EMPLOYMENT AGREEMENT
AGREEMENT made as of March 1, 1998 between United Asset Management
Corporation ("UAM"), a Delaware corporation and Xxxxxxx X. Xxxxxxxx, Xx.
("Executive").
AGREEMENT
In consideration of the mutual covenants and the agreements hereinafter set
forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto covenant and agree as follows:
Section 1. TERM OF EMPLOYMENT; COMPENSATION. UAM agrees to employ
Executive for a period of three (3) years beginning on the date hereof (the
"Term") as President of UAM; and Executive hereby accepts such employment. UAM
will pay Executive for his services during the Term hereof such annual amounts
as shall be determined by the Compensation Committee of UAM's Board of
Directors, provided, however, that Executive's compensation for each year (or
portions thereof on a pro rated basis) shall include an annual salary of not
less than $800,000, and annual bonus of not less than the amount that would be
calculated by multiplying $360,000 times the excess of UAM's operating cash flow
per share for such year over $1.00 (subject to appropriate adjustment in the
event of any stock dividend or stock split). All payments shall be subject to
applicable withholding requirements.
In addition, Executive will be entitled to annual option grants under UAM's
Stock Option Plan for a number of shares at least equal to the amount of the
annual bonus calculated pursuant to the foregoing divided by the value of such
options shares as determined in accordance with the Black-Scholes model for
valuing options. Such options shall be exercisable at the market price of UAM's
common stock on the date of grant and shall vest in equal annual installments
over four years beginning on the first anniversary of the date of grant and
shall terminate after five years.
The minimum compensation called for by the foregoing shall be determined in
accordance with past practices of the Compensation Committee.
Notwithstanding the foregoing, if the existing members of the Compensation
Committee of UAM's Board of Directors adopt modifications to the method of
calculating bonuses and option grants to senior executives of UAM prior to the
next
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annual meeting of the stockholders of UAM, the foregoing provisions with respect
to minimum bonus and option grants shall be and hereby are modified to
incorporate such changes as they relate to Executive.
Section 2. OFFICE AND DUTIES. During the Term and while employed by
UAM, Executive shall devote substantially all of his business time to his duties
hereunder and shall, to the best of his ability, perform such duties in a manner
which will faithfully and diligently further the business and interests of UAM.
Section 3. BENEFITS. Executive shall participate, to the extent he is
eligible and in a manner and to an extent that is fair and appropriate in light
of the position and duties granted to him hereunder, in all bonus, pension,
profit-sharing, group insurance, or other fringe benefit plans which UAM may
hereafter in its absolute discretion make available generally to its officers,
but UAM will not be required to establish any such program or plan. Executive
shall be entitled to such vacations and to reimbursement of such expenses as
UAM's policies allow to officers.
Section 4. TERMINATION OF EMPLOYMENT.
Notwithstanding any other provision of this Employment Agreement,
Executive's employment may be terminated by UAM during the Term only in the
following circumstances:
(i) At any time in the event of Executive's material breach of any of the terms
of this Employment Agreement; his conviction of a crime, which conviction
has a material adverse effect on UAM; or his willful misconduct in the
performance of his duties hereunder.
(ii) Upon thirty (30) days' notice to Executive if he should be unable, for one
or more periods aggregating four (4) months or more during any consecutive
twelve (12) month period, because of illness, accident, or other disability
(mental or physical), to discharge substantially all of his duties
hereunder.
Section 5. CONFIDENTIALITY. Except in performance of services for UAM,
Executive shall not, either during the period of his employment with UAM or
thereafter, use for his own benefit or disclose to or use for the benefit of any
person outside UAM, any information not already lawfully available to the public
concerning the business of UAM, whether Executive has such information in his
memory or embodied in writing or other tangible form.
Section 6. ASSIGNABILITY. This Employment Agreement shall be binding
upon and inure to the benefit of UAM, and to any person or firm who may succeed
to substantially all of the assets of UAM. Any successor to substantially all
of UAM's
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assets and business, whether by merger, consolidation, purchase of assets or
otherwise, shall succeed to the rights and obligations of UAM hereunder. UAM
shall require any such successor, by agreement in form and substance reasonably
satisfactory to Executive, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that UAM would be required
to perform it if no such succession had taken place. The failure of UAM to
obtain such agreement prior to the effectiveness of any such succession shall be
a breach of this Agreement and shall entitle Executive to compensation from UAM
or its successor in the same amount and on the same terms as Executive would be
entitled hereunder. This Employment Agreement shall not be assignable by
Executive.
Section 7. ENTIRE AGREEMENT. This Employment Agreement contains the
entire agreement between UAM and Executive with respect to the subject matter
hereof.
Section 8. WAIVERS AND FURTHER AGREEMENTS. Neither this Employment
Agreement nor any term or condition hereof, including without limitation the
terms and conditions of this Section 8, may be waived or modified in whole or in
part as against UAM or Executive except by written instrument executed by or on
behalf of the party other than the party seeking such waiver or modification,
expressly stating that it is intended to operate as a waiver or modification of
this Employment Agreement or the applicable term or condition hereof.
Section 9. AMENDMENTS. This Employment Agreement may not be amended,
nor shall any change, modification, consent, or discharge be effected except by
written instrument executed by or on behalf of the party against whom
enforcement of any change, modification, consent or discharge is sought.
Section 10. GOVERNING LAW. The execution, interpretation, and
performance of this Agreement and any claims arising out of this Agreement shall
be governed by the laws of The Commonwealth of Massachusetts without regard to
the conflict of law provisions thereof.
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement as
a sealed instrument as of the date first above written.
UNITED ASSET MANAGEMENT
EXECUTIVE CORPORATION
Xxxxxxx X. Xxxxxxxx, Xx. By: Norton X. Xxxxxx
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Xxxxxxx X. Xxxxxxxx, Xx. Norton X. Xxxxxx, Chairman and
Chief Executive Officer
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