EXHIBIT 10.1
This EMPLOYMENT AGREEMENT (this "Agreement"), dated as of August 6,
2002 (the "Effective Date"), is hereby made by and between PXRE GROUP LTD., a
Bermuda company (the "Company"), and XXX X. XXXXXXXXXXX, an individual (the
"Executive").
WHEREAS, the Company desires to employ the Executive and to enter into
this Agreement to set forth the terms of such employment; and
WHEREAS, the Executive desires to enter into such employment and enter
into this Agreement.
NOW, THEREFORE, in consideration of the covenants and agreements
hereinafter set forth, the parties hereto agree as follows:
1. EMPLOYMENT AND DUTIES
1.1. General. The Company hereby employs the Executive, and the
Executive hereby agrees to serve the Company, as Executive Vice President of the
Company, upon the terms and subject to the conditions herein contained.
The Executive shall perform such other duties and services for the
Company and its affiliates, commensurate with the Executive's position, as may
be designated from time to time by the President, the Chief Executive Officer
(the "CEO") or Board of Directors of the Company (the "Board"). The Executive
agrees to serve the Company faithfully and to the best of his ability under the
direction of the President, the CEO and the Board.
1.2. Extent of Services. Except as may otherwise be approved in advance
by the Board, and except during vacation periods and reasonable periods of
absence due to sickness, personal injury or other disability, the Executive
shall devote his full working time throughout his period of employment with the
Company to the services required of him under this Agreement. The Executive
shall use his best efforts, judgment and energy to improve and advance the
business, reputation and interests of the Company in a manner consistent with
the duties of his position.
1.3. Term of Employment. The Executive's employment under this
Agreement shall commence as of the Effective Date and shall terminate on of the
earlier of July 31, 2003 and the date of termination of the Executive's
employment pursuant to Section 4 or 5. The period commencing on the Effective
Date and ending on July 31, 2003 is hereinafter referred to as the "Employment
Term".
2. COMPENSATION
2.1. Base Salary. From the Effective Date through the end of the
Executive's employment hereunder, the Executive shall be entitled to receive a
base salary ("Base Salary") at a rate of US$350,000 per annum, payable in
arrears in equal installments in accordance with the Company's payroll
practices, with such increases as may be granted to the Executive in accordance
with Company policy. Once increased, such higher amount shall constitute the
Executive's annual Base Salary.
2.2. Annual Review. The Executive's Base Salary shall be reviewed by
the President, based upon the Executive's performance, not less often than
annually, and may be increased but not decreased during the Employment Term.
2.3. Annual Incentive Bonus Plan. Subject to the provisions of Section
4.2, the Executive shall be entitled to participate annually during the
Employment Term in the Company's Restated Employee Annual Incentive Bonus Plan
(the "Bonus Plan"), or such substitute plan as shall be established from time to
time by Company, which provides for the payment of annual bonuses to key
employees of the Company, subject to the terms and conditions of the Bonus Plan
or such substitute plan, as the case may be.
2.4. Equity Grants. Subject to the provisions of Section 4.2, the
Executive shall be entitled to participate annually during the Employment Term
in the Company's 2002 Officer Incentive Plan (the "Incentive Plan"), or such
substitute plan as shall be established from time to time by Company, which
provides for the grant of stock options and restricted shares of Company stock
to key employees of the Company, subject to the terms and conditions of the
Incentive Plan or such substitute plan, as the case may be.
2.5. Severance Plan. During the Employment Term, the Executive will not
be eligible to participate in the Company's Amended and Restated Severance Plan
for Certain Executives.
2.6. Housing Allowance. The Company shall provide the Executive with a
housing allowance at an annual rate of US$120,000 for the Employment Term with
such allowance payable to the Executive in monthly installments.
3. EMPLOYEE BENEFITS
3.1. In General. The Executive and his dependents shall, during his
employment under this Agreement, be included to the extent eligible thereunder
in all pension, 401(k), health, medical, life, disability or other similar plans
or benefits which shall be established by the Company from time to time for, or
made available to, its executives.
