EMPLOYMENT AGREEMENT
Exhibit
10.47
This
Employment Agreement, dated as of September 7, 2007 (this “Agreement”),
is by and between «Executive» (the “Executive”) and The Commerce Group,
Inc., a Massachusetts corporation (the “Company”), on behalf of itself
and each of the Companies, as hereinafter defined.
W
I T N E
S S E T H:
WHEREAS,
the Company wishes to obtain the future services of the Executive for and
on
behalf of the Companies (as defined in Section 8);
WHEREAS,
the Executive is willing upon the terms and conditions herein set forth,
to
provide services to the Companies hereunder; and
WHEREAS,
the Company wishes to secure the Executive’s non-interference with the
Companies’ business, upon the terms and conditions herein set
forth;
NOW,
THEREFORE, in consideration of the mutual promises and covenants contained
herein, and intending to be legally bound hereby, the parties hereto agree
as
follows:
1.Nature
of Employment
Subject
to
Section 3, one or more of the Companies shall employ the Executive, and
the Executive shall serve such employing entity or entities, in accordance
with
the terms of this Agreement, during the Term of Employment (as defined
in
Section 3(a)), as «Title» with such duties and responsibilities as are
customarily assigned to an executive in such position and such other duties
and
responsibilities not inconsistent therewith as may from time to time reasonably
be assigned to the Executive by the Board of Directors and/or Chairman
of the
Board, President and Chief Executive Officer of the Company. The
Executive also agrees to serve without additional compensation (unless
the Board
of Directors or the Committee (as defined in Section 8) otherwise
expressly provides) in such capacities (including, without limitation,
as an
officer or director) with Company Affiliates (as defined in Section 8) as
the Board of Directors and/or Chairman of the Board, President and Chief
Executive Officer of the Company may prescribe. Upon termination of
the Executive’s employment with the Companies, the Executive’s employment, board
membership or other service relationship with any Company Affiliate shall
automatically terminate unless otherwise agreed to by the parties.
2.Extent
of Employment
(a)During
the Term of Employment, the
Executive shall perform his obligations hereunder faithfully and to the
best of
his ability under the direction of the Board of Directors and/or Chairman
of the
Board, President and Chief Executive Officer of the Company, and shall
abide by
the rules, customs and usages from time to time established by the
Companies.
(b)During
the Term of Employment, the
Executive shall devote all of his business time, energy and skill as may
be
reasonably necessary for the performance of his duties, responsibilities
and
obligations hereunder (except for vacation periods and reasonable periods
of
illness or other incapacity), consistent with past practices and norms
in
similar positions.
(c)Nothing
contained herein shall
require the Executive to follow any directive or to perform any act which
would
violate any laws, ordinances, regulations or rules of any governmental,
regulatory or administrative body, agent or authority, any court or judicial
authority, or any public, private or industry regulatory authority
(collectively, the “Regulations”). The Executive shall act in
good faith in accordance with all Regulations.
3.Term
of Employment;
Termination
(a)The
“Term of Employment” shall commence on the date hereof and shall continue until
September 7, 2010 (the “Initial Term”); provided, that, (i) on September
7, 2010, and each anniversary thereof, such term shall be extended automatically
for a twelve month period (each such twelve month extension, an “Additional
Term”), unless at least 180 days prior to the scheduled expiration date
of
the Initial Term or any Additional Term, either the Executive or the Company
notifies the other of its decision not to continue such term and (ii) should
the
Executive’s employment by the Company be earlier terminated pursuant to
Section 3(b) or by the Executive pursuant to Section 3(c), the
Term of Employment shall end on the date of such earlier
termination.
(b)Subject
to the payments contemplated by Sections 3(e) through 3(g), the
Term of Employment may be terminated at any time by the Company:
(i)upon
the death of the
Executive;
(ii)in
the event that because of
physical or mental disability the Executive is unable to perform, and does
not
perform, in the view of the Company, and as certified in writing by a competent
medical physician, his duties hereunder for a continuous period of three
consecutive months or any sixty working days out of any consecutive six
month
period;
(iii)for
Cause, as defined in
Section 8, subject to Section 3(d); or
(iv)for
any other reason or no reason,
it being understood that no reason is required.
The
Executive acknowledges that no representations or promises have been made
concerning the grounds for termination or the future operation of the Companies’
business, and that nothing contained herein or otherwise stated by or on
behalf
of any of the Companies modifies or amends the right of the Company to
terminate
the Executive at any time, with or without Cause. Termination shall
become effective upon the delivery by the Company to the Executive of notice
specifying such termination and, if applicable, the reasons, if any, therefor
(i.e., Section 3(b)(i)-(iv)), subject to the requirements for
advance notice and an opportunity to cure provided in this Agreement, if
and to
the extent applicable.
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(c)Subject
to the payments contemplated
by Section 3(e), the Term of Employment may be terminated at any time by
the Executive:
(i)upon
the death of the
Executive;
(ii)in
the event that because of
physical or mental disability the Executive is unable to perform, and does
not
perform, in the view of the Company, and as certified by a competent medical
physician, his duties hereunder for a continuous period of three consecutive
months or any sixty working days out of any consecutive six month
period;
(iii)for
Good Reason, as defined in
Section 8, it being agreed that in the event of a Proposed Business
Combination that results in a Change of Control, the determination of Good
Reason shall be made, at the Executive’s election, relative to conditions
existing immediately prior to the commencement of the Proposed Business
Combination. Notwithstanding any provision of this Agreement to the
contrary, in no event shall “Good Reason” be deemed to exist unless the
Executive shall have given the Company written notice before the Executive’s
voluntary resignation and not more than three (3) months after the Executive
first has actual knowledge of the facts and circumstances allegedly constituting
Good Reason, which notice must have made reference to this Agreement, set
forth
in reasonable detail the facts and circumstances allegedly constituting
Good
Reason, and stated that the Executive intends to voluntarily resign for
Good
Reason within the meaning of this Section 3(c)(iii), and that, within
twenty (20) days after receipt of such notice, the Company and its subsidiaries,
as applicable, shall not have rescinded or otherwise cured, and held the
Executive harmless against, each of the events cited in the Executive’s notice
as a basis for Good Reason;
(iv)as
a result of the Company’s
willful and material violation of this Agreement, the 2002 Amended and
Restated
Incentive Compensation Plan (the “Incentive Plan”), or any agreement
between the Executive and any of the Companies pertaining to awards made
pursuant to the Incentive Plan, in each case as such agreements or plans
may be
amended from time to time; or
(v)for
any other reason or no reason,
it being understood that no reason is required.
