EMPLOYMENT AGREEMENT
This Employment Agreement (the "AGREEMENT") is made and entered into as
of this 20th day of July 2005 (the "EFFECTIVE DATE"), by and between Xxxxx &
XxXxxxxx Companies, Inc. ("MMC" or the "COMPANY"), a Delaware corporation, and
Xxxxxxx X. Xxxxxxxxx (the "EXECUTIVE").
WHEREAS, the Executive and the Company desire to embody in this
Agreement the terms and conditions of the Executive's continued employment by
the Company;
NOW, THEREFORE, in consideration of the premises and mutual promises
contained in this Agreement, including the compensation paid to the Executive,
the parties hereby agree:
ARTICLE 1
EMPLOYMENT, DUTIES AND RESPONSIBILITIES
1.1 EMPLOYMENT; REPORTING. The Company shall continue to employ the
Executive as its Chief Executive Officer. The Executive hereby accepts such
continued employment, subject to the terms and conditions of this Agreement. The
Executive shall report directly to the Board of Directors of the Company (the
"BOARD").
1.2 DUTIES AND RESPONSIBILITIES.
(a) The Executive shall have such duties and responsibilities and power and
authority as those normally associated with the position of chief executive
officer in public companies of a similar stature, as well as any additional
duties, responsibilities and/or powers and authority assigned to him by the
Board which are consistent with his position as Chief Executive Officer.
(b) The Executive agrees to use his best efforts to promote the interests
of the Company, and agrees that he will devote his entire working time, care and
attention to his duties, responsibilities and obligations to the Company
throughout the Term (as defined in Section 2.1 hereof). The Executive may serve
as a member of the New York Legal Assistance Group Board, and may also serve on
the boards of other civic, charitable and corporate entities with the prior
written consent of the Board so long as such activity does not interfere with
the Executive's duties and responsibilities as Chief Executive Officer of the
Company.
1.3 EXISTING EMPLOYMENT AGREEMENT. The existing Employment Agreement dated
July 7, 2004 among the Executive, Xxxxx USA, Inc. and Xxxxx, Inc. (the "PRIOR
AGREEMENT") shall terminate as of the execution of this Agreement by both
parties, and will thereafter be of no further force or effect, PROVIDED,
HOWEVER, that the retention award of shares of MMC granted to the Executive
pursuant to Section 3(e) of the Prior Agreement (the "EXISTING
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RETENTION AWARD") shall remain in place under the terms provided for therein,
except that the "Company" as referred to therein shall also include MMC. In no
event shall the vesting date of the Existing Retention Award under the Prior
Agreement be later than July 8, 2008, and such award shall be made in addition
to all compensation provided under this Agreement.
ARTICLE 2
TERM
2.1 EMPLOYMENT PERIOD. The initial term of the Executive's employment under
this Agreement (the "INITIAL TERM") shall commence on the Effective Date and
shall continue through July 20, 2008. Thereafter, this Agreement shall
automatically renew for successive one (1) year terms (each, a "RENEWAL TERM")
unless either party sends a notice of termination to the other party in
accordance with Section 6.2 hereof at least ninety (90) days prior to the
expiration of the Initial Term or Renewal Term, as the case may be. The Initial
Term, together with any and all Renewal Terms, if any, are the "TERM."
2.2 PAYMENT DUE TO NON-RENEWAL BY THE COMPANY. If, prior to the Executive's
sixty-second (62nd) birthday, the Company sends a notice of termination of the
Term to the Executive as provided in Section 2.1 hereof, and after the
expiration of the Term the Executive's employment is terminated (A) by the
Company without Cause (as defined in Section 5.1 hereof) or due to death or
Disability (as defined in Section 5.4 hereof) or (B) by the Executive for any
reason, then the Company shall pay to the Executive, in a lump sum within thirty
(30) days of the effective date of such termination of employment, a cash amount
equal to the sum of (x) the Executive's then-current Base Salary (as defined in
Section 3.1 hereof) and (y) the average annual bonus (as described in Section
3.2 hereof) actually paid to the Executive (including amounts paid in restricted
stock, if any) during the three (3) years immediately prior to the termination.
In addition, if at any time the Company sends a notice of termination of the
Term to the Executive as provided in Section 2.1 hereof, and after the
expiration of the Term the Executive's employment is terminated (A) by the
Company without Cause (as defined in Section 5.1 hereof) or due to death or
Disability (as defined in Section 5.4 hereof) or (B) by the Executive for any
reason, then (a) the Company shall also pay to the Executive the Accrued
Obligations (as defined in Section 5.5(a) hereof) within thirty (30) days of the
effective date of such termination and (b) all unvested equity awards (which as
used in this Agreement include stock options) held by the Executive as of the
date of termination that were granted to the Executive pursuant to Sections 3.2,
3.3 and 3.4 hereof shall immediately fully vest as of the date of termination.
