Exhibit 99.1
SEPARATION AGREEMENT
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This Separation Agreement (the "Agreement") is made on December 13,
2004 between Xxxxx Xxxxxxx ("Employee") and Aspen Insurance U.S. Services, Inc.
("Employer").
As of December 13, 2004, Employer and Employee are ending their
employment relationship and terminating the Employment Agreement between the
parties, dated June 21, 2003 (the "Employment Agreement"). In doing so, Employee
and the Employer wish to do the following:
o Resolve and settle all existing and potential differences and
disputes between them arising out of Employee's employment, his separation from
it and the Employment Agreement;
o Release all claims that the Employee and Employer could assert
arising out of Employee's employment, his separation from it and the Employment
Agreement; and,
o Be legally bound by the mutual promises contained in this Agreement.
I. TERMINATION OF EMPLOYMENT
Employee has resigned his employment with the Employer and terminated
his Term of Employment under the Employment Agreement as of the close of
business on December 13, 2004 (the "Termination Date"). Employee has
simultaneously resigned from all other positions he holds with Employer and any
of its affiliates, including all officerships and directorships. Employee agrees
to cooperate fully in signing all documents and taking all actions reasonably
requested by Employer that may be necessary or appropriate to give full force
and effect to these resignations and the other terms and intent of this
Agreement.
II. BENEFITS
X. Xxxxxxxxx Pay. In exchange for the Employee's signing this
Agreement, and assuming (i) that this Agreement becomes effective, and (ii)
Employee's continuing compliance with all provisions in Section XI, below, the
Employer will pay Employee severance in the amount of $33,333.34 per month, less
applicable withholdings, for twelve months, which in total represents Employee's
annual base salary (not including the value of any other benefits). Each monthly
payment shall be made on the last day of each month, beginning with January 31,
2005 (unless the last day of a month is not a business day, in which case the
monthly payment shall be made the business day before the last day of the
month).
B. Stock Options. As of the Termination Date, and in accordance
with the terms of Aspen Insurance Holdings Limited's 2003 Share Incentive Plan
and Nonqualified Share Option Agreement, Employee has a total of 29,200 vested
stock option. For purposes of Section 3 of the Aspen Insurance Holdings Limited
Nonqualified Share Option Agreement, Employee's employment was terminated by the
Employee for reason other than death, Disability or Good Reason.
C. Vacation Pay and Unreimbursed Business Expenses. In addition,
within 5 business days of the effective date of this Agreement, Employee will
receive an additional payment for any accrued, but unused, vacation pay and any
unreimbursed business expenses under subparagraph 3(f) of the Employment
Agreement, assuming that Employee has, at least 5 business days before the date
for such payment, submitted fully completed expense statements and other
supporting information as Employer customarily requires of its executives for
reimbursement of such expenses.
D. COBRA. Employee is eligible to continue participation in the
Employer's health and dental insurance plans until December 31, 2004. After
that, Employee is eligible to continue participation in those plans for an
additional 18 months, as provided by law, under the Consolidated Omnibus Budget
Reconciliation Act ("COBRA"). Assuming Employee's continuing compliance with all
provisions in Section XI, below, Employer will, at Employee's election, pay full
premiums for Employee's continued participation in Employer's health and dental
plans for up to twelve months after December 31, 2004. Unless stated otherwise
in this Agreement, Employee's participation and coverage in all other benefit
plans ends on the Termination Date.
E. SERP. In accordance with Employee's Distribution Election under
Employer's Supplemental Executive Retirement Plan (the "SERP"), Employee's
benefit under the SERP shall be paid in 10 annual installments (in accordance
with the provisions of Section 5.5(b) of the SERP), with the first payment to be
made as soon as administratively practical after this Agreement becomes
effective, subject to Employer's rights to terminate the SERP, in which case
Employee's SERP benefits would be payable in a lump sum within 90 days following
termination of the plan.
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F. Loss of Benefits; Transferability. Upon Employee's breach of
any of his obligations under this Agreement, specifically including any
obligation under Section XI (and the breach of any obligation under Section XI
is a material breach), Employer shall have no further obligation to provide any
benefits to Employee under Section II(A) and (D) of this Agreement, and Employee
shall be obligated to reimburse Employer for any such payment or benefit he has
received under those Sections of the Agreement. This Agreement cannot be
transferred or assigned to anyone else. If the Employee dies, however, Employer
shall pay any remaining amounts due under this Section II to Employee's estate.