(d)Notwithstanding
any other provision
of this Agreement, in no event shall “Cause” be deemed to exist unless the
Company shall provide the Executive with written notice making reference
to this
Agreement, stating that the Company intends to terminate the Executive
for Cause
within the meaning of this Agreement, and setting forth in reasonable detail
the
facts and circumstances allegedly constituting Cause, provided however,
that the
foregoing notice requirement shall not apply where the Executive has been
convicted by a court of competent jurisdiction of any criminal offense,
whether
a felony or misdemeanor, involving dishonesty, breach of trust or
misappropriation, or has entered a plea of nolocontendere to any
such offense. The Company shall give any notice to the Executive
required under this Section 3(d) not less than thirty (30) days prior to
the Committee’s definitive determination of Cause and not more
than three (3) months after the Company first has actual knowledge of facts
and
circumstances allegedly constituting Cause. The Company shall afford
the Executive an opportunity to provide a written rebuttal to the Committee
before the Committee makes a definitive determination of
Cause.
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(e)In
the event the Executive’s
employment is terminated by the Company under any circumstances described
in
Section 3(b)(iv) (e.g., relating to involuntary terminations
without Cause) or by the Executive under the circumstances described in
Section 3(c)(iii) or (iv) (e.g., relating to resignations
for Good Reason or the Company’s violation of certain agreements) and except as
otherwise provided in Section 3(f),
(i)the
Company shall pay or cause to be
paid to the Executive, (A) within five business days after the date of
termination, any earned but unpaid base salary and any expense reimbursement
payments owed to the Executive, (B) within five business days after the
date of
termination or, if later, within 30 days after the issuance of audited
financial
statements for the Company for the prior year, any earned but unpaid annual
bonus payments relating to the prior year, and (C) any other earned but
unpaid
compensation to which the Executive is entitled under any other agreement,
arrangement or practice, to be paid at such time as is specified under
the terms
of such agreement or practice, but in no event later than March 15 of the
calendar year after the year in which the Executive’s employment terminates (the
“Accrued Obligations”);
(ii)the
Company shall pay or cause to
be paid to the Executive, within thirty business days after the date of
termination, a lump-sum payment equal to one hundred fifty (150%) percent
(the
“Standard Factor”) multiplied by the sum of (A) the Executive’s annual
base salary in effect immediately prior to the date of termination and
(B)
«word» dollars ($«amount») (the “RSU Amount”), being the value of the
Executive’s 2007 Restricted Stock Unit Award, determined as of the grant date;
and
(iii)during
a period equal to twelve
(12) months multiplied by the Standard Factor (the “Standard Severance
Period”) commencing on the date of the Executive’s employment termination,
the Company will provide or cause to be provided to the Executive (and
any
covered dependents), with life and health insurance benefits (but not disability
insurance benefits) substantially similar to those the Executive and any
covered
dependents were receiving immediately prior to the date of termination
and at
the same dollar cost to the Executive as in effect immediately prior to
the
termination of employment. If the Company provides or arranges to
provide the Executive and covered dependents with life and health insurance
benefits, those benefits will be reduced to the extent comparable benefits
are
received by, or made available to, the Executive (at no greater cost to
the
Executive) by another employer during the Standard Severance Period following
the Executive’s date of termination. The Executive must report to the
Company any such benefits that he receives or that are made
available. In lieu of the benefits described in this Section
3(e)(iii), the Company, in its sole discretion, may elect to pay or cause to
be paid to the Executive a lump sum cash payment equal to the monthly premiums
that would have been paid to provide such benefits to the Executive for
each
month such coverage is not provided under this Section
3(e)(iii). Nothing in this Section 3(e)(iii) will extend
the COBRA continuation coverage period.
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(iv)Notwithstanding
the provisions of
Section 3(e)(ii) relating to the time at which the lump sum payment
provided for under this Section 3(e) is to be made, if the Executive is a
“specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code
at the time his employment terminates pursuant to this Section 3(e), and
the lump sum payment to which he is entitled under Section 3(e)(ii) is
treated as being made on account of separation from service pursuant to
Section
409A(a)(2)(A)(i) of the Code, such payment shall be paid to the Executive
pursuant to Section 3(e)(ii) on the first business day of the seventh
month commencing after the month during which his employment terminates;
provided however that if such payment is due to involuntary separation
from
service within the meaning of Treasury Regulation Sections 1.409A-1(b)(9)(iii)
and 1.409A-1(n):
(A)The
Executive shall be entitled to receive the benefit provided for in Section
3(e)(ii) regardless of his status as a “specified employee,” to the extent
the total amount of such payment does not exceed two times the lesser of
(x) the
sum of the Executive’s annualized compensation based on the annual rate of pay
for services provided to the Company for the taxable year of the Executive
preceding the taxable year of the Executive in which the Executive’s employment
terminates (adjusted for any increase during that year that was expected to
continue indefinitely if the Executive’s employment had not been terminated), or
(y) the maximum amount that may be taken into account under a qualified
plan
pursuant to Section 401(a)(17) of the Code for the year in which the Executive’s
employment is terminated; and
(B)Any
portion of the lump sum benefit payable under Section 3(e)(ii) that is in
excess of the amount described in Section 3(e)(iv)(A) shall be paid to
the Executive on the first business day of the seventh month commencing
after
the month during which his employment terminates.
(f)In
the event the Executive’s
employment is terminated under any circumstances described in Section
3(b)(iv) (e.g., relating to involuntary terminations without Cause)
or by the Executive under the circumstances described in Section
3(c)(iii) or (iv) (e.g., relating to resignations for Good
Reason or the Company’s violation of certain agreements) and such termination
occurs either (X) within three (3) years after a Change of Control (provided
the
Term of Employment has not already expired) or (Y) after the commencement
of the
Proposed Business Combination that results in such Change of
Control,
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(i)the
Company shall pay or cause to be
paid to the Executive any Accrued Obligations;
(ii)the
Company shall pay or cause to
be paid to the Executive, within thirty business days after the date of
termination, a lump-sum payment equal to three hundred (300%) percent (the
“Change-of-Control Factor”) multiplied by the sum of (A) the Executive’s
annual base salary in effect immediately prior to the date of termination
(or at
the Executive’s election, immediately prior to the earlier commencement of the
Proposed Business Combination that results in such Change of Control),
and (B)
the RSU Amount, as defined in Section 3(e)(ii); and
(iii)during
a period equal to twelve
(12) months multiplied by the Change-of-Control Factor (the
“Change-of-Control Severance Period”) commencing on the date of the
Executive’s employment termination, the Company will provide or cause to be
provided to the Executive (and any covered dependents), with life and health
insurance benefits (but not disability insurance benefits) substantially
similar
to those the Executive and any covered dependents were receiving immediately
prior to the date of termination and at the same dollar cost to the Executive
as
in effect immediately prior to the termination of employment. If the
Company provides or arranges to provide the Executive and covered dependents
with life and health insurance benefits, those benefits will be reduced
to the
extent comparable benefits are received by, or made available to, the Executive
(at no greater cost to the Executive) by another employer during the
Change-of-Control Severance Period. The Executive must report to the
Company any such benefits that he receives or that are made
available. In lieu of the benefits described in this Section
3(f)(iii), the Company, in its sole discretion, may elect to pay or cause to
be paid to the Executive a lump sum cash payment equal to the monthly premiums
that would have been paid to provide such benefits to the Executive for
each
month such coverage is not provided under this Section
3(f)(iii). Nothing in this Section 3(f)(iii) will extend
the COBRA continuation coverage period.