For the avoidance of doubt, and notwithstanding anything contained herein to the
contrary, the giving of such notice of termination of the Term by the Company
shall not constitute a "Good Reason" (as defined in Section 5.2 hereof), and a
payment made by the Company to the Executive under this Article 2 shall preclude
the Executive from thereafter receiving any payment provided for (i) in Article
5 hereof or (ii) under any separation or severance plan, program, agreement or
other arrangement in which the Executive is a participant or a party.
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ARTICLE 3
COMPENSATION
As compensation and consideration for the performance by the Executive of his
obligations under this Agreement, during the Term the Executive shall be
entitled to the compensation and benefits set FORTH IN this Article 3
(collectively, "COMPENSATION") (subject, in each case, to the provisions of
Article 5 hereof).
3.1 BASE SALARY. The Executive shall receive an annual base salary ("BASE
SALARY") of $ 1.0 million. The Base Salary shall be reviewed at least annually
by the Board, and may be increased (but not decreased) in the sole discretion of
the Board. If the Executive's Base Salary is increased, the increased amount
shall thereafter be the Base Salary. The Base Salary shall be payable in
installments, consistent with the Company's payroll procedures in effect from
time to time. At the end of the first payroll period that commences after the
Effective Date, the Executive shall also receive a lump-sum payment (subject to
appropriate deductions) equal to the difference between the Base Salary and the
Executive's base salary in effect immediately prior to the Effective Date
prorated for the period from October 14, 2004 to the Effective Date.
3.2 ANNUAL BONUS. In addition to Base Salary, the Executive shall be
eligible to participate throughout the Term in such annual bonus plans and
programs ("ANNUAL BONUS PROGRAMS"), as may be in effect from time to time in
accordance with the Company's compensation practices and the terms and
provisions of any such plans or programs. The Executive's annual bonus
opportunity will range between one hundred-fifty percent (150%) and three
hundred percent (300%) of his Base Salary. The actual bonus amounts will be
determined by the Committee based on the Executive's achievement of Company-wide
and individual performance goals, with bonuses in the upper portion of the
annual bonus opportunity range being earned only for superior achievement of
such performance goals; provided, HOWEVER, that the Executive's bonus for 2005
shall be no less than $2.5 million (the "2005 MINIMUM BONUS"). The annual bonus
shall be paid entirely in cash, except that, in the discretion of the Committee,
up to twenty percent (20%) of the bonus for each year after 2005 may be paid in
restricted stock of the Company, which restricted stock will vest three years
from the applicable grant date.
3.3 LONG-TERM AND EQUITY COMPENSATION. The Executive shall also be eligible
to participate in the Company's long-term incentive compensation plans
(including its equity-compensation plans) applicable to MMC's senior executive
officers. The specific awards under these plans will be made by the Committee in
its sole discretion, commensurate with the Executive's position as Chief
Executive Officer. Notwithstanding the foregoing, the Committee shall each year
grant to the Executive long-term incentive compensation comprised of (i) a
restricted stock or restricted stock unit award and/or (ii) a stock option or
stock-settled stock appreciation right, with a combined grant-date target value
of $5.0 million, as determined by the Committee, and provided further that
neither the restricted stock nor the stock option portion of the award shall
comprise more than two-thirds of the total grant-date target value of the award.
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Each restricted stock award will vest three years from the grant date, while
one-third of each stock option award will vest on each of the first, second and
third anniversaries of the grant date.
3.4 INITIAL RETENTION AWARD. Within two weeks of the Effective Date, the
Executive shall be granted an initial retention award (the "INITIAL RETENTION
AWARD") comprised of (i) restricted stock with a grant-date value of $3.75
million and (ii) stock options with a grant-date value of $3.75 million (which
options shall have an exercise price on the grant date that is equal to the Fair
Market Value (as defined in the 2000 Senior Executive Incentive and Stock Award
Plan) of the stock of the Company on such date but such stock options cannot be
exercised until vested and the price of the Company's stock exceeds such Fair
Market Value by at least fifteen percent (15%) for a period of at least thirty
(30) consecutive trading days). The restricted stock award will vest three years
from the grant date, while one-third of the stock option award will vest on each
of the first, second and third anniversaries of the grant date. Additional terms
and conditions of the awards shall be determined by the Committee and contained
in the grant agreements, provided that no such term or condition SHALL BE
inconsistent with any provision of this Agreement.