G. All Payments and Benefits Included. Employee understands and
agrees that the payments and benefits enumerated in this Section II are all that
Employee will receive from the Employer. Except for the payments and benefits
listed in this Section II, Employee waives all claims for back pay, future pay,
benefits, allowances, expense reimbursements, or any other form of compensation
in connection with Employee's employment and/or the termination of it. Employee
will receive no further wage, vacation, severance or other payments from the
Employer. The payments and benefits listed in this Section II include
consideration for Employee's signing, and fulfilling the duties identified in,
this Agreement. The parties agree that the payments and benefits listed in this
Section II exceed any payments or benefits to which Employee may otherwise be
entitled.
III. COMPLETE RELEASE BY EMPLOYEE
Employee, for himself and his heirs, hereby agrees to discharge and
release the Employer and its affiliates, and their predecessors, successors,
directors, officers, employees, agents and representatives from all claims,
rights, demands, suits, causes of action, attorneys' fees or damages that the
Employee had, has or may have, that are in any way based on or related to
Employee's employment with the Employer, including but not limited to the
termination of that employment, Employer's press release discussing the reasons
for the termination of that employment (a copy of which is annexed to this
Agreement) or the Employment Agreement, from the beginning of time through and
including the effective date of this Agreement. This includes a release of any
claims, rights, demands, suits, causes of actions or damages that the Employee
may have based on any facts or events, whether known or unknown by the Employee,
that occurred on or before the effective date of this Agreement, including,
without limitation, a release of any rights or claims Employee may have based
on:
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A. the Federal Civil Rights Acts of 1866, 1870, 1871, 1964 and
1991, as amended; the Age Discrimination in Employment Act of 1967, as amended
("ADEA"); the Americans with Disabilities Act of 1990; the Rehabilitation Act of
1973; the Equal Pay Act of 1963 (even though Employer contends that these laws
are not applicable);
B. the laws of Massachusetts and the City of Boston concerning
wages, employment and discharge, including, but not limited to, any law, rule,
regulation or ordinance pertaining to employment, the terms and conditions of
employment, or the termination of employment;
C. claims arising out of any legal restrictions of the right to
discharge the Employer's employees, such as claims for wrongful or unlawful
discharge;
D. defamation, including libel or slander;
E. intentional infliction of emotional distress; and/or
F. violations of any contract express or implied.
IV. COMPLETE RELEASE BY EMPLOYER
Employer, for itself and its affiliates, including its corporate
parents, predecessors, successors and assigns, hereby agrees to discharge and
release the Employee and his heirs from all claims, rights, demands, suits,
causes of action, attorneys' fees or damages that the Employer had, has or may
have, in any way based on or related to Employee's employment with the Employer,
including but not limited to the termination of that employment or the
Employment Agreement, from the beginning of time through and including the
effective date of this Agreement. This includes a release of any claims, rights,
demands, suits, causes of actions or damages that the Employer may have based on
any facts or events, whether known or unknown by the Employer, that occurred on
or before the effective date of this Agreement.
V. COMPLETE RELEASE, NO FUTURE LAWSUITS, COMPLAINTS OR CLAIMS
Employee promises never to file any petitions, demands for arbitration,
charges, complaints, grievances, lawsuits, or related documents or proceedings
with any judicial or administrative agency or arbitral tribunal relating to any
matter that has been released in this Agreement.
Nothing in this Agreement prohibits Employee from applying for and
receiving unemployment compensation benefits.
VI. PERIOD FOR REVIEW AND CONSIDERATION OF AGREEMENT
Employee confirms that he is over the age of 40 and has been given the
opportunity to review and consider this Agreement for at least 21 days before
signing it. Employee understands that he may use as much or as little of this
period as he wishes before signing it. Employer's offer of this Agreement shall
remain open to Employee until January 3, 2005.
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VII. ADVICE TO CONSULT WITH AN ATTORNEY
Employee acknowledges that the Employer has advised him to consult with
an attorney before signing this Agreement and that Employee has availed himself
of the opportunity to consult counsel of his choice. Employer agrees to pay
Employee's reasonable attorneys' fees not in excess of $10,000 in connection
with the termination of Employee's employment and the negotiation of this
Agreement.
