Exhibit 10.4
AMENDMENT NO. 1
TO
AMENDED AND RESTATED
EMPLOYMENT CONTINUATION AGREEMENT
This Amendment No. 1 (this "Amendment") to the Amended and Restated
Employment Continuation Agreement dated January 1, 2003 (the "Restated
Agreement") by and among Xxxx Xxxxxxx Life Insurance Company, a Massachusetts
corporation (the "Company"), Xxxx Xxxxxxx Financial Services, Inc., a Delaware
corporation ("JHFS"), Xxxxx X. Xxxx (the "Executive") and Manulife Financial
Corporation, a corporation organized under the laws of Canada ("Manulife"), is
dated this 28th day of September, 2003.
WHEREAS, the Restated Agreement provides benefits and protection to the
Executive in the event of a Change in Control or Potential Change in Control (as
such terms are defined in the Restated Agreement);
WHEREAS, JHFS, Manulife and Jupiter Merger Corporation ("Merger Co.") have
entered into an Agreement and Plan of Merger dated as of the date hereof (the
"Merger Agreement") pursuant to which, and subject to the terms and conditions
of which, Merger Co. will merge with JHFS (the "Merger");
WHEREAS, the Company, JHFS, the Executive and Manulife are entering into
this Amendment in reliance upon the acknowledgment by the Company, JHFS, the
Executive and Manulife that the Merger and the other transactions contemplated
by the Merger Agreement will, upon consummation thereof at the Effective Time,
constitute a "Change of Control" under the Restated Agreement; and
WHEREAS, in connection with the Merger, the Company, JHFS and the
Executive desire to amend the Restated Agreement as set forth herein, and, for
certain purposes set forth below, Manulife desires to become a party to this
Amendment.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is hereby agreed among the Company, JHFS, the Executive and
Manulife as follows:
1. All capitalized, undefined terms used in this Amendment and not otherwise
defined herein shall have the meanings assigned thereto in the Restated
Agreement.
2. This Amendment shall become effective as of the date first set forth
above; provided, however, that if the Merger Agreement is terminated prior
to the Effective Time (as defined in the Merger Agreement), then this
Amendment shall automatically terminate and shall be of no further force
or effect. Each of the Company, JHFS, the Executive and Manulife
acknowledges that the Merger and the other transactions contemplated by
the Merger Agreement will, upon consummation thereof at the Effective
Time, constitute a "Change of Control" under the Restated Agreement.
3. Section 4 of the Restated Agreement is hereby amended by deleting
subsection (a) thereof in its entirety and substituting the following
subsection (a) therefor:
"(a) Titles, Positions and Duties. During the Employment
Period, the Executive's position (including status, offices and
titles), authority, duties and responsibilities shall be as set
forth below. The Executive's services shall be performed at the
location where the Executive was employed immediately preceding the
Effective Date. During the Employment Period, so long as the
Executive is employed by the Surviving Corporation (as defined in
the Agreement and Plan of Merger, dated September 28, 2003, by and
among Manulife, JHFS and Merger Co. (the "Merger Agreement")) or the
Company:
(i) the Executive shall hold the titles of (A) on and
after the Effective Date, Executive Vice President and General
Counsel of the Surviving Corporation and Executive Vice
President and General Counsel of the Company and (B) on and
after the Effective Date, Senior Executive Vice President of
Manulife, provided that if any other individual having a title
of Senior Executive Vice President of Manulife is assigned one
or more additional or superior titles (or such individual's
Senior Executive Vice President title is supplemented by an
additional or superior title or designation) commensurate with
such individual's responsibilities, duties and authority, then
the Executive shall likewise be assigned one or more
additional or superior titles (or supplemental title or
designation to his Senior Executive Vice President title), as
the case may be, commensurate with the Executive's
responsibilities, duties and authority; and
(ii) the Executive shall, on and after the Effective
Date, (A) be a member of any Executive Committee or Policy
Committee or committee having a similar function (other than
any such committee that is a committee of the Board of
Directors consisting solely of directors (a "Board
Committee")) of Manulife, the Surviving Corporation or the
Company and (B) be a member of any Executive Committee or
Policy Committee or committee having a similar function that
is a Board Committee of the Surviving Corporation or the
Company, but only if the Executive is a director of the
Surviving Corporation or the Company, as the case may be; and
(iii) the Executive shall hold, exercise and be assigned
the same responsibilities, duties and authority as
those held and exercised by, and assigned to, the Executive in
his positions with JHFS and the Company immediately prior to
the Effective Date, provided that (1) such responsibilities,
duties and authority shall include all of those customarily
held or exercised by, or assigned to, an Executive Vice
President and General Counsel that relate to all areas of
responsibility, duties and authority held or exercised by, or
assigned to, the Chairman and Chief Executive Officer, to whom
the Executive shall report as provided below, and (2) the
Executive shall not hold, exercise or be assigned those
responsibilities, duties and authority (x) directly relating
to Investment (which does not include Xxxx Xxxxxxx Funds,
Annuities or other Wealth Management, but does include
Guaranteed and Stable Funding Products), Asia operations,
Japan operations, Reinsurance and Corporate Functions, except
that the Executive shall have such responsibility, duties and
authority necessary to comply with applicable state and
federal laws (including with respect to periodic reporting and
other compliance under the U.S. federal securities laws by the
Company), and (y) that existed prior to the Effective Date
solely by virtue of JHFS being a public company having equity
securities registered under Section 12 of the Securities
Exchange Act of 1934; and
(iv) in his capacity as Executive Vice President and
General Counsel of the Surviving Corporation, the Executive
shall report solely to the Chairman and Chief Executive
Officer of the Surviving Corporation and to the Board of
Directors of the Surviving Corporation; and
(v) in his capacity as Executive Vice President and
General Counsel of the Company, the Executive shall report
solely to the Chairman and Chief Executive Officer of the
Company and to the Board of Directors of the Company; and
(vi) subject to clauses (iii)(1) and (2) above, the
Executive shall also hold, exercise and be assigned such
responsibilities, duties and authority as are customarily held
and exercised by, and assigned to, an individual serving as
Senior Executive Vice President of a Canadian and U.S. public
company comparable in size, structure and nature to Manulife.