3.5 BENEFIT PLANS. The Executive and the Executive's spouse and eligible
dependents, as the case may be, shall be eligible to participate in employee
benefit and fringe benefit plans and programs provided by the Company, including
but not limited to pension, life insurance, health, dental and disability plans
and programs, on terms and conditions generally applicable to executives of the
Company. Nothing herein shall limit the Company's ability to change, modify,
cancel or amend any such plans. The Executive shall be eligible to participate
in the Company's retiree medical program as may be in effect from time to time.
3.6 EXECUTIVE FINANCIAL SERVICES PROGRAM. The Executive shall be eligible
to participate in the MMC Financial Services Program as in effect from time to
time.
3.7 EXPENSES. The Company will reimburse the Executive for reasonable
business-related expenses incurred by him in connection with the performance of
his duties hereunder during the Term, subject, however, to the Company's written
policies relating to business-related expenses as in effect, from time to time,
during the Term, a copy of which has previously been provided to the Executive.
3.8 VACATION. The Executive shall be entitled to paid vacation in
accordance with the Company's policy in effect from time to time during the
Term.
3.9 INDEMNIFICATION. The Executive shall be entitled to indemnification in
accordance with the Company's by-laws as in effect from time to time.
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ARTICLE 4
NONCOMPETITION/NONSOLICITATION/CONFIDENTIALITY
4.1 NONCOMPETITION AND NONSOLICITATION PERIODS
(a) During the Executive's employment with the Company and during the
applicable noncompetition/nonsolicitation period following termination of the
Executive's employment with the Company for any reason (other than a termination
of employment by the Company due to Disability (as defined in Section 5.4
hereof) or a non-renewal of the Term by the Company on or after the Executive's
sixty-second (62nd) birthday), the Executive shall not, directly or indirectly:
(i) engage in any Competitive Activity or
(ii) whether on behalf of himself or any other person or entity (x)
solicit any customer or client of the Company or any subsidiary with
respect to a Competitive Activity or (y) solicit or employ any
employee of the Company or any subsidiary for the purpose of causing
such employee to terminate his or her employment with the Company or
such subsidiary.
For purposes of this Agreement, "Competitive Activity" shall mean the
Executive's engaging in an activity other than the practice of law - whether as
an employee, consultant, principal, member, agent, officer, director, partner or
shareholder (except as a less than 1% shareholder of a publicly traded company)
- that is competitive with any business of the Company or any subsidiary
conducted by the Company or such subsidiary as of the date of the termination of
the Executive's employment; provided, however, that the Executive may be
employed by or otherwise associated with:
(i) a business of which a subsidiary, division, segment, unit, etc. is in
competition with the Company or any subsidiary but as to which such
subsidiary, division, segment, unit, etc., the Executive has
absolutely no direct or indirect responsibilities or involvement, or
(ii) a company where the Competitive Activity is:
(x) from the perspective of such company, de MINIMIS with respect to
the business of such company and its affiliates, and
(y) from the perspective of the Company or any subsidiary, not in
material competition with the Company or any subsidiary.
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The noncompetition/nonsolicitation period shall be (x) 12 months from the date
of termination if termination occurs after the expiration of the Term due to a
non-renewal of the Term by the Company and the Executive has received the
related non-renewal payment provided for in Section 2.2 hereof or (y) otherwise
shall be 24 months from the date of termination. If the termination of the
Executive's employment is in connection with a Change in Control as provided in
Section 5.6 hereof, then the noncompetition/nonsolicitation period shall be 24
months from the date of termination.
(b) At all times prior to and following the Executive's termination of
employment, the Executive shall not disclose to anyone or make use of any trade
secret or proprietary or confidential information of the Company, including such
trade secret or proprietary or confidential information of any customer or
client or other entity to which the Company owes an obligation not to disclose
such information, which the Executive acquires during the Executive's employment
with the Company, including but not limited to records kept in the ordinary
course of business except:
(i) As such disclosure or use may be required or appropriate in
connection with the Executive's work as an employee of the Company;
(ii) When required to do so by a court of law, by any governmental agency
having supervisory authority over the business of the Company or by
any administrative or legislative body (including a committee
thereof) with apparent jurisdiction to order the Executive to
divulge, disclose or make accessible such information;
(iii) As to such confidential information that becomes generally known to
the public or trade without the Executive's violation of this Section
4.1(b); or
(iv) To the Executive's spouse and/or the Executive personal tax and
financial advisors as reasonably necessary or appropriate to advance
the Executive's tax, financial and other personal planning (each and
"Exempt Person"), PROVIDED, HOWEVER, that any disclosure or use of
any trade secret or proprietary or confidential information of the
Company by an Exempt Person shall be deemed to be a breach of this
Section 4.1(b) by the Executive.
(c) The Executive acknowledges and agrees that the covenants contained in
Sections 4.1(a) and (b) hereof are reasonable and necessary to protect the
Company's confidential information and goodwill. The Executive further
represents that his experience and capabilities are such that the provisions of
Sections 4.1(a) and (b) hereof will not prevent him from earning a livelihood.