(iv)Notwithstanding
the provisions of
Section 3(f)(ii) relating to the time at which the lump sum payment
provided for under this Section 3(f) is to be made, if the Executive is a
“specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code
at the time his employment terminates pursuant to this Section 3(f), and
the lump sum payment to which he is entitled under Section 3(f)(ii) is
treated as being made on account of separation from service pursuant to
Section
409A(a)(2)(A)(i) of the Code, such payment shall be paid to the Executive
pursuant to Section 3(f)(ii) on the first business day of the seventh
month commencing after the month during which his employment terminates;
provided however that if such payment is due to involuntary separation
from
service within the meaning of Treasury Regulation Sections 1.409A-1(b)(9)(iii)
and 1.409A-1(n):
(A)The
Executive shall be entitled to receive the benefit provided for in Section
3(f)(ii) regardless of his status as a “specified employee,” to the extent
the total amount of such payment does not exceed two times the lesser of
(x) the
sum of the Executive’s annualized compensation based on the annual rate of pay
for services provided to the Company for the taxable year of the Executive
preceding the taxable year of the Executive in which the Executive’s employment
terminates (adjusted for any increase during that year that was expected
to
continue indefinitely if the Executive’s employment had not been terminated), or
(y) the maximum amount that may be taken into account under a qualified
plan
pursuant to Section 401(a)(17) of the Code for the year in which the Executive’s
employment is terminated; and
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(B)Any
portion of the lump sum benefit payable under Section 3(f)(ii) that is in
excess of the amount described in Section 3(f)(iv)(A) shall be paid to
the Executive on the first business day of the seventh month commencing
after
the month during which his employment terminates.
(vi)Nothing
in this Section 3(f)
or otherwise, shall restrict the Executive’s right to terminate employment in
accordance with Section 3(c)(v) at any time including, without limitation
at any time after a Change of Control or the commencement of any Proposed
Business Combination.
(g)In
the event the Executive’s
employment is terminated by the Company under the circumstances described
in
Section 3(b)(i) or (ii) (e.g., termination based on the
Executive’s death or disability) by the Executive under Section 3(c)(i)
or (ii) (e.g., separation from service based on the Executive’s
death or disability),
(i)the
Company will pay or cause to be
paid to the Executive (or the Executive’s estate or representative, as the case
may be) any Accrued Obligations; and
(ii)for
a one (1) year period after the
date of termination, the Company will provide or cause to be provided to
the
Executive, if living, and any covered dependents, employee life and health
insurance benefits (but not disability insurance benefits) substantially
similar
to those the Executive and any covered dependents were receiving immediately
prior to the date of termination and at the same dollar cost to the Executive
or, if applicable, his dependents, as in effect immediately prior to the
termination of employment. If the Company provides or arranges to
provide the Executive and covered dependents with life and health insurance
benefits, those benefits will be reduced to the extent comparable benefits
are
received by, or made available to, the Executive (at no greater cost to
the
Executive) by another employer during the one (1) year period following
the
Executive’s date of termination. The Executive must report to the
Company any such benefits that he receives or that are made
available. In lieu of the benefits described in this Section
3(g)(ii), the Company, in its sole discretion, may elect to pay or cause to
be paid to the Executive a lump sum cash payment equal to the monthly premiums
that would have been paid to provide such benefits to the Executive for
each
month such coverage is not provided under this Section
3(g)(ii). Nothing in this Section 3(g)(ii) will extend the
COBRA continuation coverage period.
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(h)In
the event the Executive’s
employment is terminated by the Company under any circumstances described
in
Section 3(b)(iii) (relating to termination for Cause) or by the Executive
as a result of resignation or voluntary termination due to any circumstance
other than the Good Reason described in Section 3(c)(iii) above, there
will be no amounts, other than Accrued Obligations, owed to the Executive
under
Section 3 or any other part of this Agreement, from and after the
effective date of termination.
(i)The
payments and benefits required
by Section 3(e), 3(f), or 3(g), as applicable, constitute
severance and liquidated damages, and, except for payments that may be
required
pursuant to Section 7, the Company will not be obligated to pay or cause
to be paid any further amounts to the Executive under this
Agreement. Notwithstanding the foregoing, nothing herein shall
adversely affect the Executive’s rights to the Accrued Obligations or other
amounts to which he may be entitled under any written agreement other than
this
Agreement.
(j)All
determinations pursuant to this
Section 3 shall be made by the Company’s Board of Directors (not
including the Executive) or, to the extent expressly provided for under
Section 3 by the Committee, in good faith.
(k)Termination
of the Term of
Employment will not terminate Sections 4 through 7 and 9
through 19, or any other provisions not associated specifically with the
Term of Employment.
(l)Notwithstanding
any provision herein
to the contrary, as a condition to payment of any amounts or provision
of any
benefits pursuant to Sections 3(e) through 3(g) or 7 of
this Agreement (other than due to the Executive’s death), the Executive shall be
required to have executed a complete release of the Companies and related
parties in such form as is reasonably required by the Company, and any
waiting
periods contained in such release shall have expired.
(m)The
parties agree that any
determination made by the Board or, if applicable, the Committee in connection
with the Executive’s separation from employment regarding the existence of
“Cause,” “Change of Control,” or “Good Reason” for purposes of the Incentive
Plan shall be conclusive and binding upon the parties for purposes of this
Agreement. The parties further agree that, in the absence of any such
determination made by the Board or the Committee for purposes of the Incentive
Plan, any determination made by the Board or the Committee regarding the
existence of “Cause,” “Change of Control,” or “Good Reason” for purposes of this
Agreement, shall be conclusive and binding upon the parties for purposes
of the
Incentive Plan.