VIII. EMPLOYEE'S RIGHT TO REVOKE AGREEMENT
If Employee signs this Agreement and returns it to the Employer within
the time specified in Section VI, Employee may revoke this Agreement within
seven (7) calendar days after the date of the Employee's signature. Revocation
shall be made by delivering a written notice of revocation to the Employer. For
this revocation to be effective, the written notice of revocation must be
received by the Employer no later than the close of business on the seventh
(7th) calendar day (or next business day thereafter) after Employee signs this
Agreement. This Agreement will not become effective or enforceable until after
this 7-day revocation period expires. If Employee revokes this Agreement in
accordance with this Section, this Agreement shall not become effective or
enforceable and Employee will not receive any payments or benefits described in
Section II(A) or (D).
IX. SEVERABILITY AND JUDICIAL RESTATEMENT
Employee and the Employer agree that the provisions of this Agreement
are severable and divisible. If any portion of this Agreement is determined to
be illegal or unenforceable, the remaining provisions of this Agreement shall
remain in full force and effect.
X. TAXES
Employee is responsible for Employee's portion of any tax liability
associated with payments provided under this Agreement. The Employer has the
right to withhold taxes from such payments to the extent required by law.
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XI. NON-COMPETITION, NON-SOLICITATION, CONFIDENTIALITY AND OTHER EMPLOYEE
OBLIGATIONS
A. Non-Competition. In consideration of the benefits Employee is
receiving under this Agreement, as well as the mutual promises made in the
Employment Agreement, for a period beginning immediately and continuing until
the expiration of 12 months following the effective date of this Agreement,
Employee shall not be employed, engaged interested or concerned in any business
or enterprise that is "in competition" with Employer or any of its affiliates,
including but not limited to Aspen Specialty Insurance Company, or any of their
successors or assigns (such entities collectively referred to in this Section as
the "Company"); provided, however, that Employee's ownership of less than five
percent of the issued and outstanding voting securities of a publicly traded
company shall not, in and of itself, be deemed to constitute competition. A
business or enterprise is deemed to be "in competition" if it is engaged in a
Relevant Business in any of the geographical regions in which the Company
conducts substantial business on the Termination Date. A "Relevant Business" is
any business that the Company either (i) is engaged in as of the Termination
Date, or (ii) as of Termination Date, to the knowledge of Employee, contemplates
engaging in within 12 months following the Termination Date. If Employee revokes
this Agreement in accordance with Section VIII, above, then Employee's
obligations concerning Non-Competition shall be governed by the provisions of
Paragraph 9 of the Employment Agreement.
B. Confidential Information. Employee shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge, trade secrets, methods, know-how or data relating to the Company and
its businesses or acquisition prospects that the Employee obtained during the
Employee's employment by Employer that is not and does not become generally
known to the public (other than as a result of the Employee's violation of this
paragraph) ("Confidential Information"). Employee shall not communicate,
divulge, or disseminate any Confidential Information at any time, except with
the prior written consent of the Employer or as otherwise required by legal
process; provided, however, that if required to divulge Confidential Information
by legal process, the Employee will immediately notify the Employer of such
legal process.
C. Non-Solicitation of Employees. Employee recognizes that he
possesses Confidential Information about other employees of the Company relating
to their education, experience, skills, abilities, compensation and benefits,
and inter-personal relationships with suppliers to and customers of the Company.
Employee recognizes that the information he possesses about other employees may
not be generally known, may be of substantial value to the Company in developing
its respective businesses and in securing and retaining customers, and has been
acquired by him because of his position with Employer. Employee agrees that,
during the period beginning immediately and ending 12 months following the
Termination Date of this Agreement, he will not, directly or indirectly,
initiate any action to solicit or recruit anyone who is then an employee of the
Company for the purpose of being employed by him or by any business, individual,
partnership, firm, corporation or other entity on whose behalf he is acting as
an agent, representative or employee and that he will not convey any such
Confidential Information or trade secrets about other employees of the Company
to any other person.
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D. Non-Interference with Customers. Employee agrees that beginning
immediately and ending 12 months following the Termination Date of this
Agreement, he will not interfere with any business relationship between the
Company and any of its customers.