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ARTICLE 5
TERMINATION; CHANGE OF CONTROL
5.1 TERMINATION BY THE COMPANY. The Company shall have the right, subject
to the terms of this Agreement, to terminate the Executive's employment at any
time, with or without "Cause." The Company shall give the Executive written
notice of a termination for Cause (the "CAUSE NOTICE") in accordance with
Section 6.2 hereof. The Cause Notice shall state the particular action(s) or
inaction(s) giving rise to the termination for Cause. No action(s) or
inaction(s) will constitute Cause unless (1) a resolution finding that Cause
exists has been approved by a majority of all of the members of the Board at a
meeting at which the Executive is allowed to appear with his legal counsel and
(2) where remedial action is feasible, the Executive fails to remedy the
action(s) or inaction(s) within ten (10) days after receiving the Cause Notice.
If the Executive so effects a cure to the satisfaction of the Board, the Cause
Notice shall be deemed rescinded and of no force or effect. For purposes of this
Agreement, "CAUSE" shall mean only:
(a) any willful refusal by the Executive to follow lawful directives of the
Board which are consistent with the scope and nature of the Executive's duties
and responsibilities as set forth herein;
(b) the Executive's conviction of, or plea of guilty or NOLO CONTENDERE to,
a felony or of any crime involving moral turpitude, fraud or embezzlement;
(c) any gross negligence or willful misconduct of the Executive resulting
in a material loss to the Company or any of its subsidiaries, or material damage
to the reputation of the Company or any of its subsidiaries;
(d) any material breach by the Executive of any one or more of the
covenants referred to in Article 4 hereof; or
(e) any violation of any statutory or common law duty of loyalty to the
Company or any of its subsidiaries.
5.2 TERMINATION BY THE EXECUTIVE. The Executive shall have the right,
subject to the terms of this Agreement, to terminate his employment at any time
with or without "Good Reason"; provided, that the Executive must give the
Company at least 30 days' prior written notice of any termination by the
Executive without Good Reason in accordance with Section 6.2 hereof. For
purposes of this Agreement, "GOOD REASON," shall mean the occurrence of any of
the following during the Term, without the Executive's prior written consent,
during the 60-day period preceding a termination by the Executive (provided that
an isolated, insubstantial or inadvertent action not taken in bad faith or a
failure not occurring in bad faith which is remedied by the Company promptly
after receipt of notice thereof given by the Executive shall not constitute Good
Reason): (A) the assignment to the Executive of any duties materially
inconsistent in any respect with the Executive's position (including status,
offices, titles and
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reporting requirements), authority, duties or responsibilities as contemplated
by this Agreement; (B) any removal of the Executive from any of the positions he
holds as of the date of this Agreement; (C) any failure by the Company to comply
with the provisions of Article 3 hereof; (D) a failure by the Company to comply
with any other material provision of this Employment Agreement; or (E) a change
in the Executive's principal work location to more than 50 miles from the
Company's current headquarters in New York City.
5.3 DEATH. In the event the Executive dies during the Term, the Executive's
employment shall automatically terminate, such termination to be effective on
the date of the Executive's death.
5.4 DISABILITY. In the event that the Executive shall suffer a disability
during the Term which shall have prevented him from performing satisfactorily
his obligations hereunder for a period of at least ninety (90) consecutive days
or one hundred eighty (180) non-consecutive days within any three hundred
sixty-five (365) day period ("DISABILITY"), the Company shall have the right to
terminate the Executive's employment, such termination to be effective upon the
giving of notice thereof to the Executive in accordance with Section 6.2 hereof.
5.5 EFFECT OF TERMINATION.
(a) In the event of termination of the Executive's employment for any
reason during the Term, the Term shall end as of the date of termination and the
Company shall (x) pay to the Executive (or his beneficiary, heirs or estate in
the event of his death), as provided in Section 5.7 hereof, (i) any Base Salary
to the extent not theretofore paid, (ii) any reimbursable business expenses that
have not yet been reimbursed, and (iii) if not yet paid, the earned annual bonus
for the calendar year that preceded the time of the termination, and (y) vest
any restricted stock awarded to the Executive as part of his annual bonus
pursuant to Section 3.2 hereof (collectively, the "ACCRUED OBLIGATIONS").
(b) In the event of termination of the Executive's employment during the
Term (i) by the Company for Cause or (ii) by the Executive for other than for
Good Reason, neither the Executive nor any beneficiary, heir or estate of the
Executive shall be entitled to any further compensation other than the Accrued
Obligations. In such event, all of the Executive's outstanding unvested
equity-based awards shall be immediately forfeited.