4.Confidential
Information
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During
and
after the Term of Employment, the Executive will not, directly or indirectly
in
one or a series of transactions, disclose to any person, or use or otherwise
exploit for the Executive’s own benefit or for the benefit of anyone other than
the Companies, any Confidential Information, whether prepared by the
Executive
or not; provided, however, that any Confidential Information may be disclosed
to
officers, representatives, employees and agents of the Companies who
need to
know such Confidential Information in order to perform the services or
conduct
the operations required or expected of them in the Business (as defined
in
Section 8). The Executive shall use his best efforts to
prevent the removal of any Confidential Information from the premises
of the
Companies, except as required in his normal course of employment by the
Company. The Executive shall use commercially reasonable efforts to
cause all persons or entities to whom any Confidential Information shall
be
disclosed by him hereunder to observe the terms and conditions set forth
herein
as though each such person or entity was bound hereby. The Executive
shall have no obligation hereunder to keep confidential any Confidential
Information if and to the extent disclosure of any thereof is specifically
required by law; provided, however, that in the event disclosure is required
by
applicable law, the Executive shall provide the Companies with prompt
notice of
such requirement, prior to making any disclosure, so that the Companies
may seek
an appropriate protective order. At the request of the Companies, the
Executive agrees to deliver to the Companies, at any time during the
Term of
Employment, or thereafter, all Confidential Information which he may
possess or
control. The Executive agrees that all Confidential Information of
the Companies (whether now or hereafter existing) conceived, discovered
or made
by him during the Term of Employment exclusively belongs to the Companies
(and
not to the Executive). The Executive will promptly disclose such
Confidential Information to the Companies and perform all actions reasonably
requested by the Companies to establish and confirm such exclusive
ownership.
5.Non-Interference
(a)The
Executive acknowledges that the
services to be provided give him the opportunity to have special knowledge
of
the Companies and their Confidential Information and the capabilities of
individuals employed by or affiliated with the Companies and that interference
in these relationships would cause irreparable injury to the
Companies. In consideration of this Agreement, the Executive
covenants and agrees that:
(i)During
the Restricted Period (which
shall not be reduced by any period of violation of this Agreement by the
Executive or period which is required for litigation to enforce the Company’s
rights hereunder), the Executive will not, without the express written
approval
of the Board of Directors of the Company, directly or indirectly, in one
or a
series of transactions, own, manage, operate, control, invest or acquire
an
interest in, or otherwise engage or participate in, whether as a proprietor,
partner, stockholder, lender, director, officer, employee, joint venturer,
investor, lessor, supplier, customer, agent, consultant, representative
or other
participant, in any business which competes, directly or indirectly, with
the
Business in the Market (“Competitive Business”) without regard to (A)
whether the Competitive Business has its office, manufacturing or other
business
facilities within or without the Market, (B) whether any of the activities
of
the Executive referred to above occur or are performed within or without
the
Market or (C) whether the Executive resides, or reports to an office, within
or
without the Market; provided, however, that (x) the Executive may, directly
or
indirectly, in one or a series of transactions, own, invest or acquire
an
interest in up to two percent (2%) of the capital stock of any corporation
that
is engaged in a Competitive Business and the capital stock of which is
traded
publicly, or that (y) the Executive may accept employment with a successor
company to the Company;
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(ii)During
the Restricted Period (which
shall not be reduced by any period of violation of this Agreement by the
Executive or period which is required for litigation to enforce the Company’s
rights hereunder), the Executive will not without the express prior written
approval of the Board of Directors of the Company (A) directly or indirectly,
in
one or a series of transactions, recruit, solicit or otherwise induce or
influence any proprietor, partner, stockholder, lender, director, officer,
employee, sales agent, joint venturer, investor, lessor, supplier, customer,
agent, consultant, representative or any other person which has a business
relationship with the Companies or had a business relationship with the
Companies within the 24 month period preceding the commencement of the
conduct
covered by this clause (A), to discontinue, reduce or modify such employment,
agency or business relationship with the Companies, or (B) employ or seek
to
employ or cause any Competitive Business to employ or seek to employ any
person
or agent who is then (or was at any time within 24 months prior to the
date the
Executive or the Competitive Business employs or seeks to employ such person)
employed or retained by the Companies. Notwithstanding the foregoing,
nothing herein shall prevent the Executive from providing a letter of
recommendation to an employee with respect to a future employment opportunity;
and
(iii)The
Executive expressly
acknowledges and agrees that the scope and term of this Section 5 would
not preclude the Executive from earning a living with an entity that is
not a
Competitive Business.
(b)In
the event that the Executive
breaches his obligations in any material respect under Section 4, this
Section 5 or Section 6, the Company, in addition to pursuing all
available remedies under this Agreement, at law or otherwise, and without
limiting its right to pursue the same shall cease or cause to be ceased
all
payments thereafter due to the Executive under this Agreement or any other
agreement. Notwithstanding any other provision of this Agreement to
the contrary, in no event shall the Companies be entitled to recover any
amounts
paid hereunder prior to the date of a breach by the Executive, and the
Companies
expressly waive all rights to seek or receive any such amounts.
6.Non-Disparagement
During
and
after the Term of Employment, the Executive agrees that he shall not make
any
false, defamatory or disparaging statements about any Company Affiliate
or the
officers or directors of the Companies. During and after the Term of
Employment, the Company agrees, on behalf of the Companies that neither
the
officers nor the directors of the Companies shall make any false, defamatory
or
disparaging statements about the Executive.
7.Excise
and Additional Tax Gross-up Payments
(a)If
any payments or benefits paid or
provided or to be paid or provided to the Executive or for his benefit
pursuant
to the terms of this Agreement or otherwise in connection with, or arising
out
of, his employment with the Company or the termination thereof (a
“Payment”) would be subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the “Code”) or to an
additional tax imposed by Section 409A of the Code (jointly and severally
referred to herein as an “Excise Tax”), then the Executive will be
entitled to receive an additional payment (a “Gross-Up Payment”) in an
amount such that after payment by the Executive of all income taxes, employment
taxes and any Excise Tax imposed upon the Gross-Up Payment (including any
related interest and penalties), the Executive retains an amount of the
Gross-Up
Payment equal to the Excise Tax (including any related interest and penalties)
imposed upon the Payments.
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(b)An
initial determination of whether
a Gross-Up Payment is required pursuant to this Agreement, and the amount
of
such Gross-Up Payment, will be made at the Company’s expense by an accounting
firm selected by the Company. The accounting firm will provide its
determination, together with detailed supporting calculations and documentation,
to the Company and the Executive within twenty (20) business days after
the date
of termination of the Executive’s employment, or such other time as may be
requested by the Company or the Executive. If the accounting firm
determines that no Excise Tax is payable by the Executive with respect
to a
Payment or Payments, it will furnish the Executive with an opinion to that
effect. If a Gross-Up Payment becomes payable, such Gross-Up Payment
shall be paid to the Executive within thirty (30) business days of the
receipt
of the accounting firm’s determination. Within ten (10) business days
after the accounting firm delivers its determination to the Executive,
the
Executive will have the right to dispute the determination. The
existence of a dispute will not in any way affect the Executive’s right to
receive the Gross-Up Payment in accordance with the determination. If
there is no dispute, the determination will be binding, final, and conclusive
upon the Company and the Executive. If there is a dispute, the
Company and the Executive will together select a second accounting firm,
which
will review the determination and the Executive’s basis for the dispute and then
will render its own determination, which will be binding, final, and conclusive
on the Company and on the Executive for purposes of determining whether
a
Gross-Up Payment is required pursuant to this Section 7(b). If
as a result of any dispute pursuant to this Section 7(b) a Gross-Up
Payment or additional Gross-Up Payment is made, such Gross-Up Payment will
be
paid to the Executive within thirty (30) business days of the receipt of
the
second accounting firm’s determination. The Company will pay or
caused to be paid all costs associated with the second accounting firm’s
determination, unless such determination does not result in additional
Gross-Up
Payments to the Executive and in the good faith judgment of the second
accounting firm, the Executive’s dispute of the initial determination was
frivolous or in bad faith, in which case all such costs will be borne by
the
Executive.