In his capacity as Senior Executive Vice President of
Manulife, the Executive shall report solely to the Chief
Operating Officer and President-Elect and the Board of
Directors of Manulife."
4. Section 6(d) of the Restated Agreement is hereby amended by deleting
subsection (i) thereof in its entirety and substituting the following
subsection (i) therefor:
"(i) the assignment to the Executive of any duties
inconsistent in any material adverse respect with the Executive's
position, authority or responsibilities, as contemplated by Section
4 of this Agreement, or any other material adverse change or
significant reduction in position, titles, reporting lines,
authority or responsibilities, other than any such assignment
inconsistent with the foregoing that is inadvertent and cured by the
Company or JHFS, as applicable, within ten (10) business days after
receipt by the Board of Directors of the Company or the Board of
Directors of JHFS, as applicable, of written notice thereof given by
the Executive;"
5. Section 6(d) of the Restated Agreement is further amended by deleting
subsection (ii) thereof in its entirety and substituting the following
subsection (ii) therefor:
"(ii) any failure by the Company or JHFS to comply with any of
the provisions of Section 5 (other than Section 5(c)) of this
Agreement, other than an insubstantial or inadvertent failure that
is cured by the Company or JHFS, as applicable, within ten (10)
business days after receipt by the Board of Directors of the Company
or the Board of Directors of JHFS, as applicable, of written notice
thereof given by the Executive;"
6. Section 6(d) of the Restated Agreement is further amended by deleting the
last paragraph thereof and substituting therefor the following:
"Notwithstanding anything herein to the contrary, termination of
employment by the Executive for any reason at any time during the
one hundred and eighty (180) day period commencing on the first
anniversary date of the Effective Time of the Merger (as such terms
are defined in the Merger Agreement) shall be deemed to constitute
Good Reason."
7. By executing this Amendment, Manulife hereby expressly assumes and agrees
to perform the Restated Agreement, as amended by this Amendment, in
accordance with Section 13 thereof; provided, however that the Executive
hereby acknowledges and agrees that in no event shall anything in this
Amendment (or the Restated Agreement) be construed or applied to entitle
the Executive to receive payments or benefits under the Restated Agreement
that are duplicative of any payments or benefits provided to the Executive
by any of the Company, JHFS or Manulife under any other agreement or plan
that provides for payments or benefits upon a change of control. Manulife
further acknowledges and agrees to be bound by (1) the methodologies for
determining the amounts payable to the Executive pursuant to the
provisions of Sections 7(c), 7(d) and 7(f) of the Restated Agreement and
(2) the amounts that would be payable to the Executive if the Executive
were entitled to receive the payments and benefits set forth in such
Sections as of the Closing Date (as such term is defined in the Merger
Agreement), in each case as such methodologies and amounts are set forth
on Schedule A attached hereto. Manulife acknowledges that, in accordance
with the Restated Agreement, the Company shall designate in writing
primary and alternate Accountants to Manulife on or prior to the Closing
Date.
8. Except as amended by this Amendment, all other terms of the Restated
Agreement shall remain in full force and effect; provided, that, until the
earlier to occur of (i) the date that this Amendment terminates and is of
no further force and effect pursuant to Section 2 of this Amendment and
(ii) the Effective Time of the Merger, the Company, JHFS and the Executive
each hereby agrees and acknowledges that the Restated Agreement (as
amended by this Amendment) shall not be amended without the prior written
consent of Manulife.
9. Subject to Section 8 of this Amendment, this Amendment shall be subject to
the "Miscellaneous" provisions contained in Section 14 of the Restated
Agreement, which are incorporated by reference herein, provided that any
notice or other communication under the Restated Agreement or this
Amendment to be delivered to Manulife shall be provided to the following
address in accordance with Section 14(e) of the Restated Agreement:
Manulife Financial Corporation, 000 Xxxxx Xxxxxx Xxxx, Xxxxxxx, Xxxxxxx
X0X 0X0, attention: General Counsel. This Amendment may be executed in or
more counterparts and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an
original but all of which taken together shall constitute one and the same
agreement.
IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and the Company, JHFS and Manulife have caused this Amendment to be executed in
their respective names and on their behalf, all as of the day and year first
above written.
XXXX XXXXXXX LIFE INSURANCE COMPANY
By:_________________________________
Name: Xxxxx X'Xxxxxxxxxx
Title: Chairman, President and
Chief Executive Officer
XXXX XXXXXXX FINANCIAL SERVICES, INC.
By:_________________________________
Name: Xxxxx X'Xxxxxxxxxx
Title: Chairman, President and
Chief Executive Officer
EXECUTIVE:
____________________________________
Xxxxx X. Xxxx
MANULIFE FINANCIAL CORPORATION
By:_________________________________
Name: Xxxxxxx X'Xxxxxxxxxx
Title: President and Chief Executive Officer
Signature Page to Amendment to Employment Continuation Agreement