(c) In the event of termination of the Executive's employment during the
Term (i) by the Company based on the Disability of the Executive as defined in
Section 5.4 hereof, or (ii) due to the Executive's death, the Company shall pay
the Executive (or his estate, beneficiary or heir in the case of death), in
addition to the Accrued Obligations, a prorated target annual bonus for the year
in which the termination occurs based on the portion of the year elapsed as of
the date of such termination; PROVIDED, HOWEVER, that if such termination occurs
prior to the payment of the 2005 Minimum Bonus, such bonus shall be paid in lieu
of the prorated target annual bonus. Any such bonus amount shall be paid as
provided in Section 5.7 hereof. In addition, upon such a termination, all
unvested equity awards held by the Executive as
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of the date of termination that were granted to the Executive pursuant to
Sections 3.2, 3.3 and 3.4 hereof shall immediately fully vest as of the date of
termination.
(d) In the event of termination of the Executive's employment during the
Term (i) by the Company other than for Cause (and not due to the Executive's
death or Disability), or (ii) by the Executive for Good Reason, in either case
which is not covered by Section 5.6 hereof, the Company shall pay the Executive,
in addition to the Accrued Obligations, a lump sum amount equal to 200% times
the sum of (x) the Executive's then-current Base Salary and (y) the average
annual bonus actually paid to the Executive (including amounts paid in
restricted stock, if any) during the three years prior to the termination (or
such shorter time if the termination occurs prior to the payment of three annual
bonuses to the Executive, or if termination occurs before any annual bonus has
been actually paid to the Executive, then the 2005 Minimum Bonus shall be used
for purposes of determining the average annual bonus (such sum is the "Annual
Compensation"). The Executive shall also be entitled to a prorated annual bonus
for the year in which the termination occurs based on the degree of achievement
of goals under the bonus program in effect at the time of termination and the
portion of the year elapsed as of the date of such termination; PROVIDED,
HOWEVER, that if such termination occurs prior to the payment of the 2005
Minimum Bonus provided for in Section 3.2 hereof, such bonus shall be paid in
lieu of the prorated annual bonus. The degree of achievement of goals shall be
determined in accordance with the bonus program, except that should any goals be
of a subjective nature, the degree of achievement thereof shall be determined by
the Company in its sole discretion. Any such bonus amount shall be paid at the
same time as annual bonuses for the year are paid to the Company's senior
executives generally. In addition, upon such a termination, all unvested equity
awards held by the Executive as of the date of termination that were granted to
the Executive pursuant to Sections 3.2, 3.3 and 3.4 hereof shall immediately
fully vest as of the date of termination.
5.6 CHANGE IN CONTROL. Upon the termination of the Executive's employment
by the Company without Cause or by the Executive for Good Reason (i) during the
6-month period immediately preceding the occurrence of a Change in Control (as
defined in the Company's 2000 Senior Executive Incentive and Stock Award Plan,
as in effect on the date hereof) or (ii) during the 2-year period immediately
following a Change in Control, the Executive shall be entitled to receive, in
addition to the Accrued Obligations, a lump sum amount equal to 300% times the
Annual Compensation (as defined in Section 5.5(d) hereof). The Executive shall
also be entitled to a prorated annual bonus for the year in which the
termination occurs based on the portion of the year elapsed as of the date of
such termination multiplied by the greater of (I) the Executive's target annual
bonus for the year of termination or (II) the average annual bonus actually paid
to the Executive (including amounts paid in restricted stock, if any) during the
three years prior to the termination (or such shorter time if the termination
occurs prior to the payment of three annual bonuses to the Executive); PROVIDED,
HOWEVER, that if such termination occurs prior to the payment of the 2005
Minimum Bonus provided for in Section 3.2 hereof, such bonus shall be paid in
lieu of the prorated annual bonus. Any such bonus amount shall be paid as
provided in Section 5.7 hereof. In addition, all equity-based awards held by the
Executive as of the date of the Change in Control shall vest in
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accordance with the terms and conditions of the applicable equity compensation
plan and/or agreement, PROVIDED, HOWEVER, that all equity-based awards granted
to the Executive which are unvested on the date of termination shall then
immediately fully vest.
5.7 CONDITIONS. Any payments or benefits made or provided pursuant to this
Article 5 (other than the Accrued Obligations) are subject to the Executive's:
(a) compliance with the provisions of Article 4 and Section 5.9 hereof
(provided that this shall not affect the timing of the payment to the Executive
provided for below in this Section 5.7 unless the Executive is in material
breach of any of such provisions as of the time such payment is to be made);
(b) delivery to the Company of an executed General Release, which shall be
substantially in the form attached hereto as Exhibit A, with such changes
therein or additions thereto as needed under then applicable law to give effect
to its intent and purpose; and
(c) delivery to the Company of a resignation from all offices,
directorships and fiduciary positions with the Company, its affiliates and
employee benefit plans.
