EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of the 17th day of August,
1992, as amended and restated as of May 14, 1998, between CONSECO, INC., an
Indiana corporation (hereinafter called the "Company"), and Xxxxxx X. Xxxxx
(hereinafter called "Executive").
RECITALS
WHEREAS, the services of Executive, her managerial and professional
experience, and her knowledge of the affairs of the Company are of great value
to the Company;
WHEREAS, the Company deems it to be essential for it to have the
benefit and advantage of the services of the Executive for an extended period;
and
WHEREAS, the Company and Executive are parties to an employment
agreement dated August 17, 1992, as amended on March 12, 1996 (as so amended the
"Existing Employment Agreement"), and the Company and Executive desire to make
certain modifications to the Existing Employment Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants contained herein, the parties agree the Existing Employment Agreement
be amended and restated in its entirety to be as follows:
1. Employment. The Company hereby employs Executive and Executive
hereby accepts employment upon the terms and conditions hereinafter set forth.
2. Term. The effective date of this Agreement shall be August 17, 1992.
Subject to the provisions for termination as provided in Section 10 hereof, the
term of this Agreement shall be the period beginning September 1, 1992 and
ending December 31, 2001 (hereinafter called the "Basic Employment Period").
3. Duties. Executive is engaged by the Company in an executive capacity
as its executive vice president of corporate development. Executive shall report
to the Chief Executive Officer regarding the performance of her duties and shall
be subject to the direction and control of the Board of Directors of the Company
(sometimes referred to herein as the "Board") and the Chief Executive Officer.
Executive's position with the Company shall initially be Executive Vice
President, and such other positions as may be determined from time to time by
the Board.
4. Extent of Services. Executive, subject to the direction and control
of the Chief Executive Officer and the Board, shall have the power and authority
commensurate with her executive status and necessary to perform her duties
hereunder. The Company agrees to provide to Executive such assistance and work
accommodations as are suitable to the character of her positions with the
Company and adequate for the performance of her duties. Executive shall devote
her entire employable time, attention and best efforts
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to the business of the Company, and shall not, without the consent of the
Company, during the term of this Agreement be actively engaged in any other
business activity, whether or not such business activity is pursued for gain,
profit or other pecuniary advantage; but this shall not be construed as
preventing Executive from investing her assets in such form or manner as will
not require any services on the part of Executive in the operation of the
affairs of the companies in which such investments are made. For purposes of
this Agreement, full-time employment shall be the normal work week for
individuals in comparable executive positions with the Company.
5. Compensation.
(a) As compensation for services hereunder rendered during the term
hereof, Executive shall receive a base salary ("Base Salary") of Two
Hundred Fifty Thousand Dollars ($250,000) per year payable in equal
installments in accordance with the Company's payroll procedure for its
salaried employees. Salary payments shall be subject to withholding of
taxes and other appropriate and customary amounts. Executive may
receive increases in her Base Salary from time to time, based upon her
performance in her executive and management capacity. The amounts of
any such salary increases shall be approved by the Board or the
Compensation Committee of the Board upon the recommendation of the
Chief Executive Officer.
(b) In addition to Base Salary, Executive may receive such other
bonuses or incentive compensation as the Compensation Committee or the
Board may approve from time to time, upon the recommendation of the
Chief Executive Officer.
6. Fringe Benefits.
(a) Executive shall be entitled to participate in such existing
employee benefit plans and insurance programs offered by the Company,
or which it may adopt form time to time, for its executive management
or supervisory personnel generally, in accordance with the eligibility
requirements for participation therein. Nothing herein shall be
construed so as to prevent the Company from modifying or terminating
any employee benefit plans or programs, or employee fringe benefits, it
may adopt from time to time.
(b) During the term of this Agreement, the Company shall pay
Executive a monthly automobile allowance in the amount of Six Hundred
Dollars ($600), and the Company shall pay directly or shall reimburse
Executive for the cost of fuel that she incurs in using her automobile.
(c) Executive shall be entitled to four (4) weeks vacation with pay
for each year during the term hereof.
(d) Executive may incur reasonable expenses for promoting the
Company's business, including expenses for entertainment, travel, and
similar items. The Company shall reimburse Executive for all such
reasonable expenses upon Executive's periodic presentation of an
itemized account of such expenditures.
