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EXHIBIT 10.18
EMPLOYMENT AGREEMENT
AGREEMENT, made as of the First day of August, 1990, between
NEW JERSEY STATE MEDICAL UNDERWRITERS, INC., a
corporation of the State of New Jersey, having its
principal place of business at 0000 Xxxxxxxxx Xxxx,
Xxxxxxxxxxxxx, Xxx Xxxxxx (hereinafter called the
"Company")
and
XXXX X. XXXXXX, residing at 000 Xxxx Xxxxx Xxxx, Xxxx
Xxxx, Xxxxxxxxxxxx 00000 (hereinafter called "Xx.
Xxxxxx")
WHEREAS, the Company desires to employ, retain and make secure
for itself the experience, abilities and services of Xx. Xxxxxx as its Vice
President of Claims for a period of at least three (3) years from the effective
date hereof; and
WHEREAS, Xx. Xxxxxx desires to be so employed by the Company
on the terms and conditions stated herein;
NOW, THEREFORE, it is mutually agreed by and between the
parties hereto as follows:
1. Term. The Company agrees to, and does hereby, employ Xx. Xxxxxx as
its Vice President of Claims for a three (3) year term commencing August 1, 1990
and ending July 31, 1993, unless terminated sooner as herein provided. In the
event, however, that the Company does not intend to renew this Agreement for a
renewal term of at least one year, then it shall so notify Xx. Xxxxxx not less
than one year prior to the expiration date set forth in the immediately
preceding sentence. The failure of the Company to furnish such timely notice of
non-renewal shall constitute the binding commitment of the Company to extend the
term of this Agreement (on the same terms and conditions as herein set forth)
for a period of at least one year, unless Ms.
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Xxxxxx rejects such extension by written notice delivered to the Board of
Directors at least 120 days prior to the otherwise applicable expiration date.
2. Duties of Xx. Xxxxxx. Xx. Xxxxxx shall devote her entire business
time and attention to the interest and affairs of the Company in an executive
capacity as Vice President of Claims and will not during the period of her
employment hereunder engage in any other business or undertaking of any kind,
except those of an investment nature, without the prior written approval of the
President or the Board of Directors of the Company. Xx. Xxxxxx shall be
furnished with a private office, stenographic help and such other facilities and
services suitable to her executive position as a Vice President and adequate for
the performance of her duties.
Xx. Xxxxxx shall (subject to the supervision of the President,
to whom she shall report) be responsible for overseeing the activities of the
Claims Department. Xx. Xxxxxx shall serve on such committees as the President or
the Board of Directors may from time to time direct. Xx. Xxxxxx understands and
agrees that her duties may include the provision of services for or in respect
of other organizations with which the Company is affiliated by membership,
contract or otherwise. Xx. Xxxxxx shall, in addition, perform the duties
incident to the foregoing as well as such other duties, not inconsistent with
the foregoing or with her executive position, as the President or the Board of
Directors may from time to time direct.
3. Relocation Expenses of Xx. Xxxxxx. The Company shall assist Xx.
Xxxxxx to relocate her principal residence to the Lawrenceville, NJ area
(including Bucks County, PA) as follows:
(a) The Company shall lend Xx. Xxxxxx up to $60,000 at 10%
simple interest to be used as deposit moneys on a new home, provided Xx. Xxxxxx
executes a promissory note
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satisfactory to the Company in its form and content, and which note bears a term
not to exceed one year. Alternatively, the Company may guarantee a $60,000
credit line for Xx. Xxxxxx at a commercial lending institution for up to a one
year period, provided Xx. Xxxxxx executes a reimbursement agreement satisfactory
to the Company in its form and content.
(b) The Company shall reimburse Xx. Xxxxxx for the following:
(i) interest on the loan described in (a);
(ii) up to 18 months of interest at the prevailing
market rate on a swing loan needed to finance acquisition of a new home pending
sale of Xx. Xxxxxx'x current home.
(iii) a relocation allowance of a minimum of Five
Thousand Dollars ($5,000.00) to be used for the payment of expenses incurred by
Xx. Xxxxxx in relocating her principal residence to the Lawrenceville, New
Jersey area, such as the attorneys' fees for selling her current home and
purchasing a new home and moving costs. Expenses over the minimum relocation
allowance of Five Thousand Dollars ($5,000.00) may be reimbursed if the expenses
are reasonable, in the sole discretion of the Board of Directors. Such
relocation allowance shall be paid as soon as administratively feasible after
the submission of receipts or other documents by Xx. Xxxxxx adequate to
substantiate the amount of and purpose of the expenditure; and
(iv) Actual broker's fees up to six percent of the
sale price of Xx. Xxxxxx'x current home.