Notwithstanding the due date of any post-employment payments, any
amounts due following a termination under this Agreement (other than the Accrued
Obligations) shall not be due until after the expiration of any revocation
period applicable to the General Release without the Executive having revoked
such General Release, and any such amounts shall be paid to the Executive within
thirty (30) days of the expiration of such revocation period without the
occurrence of a revocation by the Executive (or such later date as may be
required under Section 409A of the Internal Revenue Code of 1986, as amended
(the "CODE"). Nevertheless (and regardless of whether the General Release has
been executed by the Executive), upon any termination of Executive's employment,
Executive shall be entitled to receive the Accrued Obligations, payable within
thirty (30) days after the date of termination or in accordance with the
applicable plan, program or policy.
5.8 NO MITIGATION. The Executive shall be under no obligation to seek other
employment following a termination of his employment with the Company for any
reason. In addition, there shall be no offset against amounts due to the
Executive under this Article 5 on account of any compensation attributable to
any subsequent employment.
5.9 COOPERATION; ASSISTANCE. The Executive agrees to cooperate fully,
subject to reimbursement by the Company of reasonable out-of-pocket costs and
expenses, with the Company and its counsel with respect to any matter (including
any litigation, investigation or governmental proceeding) which relates to
matters with which the Executive was involved or about which he had knowledge
during his employment with the Company. Such cooperation shall include appearing
from time to time at the offices of the Company or the Company's counsel for
conferences and interviews and in general providing the officers of the Company
and its counsel with the full benefit of the Executive's knowledge with respect
to any such matter. The Executive further agrees, upon termination of his
employment for any reason, to assist his
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successor in the transition of his duties and responsibilities to such
successor. The Executive agrees to render such cooperation in a timely fashion
and at such times as may be mutually agreeable to the parties.
ARTICLE 6
MISCELLANEOUS
6.1 BENEFIT OF AGREEMENT, ASSIGNMENT; BENEFICIARY.
(a) This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns, including, without limitation, any
corporation or person which may acquire all or substantially all of the
Company's assets or business or with or into which the Company may be
consolidated or merged. This Agreement shall also inure to the benefit of, and
be enforceable by, the Executive and his personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. If the Executive should die while any amount would still be payable to
the Executive hereunder if he had continued to live, all such amounts shall be
paid in accordance with the terms of this Agreement to the Executive's
beneficiary, devisee, legatee or other designee, or if there is no such
designee, to the Executive's estate.
(b) The Company shall require any successor (whether direct or indirect, by
operation of law, 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.
6.2 NOTICES. Any notice required or permitted hereunder shall be in writing
and SHALL BE sufficiently given if personally delivered or if sent by certified
mail, postage prepaid, with return receipt requested or by reputable overnight
courier, addressed: (a) in the case of the Company to the General Counsel of the
Company at the Company's then-current headquarters, and (b) in the case of the
Executive, to the Executive's last known address as reflected in the Company's
records, or to such other address as either party shall designate by written
notice to the other party. Any notice given hereunder shall be deemed to have
been given at the time of receipt thereof by the person to whom such notice is
given if personally delivered or at the time of mailing if sent by certified
mail or by courier.
6.3 ENTIRE AGREEMENT; AMENDMENT. Except as specifically provided herein,
this Agreement contains the entire agreement of the parties hereto with respect
to the terms and conditions of the Executive's employment during the Term and
supersedes any and all prior agreements and understandings, whether written or
oral, between the parties hereto with respect to compensation due for services
rendered hereunder (including without limitation the Prior Agreement). For the
avoidance of doubt, in the event of any inconsistency between this Agreement and
any plan of the Company, the terms of this Agreement shall control. This
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Agreement may not be changed or modified except by an instrument in writing
signed by both of the parties hereto.
6.4 WAIVER. The waiver of either party of a breach of any provision of this
Agreement shall not operate or be construed as a continuing waiver or as a
consent to or waiver of any subsequent breach hereof.
6.5 HEADINGS. The Article and Section headings herein are for convenience
of reference only, do not constitute a part of this Agreement and shall not be
deemed to limit or affect any of the provisions hereof.
6.6 GOVERNING LAW. This Agreement shall be governed by, and construed and
interpreted in accordance with, the internal laws of the State of New York
without reference to the principles of conflict of laws.
6.7 AGREEMENT TO TAKE ACTIONS. Each party hereto shall execute and deliver
such documents, certificates, agreements and other instruments and shall take
such other actions, as may be reasonably necessary or desirable in order to
perform his or its obligations under this Agreement or to effectuate the
purposes hereof.