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(e) The Company shall, upon periodic presentation of satisfactory
evidence and to a maximum of Ten Thousand Dollars ($10,000) per each
year of this Agreement, reimburse Executive for reasonable medical
expenses incurred by Executive and her dependents which are not
otherwise covered by health insurance provided to Executive under
Section 6(a).
(f) During the term of this Agreement, the Company shall at its
expense maintain a term life insurance policy or policies on the life
of Executive in the face amount of Five Hundred Thousand Dollars
($500,000), payable to such beneficiaries as Executive may designate.
7. Disability. If Executive shall become physically or mentally
disabled during the term of this Agreement to the extent that her ability to
perform her duties and services hereunder is materially and adversely impaired,
her salary, bonus and other compensation provided herein shall continue while
she remains employed by the Company; provided, that if such disability (as
confirmed by competent medical evidence) continues for at least nine (9)
consecutive months, the Company may terminate Executive's employment hereunder
in which case the Company shall immediately pay Executive a lump sum payment
equal to one-quarter of the sum of her annual salary and bonus with respect to
the most recent fiscal year then ended and, provided further, that no such lump
sum payment shall be required if such disability arises primarily from: (a)
chronic depressive use of intoxicants, drugs or narcotics, or (b) intentionally
self-inflicted injury or intentionally self-induced sickness; or (c) a proven
unlawful act or enterprise on the part of Executive.
8. Disclosure of Information. Executive acknowledges that in and as a
result of her employment with the Company, she has been and will be making use
of, acquiring and/or adding to confidential information of the Company of a
special and unique nature and value. As a material inducement to the Company to
enter into this Agreement and to pay to Executive the compensation stated in
Section 5, as well as any additional benefits stated herein, Executive covenants
and agrees that she shall not, at any time during or following the term of her
employment, directly or indirectly, divulge or disclose for any purpose
whatsoever, any confidential information that has been obtained by or disclosed
to her as a result of her employment with the Company. Upon the termination of
this Agreement, Executive shall return all materials obtained from or belonging
to the Company which she may have in her possession or control. In the event of
a breach or threatened breach by Executive of the provisions of this Section,
the Company shall be entitled to an injunction restraining Executive from
utilizing or disclosing, in whole or in part, such material, or from rendering
any service to any person, firm, corporation, association, or other entity to
which such material might be useful, and/or any and all persons directly or
indirectly acting for or with Executive. Nothing herein shall be construed as
prohibiting the Company from pursuing any other remedies available to the
Company for such breach or threatened breach, including the recovery of damages
from Executive.
9. Covenants Against Competition and Solicitation. Executive
acknowledges that the services she is to render to the Company are of a special
and unusual character, with a unique value to the Company, the loss of which
cannot adequately be compensated by damages or an action at law. In view of the
unique value to the Company of the services of Executive for which the Company
has contracted hereunder, because of the confidential information to be obtained
by, or disclosed to, Executive as hereinabove set
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forth, and as a material inducement to the Company to enter into this Agreement
and to pay to Executive the compensation stated in Section 5, as well as any
additional benefits stated herein, and other good and valuable consideration,
Executive covenants and agrees that throughout the Basic Employment Period,
Executive shall not, directly or indirectly, anywhere in the United States of
America (i) render any services, as an agent, independent contractor, consultant
or otherwise, or become employed or compensated by, any other corporation,
person or entity engaged in the business of selling or providing life or
accident and health insurance products or services; (ii) in any manner compete
with the Company or any of its subsidiaries; (iii) solicit or attempt to convert
to other insurance carriers providing these same or similar products or services
provided by the Company and its subsidiaries, any customers or policyholders of
the Company, or any of its subsidiaries; or (iv) solicit for employment or
employ any employee of the Company or any of its subsidiaries. The covenants of
Executive in this Section 9 shall be void and unenforceable in the event of a
Control Termination of this Agreement as defined in Section 10 below.
10. Termination.
(a) Either the Company or Executive may terminate this Agreement at
any time for any reason upon written notice to the other. This
Agreement shall also terminate upon (i) the death of Executive or (ii)
termination by the Company pursuant to Section 7.
(b) In the event this Agreement is terminated by the Company and
such termination is not pursuant to the last sentence of (a) above or
for "just cause" as defined in (e) below and does not constitute a
Control Termination as defined in (d) below, Executive shall be
entitled to receive her Base Salary, as determined pursuant to Section
5(a) hereof, for the remainder of the Basic Employment Period and all
other unpaid amounts previously accrued or awarded pursuant to any
other provision of this Agreement.
