Exhibit 10.2
CONSULTING AGREEMENT
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This memorandum sets forth the terms and conditions of the agreement
(hereinafter referred to as "Consulting Agreement") for consulting services to
be provided by Xxxxxx X. Xxxxx (the "Consultant") to Tower Group, Inc., its
parent, subsidiary and affiliated corporations, and their successors and assigns
(collectively, "Tower").
1. The term of this Consulting Agreement will be for a period of six (6)
months beginning on July 1, 2007 and ending on December 31, 2007 (the "Term").
Notwithstanding anything to the contrary in this Consulting Agreement, this
Consulting Agreement will be signed contemporaneously with the Separation
Agreement between Consultant and Tower dated June 30, 2007 (the "Separation
Agreement"), and this Consulting Agreement will not become effective unless and
until Consultant has signed and has not revoked (as set forth in paragraph 16 of
the Separation Agreement) the Separation Agreement.
2. During the Term, Consultant will, as an independent contractor, make
himself available for all projects and meetings as reasonably requested by Tower
in order to assist Tower with the transition of its claims and legal departments
and to provide Tower with technical claims expertise on pending claims or suits.
Consultant's responsibilities will be limited to matter in which he worked on
while employed by Tower and is intended only to provide services for which
Consultant is uniquely qualified due to his prior work for Tower.
3. As payment for the provision of the consulting services, Tower will pay
to Consultant the lump sum of $190,378.50 on or before July 1, 2007.
4. Nothing in this Consulting Agreement shall be construed as creating any
partnership, joint venture or agency between Tower and Consultant. Consultant
shall act solely as an independent contractor and, as such, is not authorized to
bind Tower to third parties. Consultant agrees that he will not, without written
consent of Tower in each instance (1) send any written or electronic
correspondence on behalf of Tower, or any affiliate of Tower, or any employee of
Tower, nor use any trade name, trademark, trade device, service xxxx, symbol or
any abbreviation, contraction or simulation thereof owned by Tower or its
affiliates, or (2) represent, directly or indirectly, that Consultant has any
authority to act on behalf of Tower. Tower shall issue a form 1099 with respect
to the payment made pursuant to paragraph 3 of this Consulting Agreement.
Neither federal, state, nor local taxes of any kind shall be withheld or paid by
Tower on behalf of Consultant in connection with the payment made by Tower under
paragraph 3 hereof. Consultant shall be responsible for determining the amounts
of and making all such payments. Consultant shall indemnify, defend and hold
Tower, its officers, directors, agents, employees, contractors and shareholders
harmless from and against any and all claims, liabilities, losses, damages,
costs and expenses (including, without limitation, attorneys' fees and expenses)
arising out of or relating to the foregoing responsibility of Consultant.
5. Consultant is not an employee of Tower and, except as expressly provided
in the Separation Agreement, is not entitled to participate in any of Tower
employee benefit plans including, but not limited to, any retirement, pension,
profit sharing, group insurance, health insurance or similar plans that have
been or may be instituted by Tower for the benefit of its employees. Consultant
will be responsible for all expenses incurred by him in connection with his
performance of services under this Consulting Agreement.
6. All proposals, research, records, reports, recommendations, manuals,
findings, evaluations, forms, reviews, information, data and written materials
originated or prepared by Consultant for and in the performance of the
consulting services hereunder shall become the exclusive property of Tower, and
shall be considered to be works for hire belonging to Tower, and Consultant
shall relinquish and hereby assigns any and all right, title, and interest in
and to such material to Tower. Consultant agrees to execute any and all
documents prepared by Tower and to do any and all other lawful acts as may be
required by Tower to establish, document and protect such rights of Tower.
7. Consultant agrees not to disclose, nor use for Consultant's benefit or
the benefit of any other person or entity, any information received from Tower
which is confidential or proprietary and (i) which has not been disclosed
publicly by Tower, (ii) which is otherwise not a matter of public knowledge or
(iii) which is a matter of public knowledge but Consultant knows or has reason
to know that such information became a matter of public knowledge through an
unauthorized disclosure. Proprietary or confidential information shall include
information the unauthorized disclosure or use of which would reduce the value
of such information to Tower. Such information includes, without limitation,
Tower's client lists, its trade secrets, any confidential information about (or
provided by) any client or prospective or former client of Tower, information
concerning Tower's business or financial affairs, including its books and
records, commitments, procedures, plans and prospects, products developed by
Tower, securities positions, or current or prospective transactions or business
of Tower. Consultant hereby confirms that, on or the conclusion of the Term,
Consultant will deliver to Tower and retain no copies of any written materials,
records and documents (including those that are electronically stored) made by
Consultant or coming into Consultant's possession during the Term which contain
or refer to any such proprietary or confidential information. Consultant further
confirms that, on or before the conclusion of the Term, Consultant will deliver
to Tower any and all property and equipment of Tower, including laptop
computers, etc., which may have been in Consultant's possession. Nothing in this
Agreement, however, shall be construed as a limitation on your right to work or
consult for any other employer or entity.