(c)For
purposes of determining the
amount of the Gross-Up Payment, the Executive will be deemed to pay federal
income taxes at the highest marginal rate of federal income taxation in
the
calendar year in which the Gross-Up Payment is to be made and applicable
state
and local income taxes at the highest marginal rate of taxation in the
state and
locality of the Executive’s residence on the date of termination of the
Executive’s employment, net of the maximum reduction in federal income taxes
that would be obtained from deduction of those state and local
taxes.
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11 -
(d)As
a result of the uncertainty in
the application of Section 409A and/or Section 4999 of the Code, it is
possible
that Gross-Up Payments which will not have been made which should have
been made
(“Underpayment”) or Gross-Up Payments are made which should not have been
made (“Overpayment”). If it is determined that an Underpayment
has occurred, an accounting firm mutually acceptable to the Company and
the
Executive shall determine the amount of the Underpayment that has occurred
and
any such Underpayment (together with interest at the rate provided in Section
1274(b)(2)(B) of the Code adjusted, as applicable, in accordance with Section
409A of the Code) shall be promptly paid to or for the benefit of the
Executive. If an Overpayment has occurred, the Accounting Firm shall
determine the amount of the Overpayment that has been made and any such
Overpayment (together with interest at the rate provided in Section 1274(b)(2)
of the Code adjusted, as applicable, in accordance with Section 409A of
the
Code) shall be promptly paid by the Executive (to the extent he has received
a
refund if the applicable Excise Tax has been paid to the Internal Revenue
Service) to or for the benefit of the Company; provided, however, that
if the
Company determines that such repayment obligation would be or result in
an
unlawful extension of credit under Section 13(k) of the Securities Exchange
Act,
repayment shall not be required. The Executive shall cooperate, to
the extent his expenses are reimbursed in accordance with this Section 7,
with any reasonable requests by the Company in connection with any contest
or
disputes with the Internal Revenue Service in connection with the Excise
Tax.
(e)The
Executive shall notify the
Company in writing of any claim by the Internal Revenue Service that, if
successful, would require the payment of an Underpayment. Such
notification shall be given as soon as practicable but no later than ten
(10)
business days after the Executive is informed in writing of such claim
and shall
apprise the Company of the nature of such claim and the date on which such
claim
is requested to be paid. The Executive shall not pay such claim prior
to the expiration of the thirty (30) day period following the date on which
he
gives such notice to the Company (or such shorter period ending on the
date that
any payment of taxes with respect to such claim is due). If the
Company notifies the Executive in writing prior to the expiration of such
period
that it desires to contest such claim, the Executive shall:
(i)give
the Company any information
reasonably requested by the Company relating to such claim,
(ii)take
such action in connection with
contesting such claim as the Company shall reasonably request in writing
from
time to time, including, without limitation, accepting legal representation
with
respect to such claim by an attorney reasonably selected by the
Company,
(iii)cooperate
with the Company in good
faith in order effectively to contest such claim, and
(iv)permit
the Company to participate
in any proceeding relating to such claim;
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12 -
provided,
however, that the Company shall pay or cause to be paid all costs and expenses
(including additional interest and penalties) incurred in connection with
such
contest and shall indemnify and hold the Executive harmless, on an after-tax
basis, for any Excise Tax or income tax (including related interest and
penalties) imposed as a result of such representation and payment of costs
and
expenses. Without limitation on the foregoing provisions of this
Section 7(e), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or forgo
any
and all administrative appeals, proceedings, hearings and conferences with
the
taxing authority in respect of such claim and may, at its sole option,
either
direct the Executive to pay the tax claimed and xxx for a refund or contest
the
claim in any permissible manner, and the Executive agrees to prosecute
such
contest to a determination before any administrative tribunal, in a court
of
initial jurisdiction and in one or more appellate courts, as the Company
shall
determine; provided, however, that if the Company directs the Executive
to pay
such claim and xxx for a refund, such payment shall be advanced to the
Executive, on an interest-free basis and the Executive shall be indemnified
and
held harmless, on an after-tax basis, from any Excise Tax or income tax
(including related interest or penalties) imposed with respect to such
advance
or with respect to any imputed income with respect to such
advance. The Company’s control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder
and
the Executive shall be entitled to settle or contest, as the case may be,
any
other issue raised by the Internal Revenue Service or any other taxing
authority.
(f)If,
after the receipt by the
Executive of an amount advanced pursuant to Section 7(e), the Executive
becomes entitled to receive any refund with respect to such claim, the
Executive
shall (subject to the Company’s complying with the requirements of Section
7(e)) promptly pay to the Company the amount of such refund (together with
any interest paid or credited thereon after taxes applicable
thereto). If, after the receipt by the Executive of an amount
advanced pursuant to Section 7(e) hereof, a determination is made that
the Executive shall not be entitled to any refund with respect to such
claim and
the Company does not notify the Executive in writing of its intent to contest
such denial of refund prior to the expiration of thirty (30) days after
such
determination, then such advance shall be forgiven and shall not be required
to
be repaid.
8.Definitions
Capitalized
terms used in this Agreement but not otherwise defined shall have the meanings
set forth below:
“Affiliate”
and “Company Affiliate” means any corporation, limited liability company,
partnership or other entity which, directly or indirectly, controls, is
controlled by, or is under common control with the Company, including any
subsidiary of the Company within the meaning of Section 424 of the
Code.
“Board”
and “Board of Directors” means the board of directors of the
Company.
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13 -
“Business”
means any business conducted, or engaged in, by the Companies within the
twelve
month period ending on the applicable determination date. For this
purpose, the applicable determination date means the effective date as
of which
the Executive’s compliance with Section 7 or Section 8, respectively, is to be
determined.
“Business
Combination” shall have the meaning set forth in this Section 8 in the
definition of Change of Control.