(c) In the event this Agreement is terminated by the death of
Executive, is terminated by the Company for "just cause" as defined in
(e) below, or is terminated by Executive and such termination does not
constitute a Control Termination as defined in (d) below, Executive
shall be entitled to receive her Base Salary as provided in Section
5(a) accrued but unpaid as of the date of termination, and all other
unpaid amounts previously accrued or awarded pursuant to any other
provision of this Agreement.
(d) The term "Control Termination" as used herein shall mean (a)
termination of this Agreement by the Company in anticipation of or
following a "change in control" of the Company (as defined below), or
(b) termination of this Agreement by Executive following "change in
control" of the Company (as defined below) upon the occurrence of any
of the following events:
(i) significant change in the nature or scope of
Executive's authorities or duties from those described in Section
3, a reduction in her total compensation from that provided in
Section 5, or a breach by the Company of any other provision of
this Agreement; or
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(ii) reasonable determination by Executive that, as a
result of a change in circumstances significantly affecting her
position, she is unable to exercise the authorities, powers,
functions or duties attached to her position and contemplated by
Section 3 of this Agreement, or
(iii) the Company's principal executive offices are moved
outside the geographic area comprised of Xxxxxx County, Indiana,
and the seven contiguous counties or Executive is required to work
at a location other than the Company's principal executive offices;
or
(iv) the giving of notice of termination by Executive
during the 6-month period commencing six (6) months after the
change in control.
The term "change in control" shall mean a change in control of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934 (the "Act")
as revised effective January 20, 1987; provided that, without limitation, such a
change in control shall be deemed to have occurred if and when either (A) except
as provided in (y) below, any "person" (as such term is used in Sections 13(d)
and 14(d) of the Act) is or becomes a "beneficial owner" (as such term is
defined in Rule 13d-3 promulgated under the Act), directly or indirectly, of
securities of the Company representing 25% or more of the combined voting power
of the Company's then outstanding securities entitled to vote with respect to
the election of its Board of Directors or (B) as the result of a tender offer,
merger, consolidation, sale of assets, or contest for election of directors, or
any combination of the foregoing transactions or events, individuals who were
members of the Board of Directors of the Company immediately prior to any such
transaction or event shall not constitute a majority of the Board of Directors
following such transaction or event.
(e) For purposes of this Agreement "just cause" shall mean and
include:
(i) Executive's breach of any provisions of this Agreement,
or her use of alcohol or drugs which interferes with the
performance of her duties hereunder or which compromises the
integrity and reputation of the Company, its employees, and
products;
(ii) Executive's conviction by a court of law, or admission
that she is guilty, or a felony or other crime involving moral
turpitude;
(iii) Executive's absence from her employment other than as
a result of Section 7 hereof, for whatever cause, for a period of
more than one (1) month, without prior written consent from the
Company;
(iv) Executive becomes incompetent or is reasonably unable
to undertake and discharge the duties and responsibilities of her
position; or
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(v) Executive's gross negligence, willful malfeasance or fraud or
dishonesty in performing her services on behalf of the Company pursuant
to this Agreement.
11. Payments for Control Termination. In the event of a Control
Termination of this Agreement, the Company shall pay Executive and provide her
with the following:
(a) During the remainder of the Basic Employment Period, the
Company shall continue to pay Executive her Base Salary at the same
rate as payable immediately prior to the date of termination plus the
estimated amount of any bonuses to which she would have been entitled
had she remained in the employ of the Company and a change in control
of the Company had not occurred.
(b) During the remainder of the Basic Employment Period, Executive
shall continue to be treated as an employee under the provisions of all
incentive compensation arrangements applicable to the Company's
executive employees. In addition, Executive shall continue to be
entitled to all benefits and service credits for benefits under
medical, insurance and other employee benefit plans, programs and
arrangements of the Company as if she were still employed under this
Agreement and a change in control of the Company had not occurred.
(c) If, despite the provisions of paragraph (b) above, benefits
under any employee benefit plan shall not be payable or provided under
any such plan to Executive, or her dependents, beneficiaries and
estate, because she is no longer an employee of the Company, the
Company itself shall, to the extent necessary, pay or provide for
payment of such benefits and service credits for such benefits to
Executive, her dependents, beneficiaries and estate.