(v) The maximum amount reimbursed under subparagraphs
(i), (ii), and (iv) combined shall not exceed six percent of the sale price of
Xx. Xxxxxx'x current home.
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4. Salary. During the term hereof, the Company shall pay to Xx. Xxxxxx
a salary of One Hundred Fifty Thousand ($150,000) Dollars annually, payable in
equal bi-weekly installments. Such salary, and Xx. Xxxxxx'x performance
hereunder, shall be subject to a six-month review by the Board of Directors as
of February 1, 1991 and an annual review thereafter as of each August 1. Such
reviews will include cost of living and merit considerations. The Board of
Directors, in its sole and uncontrolled discretion, may grant a salary increase
as it deems appropriate.
5. Vacation. Xx. Xxxxxx shall be entitled to four weeks vacation, with
pay, during each twelve month period hereof. Such vacation shall be taken on
reasonable prior notice and at a time and manner which shall not interfere with
the proper operation of the Company's business. No more than ten days of unused
vacation time may be carried over to any subsequent calendar year.
6. Employee Benefits. Xx. Xxxxxx shall be entitled to any employee
benefits which may be made available to all salaried employees of the Company
and on the same terms and conditions as offered to any other salaried employee
of the Company. All matters of eligibility for benefits under any plan or plans
of retirement, deferred compensation, health, hospitalization, life insurance or
other benefits provided by the Company shall be determined in accordance with
the provisions of the employee benefit plans or the insurance policies, as the
case may be.
7. Automobile. During the period of Xx. Xxxxxx'x employment hereunder,
the Company shall supply her with an automobile suitable to her executive
position for her use, and the Company shall pay all maintenance, fuel, repairs
and insurance expense in connection with said automobile. Upon termination of
her employment with the Company, Xx. Xxxxxx shall have
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the right to purchase from the Company, at its then "trade-in" value (according
to National Automobile Dealers Association publications, or other reputable
sources), the automobile supplied to her by the Company.
8. Other Business Expense. During the period of her employment, Xx.
Xxxxxx will be reimbursed for her ordinary and necessary expenses incurred by
her for the Company in the performance of her duties hereunder in accordance
with the general policies of the Company as adopted by the Board of Directors
from time to time. Xx. Xxxxxx agrees to account monthly to the Company in detail
reasonably sufficient to substantiate that all such expenses were ordinary and
necessary and incurred in the performance of her duties hereunder, or the
Company shall have no obligation to reimburse Xx. Xxxxxx therefore.
9. Furnishing of Records. Xx. Xxxxxx agrees to furnish to the Company,
or the insurer under any policy of insurance providing benefits hereunder, or
the trustee or administrator of any employee benefit plan of the Company, or to
the authorized representative of any of the same, such records or other
information as may be reasonably required by them in connection with the
provision of benefits or the reimbursement of expense hereunder. In the event
that Xx. Xxxxxx fails to provide such records or furnish such information within
a reasonable time after request therefor, Xx. Xxxxxx shall be deemed to have
waived her rights with respect to such benefits or such reimbursement hereunder
without liability to the Company.
10. Confidential Information and Materials. (a) Xx. Xxxxxx hereby
acknowledges and agrees that all Confidential Information and Materials, as
defined below, of the Company she has received either directly or indirectly
within the scope of her employment, has been disclosed to her in a relationship
of confidence and she hereby covenants and agrees that she will keep the same
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confidential as more fully specified below. (For purposes of this Paragraph, the
term "Company" shall include any entity affiliated with the Company through some
degree of common ownership). She will not, without having first obtained the
written consent of the Company, directly or indirectly, communicate, reproduce,
disclose, reveal or use, any Confidential Information and Materials of the
Company whether such Confidential Information was acquired or developed by her
in the course of her employment or was otherwise obtained. She agrees that she
will not utilize any Confidential Information and Materials either on her own
behalf or on behalf of any Person, in any enterprise, venture, project or
business. (The term "Person" shall refer to any individual, corporation,
partnership, joint venture or other entity or association).
This Agreement does not apply to Confidential Information and
Materials (i) that have entered the public domain through no fault of Xx.
Xxxxxx, (ii) that the Company has authorized for public dissemination, (iii)
that were known to or possessed by her prior to her employment by the Company,
(iv) that were learned or obtained by her from sources having no duty of
confidentiality to the Company, or (v) that are generally available within the
medical professional liability insurance industry.
(b) All Confidential Information and Materials obtained in the
course of Xx. Xxxxxx'x employment by the Company, whether developed by her or
not, shall be the sole property of the Company, shall not be removed from the
premises of the Company without the written consent of the Company, and shall be
surrendered by her to the Company upon request by either the Company or upon
termination of her employment. She agrees not to retain any copies,
reproductions, notes or samples of Confidential Information and Materials.
