EXHIBIT 10.25
EMPLOYMENT AGREEMENT
EMPLOYMENT ASSUMPTION AND AMENDMENT AGREEMENT, dated as of October 25, 1999
(the "Agreement"), between Trenwick Group Inc., a Delaware corporation (the
"Company"), and Steven J. Bensinger ("Executive").
WHEREAS, Chartwell Re Corporation ("Chartwell") and the Executive entered into
an Employment Agreement, dated March 6, 1992, as amended from time to time (the
"Employment Agreement"), a copy of which, including all amendments, is attached
hereto as Exhibit A; and
WHEREAS, the Company has agreed to assume the Employment Agreement and the
Company and the Executive have agreed to make certain amendments to the
Employment Agreement, all as set forth herein.
NOW, THEREFORE, the Company and Executive hereby agree that the Employment
Agreement shall be amended to provide as follows:
1. Assumption
The Company hereby assumes the Employment Agreement as if the Company, rather
than Chartwell, had been the signatory thereto and the Company and the Executive
hereby consent to the assumption thereto by the Company and the substitution of
the Company for Chartwell in each place it appears in the Employment Agreement
and the deletion of Chartwell as a party thereto, subject to the terms and
conditions of this Agreement.
2. Term and Non-Competition
The Company and the Executive hereby agree (i) to amend the Employment Agreement
to extend the Term under Section 2 of the Employment Agreement to end on
December 31, 2000 and (ii) that, notwithstanding Section 10(b) of the Employment
Agreement, the provisions of Section 10(b)(A) of the Employment Agreement shall
not apply to the Executive on or after the date of any termination pursuant to
Section 6 of the Employment Agreement.
3. Position and Duties.
Section 3 of the Employment Agreement is hereby amendment to read as follows:
"The Executive shall serve as Executive Vice President of the Company
and shall have such responsibilities and duties (consistent with his
position as Executive Vice President) as may from time to time be
assigned to the Executive by the Chief Executive Officer and the Board
and all of the powers and duties usually incident to the office of
Executive Vice President. The Executive shall devote substantially all
of his working time and efforts to the business and affairs of the
Company, except for vacations, illness or incapacity. The Executive
also agrees to serve without additional compensation, if elected or
appointed thereto, on the board of directors or as an executive officer
of any majority-owned subsidiary of the Company. The Executive may
devote reasonable time to (i) insurance associations and charitable and
civic organizations, (ii) managing personal investments, and (iii)
service as a director or member of an advisory committee of any
corporation not in competition with the Company, provided that the
performance of his duties and responsibilities in such service does not
interfere substantially with the performance of his duties and
responsibilities under this Agreement."
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4. Compensation and Benefits:
The term "Base Salary" set forth in Section 5(a) of the Employment Agreement
shall refer to the Base Salary as most recently determined by the Board of
Chartwell prior to the Merger (as defined in Section 6(a) of this Agreement).
Section 5(k) of the Employment Agreement shall be deleted in its entirely for
tax years beginning after December 31, 1999. Section 5(d) of the Employment
Agreement shall be amended to read as follows for periods after the date of the
Merger (defined in Section 6(a) of this Agreement):
"5(d) Automobile. During the Term, the Company shall provide Executive
with an automobile appropriate to his status as Executive Vice
President of the Company and shall reimburse the Executive for the cost
of reasonable and proper maintenance, insurance and parking expenses
for such automobile."
5. Termination for Good Reason:
The Executive hereby agrees that any right he may have to terminate his
employment for "Good Reason" shall be based on the terms and conditions of the
Employment Agreement as amended by this Agreement. The Company and the Executive
hereby amend Section 6(d)(iii) to read as follows:
"(iii) failure to be elected to the Board of the Company or failure to
be elected President of the Company (provided that a Notice of
Termination has not been provided under this Agreement at such time),"
The following sentence shall be added to the end of Section 6(d) of the
Employment Agreement:
"For the purpose of this Section 6(d), the Company shall be treated as
curing any failure to elect the Executive under Section 6(d)(iii) if,
prior to the earlier of November 1, 2001 or the time that the Executive
gives Notice of Termination for "Good Reason" under Section 6(c)(iii),
the Company provides the Executive with a letter signed by the Chairman
of the Board and the Chief Executive Officer of the Company agreeing to
place the Executive's name before the Board of Directors for election
as a Director of the Company and as President of the Company by the
earlier of the next meeting of the Board of Directors of the Company or
within thirty (30) days after such written notice and he is so elected
within such time period."
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6. Change of Control
(a) The Company and the Executive agree that (i) a "Change of
Control" shall have occurred under the Employment Agreement, as
amended by this Agreement, upon the merger ("Merger") of
Chartwell into the Company ("Chartwell Change of Control"), (ii)
the date of the Chartwell Change of Control shall be the
effective date of the Merger, (iii) for the purpose of the
Chartwell Change of Control, the two year period set forth in
Section 8(e) of the Employment Agreement shall be extended to end
on December 31, 2001 and (iv) the term "Base Salary" in Section
8(e)(A) shall mean $ 375,000 and the term "highest annual bonus"
in Section 8(e)(B)(1) and (2) shall mean $187,500, subject to the
provision for adjustment for Excise Tax.