(d) If, despite the provisions of paragraph (b) above, benefits or
the right to accrue further benefits under any stock option or other
incentive compensation arrangement shall not be provided under any such
arrangement to Executive, or her dependents, beneficiaries and estate,
because she is no longer an employee of the Company, the Company shall,
to the extent necessary, pay or provide for payment of such benefits to
Executive, her dependents, beneficiaries and estate.
12. Severance Allowance. In the event of a Control Termination of this
Agreement, Executive may elect, within 60 days after such Control Termination,
to be paid a lump sum severance allowance, in lieu of the termination payments
provided for in Section 11 above, in an amount which is equal to the sum of the
amounts determined in accordance with the following clauses (a) and (b):
(a) an amount equivalent to salary payments for 60 calendar months
at the rate of Base Salary which she would have been entitled to
receive in accordance with Section 5(a); and
(b) an amount equivalent to 60 calendar months of bonus at the
greater of (i) the monthly rate of the bonus payment for the annual
bonus period
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immediately prior to this termination date, or (ii) the monthly rate of
the estimated amount of the bonus for the annual bonus period which
includes her termination date.
In the event that Executive makes an election pursuant to this Section
to receive a lump sum severance allowance of the amount described in clauses (a)
and (b), then, in addition to such amount, she shall receive (i) in addition to
the benefits provided under any deferred compensation, retirement or pension
benefit plan maintained by the Company, the benefits she would have accrued
under such benefit plan if she had remained in the employ of the Company and
such plan had remained in effect for 60 calendar months after her termination,
which benefits will be paid concurrently with, and in addition to, the benefits
provided under such benefit plan, and (ii) the employee benefits (including, but
not limited to, coverage under any medical insurance and life insurance
arrangements or programs) to which she would have been entitled under all
employee benefit plans, programs or arrangements maintained by the Company if
she had remained in the employ of the Company and such plans, programs or
arrangements had remained in effect for 60 calendar months after her
termination; or the value of the amounts described in clauses (i) and (ii) next
preceding. The amount of the payments described in the preceding sentence shall
be determined and such payments shall be distributed as soon as it is reasonably
possible.
13. Tax Indemnity Payments. (a) Anything in this Agreement to the
contrary notwithstanding, in the event it shall be determined that any payment
or distribution by the Company or its affiliated companies to or for the benefit
of Executive paid or payable or distributed or distributable pursuant to the
terms of the Agreement (but determined without regard to any additional payments
required under this Section 13, a "Payment") would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986 (as amended the
"Code"), or any successor provision (collectively, "Section 4999"), or any
interest or penalties are incurred by Executive with respect to such excise tax
(such excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the "Excise Tax"), then Executive shall be entitled
to receive an additional payment (a "Gross-Up Payment") in an amount such that
after payment by Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any Federal,
state or local income and employment taxes and Excise Tax (and any interest and
penalties imposed with respect to any such taxes) imposed upon the Gross-Up
Payment, Executive retains an amount of the Gross-Up Payment equal to the Excise
Tax imposed upon the Payments.
(b) Subject to the provisions of Section 13(c), all determinations
required to be made under this Section 13, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the assumptions
to be utilized in arriving at such determination, shall be made by the Company's
public accounting firm (the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and Executive within fifteen (15)
business days of the receipt of notice from Executive that there has been a
Payment, or such earlier time as is requested by the Company. In the event that
the Accounting Firm is serving as accountant or auditor for the individual,
entity or group effecting the Change in Control, Executive may appoint another
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nationally recognized public accounting firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the Accounting
Firm hereunder). All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any Gross-Up Payment, as determined pursuant to this
Section 13, shall be paid by the Company to Executive within five (5) days of
the receipt of the Accounting Firm's determination. If the Accounting Firm
determines that no Excise Tax is payable by Executive, it shall furnish
Executive with a written opinion that failure to report the Excise Tax on
Executive's applicable federal income tax return would not result in the
imposition of a negligence or similar penalty. Any determination by the
Accounting Firm shall be binding upon the Company and Executive. As a result of
the uncertainty in the application of Section 4999 at the time of the initial
determination by the Accounting Firm hereunder, it is possible that adjustments
may be determined at any time of Gross-Up Payments which should have been made
by the Company ("Underpayment"), consistent with the calculations required to be
made hereunder. In the event that the Company exhausts its remedies pursuant to
Section 13(c) and Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of Executive.