E. Non-Disparagement. Employee shall take no action and make no
statement, oral or written, that publicly disparages or damages the reputation
of the Company, including but not limited to its officers, directors, employees,
representatives or agents. Employer shall take no action and make no statement,
oral or written, that publicly disparages or damages the reputation of Employee;
provided however, that (i) this provision does not apply to the content of the
press release attached to this Agreement nor any other communication made by the
Company that is consistent with the content of the press release, and (ii)
nothing shall prevent the Company from making any disclosures as may be required
by law or to any regulators to whom the Company otherwise believes disclosure is
advisable, including but not limited to the SEC, the New York Stock Exchange,
and any insurance regulators in the United States or elsewhere.
F. Remedies. Employee acknowledges that if he breaches or
threatens to breach any provision of this Section, the damages to Employer and
the Company may be substantial, although difficult to ascertain, and money
damages will not afford Employer or the Company an adequate remedy. Therefore,
if Employee violates or threatens to violate any provisions of this Section, in
whole or in part, Employer and the Company shall be entitled to specific
performance and injunctive relief, without prejudice to other remedies they may
have at law or in equity. In addition, Employee acknowledges that his breach of
any provision of Section XI of this Agreement is material such that, upon any
such breach, Employer shall have no further obligation to provide any benefits
to Employee under Section II(A) and (D) of this Agreement, and Employee shall be
obligated to reimburse Employer for any payment or benefit he has received under
those Sections of the Agreement.
G. Severability. Although Employee agrees that the terms of this
Section are fully enforceable against him, if any such term or the application
of it is deemed invalid or unenforceable, the remainder of this Section and the
application of such terms other than those that are deemed invalid or
unenforceable shall not be affected thereby and each term of this Section shall
be valid and enforceable to the fullest extent permitted by law. Moreover, if a
court of competent jurisdiction deems any provision hereof to be too broad in
time, scope, or area, it is expressly agreed that such provision shall be
reformed to the maximum degree that would not render it unenforceable.
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H. Attorneys' Fees. Employer and Employee shall each pay their own
attorneys' fees, court costs and other expenses that they incur during the
course of any litigation or other proceeding regarding their rights and
obligations under this Agreement; provided however, that if Employer or the
Company prevails on a claim that Employee has breached the terms of Section XI
of this Agreement, Employer or the Company, as applicable, shall be entitled to
any costs and expenses relating to such litigation or proceeding, including but
not limited to reasonable attorneys' fees. If in such proceeding the Employee is
found not to have breached the terms of Section XI of this Agreement, then
Employee shall be entitled to recover his costs and expenses relating to such
litigation or proceeding, including but not limited to reasonable attorneys'
fees.
XII. ENTIRE AGREEMENT
This is the entire Agreement between Employee and the Employer and it
supersedes the Employment Agreement. The Employer has made no promises to
Employee other than those in this Agreement.
This Agreement shall be governed by and construed in accordance with
the laws of Massachusetts, without reference to principles of conflict of laws
thereunder.
This Agreement may not be amended or changed, except by a written
agreement signed by both parties or their respective successors and legal
representatives.
Nothing contained in this Agreement is intended to be, or shall be
construed to be, an admission of any liability by either party or an admission
of the existence of any facts upon which liability could be based.
Employee acknowledges that he has read this Agreement, understands its
contents, and voluntarily and knowingly signed it.
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EFFECTIVE DATE OF AGREEMENT
The effective date of this Agreement shall be the first business day
after expiration of the revocation period set forth in Section VIII of this
Agreement. If the Employee does not date the Agreement when he signs it, then
the effective date of this Agreement shall be the first business day after the
expiration of seven calendar days following the Employer's receipt of it.
PLEASE READ THIS AGREEMENT CAREFULLY. THIS AGREEMENT INCLUDES A RELEASE OF ALL
KNOWN AND UNKNOWN CLAIMS INCLUDING THOSE UNDER THE AGE DISCRIMINATION IN
EMPLOYMENT ACT, AS AMENDED, AND OTHER LAWS PROHIBITING DISCRIMINATION IN
EMPLOYMENT. EMPLOYEE ACKNOWLEDGES THAT HE HAS READ THIS AGREEMENT, UNDERSTANDS
IT AND IS VOLUNTARILY ENTERING INTO IT.
XXXXX XXXXXXX ASPEN INSURANCE U.S. SERVICES, INC.
/s/ Xxxxx Xxxxxxx By: /s/ Xxxxxx Xxxxxx
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Date: December 13, 2004 Date: December 13, 2004
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