6.8 DISPUTE RESOLUTION. Any dispute or controversy arising from or relating
to this Agreement and/or the Executive's employment or relationship with the
Company shall be resolved by binding arbitration, to be held in New York City or
in any other location mutually agreed to by the Company and the Executive in
accordance with the rules and procedures of the American Arbitration
Association. Judgment upon the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof. The Executive and the Company agree
that, in the event a dispute arises that concerns this Agreement, if the
Executive is the Prevailing Party, the Executive shall be entitled to recover
all of his reasonable fees and expenses, including, without limitation,
reasonable attorneys' fees and expenses, incurred in connection with the
dispute. A Prevailing Party is one who is successful on any significant
substantive issue in the action and achieves either a judgment in such party's
favor or some other affirmative recovery.
6.9 SURVIVORSHIP. The respective rights and obligations of the parties
hereunder shall survive any termination of this Agreement to the extent
necessary to effectuate the intended preservation of such rights and
obligations, including without limitation Article 4 hereof.
6.10 VALIDITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision or provisions of this Agreement, which shall remain in full
force and effect. If any provision of this Agreement is held to be invalid, void
or unenforceable, any court so holding shall substitute a valid, enforceable
provision that preserves, to the maximum lawful extent, the terms and intent of
this Agreement.
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6.11 CONSTRUCTION. The parties have participated jointly in the negotiation
and drafting of this Agreement. In the event an ambiguity or question of intent
or interpretation arises, this Agreement shall be construed as if drafted
jointly by the parties and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any of the
provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "INCLUDING" shall mean including without limitation.
6.12 CODE SECTION 409A. It is intended that this Agreement and the
Company's and the Executive's exercise of authority or discretion hereunder
shall comply with the provisions of Code Section 409A and the treasury
regulations relating thereto so as not to subject the Executive to the payment
of interest and tax penalty which may be imposed under Code Section 409A. In
furtherance of this interest, to the extent that any regulations or other
guidance issued under Code Section 409A after the date of this Agreement would
result in the Executive being subject to payment of interest and tax penalty
under Code Section 409A, the parties agree to amend this Agreement in order to
avoid the application of Code Section 409A.
6.13 WITHHOLDING. All compensation paid or provided to the Executive under
this Agreement shall be subject to any applicable income, payroll or other tax
withholding requirements.
6.14 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement effective as of the date first written above. The Company represents
that its execution of this Agreement has been authorized by the Committee.
XXXXX & XXXXXXXX COMPANIES, INC.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------
Name: Xxxxx X. Xxxxxxx
Title: Chair, Compensation Committee of the
Board of Directors
/s/ Xxxxxxx X. Xxxxxxxxx
--------------------------
XXXXXXX X. XXXXXXXXX
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EXHIBIT A
GENERAL RELEASE OF ALL CLAIMS
1. For valuable consideration, the adequacy of which is hereby acknowledged, the
undersigned ("EXECUTIVE"), on his own behalf and on behalf of his heirs,
executors, administrators, successors, representatives and assigns, does herein
knowingly and voluntarily unconditionally release, waive, and fully discharge
Xxxxx & McLennan Companies, Inc. and its subsidiaries (including successors and
assigns thereof) (collectively, the "COMPANY"), and all of their respective
past, present and future employees, officers, directors, agents, affiliates,
parents, predecessors, administrators, representatives, attorneys, and
shareholders, and employee benefit plans, from any and all legal claims,
liabilities, suits, causes of action (whether before a court or an
administrative agency), damages, costs, attorneys' fees, interest, injuries,
expenses, debts, or demands of any nature whatsoever, known or unknown,
liquidated or unliquidated, absolute or contingent, at law or in equity, which
were or could have been filed with any Federal, state, or local court, agency,
arbitrator or any other entity, based directly or indirectly on Executive's
employment with and separation from Company or based on any other alleged act or
omission by or on behalf of Company prior to Executive's signing this General
Release. Without limiting the generality of the foregoing terms, this General
Release specifically includes all claims based on the terms, conditions, and
privileges of employment, and those based on breach of contract (express or
implied), tort, harassment, intentional infliction of emotional distress,
defamation, negligence, privacy, employment discrimination, retaliation,
discharge not for just cause, constructive discharge, wrongful discharge, the
Age Discrimination in Employment Act of 1967, as amended (the "ADEA"), the Older
Workers Benefit Protection Act of 1990, the Worker Adjustment and Retraining
Notification Act, as amended, Executive Order 11,141 (age discrimination), Title
VII of the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991,
the Civil Rights Act of 1866 and 1871, Sections 1981 through 1988 of Title 42 of
the United States code, as amended, 41 U.S.C. ss.1981 (discrimination), 29
U.S.C. ss.206(d)(1) (equal pay), Executive Order 11,246 (race, color, religion,
sex and national origin discrimination), the National Labor Relations Act, the
Equal Pay Act of 1993, the Americans with Disabilities Act of 1990, the
Occupational Safety and Health Act, as amended, the Family Medical Leave Act,
the Immigration Reform and Control Act, as amended, the Vietnam Era Veterans
Readjustment Assistance Act, ss.ss.503-504 of the Rehabilitation Act of 1973
(handicap rehabilitation), the Employee Retirement Income Security Act of 1974,
as amended, any federal, state or local fair employment, civil or human rights,
wage and hour laws and wage payment laws, and any and all other Federal, state,
local or other governmental statutes, laws, ordinances, regulations and orders,
under common law, and under any Company policy, procedure, bylaw or rule. This
General Release shall not waive or release any rights or claims that Executive
may have which arise after the date of this General Release and shall not waive
post-termination health-continuation insurance benefits required by state or
Federal law.