“Cause”
means,
subject to the
provisions of Section 3(d), any of the following:
(i)the
Executive has been convicted by
a court of competent jurisdiction of any criminal offense, whether a felony
or
misdemeanor, involving dishonesty, breach of trust or misappropriation,
or has
entered a plea of nolocontendere to any such offense;
(ii)the
Executive has been the subject
of any action taken by a regulatory body or a self regulatory organization
that,
in the Committee’s good faith judgment, substantially impairs the Executive from
performing his or her duties to the Company or its subsidiaries, as
applicable;
(iii)the
Executive has committed, in
the Committee’s good faith judgment, any act of personal dishonesty in
connection with the Executive’s responsibilities to the Company or any of its
subsidiaries that is intended to result in the Executive’s personal
enrichment;
(iv)the
Executive has willfully
committed, in the Committee’s good faith judgment, a material violation of the
policies or rules of the Company or its subsidiaries, as applicable, including
the Company’s Code of Ethics;
(v)the
Executive has committed a
willful violation or any law, rule or regulation applicable to the Company
or
any of its affiliates (A) which, in the Committee’s good faith judgment, is a
felony or misdemeanor, or (B) which, in the Committee’s good faith judgment,
will likely have or has had a material adverse effect on the business,
interests
or reputation of the Company and its subsidiaries, taken as a
whole;
(vi)the
Executive has committed, in the
Committee’s good faith judgment, a willful and unauthorized disclosure of
material Confidential Information that the Executive received as a consequence
of the Executive’s employment by or other service with the Company or any of its
subsidiaries, as applicable, which disclosure, in the Committee’s good faith
judgment, will likely have or has had a material adverse effect on the
business,
interests or reputation of the Company and its subsidiaries, taken as a
whole;
or
(vii)the
Executive has committed, in
the Committee’s good faith judgment, gross negligence or gross misconduct in the
performance of duties reasonably assigned to the Executive in accordance
with
the custom and practices of the Company or its subsidiaries, as applicable,
that
in the Committee’s good faith judgment, will likely be or has been materially
injurious to the Companies or any of their customers; or
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14 -
(viii)the
Executive has willfully
refused to perform any lawful order or instruction reasonably given to
the
Executive in accordance with the custom and practices of the Company or
its
subsidiaries, as applicable, other than a refusal resulting from the Executive’s
incapacity because of physical or mental illness, which refusal continues
for
more than twenty (20) days after the Company gives written notice to the
Executive pursuant to a vote of the Committee, such notice and vote setting
forth in reasonable detail the nature of such refusal.
For
purposes of the foregoing clauses
(ii) through (viii), no act or failure to act on the part of the Executive
shall
be considered “willful” unless it is done, or omitted to be done, by the
Executive in bad faith or without reasonable belief that the Executive’s act or
omission was in the best interests of the Company. Any act, or failure
to act,
based upon express authority given pursuant to a resolution duly adopted
by the
Board of Directors of the Company with respect to such act or omission
or based
upon the advice of counsel for the Company shall be conclusively presumed
to be
done, or omitted to be done, by the Executive in good faith and in the
best
interests of the Company.
“Change
of
Control” means a reorganization, merger or consolidation of the Company, sale or
other disposition of all or substantially all of the assets of the Company,
liquidation, dissolution or similar transaction (each a “Business
Combination”) that the Board or the Committee determines constitutes a
Change of Control of the Company for purposes of the Incentive
Plan. Unless the Board or the Committee otherwise determines, a
“Change of Control” shall be deemed to have occurred if:
(i)holders
of a majority of the outstanding shares of Common Stock shall sell, in
a single
or related series of transactions, a majority of the outstanding shares
of
Common Stock to a person or entity, or a group of related persons or entities;
or
(ii)the
Company engages in a Business Combination, unless immediately following
the
consummation of such Business Combination both of the following conditions
are
satisfied: (i) persons who held a majority of the outstanding shares of
Common
Stock immediately prior to such Business Combination hold a majority of
the
outstanding shares of common stock of the entity resulting from such Business
Combination (the “Resulting Entity”), and (ii) at least one-half (½) of
the members of the board of directors of the Resulting Entity are persons
who
were Incumbent Directors immediately prior to the consummation of the Business
Combination (or persons whom a majority of the then Incumbent Directors
have
designated to serve on the Resulting Entity board of directors); or
(iii)any
person (including any entity or a group of persons and/or entities
acting in concert) acquires beneficial ownership (within the meaning of
Rule
13d-3 promulgated under the Securities Exchange Act of 1934, as amended)
of more
than twenty-five percent (25.0%) of the combined voting power (calculated
as
provided in Rule 13d-3 in the case of rights to acquire securities) of
the then
outstanding voting securities of the Company; provided, however, that for
purposes of this clause, the following acquisitions shall not constitute
a
Change of Control: (x) any acquisition directly from the Company, and
(y) any acquisition by any employee benefit plan (or related trust) sponsored
or
maintained by the Company or any entity controlled by the Company;
or
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15 -
(iv)if
a
tender offer (for which a filing has been made with the United States Securities
and Exchange Commission (the “SEC”) which purports to comply with the
requirements of Section 14(d) of the Securities Exchange Act of 1934, as
amended
and the corresponding SEC rules) is made for the stock of the Company and
the
person (including any entity or group of persons and/or entities acting
in
concert) making the tender offer could own, by the terms of the offer plus
any
shares owned by such person, stock constituting a majority of the total
voting
power of the Company’s outstanding voting securities immediately following the
consummation of such tender offer, in which case the Change of Control
will be
deemed to have occurred three (3) business days before the tender offer
is to
terminate unless the offer is first withdrawn; or
(v)Incumbent
Directors cease for any reason to constitute at least a majority of the
Board;
or
(vi)the
stockholders of the Company approve any plan or proposal for the liquidation
or
dissolution of the Company.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Committee”
means the Compensation Committee of the Board of Directors of the Company
or
such other committee that the Board may appoint to administer the Incentive
Plan
in accordance with Section 3 of the Incentive Plan.
“Common
Stock” means the common stock of the Company, $.50 par value per share, or any
successor security.
“Companies”
means the Company and its successors or any of its direct or indirect parents
or
direct or indirect subsidiaries, now or hereafter existing.
“Company”
means The Commerce Group, Inc., a Massachusetts corporation, and any
successor.
“Competitive
Business” is defined in Section 5(a)(i).
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16 -
“Confidential
Information” means any confidential information including, without limitation,
any study, data, calculations, software storage media or other compilation
of
information, patent, patent application, copyright, trademark, trade
name,
service xxxx, service name, “know-how”, trade secrets, customer lists, details
of client or consultant contracts, pricing policies, operational methods,
marketing plans or strategies, product development techniques or plans,
business
acquisition plans or any portion or phase of any scientific or technical
information, ideas, discoveries, designs, computer programs (including
source of
object codes), processes, procedures, formulas, improvements or other
proprietary or intellectual property of the Companies, whether or not
in written
or tangible form, and whether or not registered, and including all files,
records, manuals, books, catalogues, memoranda, notes, summaries, plans,
reports, records, documents and other evidence thereof. The term
“Confidential Information” does not include, and there shall be no obligation
hereunder with respect to, information that becomes generally available
to the
public other than as a result of a disclosure by the Executive not permissible
hereunder.