(c) Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require a change in the
amount of the payment by the Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable after Executive is informed in writing of
such claim and shall apprise the Company of the nature of such claim and the
date on which such claim is requested to be paid; provided that the failure to
give any notice pursuant to this Section 13(c) shall not impair Executive's
rights under this Section 13 except to the extent the Company is materially
prejudiced thereby. Executive shall not pay such claim prior to the expiration
of the 30-day period following the date on which Executive gives such notice to
the Company (or such shorter period ending on the date that any payment of taxes
with respect to such claim is due). If the Company notifies Executive in writing
prior to the expiration of such period that it desires to contest such claim,
Executive shall:
(1) give the Company any information reasonably requested by the
Company relating to such claim,
(2) take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by the Company,
(3) cooperate with the Company in good faith in order effectively
to contest such claim, and
(4) permit the Company to participate in any proceedings relating
to such claim; provided, however, that the Company shall bear and pay directly
all costs and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold Executive harmless, on
an after-tax basis, for any
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Excise Tax or income, employment or other tax (including interest and penalties
with respect thereto) imposed as a result of such representation and payment of
costs and expenses. Without limitation on the foregoing provisions of this
Section 13(c), the Company shall control all proceedings taken in connection
with such contest and, at its sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
Executive to pay the tax claimed and xxx for a refund or contest the claim in
any permissible manner, and Executive agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided further, that if the Company directs Executive to pay such
claim and xxx for a refund, the Company shall advance the amount of such payment
to Executive on an interest-free basis and shall indemnify and hold Executive
harmless, on an after-tax basis, from any Excise Tax or income, employment or
other tax (including interest or penalties with respect to any such taxes)
imposed with respect to such advance or with respect to any imputed income with
respect to such advance; and provided further, that any extension of the statute
of limitations relating to payment of taxes for the taxable year of Executive
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Company's control of the
contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and Executive shall be entitled to settle or contest,
as the case may be, any other issue raised by the Internal Revenue Service or
any other taxing authority.
(d) If, after the receipt by Executive of an amount advanced by the
Company pursuant to Section 13(c), Executive becomes entitled to receive, and
receives, any refund with respect to such claim, Executive shall (subject to the
Company's complying with the requirements of Section 12(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by Executive of
an amount advanced by the Company pursuant to Section 13(c), a determination is
made that Executive shall not be entitled to any refund with respect to such
claim and the Company does not notify Executive in writing of its intent to
contest such denial of refund prior to the expiration of thirty (30) days after
such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.
14. Payment for Options and Stock. In the event of a Control
Termination of this Agreement, Executive may also elect, within sixty (60) days
after such Control Termination, to receive a lump sum payment from the Company
in return for surrender by the Executive of all or any portion of the options
then outstanding held by the Executive to purchase shares of common stock of the
Company ("Unexercised Options"), all or any portion of the units or rights
credited to Executive in any deferred compensation plan payable in common stock
("Deferred Compensation Units") and all or any portion of the common stock of
the Company then owned by Executive (the "Owned Stock"). For purposes of this
provision, Unexercised Options shall include all outstanding options whether or
not they are exercisable at the time of the election by Executive hereunder. For
each Unexercised Option to purchase one share of common stock, the Company shall
pay to Executive an amount equal to the highest per share fair market value of
the common stock on any day
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during the period beginning six (6) months prior to the date of Executive's
election pursuant to this Section. To compensate Executive for her loss of the
potential future speculative value of the Unexercised Options, there shall be no
deduction of Executive's exercise price per share for each Unexercised Option
from the amount to be received by her pursuant to the foregoing sentence. For
each share of Owned Stock or Deferred Compensation Unit, the Company shall pay
to Executive the highest fair market value per share of the common stock on any
date during the period beginning six (6) months prior to the date of Executive's
election pursuant to this Section. The payment due from the Company pursuant to
this Section shall be made to Executive within ten (10) days after the date of
her election hereunder, against execution and delivery by Executive to the
Company of an appropriate agreement confirming her surrender of the Unexercised
Options and Deferred Compensation Units and the certificates duly endorsed by
Executive for the Owned Stock.
15. Character of Termination Payments. The amounts payable to Executive
upon any termination of this Agreement shall be considered severance pay in
consideration of past services rendered on behalf of the Company and her
continued service from the date hereof to the date she becomes entitled to such
payments. Executive shall have no duty to mitigate her damages by seeking other
employment and, should Executive actually receive compensation from any such
other employment, the payments required hereunder shall not be reduced or offset
by any such other compensation.