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4. TERMINATION OF EMPLOYMENT
4.1. Termination Without Cause; Resignation for Good Reason.
4.1.1. General. Subject to the provisions of Sections 4.1.2
and 4.1.3, ifthe Executive's employment is terminated by the Company
without Cause (as defined in Section 4.3), or if the Executive
terminates his employment hereunder for Good Reason (as defined in
Section 4.4), the Company shall pay the Executive severance pay in an
amount equal to the sum of (i) the Base Salary (at a rate in effect on
the date of such termination or, if a reduction in Base Salary is the
basis for termination for Good Reason, then the Base Salary in effect
immediately prior to such reduction), plus (ii) the amount of the
annual housing allowance payable pursuant to Section 2.6. Such
severance pay shall be payable at such intervals as the same would have
been paid had the Executive remained in the active service of the
Company. In addition, the Executive and his dependents shall continue
to participate in the benefit plans described in Section 3.1 for a
period of one year from the date of termination or resignation pursuant
to this Section 4.1.1; provided, however, that the Company may, at its
option, pay to the Executive the present value of the aggregate dollar
value of such benefits, without the necessity to provide the respective
benefits to the Executive set forth in Section 3.1 hereof. The
Executive shall have no further right to receive any other compensation
or benefits after such termination or resignation of employment except
as determined in accordance with the terms of the employee benefit
plans or programs of the Company except that he shall receive payment
for earned but unused vacation. Salary continuation payments made and
benefits provided to the Executive pursuant to this Section 4.1.1 shall
be reduced by compensation earned and benefits received by the
Executive from a subsequent employer during 12-month period following
termination of employment (the "Severance Period").
4.1.2. Conditions Applicable to the Severance Period. If,
during the Severance Period, the Executive breaches his obligations
under Section 7 of this Agreement, the Company may terminate the
Severance Period and cease to make any further payments or provide any
benefits described in Section 4.1.1.
4.1.3. Death During Severance Period. In the event of the
Executive's death during the Severance Period, all remaining severance
pay due to the Executive unde Section 4.1.1 shall be payable
immediately to the Executive's designated beneficiary.
4.1.4. Date of Termination. The date of termination of
employment without Cause shall be the date specified in a written
notice of termination to the Executive. The date of resignation for
Good Reason shall be the date specified in the written notice of
resignation from the Executive to the Company; provided, however, that
no such written notice shall be effective unless the cure period
specified in Section 4.4 has expired without the Company having
corrected the event or events subject to cure. If no date of
resignation is specified in the written notice from the Executive to
the Company, the date of termination shall be the first day following
the expiration of such cure period.
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4.2. Termination for Cause; Resignation Without Good Reason.
4.2.1. General. If, prior to the expiration of the Employment
Term, the Executive's employment is terminated by the Company for
Cause, or the Executive resigns from his employment hereunder other
than for Good Reason, the Executive shall be entitled only to payment
of his Base Salary as then in effect through and including the date of
termination or resignation together with payment for earned but unused
vacation. The Executive shall have no further right to receive any
other severance, compensation or benefits after such termination or
resignation of employment, except as determined in accordance with the
terms of the employee benefit plans or programs of the Company.
4.2.2. Date of Termination. Subject to the proviso to Section
4.3, the date of termination for Cause shall be the date specified in a
written notice of termination to the Executive. The date of resignation
without Good Reason shall be the date specified in the written notice
of resignation from the Executive to the Company, or if no date is
specified therein, 10 business days after receipt by the Company of
written notice of resignation from the Executive.