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(c) Each and every Invention, as that term is defined below,
relating to the business or activities of the Company, that Xx. Xxxxxx, solely
or jointly with others, made or conceived of during the term of her employment
by the Company shall be the sole and exclusive property of the Company.
(d) In the event of a breach or threatened breach by Xx.
Xxxxxx of the provisions of this Agreement, the Company shall be entitled to an
injunction restraining her from disclosing, in whole or in part, information
about the Company or from rendering any services to any person, firm,
corporation, association or other entity to whom such information, in whole or
in part, has been disclosed or is threatened to be disclosed. Nothing herein
shall be construed as prohibiting the Company from pursuing any other remedies
available to it for such breach or threatened breach, including the recovery of
damages from Xx. Xxxxxx.
(e) Confidential Information and Materials means and includes,
but is not limited to the following, however obtained by or disclosed to Xx.
Xxxxxx and either (i) used or contemplated for use (and, if in writing, shall
include machine readable forms) in or pertaining to the business as engaged in
by the Company or (ii) as may have been disclosed by the Company to Xx. Xxxxxx:
patent disclosures and applications; technology; trade secrets; designs;
formulas; know-how; contracts; projects; documents; files; photographs;
drawings; sketches; data processing and computer software techniques; programs
and systems in any stage of development or completion; inventions; improvements;
discoveries; product components or compositions; processes; parts of processes;
manufacturing or engineering techniques; prototypes; tools; equipment; samples;
specimens; model; books; notebooks; papers; compilation of information; records
and specifications; operating methods; computer lists; the terms and conditions
of, and
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any information disclosed pursuant to, any license or similar agreement to which
the Company is party; the marketing methods, business plans, bid procedures,
operating practices and related financial data of the Company and of its
existing and potential licensors, licensees, customers, vendors, and suppliers;
the data and prices the Company obtains or has obtained, or at which it sells or
has sold, its product or services; research, development, manufacturing and
sales costs and receipts; lists or other written records used in the Company's
business; bids and proposals by the Company; information regarding Company's
financial condition; compensation and other terms of Company's collective
bargaining and other labor agreements.
"Inventions" shall mean and include any new inventions,
discoveries, modifications, improvements, ideas, conceptions, developments, and
designs, whether or not (i) patentable, (ii) tested, (iii) reduced to practice
or (iv) subject to copyright.
11. Termination with Cause. The Company shall have the right to
terminate Xx. Xxxxxx'x employment hereunder prior to the expiration of the term
provided herein, without liability to it, in the event of any of the following:
(a) Xx. Xxxxxx'x death;
(b) Xx. Xxxxxx'x inability to perform her duties as set forth
herein for a period of thirteen consecutive weeks , or a period of thirteen
weeks in any one calendar year, or sixteen weeks in any two year period during
the term hereof, except that the first sixteen weeks of disability resulting
from my pregnancy or childbirth shall not be counted;
(c) Demonstrable and material dereliction of duty or
responsibility by Xx. Xxxxxx;
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(d) The performance of any material act of dishonesty by Xx.
Xxxxxx relating to the Company or the type of duties to be performed by her
hereunder;
(e) Commission of a "crime" by Xx. Xxxxxx, as such term is
defined in N.J.S.A., 2C:1-4 (which definition, it is noted, excludes disorderly
persons offenses and other xxxxx offenses);
(f) The willful or grossly negligent commission by Xx. Xxxxxx
of any act materially harmful to the Company;
(g) The willful or grossly negligent impairment by Xx. Xxxxxx
of any Confidential Information and Materials as such term is defined in
Paragraph 10, or
(h) Except as may be permitted pursuant to the provisions of
Paragraph 2 hereof, employment or engagement in any occupation or business other
than Xx. Xxxxxx'x employment with the Company pursuant to this Agreement.
12. Termination Without Cause. The Company shall have the right to
terminate Xx. Xxxxxx'x employment hereunder, without cause, upon thirty (30)
days notice to Xx. Xxxxxx, provided that, subject to the provisions of Paragraph
13 hereof, Xx. Xxxxxx'x compensation and benefits shall continue until the
expiration of the term provided herein.
13. Obligation To Xx. Xxxxxx Upon Termination; Limit of Liability. In
the event of termination by the Company of Xx. Xxxxxx'x employment hereunder
prior to the expiration of the term herein provided without cause (or assertedly
without cause), Xx. Xxxxxx agrees to utilize her best efforts promptly to obtain
other employment at a comparable salary to that provided herein and in a
position suitable in consideration of Xx. Xxxxxx'x ability, experience and
reputation. Any compensation (including the value of any fringe benefits)
received by Ms.
