employee's entire time, attention and energies to the business
of the Company and the duties to which the Company shall assign
him from time to time. Employee agrees to perform Employee's
services well and faithfully and to the best of Employee's
ability and to carry out the policies and directives of the
Company. Employee agrees to take no action prejudicial to the
interests of the Company during Employee's employment hereunder.
Employee shall be based in Worcester, Massachusetts but Employee
may be required from time to time to perform duties hereunder
for reasonably short periods of time outside said area.
3. Term. The term of this Agreement shall begin on November 1, 2002
and shall end on December 31, 2003 (the "Term"). This Agreement
may by mutual agreement of the parties be extended beyond the
Term.
4. Compensation.
i) Base Salary: During the period of Employee's employment under
this Agreement, the Company shall pay Employee an annual salary
rate of $350,000.00, payable bi-weekly, subject thereafter to
periodic review by the Chairman of the Board or the new
permanent President and Chief Executive Officer of AFC and the
AFC Compensation Committee and payable in accordance with the
Company's payroll policy as in effect from time to time ("Base
Salary").
ii) Incentive Compensation: If an incentive or bonus
compensation program is made available to employees of the
Company generally, Employee shall be entitled, during the term
hereof, to participate in such program in accordance with the
terms thereof, as such terms may be modified or amended by the
Company from time to time; provided, however, that nothing
contained herein shall obligate the Company to adopt or continue
such an incentive or bonus compensation program. The Company
hereby acknowledges that the Employee is a participant in the
2002 Short Term Incentive Compensation Plan and has a target
goal of sixty percent (60%) of $350,000.00. Notwithstanding the
provisions of the 2002 Short Term Incentive Compensation Plan,
the Company agrees that your 2002 Short Term Incentive
Compensation award will be no less than $100,000.00, provided
the business unit contribution from Risk Management is at least
$140 million dollars. The Company agrees that the Employee shall
be a participant in the 2003 Short Term Incentive Compensation
Plan and have a target goal of seventy-five percent (75%) of
$350,000.00.
iii) Stock Plan: The Company agrees that the Employee is
eligible to participate in the 2003 Allmerica Financial
Corporation Long Term Stock Incentive Plan. The terms of such
participation shall be determined in January of 2003.
iv) Retention Bonus: If Employee is actively at work from the
date of this Agreement until July 1, 2003, or if Employee's
employment is terminated prior to July 1, 2003 by the new
permanent President and Chief Executive Officer of AFC pursuant
to the provisions of Section 9(e), the Employee will receive a
Retention Bonus of $275,000.00.
5. Severance Benefit. Notwithstanding any provision included in
Section 9, during the Term, Employee shall have the right upon
thirty days written notice to elect to retire. In such event,
Employee shall receive a severance benefit equal to $350,000.00
and shall have any Restricted Stock held by the Employee at such
time vest without restriction, provided Employee executes a
mutually acceptable severance agreement, which agreement would
include a general release in favor of the Company. If Employee
elects to retire after July 1, 2003, Employee shall have his
cash severance benefit increased to $400,000.00.
6. Expenses. Employee shall be entitled to reimbursement for
expenses reasonably incurred in connection with the performance
of Employee's duties hereunder in accordance with such
Procedures as the Company may establish from time to time.
7. Vacation During Employment. Employee shall be entitled to five
(5) weeks during each calendar year in accordance with Company
policy.
8. Additional Benefits. During the term hereof and subject to any
contribution therefor generally required of employees of the
Company, Employee shall be entitled to participate in any and
all employee benefit plans from time to time in effect for
employees of the Company generally, but the Company shall not be
required to establish any such program or plan. Such
participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable Company
policies and (iii) the discretion of the Board of Directors or
any administrative or other committee provided for in or
contemplated by such plan. The Company may alter, modify, add to
or delete its employee benefit plans at any time as it, in its
sole judgment, determines to be appropriate, without recourse by
the Employee.
9. Termination of Employment. Employee's employment may be
terminated prior to the expiration of the term of this Agreement
under the following circumstances:
(a) By the Company in the event of Employee's failure,
refusal or inability satisfactorily to perform the
services required of Employee hereby, or to carry out
any proper direction of the Board of Directors with
respect to the services to be rendered by Employee
hereunder or the manner of rendering such services, or
Employee's willful misconduct in the performance of
Employee's duties hereunder, or Employee's commission of
a felony;
(b) By the Company upon 30 days' notice to Employee if
Employee should be prevented by illness, accident or
other disability from discharging Employee's duties
hereunder for one or more periods totaling three months
during any twelve-month period;
(c) Except as otherwise provided in Section 9(a), by either
the Company or Employee for any material breach by the
other of the terms hereof, but only upon 30 days'
written notice to the other specifying the breach relied
on for such termination, and only if such breach has not
been cured within such 30-day period; or
(d) In the event of Employee's death during the term of
Employee's employment, the Company's obligation to pay
further compensation hereunder shall cease forthwith,
except that Employee's legal representative shall be
entitled to receive Employee's fixed compensation for
the period up to the last day of the month in which such
death shall have occurred.
(e) By Company Other Than for Cause. Company may terminate
Employee's employment hereunder other than for Cause at
any time upon notice to Employee. In the event of such
termination, and provided that no benefits are payable
to Employee under a separate severance agreement or an
executive severance plan as a result of such termination
or pursuant to the provisions of Section 5, Company
shall pay Employee one (1) year of Base Salary at the
rate in effect on the date of termination and provided
Employee executes a mutually acceptable severance
agreement, which agreement would include a general
release in favor of the Company.