“Executive”
has the meaning set forth in the first paragraph of this Agreement.
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17 -
“Good
Reason” means, subject to Section 3(c)(iii) and Section 15(c), any
of the following:
(i)a
substantial and adverse alteration
in the nature, status, or prestige of the Executive’s responsibilities, title,
authority, powers, functions, duties or reporting requirements, taken as
a
whole;
(ii)a
reduction in the Executive’s
annual base compensation, other than a reduction of not more than ten percent
(10%) that is also applied to substantially all similarly situated officers
or
directors, as applicable;
(iii)a
reduction in the percentage of
the Executive’s base salary on which the Executive’s bonus is based, other than
a reduction of not more than ten percent (10%) that is also applied to
substantially all similarly situated officers or directors, as
applicable;
(iv)a
substantial reduction of the
facilities and perquisites (including office space) available to the
Executive;
(v)any
failure of the Company to
provide the Executive with benefits at least as favorable as those enjoyed
by
the Executive under any of the retirement, life insurance, medical, health,
and
accident, disability or other employee plans of the Company or any of its
subsidiaries in which the Executive participated as at the commencement
of the
Initial Term, taken as a whole, or the taking of any action following the
commencement of the Initial Term that would materially reduce any of the
Executive’s benefits in effect immediately prior to such action, unless the
reduction is part of a reduction applicable to all employees;
(vi)the
Company’s relocation, without
the Executive’s prior written consent, of the Executive’s principal place of
employment to any place outside a twenty-five (25) mile radius of the
Executive’s principal place of employment; or
(vii)a
breach by the Company of any
material obligation to the Executive including, without limitation, any
obligation under the Incentive Plan.
“Incentive
Plan” means the 2002 Amended and Restated Incentive Compensation Plan referenced
in Section 3(c)(iv).
“Incumbent
Director” means any individual who, as of the commencement of the Initial Term,
was a member of the Board and any individual who becomes a director subsequent
to such date whose election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a majority of the then
Incumbent Directors, but shall not include any such individual whose initial
assumption of office occurs as a result of either an actual or threatened
election contest (as such terms are used in SEC Rule 14a-11 of Regulation
14A
promulgated under the Securities Exchange Act of 1934, as amended) or other
actual or threatened solicitation of proxies or consents by or on behalf
of a
person other than the Board.
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18 -
“Market”
means any state in the United States of America and each similar jurisdiction
in
any other country in which the Business was or is conducted or engaged
in by the
Companies, or in which the Companies are seeking authorization to conduct
Business, in each case at any time during the twenty-four (24) month period
ending on the applicable determination date. For this purpose, the
applicable determination date means the date as of which the Executive’s
compliance with Section 5 is to be determined.
“Proposed
Business Combination” means the occurrence of the Company entering into a
definitive agreement providing for a Business Combination that, as the
result of
or in connection with such transaction or any combination of related
transactions, will result in a Change of Control.
“Regulations”
is defined in Section 2(c).
“Restricted
Period” means the period commencing on the effective date of this Agreement and
ending upon the expiration of the Term of Employment, provided however,
that if
the Executive’s employment terminates under circumstances that entitle him to
any amounts under Sections 3(e) or (f), then “Restricted Period”
means the period commencing on the effective date of this
Agreement and ending
twelve months after the effective date of the Executive’s employment
termination.
“Term
of
Employment” is defined in Section 3(a).
9.Notice
Any
notice, request, demand or other communication required or permitted to
be given
under this Agreement shall be given in writing and if delivered personally,
or
sent by certified or registered mail, return receipt requested, as follows
(or
to such other addressee or address as shall be set forth in a notice given
in
the same manner):
|
If
to the Executive:
|
Executive
|
|
|
Address_Line_1
|
|
|
Address_Line_2
|
|
|
City,
State ZIP_Code
|
|
If
to the Company:
|
The
Commerce Group, Inc.
|
|
|
000
Xxxx Xxxxxx, X0-00
|
|
|
Xxxxxxx,
Xxxxxxxxxxxxx 00000
|
|
|
Attention: Chairman
of the Board
|
|
|
Copy
to: Chairman of the Compensation
Committee
|
Any
such
notices shall be deemed to be given on the date personally delivered or
such
return receipt is issued.
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19 -
10.Executive’s
Representation
The
Executive hereby warrants and represents to the Company that the Executive
has
carefully reviewed this Agreement and has consulted with such advisors
as the
Executive considers appropriate in connection with this Agreement, and
is not
subject to any covenants, agreements or restrictions, including without
limitation any covenants, agreements or restrictions arising out of the
Executive’s prior employment which would be breached or violated by the
Executive’s execution of this Agreement or by the Executive’s performance of his
duties hereunder.
11.Other
Matters
(a)The
Executive agrees and
acknowledges that the obligations owed to the Executive under this Agreement
are
solely the obligations of the Company, and that none of the Companies’
stockholders, directors, officers, affiliates, representatives, agents
or
lenders will have any obligations or liabilities in respect of this Agreement
and the subject matter hereof.
(b)Notwithstanding
anything contained
herein to the contrary, the Companies may withhold from any amounts payable
under, or benefits provided pursuant to, this Agreement all federal, state,
local, and foreign taxes that are required to be withheld by applicable
laws or
regulations.
(c)In
addition to any obligations
imposed by law upon any successor to the Company, the Company will require
any
successor (whether direct or indirect, by purchase, merger, consolidation
or
otherwise) to all or substantially all of the business and/or assets of
the
Company, to expressly assume and agree to perform this Agreement in the
same
manner and to the same extent that the Company would be required to perform
it
if no such succession had taken place.
12.Validity
If,
for
any reason, any provision hereof shall be determined to be invalid or
unenforceable, the validity and effect of the other provisions hereof shall
not
be affected thereby.
13.Severability
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20 -
Whenever
possible, each provision of this Agreement will be interpreted in such
manner as
to be effective and valid under applicable law, but if any provision
of this
Agreement is held to be invalid, illegal or unenforceable in any respect
under
any applicable law or rule in any jurisdiction, such invalidity, illegality
or
unenforceability will not affect any other provision or any other jurisdiction,
but this Agreement will be reformed, construed and enforced in such jurisdiction
as if such invalid, illegal or unenforceable provision had never been
contained
herein. If any court determines that any provision of Section
5 or any other provision hereof is unenforceable and therefore acts
to
reduce the scope or duration of such provision, the provision in its
reduced
form shall then be enforceable.