4.3. Cause. Termination for "Cause" shall mean termination of the
Executive's employment because of:
(a) any wilful act or omission that constitutes a material breach
by the Executive of any of his obligations under this
Agreement;
(b) the wilful and continued failure or refusal of the Executive
to substantially perform the material duties required of him
as an employee of the Company;
(c) any wilful material violation by the Executive of any law or
regulation applicable to the business of the Company or any of
its subsidiaries or affiliates, or the Executive's conviction
of or plea of nolo contendere to a felony or a crime involving
moral turpitude, or any wilful perpetration by the Executive
of a common law fraud; or
(d) any other wilful misconduct by the Executive that is injurious
to the financial condition or business reputation of, or is
otherwise materially injurious to, the Company or any of its
subsidiaries or affiliates;
provided, however, that if any such Cause relates to the Executive's obligations
under this Agreement and is susceptible to cure, the Company shall not terminate
the Executive's employment hereunder unless the Company first gives the
Executive notice of its intention to terminate and of the grounds for such
termination, and the Executive has not, within 10 business days following
receipt of the notice, cured such Cause.
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For purposes of this Section 4.3, an "affiliate" of a person or other
entity shall mean a person or other entity that directly or indirectly controls,
is controlled by, or is under common control with, the person or entity
specified.
4.4. Good Reason. For purposes of this Agreement, "Good Reason" shall
mean either of the following (occurring without the Executive's prior consent):
(a) a decrease in the Executive's base rate of compensation, or a
failure by the Company to pay material compensation due and
payable to the Executive in connection with his employment; or
(b) the failure by the Company to obtain an agreement from a
successor to assume and agree to perform this Agreement in
accordance with the second sentence of Section 8.3;
provided, however, that if any such Good Reason is susceptible of cure, the
Executive may not resign for Good Reason unless the Executive first gives the
Company notice of his intention to resign and of the grounds for such
resignation, and the Company has not, within 10 business days following receipt
of the notice, cured such Good Reason, or in the event that such Good Reason is
not susceptible to cure within such 10 business day period, the Company has not
taken all reasonable steps within such 10 business day period to cure such Good
Reason as promptly as practicable thereafter.
5. DEATH OR DISABILITY
In the event of termination of the Executive's employment by reason of
death or Permanent Disability (as hereinafter defined), the Executive (or his
estate, as applicable) shall be entitled to Base Salary and benefits determined
under Sections 2 and 3 through the date of termination. Other benefits shall be
determined in accordance with the benefit plans maintained by the Company, and
the Company shall have no further obligation hereunder. For purposes of this
Agreement, "Permanent Disability" means a physical or mental disability or
infirmity of the Executive that prevents the normal performance of substantially
all his duties as an employee of the Company, which disability or infirmity
shall exist, or in the option of an independent physician is reasonably likely
to exist, for any continuous period of 180 days.
6. NO MITIGATION OF DAMAGES
The Executive shall not be required to mitigate the amount of any
payment provided for in Section 4.1 by seeking other employment.
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7. CONFIDENTIALITY
7.1. Confidentiality. The Executive agrees that during the Employment
Term and thereafter he will not, except in the performance of his obligations to
the Company hereunder or as may otherwise be approved in advance by the Board,
directly or indirectly, disclose or use (except for the direct benefit of the
Company) any confidential information that he may learn or has leaned by reason
of his association with the Company, any client or any of their respective
subsidiaries and affiliates. The term "confidential information" includes all
data, analyses, reports, interpretations, forecasts, documents and information
concerning or otherwise reflecting information and concerning the Company and
its affairs, including, without limitation, with respect to clients, products,
policies, procedures, methodologies, trade secrets and other intellectual
property, systems, personnel, confidential reports, technical information,
financial information, business transactions, business plans, prospects or
opportunities, but shall exclude any portion of such information that (a) was
acquired by the Executive prior to his employment by, or other association with,
the Company, (b) is or becomes generally available to the public or is generally
known in the industry or industries in which the Company operates, in each case
other than as a result of disclosure by the Executive in violation of this
Section 7.1 or (c) the Executive is required to disclose under any applicable
laws, regulations or directives of any government agency, tribunal or authority
having jurisdiction in the matter or under subpoena or other process of law.