(f) If Employee receives benefits under a separate severance
agreement, executive severance plan or pursuant to the
provision of Section 5, Employee shall not be entitled
to payments pursuant to sub-section 9(e).
10. Confidentiality. Except in performance of services for the
Company, Employee shall not, either during the period of
Employees employment with the Company or thereafter, use for
Employee's own benefit or disclose to or use for the benefit of
any person outside the Company, any information concerning any
Intellectual Property, or other confidential or proprietary
information of the Company, whether Employee has such
information in Employee's memory or embodied in writing or other
tangible form. All originals and copies of any of the foregoing,
however and whenever produced, shall be the sole property of the
Company, not to be removed from the premises or custody of the
Company without in each instance first obtaining authorization
of the Company, which authorization may be revoked by the
Company at any time. Upon the termination of Employee's
employment in any manner or for any reason, Employee shall
promptly surrender to the Company all copies of any of the
foregoing, together with any documents, materials data,
information and equipment belonging to or relating to the
Company's business and in Employee's possession, custody or
control, and Employee shall not thereafter retain or deliver to
any other person any of the foregoing or any summary or
memorandum thereof.
11. Non-Competition Covenants:
11.1 For as long as Employee is receiving Base Salary payments
pursuant to the terms of this Agreement, Employee may not render
services to or be otherwise employed by or associated with, or
(except as a holder of a stock interest not to exceed 1 percent
in the securities of publicly held and traded companies)
interested in any person or entity which sells services or
products competitive with those offered by Company.
11.2 If Employee violates any of the covenants or agreements under
this Section 11, Company shall be entitled to an accounting and
repayment of all profits, compensation, commissions,
remuneration, or other benefits that Employee directly or
indirectly has realized and/or may realize as a result of,
growing out of, or in connection with, any such violation. These
remedies shall be in addition to, and not
in limitation of, any other rights or remedies to which Company
is or may be entitled.
12. Non-Solicitation Agreement. Employee agrees and covenants that
Employee will not, unless acting with the Company's express
written consent, directly or indirectly, during the term of this
Agreement or for a period of two (2) years thereafter, solicit,
entice away or interfere with the Company's contractual
relationships with any customer, client, broker, officer or
employee of the Company.
13. Notices. All notices and other communications hereunder shall be
in writing and shall be deemed to have been given three days
after having been delivered or mailed by first-class, registered
or certified mail, or the next day after having been sent by
overnight mail, as follows: (a) if to Employee, at the address
shown at the head of this Agreement or to such other person(s)
or address(es) as Employee shall have furnished to the Company
in writing; and (b) if to the Company, Attention: Chairman of
the Board, with a copy to the General Counsel, or to such other
person(s) or address(es) as the Company shall have furnished to
the Employee in writing.
14. Assignability. In the event that the Company shall be merged
with, or consolidated into, any other corporation, or in the
event that it shall sell and transfer substantially all of its
assets to another corporation or entity, the terms of this
Agreement shall inure to the benefit of, and be assumed by, the
corporation or entity resulting from such merger or
consolidation, or to which the Company's assets shall be sold
and transferred. This Agreement shall not be assignable by
Employee.
15. Entire Agreement. This Agreement contains the entire agreement
between the Company and Employee with respect to the subject
matter hereof and there have been no oral or other prior
agreements of any kind whatsoever as a condition, precedent or
inducement to the signing of this Agreement or otherwise
concerning this Agreement or the subject matter hereof.
16. Remedies.
16.1 Subject to Section 16.2, any claim or controversy arising out of
or relating to this Agreement, including (without limitation) a
claim by Company that Employee has violated any one or more of
the restrictions set forth in Sections 10, 11 or 12, shall be
settled by arbitration before a single arbitrator in Boston,
Massachusetts in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. If the arbitrator
finds that a violation of the foregoing restrictions exits or is
threatened he shall prescribe appropriate relief which may
include an award that Employee desist from such violation,
whether or not such an order would issue, in the circumstances,
under the equity powers of a court. Judgment upon the award
rendered by the arbitrator may be entered in any court of
competent jurisdiction.
16.2 Company shall have the right, which may be exercised in lieu of
or in addition to the procedure set forth in Section 16.2, to
submit a claim that Employee has violated any one or more of the
restrictions set forth in Sections 10, 11 or 12 to any court of
competent jurisdiction and Company will be entitled, in addition
to any other remedies available to it from such court, to obtain
injunctive relief from such court to enforce the terms of this
Agreement. Employee, upon receipt of written notice of the
institution of proceedings in such court, hereby agrees to
submit to the jurisdiction of such court.
17. Amendments. This Agreement may not be amended, nor shall any
change, waiver, modification, consent or discharge be effected
except by written instrument executed by the Company and
Employee.
18. Severability. If any part of any term or provision of this
Agreement shall be hold or deemed to be invalid, inoperative or
unenforceable to any extent by a court of competent
jurisdiction, such circumstance shall in no way affect any other
term or provision of this Agreement, the application of such
term or provision in any other circumstances, or the validity or
enforceability of this Agreement.
19. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the law of the Commonwealth of
Massachusetts, without regard to conflict of law principles.
IN WITNESS WHEREOF, the parties have executed or caused to be executed this
Agreement as of the date first above written,
First Allmerica Financial Life Insurance
Company
[Seal] By: /s/ Xxxxx X. Xxxxxxxx
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Its
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Xxxxx X. Xxxxxxxx, Employee