16. Right of First Refusal to Purchase Stock. Executive agrees that the
Company shall have throughout the Basic Employment Period the right of first
refusal to purchase all or any portion of the shares of the Company's common
stock owned by her (the "Shares") at the following price:
(a) in the event of a bona fide offer for the Shares, or any part
thereof, received by Executive from any other person (a "Third Party
Offer"), the price to be paid by the Company shall be the price set
forth in such Third Party Offer; and
(b) in the event Executive desires to sell the Shares, or any part
thereof, in the public securities market, the price to be paid by the
Company shall be the last sale price quoted on the New York Stock
Exchange (or any other exchange or national market system upon which
price quotations for the Company's common stock are regularly
available) for the Company's common stock on the last business day
preceding the date on which Executive notifies the Company of such
desire.
In the event Executive shall receive a Third Party Offer which she
desires to accept, she shall deliver to the Company a written notification of
the terms thereof and the Company shall have a period of 48 hours after such
delivery in which to notify Executive of its desire to exercise its right of
first refusal hereunder.
In the event Executive desires to sell any portion of the Shares in the
public market she shall deliver to the Company a written notification of the
amount of Shares she desires to sell, and the Company shall have a period of 24
hours after such delivery to notify Executive of its desire to exercise its
right of first refusal hereunder with respect to such amount of Shares.
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Upon each exercise by the Company of its right of first refusal
hereunder, it shall make payment to Executive for the Shares in accordance with
standard practice in the securities brokerage industry. After each failure by
the Company to exercise its right of first refusal hereunder, Executive may
proceed to complete the sale of Shares pursuant to the Third Party Offer or in
the open market in accordance with her notification to the Company, but her
failure to complete such sale within two weeks after her notification to the
Company shall reinstate the Company's right of first refusal with respect
thereto and require a new notification to the Company.
17. Arbitration of All Disputes. Any controversy or claim arising out
of or relating to this Agreement or the breach thereof, shall be settled by
arbitration in the City of Indianapolis, Indiana, in accordance with the laws of
the State of Indiana by three arbitrators, one of whom shall be appointed by the
Company, one by Executive and the third of whom shall be appointed by the first
two arbitrators. If the first two arbitrators cannot agree on the appointment of
a third arbitrator, then the third arbitrator shall be appointed by the Chief
Judge of the United States District Court for the Southern District of Indiana.
The arbitration shall be conducted in accordance with the rules of the American
Arbitration Association, except with respect to the selection of arbitrators
which shall be as provided in this Section. Judgment upon the award rendered by
the arbitrators may be entered in any court having jurisdiction thereof. In the
event that it shall be necessary or desirable for Executive to retain legal
counsel and/or incur other costs and expenses in connection with the enforcement
of any and all of her rights under this Agreement, the Company shall pay (or
Executive shall be entitled to recover from the Company, as the case may be) her
reasonable attorneys' fees and costs and expenses in connection with the
enforcement of any arbitration award in court, regardless of the final outcome,
unless the arbitrators shall determine that under the circumstances recovery by
Executive of all or a part of any such fees and costs and expenses would be
unjust.
18. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and if sent by registered mail to
her residence, in the case of Executive, or to the business office of its Chief
Executive Officer, in the case of the Company.
19. Waiver of Breach and Severability. The waiver by either party of a
breach of any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any subsequent breach by either party. In the
event any provision of this Agreement is found to be invalid or unenforceable,
it may be severed from the Agreement and the remaining provisions of the
Agreement shall continue to be binding and effective.
20. Entire Agreement. This instrument contains the entire agreement of
the parties and supersedes all prior agreements between them. This agreement may
not be changed orally, but only by an instrument in writing signed by the party
against whom enforcement of any waiver, change, modification, extension or
discharge is sought.
21. Binding Agreement and Governing Law; Assignment Limited. This
Agreement shall be binding upon and shall inure to the benefit of the parties
and their lawful successors in interest and shall be construed in accordance
with and governed by the laws of the State of Indiana. This Agreement is
personal to each of the parties hereto, and neither party may assign nor
delegate any of its rights or obligations hereunder without the prior written
consent of the other.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
CONSECO, INC.
/s/ XXXXXXX X. XXXXXXX
By: --------------------------
Xxxxxxx X. Xxxxxxx
Chairman of the Board
"Company"
/s/ XXXXXX X. XXXXX
--------------------------
Xxxxxx X. Xxxxx
"Executive"
12