8. Except for matters covered under paragraphs 6 and/or 7 hereof, in the
event of any dispute or difference between Tower and Consultant with respect to
the subject matter of this Consulting Agreement and the enforcement of rights
hereunder, either Consultant or Tower may, by written notice to the other,
require such dispute or difference to be submitted to arbitration. The
arbitrator or arbitrators shall be selected by agreement of the parties or, if
they cannot agree on an arbitrator or arbitrators within 30 days after the date
arbitration is required by either party, then the arbitrator or arbitrators
shall be selected by the American Arbitration Association upon the application
of Consultant or Tower. The determination reached in such arbitration shall be
final and binding on both parties without any right of appeal or further
dispute. Execution of the determination by such arbitrator or arbitrators may be
sought in any court of competent jurisdiction. The arbitrator or arbitrators
shall not be bound by judicial formalities and may abstain from following the
strict rules of evidence and shall interpret this Consulting Agreement as an
honorable engagement and not merely as a legal obligation. Unless otherwise
agreed by the parties, any such arbitration shall take place in New York, New
York.
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9. If any of the provisions, terms or clauses of this Consulting Agreement
are declared illegal, unenforceable or ineffective in a legal forum, those
provisions, terms and clauses shall be deemed severable, such that all other
provisions, terms and clauses of this Consulting Agreement shall remain valid
and binding upon both parties.
10. All notices and other communications hereunder shall be in writing and
shall be mailed by first class, registered or certified mail, return receipt
requested, or postage prepaid or personally delivered (including delivery by
overnight couriers such as Federal Express), addressed as follows:
If to Tower:
Tower Group, Inc.
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: General Counsel
If to Consultant:
Xxxxxx X. Xxxxx
000 Xxxxxxx Xxxxxx
Xxxxxxxxx 0XX
Xxx Xxxx, XX 00000
Each party hereto may designate in writing a new address to which any notice or
other communication may thereafter be so given, served or sent. Each notice or
other communication that shall be mailed in the manner described above shall be
deemed sufficiently given, served, sent or received for all purposes at such
time as it is delivered to the addressee or at such time as delivery is refused
by the addressee upon presentation.
11. This Consulting Agreement may not be assigned, transferred or
subcontracted, in whole or in part, by Consultant.
12. This Consulting Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to conflicts of
law principles.
13. This Consulting Agreement and the Separation Agreement set forth the
entire understanding of the parties hereto relating to the retention of
Consultant by Tower, and all other previous and contemporaneous understandings
and agreements relating to the retention of Consultant by Tower, whether written
or oral, are hereby superseded. None of the terms or provisions hereof shall be
modified or waived, and this Consulting Agreement may not be amended or
terminated, except by a written instrument signed by the party against which
modification, waiver, amendment or termination is to be enforced. No waiver of
any one provision shall be construed as a waiver of any other provision and the
fact that an obligation is waived for a period of time shall not be considered
to be a continuous waiver.
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If the foregoing accurately sets forth our understanding, please indicate
your agreement by signing the originally executed copy of this Consulting
Agreement where indicated.
Very truly yours,
TOWER GROUP, INC.
By: /s/ Xxxxxxx X. Xxx
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Name: Xxxxxxx X. Xxx
Title: Chairman of the Board,
President and Chief Executive Officer
(Principal Executive Officer)
ACCEPTED AND AGREED:
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx Date
This Consulting Agreement shall be executed contemporaneously with the
Separation Agreement between Tower and Consultant dated June 30, 2007. This
Consulting Agreement and the Separation Agreement shall not become effective
unless and until Consultant has signed and not revoked (as set forth in
paragraph 16 of the Separation Agreement) the Separation Agreement.
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