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Xxxxxx pursuant to any other employment obtained shall serve to reduce any
liability of the Company hereunder. Should Xx. Xxxxxx fail to make such efforts,
she shall be deemed to have waived all rights to compensation or other benefits
hereunder after the date of such termination (except such as shall be then
vested in her), and the Company shall have no liability hereunder after the date
of such termination. In no event shall the liability of the Company hereunder
exceed the amount of compensation and benefits provided hereby.
14. Termination By Xx. Xxxxxx. Notwithstanding any provision herein
contained to the contrary, Xx. Xxxxxx may at any time terminate her employment
hereunder upon 120 days written notice delivered to the Board of Directors of
the Company.
15. Employment After Termination or Expiration. In the event of the
termination of Xx. Xxxxxx'x employment with the Company for any reason,
including expiration of this Agreement, other than as set forth in the following
sentence, Xx. Xxxxxx agrees that she will not, for a period of three years after
the effective date of such termination, compete directly or indirectly, as an
employee, consultant or otherwise, with the Company or with the Medical
Inter-Insurance Exchange of New Jersey (the "Exchange"), or accept employment
with any person, firm or corporation which competes directly or indirectly with
the Company or the Exchange; provided, however, that employment with any
insurance company which then (directly or through its subsidiaries and
affiliated companies) accounts for less than fifteen percent (15%) of all
written premiums for medical professional liability (including hospital
liability) insurance for New Jersey insured, shall not be deemed to violate the
terms hereof. The restrictions set forth in this Paragraph, however, shall not
apply in the event of (i) termination by the Company without cause as provided
in Paragraph 12 hereof, or (ii) expiration of this Agreement if the Company
shall not
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have offered (in writing) to extend the term hereof for at least one year and
upon the same terms and conditions as herein set forth. Xx. Xxxxxx expressly
agrees that upon any breach or violation of the terms of this Paragraph, the
Company, in addition to any other remedy, shall be entitled, as a matter of
right, to injunctive relief in any court of competent jurisdiction.
16. Protection against Personal Liability. The Company agrees to
maintain, to the extent reasonably available, a directors' and officers'
liability insurance policy, naming Xx. Xxxxxx as an insured thereunder, issued
by a reputable insurer, with policy limits of at least $1,000,000 (per claim and
in the aggregate) and containing coverages, conditions and exclusions which are
customary in such policies. The Company further agrees to reimburse Xx. Xxxxxx
for any loss covered under such policy to the extent of any deductible amount
provided therein. In the event that the Company determines, in its reasonable
discretion, that such an insurance policy is not reasonably available, it shall
(in lieu of maintaining such a policy) indemnify Xx. Xxxxxx against any and all
losses or expenses normally covered by such policies to the extent set forth in
the first two sentences of this Paragraph.
17. Assignment. The parties recognize and acknowledge that this
Agreement is one for the personal services of Xx. Xxxxxx and, therefore, may not
be assigned by her; nor may the services required of her hereunder be performed
by any other person without the authorization of the Company.
18. Other Binding Instruments, Etc. In addition to the policies, plans
and other instruments and documents described in Paragraph 8 hereof, the
following instruments and documents are incorporated herein by reference and
shall not be deemed superseded by this Agreement:
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Any and all applications, agreements and elections relating to
the plans and policies referred to in Paragraph 6 hereof, or
relating to any other employee benefit plan program maintained
by the Company.
19. Oral Negotiations Superseded; Amendment. This Agreement and (to the
extent specified herein) any agreement, document or instrument referred to
herein integrate all the terms and conditions mentioned herein or incidental
hereto and supersede all oral negotiations and prior writings in respect to the
subject matter hereof. This Agreement may not be amended or modified in any
manner, including this provision against oral amendment or modification, except
by an instrument in writing signed by the parties hereto.
20. Binding Effect. This Agreement shall inure to the benefit of and be
binding upon the Company and Xx. Xxxxxx and their respective successors,
assigns, executors and administrators, except that Xx. Xxxxxx may not assign
this Agreement and may not substitute another person to perform the services
required to be performed by her hereunder except as specifically provided
herein.
21. Paragraph Headings. Paragraph headings used herein are for
convenience only and shall not affect construction of this Agreement.
22. Governing Law. This Agreement shall be governed by and construed
under the laws of the State of New Jersey.
23. Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
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IN WITNESS WHEREOF, the Company has caused this Agreement to
be signed by its duly authorized officers and its corporate seal to be hereunto
affixed, and Xx. Xxxxxx has hereunto affixed her hand and seal, all as of the
day and year first above written.
NEW JERSEY STATE MEDICAL UNDERWRITERS, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx, President
ATTEST:
/s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, M.D.
Secretary/Treasurer
/s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
WITNESS:
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