2. Executive intends this General Release to be binding on his successors, and
Executive specifically agrees not to file or continue any claim in respect of
matters covered by Section 1, above. Executive further agrees never to institute
any suit, complaint, proceeding, grievance or action of any kind at law, in
equity, or otherwise in any court of the United States or in any state, or in
any administrative agency of the United States or any state, county or
municipality, or before any other tribunal, public or private, against Company
arising from or relating to his
employment with or his termination of employment from Company and/or any other
occurrences to the date of this General Release, other than a claim challenging
the validity of this General Release under the ADEA or respecting any matters
not covered by this General Release.
3. Executive is further waiving his right to receive money or other relief in
any action instituted by him or on his behalf by any person, entity or
governmental agency in respect of matters covered by this General Release.
Nothing in this General Release shall limit the rights of any governmental
agency or his right of access to, cooperation or participation with any
governmental agency, including without limitation, the United States Equal
Employment Opportunity Commission. Executive further agrees to waive his rights
under any other statute or regulation, state or federal, which provides that a
general release does not extend to claims which Executive does not know or
suspect to exist in his favor at the time of executing this General Release,
which if known to him must have materially affected his settlement with Company.
4. Executive agrees that Executive shall not be eligible and shall not seek or
apply for reinstatement or re-employment with Company and agrees that any
application for re-employment may be rejected without explanation or liability
pursuant to this provision.
5. In further consideration of the promises made by Company in this General
Release, Executive specifically waives and releases Company from all claims
Executive may have as of the date of this General Release, whether known or
unknown, arising under the ADEA. Executive further agrees that:
(a) Executive's waiver of rights under this General Release is knowing and
voluntary and in compliance with the Older Workers Benefit Protection
Act of 1990 ("OWBPA");
(b) Executive understands the terms of this General Release;
(c) The consideration offered by Company under Article 5 of that certain
Employment Agreement dated as of the 20th day of July, 2005 by and
between the Company and Executive (the "EMPLOYMENT AGREEMENT") in
exchange for the General Release represents consideration over and
above that to which Executive would otherwise be entitled, and that
the consideration would not have been provided had Executive not
agreed to sign the General Release and did not sign the Release;
(d) Company is hereby advising Executive in writing to consult with an
attorney prior to executing this General Release;
(e) Company is giving Executive a period of twenty-one (21) days within
which to consider this General Release;
(f) Following Executive's execution of this General Release, Executive has
seven (7) days in which to revoke this General Release by written
notice. An attempted revocation not actually received by Company prior
to the revocation deadline will not be effective; and
(g) This General Release and all payments and benefits otherwise payable
under Article 5 of the Employment Agreement (other than the Accrued
Obligations) shall be void and of no force and effect if Executive
chooses to so revoke, and if Executive chooses not to so revoke, this
General Release shall then become effective and enforceable.
6. This General Release does not waive rights or claims that may arise under the
ADEA after the date Executive signs this General Release. To the extent barred
by the OWBPA, the covenant not to xxx contained in Section 2, above, does not
apply to claims under the ADEA that challenge the validity of this General
Release.
7. To revoke this General Release, Executive must send a written statement of
revocation to:
Xxxxx & McLennan Companies, Inc.
[Address]
[City, State Zip Code]
Attn: ______________________
The revocation must be received no later than 5:00 p.m. on the seventh day
following Executive's execution of this General Release. If Executive does not
revoke, the eighth day following Executive's acceptance will be the "effective
date" of this General Release.
8. This General Release shall be governed by the internal laws (and not the
choice of laws) of the State of New York, except for the application of
pre-emptive Federal law.
PLEASE READ THIS AGREEMENT CAREFULLY. IT CONTAINS A RELEASE OF ALL
KNOWN AND UNKNOWN CLAIMS.
Date: ___________________________ ________________________________
Xxxxxxx X. Xxxxxxxxx