(b) The Company and the Executive hereby agree that, except with
respect to the Chartwell Change of Control, the term "Change of
Control" shall be amended to read as follows:
"For the Purposes of this Agreement, a "Change in Control" of
the Company shall mean the first to occur of one of the following
events:
(i) The acquisition, in one or more transactions, of
beneficial ownership(within the meaning of Rule13d-3
under the Securities Exchange Act of 1934 (the
"Exchange Act") by any person or entity or any group
of persons or entities who constitute a group (within
the meaning of Rule 13d-3 of the Exchange Act), other
than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or a
subsidiary, of any securities of the Company if, as a
result of such acquisition, such person, entity or
group either(A) beneficially owns (within the meaning
of Rule 13d-3 under the Exchange Act), directly or
indirectly, more than 50% of the Company's
outstanding voting securities entitled to vote on a
regular basis for a majority of the members of the
Board or (B) otherwise has the ability to elect,
directly or indirectly, a majority of the members of
the Board;
(ii) A change in the composition of the Board such that a
majority of the members of the Board are not
Continuing Directors. A "Continuing Director" means,
as of any date of determination, any member of the
Board who (A) was a member of the Board on the date
of this Agreement, or (B) was nominated and elected
to such Board with the affirmative vote of a majority
of the Continuing Directors who were members of the
Board at the time of such nomination or election; or
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(iii) The stockholders of the Company approve (A) a merger
or consolidation of the Company with any other
corporation, othe than a merger or consolidation
which would result in the voting securities of the
Company outstanding immediately prior thereto
continuing to represent (either by remaining
outstanding or by being converted into voting
securities of the surviving entity) at least 50% of
the total voting power represented by the voting
securities of the Company or such surviving entity
outstanding immediately after such merger or
consolidation, or (B) a plan of complete liquidation
of the Company or an agreement for the sale or
disposition by the Company (in one or more
transactions) of all or substantially all of the
Company's assets."
(c) The Company and the Executive hereby agree that, other than with
respect to the Chartwell Change of Control and any amounts
payable under the Employment Agreement with respect to the
Chartwell Change of Control, Section 8(f) of the Employment
Agreement shall be amended to read as follows:
"Notwithstanding any other provision of this Agreement or of
any other agreement, understanding or compensation plan,
Executive shall not be entitled to receive any payment which,
taking into account all payments, rights and benefits, would
be deemed to be an "excess parachute payment" under Section
280G (of the Internal Revenue Code of 1986, as amended), and
the amount of each payment shall be reduced to the extent
necessary to ensure that the Executive receives no "parachute
payment" in connection with a Change of Control; provided that
no such reduction shall occur to the extent that Executive
shall have elected to defer receipt of payments beyond the
dates such payments were otherwise to be made to the Executive
("Payment Period") and such deferral shall have resulted in
the present value of such payment not constituting an "excess
parachute payment". Any such election by Executive, to be
effective for purposes of this Agreement: (a) must be in
irrevocable when made, (b) must be made in a writing delivered
to the Company prior to the occurrence of a Change of Control,
(c) must be for a period not be exceed five years after the
date on which the Payment Period would otherwise end, and (d)
must be concurred in by the Company, on the basis of the
advice of its tax advisors, as being both necessary and
effective to reduce the extent to which payments to be made
hereunder will constitute an "excess parachute payment". If,
at any future date following the making of a payment
hereunder, it shall have been determined by the IRS that such
payment was in excess of the limits set forth in Section 280G,
and such excess shall not have been caused by a voluntary
action of the Executive not required by this Agreement, then
the Executive shall be entitled to receive from the Company,
and the Company shall pay to Executive promptly upon
notification to the Company of such determination, an Excise
Tax Adjustment Payment equal to the amount of all applicable
U.S. federal, state and local taxes (computed at the maximum
marginal rates and including interest penalties and any cost
of contest or defense and including any applicable Excise Tax)
imposed upon the Excise Tax Adjustment Payment."
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(d) In the event that the Company provides to its most senior
executives, other than its Chairman and Chief Executive Officer,
with a Change of Control Agreement with provisions that are in
the aggregate more beneficial for these senior executives that
those set forth in the Employment Agreement, as amended by this
Agreement, then the Company will immediately offer the same to
the Executive, in lieu of those set forth in the Employment
Agreement, as amended by this Agreement .
7. Notice:
Section 11 of the Employment shall be amended to read as follows:
"Notice. For the purposes of this Agreement, notices, demands and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered to the recipient, addressed as
follows:"
If to the Executive:
Steven J. Bensinger
1049 Fifth Avenue, Apt. 11A
New York, NY 10028
If to the Company:
Trenwick Group Inc.
Second Floor
One Canterbury Green
Stamford, CT 06902
Attention: James W. Billett, Jr.
8. Termination and Miscellaneous:
This Agreement is conditioned upon the Merger and, in the event the Merger does
not occur and the Agreement and Plan of Merger dated June 21, 1999 between the
Company and Chartwell is terminated for any reason, this Agreement shall be null
and void. All capitalized terms used in this Agreement shall have the same
meaning as called for by the Employment Agreement, unless otherwise indicated in
this Agreement. All of the provisions of Sections 13-17 of the Employment
Agreement shall apply to this Agreement as if set forth herein
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IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the date set forth above.
TRENWICK GROUP INC.
By: /s/ James F. Billett, Jr.
----------------------------
Name: James F. Billett, Jr.
Title: Chairman, Presisdent & Chief
Executive Officer
EXECUTIVE
By: /s/ Steven J. Bensinger
----------------------------
Name: Steven J. Bensinger
Title: President
Chartwell Re Corporation hereby
consents to the substitution of
Trenwick Group Inc. as a
party to the Employment Agreement
as of the date of the Merger.
Chartwell Re Corporation
By: /s/ John V. Del Col
-----------------------------
Name: John V. Del Col
Title: Senior Vice President, General Counsel
and Secetary
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