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21 -
14.Waiver
of Breach; Specific Performance
The
waiver
by the Company or the Executive of a breach of any provision of this Agreement
by the other party shall not operate or be construed as a waiver of any
other
breach of such other party. Each of the parties (and third party
beneficiaries) to this Agreement will be entitled to enforce its respective
rights under this Agreement and to exercise all other rights existing in
its
favor. The parties hereto agree and acknowledge that money damages
may not be an adequate remedy for any breach of the provisions of Sections
4, 5 and 6 of this Agreement and that any party (and third
party beneficiaries) may in its sole discretion apply to any court of law
or
equity of competent jurisdiction for specific performance and/or injunctive
relief, including temporary restraining orders, preliminary injunctions
and
permanent injunctions in order to enforce or prevent any violations of
the
provisions of this Agreement.
15.Assignment;
Third Parties
(a)The
Executive may not make any
assignment of this Agreement or any interest herein, by operation of law
or
otherwise, without the Company’s express prior written consent.
(b)This
Agreement shall inure to the
benefit of and be binding upon the Company and the Executive, their respective
successors, executors, administrators, heirs and permitted assigns. In
the event
of the Executive’s death prior to the completion by the Company of all payments
due to the Executive under this Agreement, the Company shall continue such
payments to the Executive’s beneficiary designated in writing to the Company
prior to the Executive’s death (or to the Executive’s estate, if the Executive
fails to make such designation).
(c)Notwithstanding
Sections 11(c) and 15(b), the Company shall require its successor
(whether direct or indirect, by purchase, merger, consolidation, or otherwise)
to all or substantially all of its business and/or assets to expressly
assume
and agree to perform this Agreement in the same manner and to the same
extent
that the Company would be required to perform it if no such succession
had taken
place. Failure by the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall constitute (i)
a breach
of this Agreement and (ii) “Good Reason,” as defined in Section
8.
(d)The
parties agree and acknowledge that each of the Companies are intended to
be
third party beneficiaries of, and have rights and interests in respect
of, the
Executive’s agreements set forth in Sections 4, 5, and
6.
16.Payment
of Costs and Legal Fees.
All
reasonable costs and legal fees paid or incurred by the Executive pursuant
to
any dispute or question of interpretation relating to this Agreement (whether
initiated by the Executive or the Company) shall be reimbursed by the Company,
plus interest on any delayed payment at the rate provided for in Section
7872(f)(2)(A) of the Code or any successor provision, at the conclusion
of such
dispute or question of interpretation, unless the Company prevails on the
merits
of such dispute or question of interpretation, as determined pursuant to
a legal
judgment or settlement (whether formal or informal). Notwithstanding
the immediately preceding sentence, if any dispute or question of interpretation
arises after a Change of Control (whether initiated by the Executive or
the
Company) and relates to any payment or benefit required to be provided
to the
Executive under this Agreement, including without limitation Section 3(f)
or Section 7, the Company shall pay or cause to be paid all reasonable
costs and legal fees paid or incurred by the Executive in connection with
such
dispute or question of interpretation, on a quarterly basis for the duration
of
such dispute or question of interpretation, upon presentation of proof,
in a
form reasonably acceptable to the Company, that such expenses have been
incurred, provided that the Executive has first delivered an undertaking
to the
Company, in form and substance acceptable to it, to reimburse the Company
for
such amounts, plus interest thereon at the rate provided for in Section
7872(f)(2)(A) of the Code or any successor provision, at the conclusion
of such
dispute or question of interpretation, if the Company prevails on such
dispute
or question of interpretation, as determined pursuant to a legal judgment
or
settlement (whether formal or informal).
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22 -
17.Amendment;
Entire Agreement
This
Agreement may not be changed orally but only by an agreement in writing
agreed
to by the party against whom enforcement of any waiver, change, modification,
extension or discharge is sought. This Agreement embodies the entire
agreement and understanding of the parties hereto in respect of the subject
matter of this Agreement, and supersedes and replaces all prior agreements,
understandings and commitments with respect to such subject matter.
18.Litigation
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23 -
THIS
AGREEMENT SHALL BE GOVERNED BY, CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS, EXCEPT THAT NO DOCTRINE
OF
CHOICE OF LAW SHALL BE USED TO APPLY ANY LAW OTHER THAN THAT OF MASSACHUSETTS,
AND NO DEFENSE, COUNTERCLAIM OR RIGHT OF SET-OFF GIVEN OR ALLOWED BY
THE LAWS OF
ANY OTHER STATE OR JURISDICTION, OR ARISING OUT OF THE ENACTMENT, MODIFICATION
OR REPEAL OF ANY LAW, REGULATION, ORDINANCE OR DECREE OF ANY FOREIGN
JURISDICTION, BE INTERPOSED IN ANY ACTION HEREON. THE EXECUTIVE AND
THE COMPANY AGREE THAT ANY ACTION OR PROCEEDING TO ENFORCE OR ARISING
OUT OF
THIS AGREEMENT SHALL BE COMMENCED IN THE COURTS OF THE COMMONWEALTH OF
MASSACHUSETTS LOCATED IN BOSTON, MASSACHUSETTS OR THE UNITED STATES DISTRICT
COURTS IN BOSTON, MASSACHUSETTS. THE EXECUTIVE AND THE COMPANY
CONSENT TO SUCH JURISDICTION, AGREE THAT VENUE WILL BE PROPER IN SUCH
COURTS AND
WAIVE ANY OBJECTIONS BASED UPON FORUM NON CONVENIENS. THE
CHOICE OF FORUM SET FORTH IN THIS SECTION 18 SHALL NOT BE DEEMED TO PRECLUDE
THE
ENFORCEMENT OF ANY JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF ANY
ACTION
UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY OTHER JURISDICTION.
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24 -
19.Further
Action
The
Executive and the Company agree to perform any further acts and to execute
and
deliver any documents which may be reasonable to carry out the provisions
hereof.
00.Xxxxxxxxxxxx
Headings
at the beginning of each paragraph are solely for the convenience of the
parties
and are not a part of this Agreement. Whenever required by the
context of this Agreement, the singular shall include the plural and the
masculine shall include the feminine and vice versa. This Agreement
shall not be construed as if it had been prepared by one of the parties,
but
rather as if both parties had prepared the same. Unless otherwise
indicated, all references to sections are to this Agreement.
21.Counterparts
This
Agreement may be executed in counterparts, each of which shall be deemed
an
original, but all of which together shall constitute one and the same
instrument.
[PAGE
INTENTIONALLY ENDS HERE]
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25 -
IN
WITNESS WHEREOF, this Agreement has
been executed as of the date first written above.
EXECUTIVE:
__________________________________________
Name: Executive
THE
COMMERCE GROUP, INC.:
__________________________________________
Name: Xxxxxx
Xxxx
Title: President
& Chief Executive Officer
|
H:
CGI Form of Exec Employment Agmt
|
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