7.2. Exclusive Property. The Executive confirms that all confidential
information with respect to the Company is and shall remain the exclusive
property of the Company. All business records, papers and documents kept or made
by the Executive relating to the business of the Company shall be and remain the
property of the Company, except for such papers customarily deemed to be the
personal copies of the Executive.
7.3. Injunctive Relief. Without intending to limit the remedies
available to the Company, the Executive acknowledges that a breach of any of the
covenants contained in this Section 7 may result in material and irreparable
injury to the Company and its affiliates and subsidiaries for which there is no
adequate remedy at law, that it will not be possible to measure damages for such
injuries precisely and that, in the event of such a breach or threat thereof,
the Company shall be entitled to seek a temporary restraining order or a
preliminary or permanent injunction restraining the Executive from engaging in
activities prohibited by this Section 7 or such other relief as may be required
specifically to enforce any of the covenants in this Section 7. If for any
reason it is held that the restrictions under this Section 7 are not reasonable
or that consideration therefor is inadequate, such restrictions shall be
interpreted or modified to include as much of the duration and scope identified
in this Section 7 as will render such restrictions valid and enforceable.
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8. MISCELLANEOUS
8.1. Notices. All notices or communications hereunder shall be in
writing, addressed as follows:
To the Company:
PXRE Group Ltd.
00 Xxxxx Xxxxxx
Xxxxxxxx XX 00
Xxxxxxx
Fax: 000-000-0000
Attn: President
To the Executive:
Xxx X. Xxxxxxxxxxx
00 Xxxxx Xxxxxx
Xxxxxxxx XX 00
Bermuda
Fax: 000-000-0000
All such notices shall be conclusively deemed to be received and shall be
effective, (a) if sent by hand delivery or courier service, upon receipt, (b) if
sent by telecopy or facsimile transmission, upon confirmation of receipt by the
sender of such transmission or (c) if sent by registered or certified mail, on
the fifth day after the day on which such notice is mailed.
8.2. Severability. Each provision of this Agreement shall 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 prohibited by or invalid
under applicable law, such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
8.3. Assignment. The Company's rights and obligations under this
Agreement shall not be assignable by the Company except as incident to a
reorganization, merger or consolidation, or transfer of all or substantially all
the Company's business and properties (or portion thereof in which the Executive
is employed). The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all the business 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.
Neither this Agreement nor any rights hereunder shall be assignable or otherwise
subject to hypothecation by the Executive.
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8.4. Entire Agreement. Except as expressly set forth herein, this
Agreement represents the entire agreement of the parties and shall supersede any
and all previous contracts, arrangements or understandings between the Company
and the Executive. This Agreement may be amended at any time by mutual written
agreement of the parties hereto.
8.5. Withholding. The payment of any amount pursuant to this Agreement
shall be subject to applicable withholding and payroll taxes, and such other
deductions as may be required under the Company's employee benefit plans, if
any.
8.6. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of Bermuda with regard to any conflict of law rules
that might apply the laws of any other jurisdiction.
8.7. Waiver. No waiver by either party of any breach by the other party
of any condition or provision contained in this Agreement to be performed by
such other party shall be deemed a waiver of a similar or dissimilar condition
or provision at the same or any prior or subsequent time. Any waiver must be in
writing and signed by the Executive or an authorized officer of the Company, as
the case may be.
8.8. Headings. The headings of the sections contained in this Agreement
are for convenience of reference only and shall not be deemed to control or
affect the meaning or construction of any provision of this Agreement.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed and the Executive has hereunto set his hand, as of the day and year
first above written.
PXRE GROUP LTD.
By /s/ Xxxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxx
Title: President & Chief Operating Officer
XXX X. XXXXXXXXXXX
/s/ Xxx X. Xxxxxxxxxxx
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