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Exhibit 10.16f
EMPLOYMENT AGREEMENT
AGREEMENT dated as of May 5, 2000, by and between SELECTIVE
INSURANCE COMPANY OF AMERICA, a New Jersey corporation (the "Company"), having
an office at 40 Wantage Avenue, Branchville, New Jersey 07826, and DALE A.
THATCHER, having an address at 3954 Brockton Drive, Cincinnati, Ohio (the
"Executive").
In consideration of the premises and the mutual covenants hereinafter set forth,
the parties hereto agree as follows:
1. Employment. The Company agrees to employ the Executive, and the Executive
accepts employment with the Company, on the terms and conditions set forth
herein.
2. Term. The term of employment under this Agreement shall commence as of the
date hereof and, subject to Section 7 hereof, shall terminate three (3)
years after the date hereof.
3. Compensation. For all services rendered by the Executive under this
Agreement, the Company shall pay the Executive a fixed salary during the
term of employment under this Agreement at a rate of not less than One
Hundred Ninety Thousand and 00/100 ($190,000.00) per year (the "Salary"),
payable in installments in accordance with the Company's policy from time
to time in effect for payment of salary to executives. The Salary shall be
reviewed no less than annually by the Company's Board of Directors, and
nothing contained herein shall prevent the Company's Board of Directors
from at any time increasing the Salary or other benefits herein provided
to be paid or provided to Executive or from providing additional or
contingent benefits to Executive as it deems appropriate.
4. Duties.
(a) The Executive has been elected as Senior Vice President and Chief
Financial Officer of the Company, and he agrees to serve as such
during each year of the term of this Agreement that he is elected to
such office and until his successor is elected and qualified. If at
any time prior to the expiration of this Agreement, the Board of
Directors of the Company shall fail to reelect Executive as Senior
Vice President and Chief Financial Officer at the Company's Annual
Organizational Meeting (except as a result of termination pursuant
to Section 7 hereof), Executive's employment hereunder shall
terminate ninety (90) days after the date of such meeting. During
said ninety-day (90-day) period the Executive shall
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continue to be employed under this Agreement, shall cooperate fully
with the Company's Board of Directors and shall devote his full
business time and attention to such duties not inconsistent with the
provisions hereof as he shall be assigned by the Company's Board of
Directors. Upon termination of Executive's employment hereunder
pursuant to this Section 4(a), the Executive shall resign as an
officer of the Company and each of its subsidiaries of which he
shall then be a director and/or officer. Notwithstanding any such
termination, the Executive, provided he does not violate the
provisions of Section 9 hereof, shall be entitled to receive (i) as
severance pay an amount equal to his Salary, at the rate in effect
at the time of termination of employment hereunder, for a period of
two (2) years after the date of such termination, payable in monthly
installments, and (ii) the certain benefits provided for in Section
8 hereof, for a period of two (2) years after the date of such
termination or such shorter period as provided in Section 8. If
Executive's employment hereunder shall terminate pursuant to this
Section 4(a), such termination shall not prevent Executive from
accepting other employment with the Company or otherwise after the
effective date of such termination.
(b) The Executive agrees to devote his entire business time, attention
and services exclusively to the business and affairs of the Company
and its subsidiaries and to perform his duties with fidelity and to
the best of his ability. Executive may accept directorships on the
Board of Directors of profit and nonprofit corporations with the
prior consent of the Board of Directors of the Company.
5. Deferred Compensation.
(a) The Executive may, from time to time during the term of employment
hereunder, request that the Company defer the whole or any part of
his Salary payable under Section 3, provided that such request is
received by the Company on or before the December 31 of the calendar
year immediately preceding the calendar year in respect of which
such Salary is due (or such other date as may be required from time
to time by applicable law). If so requested by the Executive, the
Company shall defer payment of the amount so specified and credit on
the first day of each month during the year in respect of which the
deferred Salary is due, the pro rata share of the amount of Salary
deferred for such year to a deferred compensation account
established on its corporate books of account. Such account shall be
called the "Dale A. Thatcher Deferred Compensation Account" (the
"Account") and shall be an unfunded, unsecured liability of the
Company to be satisfied from its general corporate funds. The
Company agrees to credit the Account semiannually on June 30 and
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December 31 of each year with interest at a rate equal to the rate
announced from time to time by Morgan Guaranty Trust Company of New
York as its prime rate.
(b) Except as herein provided in this Section 5(b), the Company shall
distribute to the Executive all amounts credited to the Account in
ten (10) approximately equal annual installments commencing on the
first day of January immediately succeeding the date of termination
of the Executive's employment under this Agreement for any reason
whatsoever. In the event of the Executive's death prior to the time
he shall have received the full amount due under the preceding
sentence, the remaining payments due under such sentence shall be
paid on the respective due dates thereof to any beneficiary or
beneficiaries designated by the Executive to the Company in writing
or, in the absence of such designation, to the Executive's legal
representative. It is agreed that the benefits to be paid as
deferred compensation pursuant to this Section 5 shall not be
forfeited by the Executive.
(c) Nothing contained in this Section 5 and no action taken pursuant to
this Section 5 shall create or be construed to create a trust of any
kind for the benefit of any person or a fiduciary relationship
between the Company and any person.
6. Benefits During Employment. During the term of Executive's employment
under this Agreement, the Company shall (a) permit the Executive to
participate in the Selective Insurance Stock Option Plan II, Thrift Plan
for Employees of Selective Insurance Company of America and Subsidiaries,
and incentive compensation, stock option, stock appreciation right, stock
bonus, pension, group insurance and other benefit plans, if any, in
accordance with the respective provisions thereof, from time to time in
effect (collectively, the "Plans"), and (b) provide the Executive with
suitable offices, secretarial and other services, and other perquisites
applicable to executives of the Company, all in accordance with the
Company's policies with respect thereto from time to time in effect. The
Executive shall also be entitled, during the term of his employment under
this Agreement, to vacations and reimbursements for ordinary and necessary
travel and entertainment expenses in accordance with the Company's
policies on such matters from time to time in effect.
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7. Termination.
(a) The Executive's employment under this Agreement shall be terminated
upon the Executive's death or if the Executive shall be adjudicated
legally incompetent by a court of competent jurisdiction. In such
event, the Executive or his legal representative shall be entitled
to receive (i) as severance pay an amount equal to Executive's
Salary, at the rate in effect at the time of termination of
employment hereunder, for a period of one (1) year after the date of
such termination, payable in monthly installments, and (ii) the
certain benefits provided for in Section 8 hereof, for a period of
one (1) year after the date of such termination or such shorter
period as provided in Section 8.
(b) The Company may, at its option, terminate the Executive's employment
under this Agreement if the Executive shall fail, or if the majority
of the Board of Directors shall find on the basis of medical
evidence reasonably satisfactory to it that the Executive is unable,
by virtue of or by reason of some physical or mental impairment, to
perform his duties hereunder for a period of ninety (90) consecutive
days or more or for a period of one hundred eighty (180) days or
more during any 270-day period. In the event that this Agreement is
terminated pursuant to this paragraph 7(b), Executive shall be
entitled to receive, in monthly installments, for a period of one
(1) year from the date of such termination, an amount which,
together with any disability insurance benefits to which Executive
is entitled under disability insurance policies with respect to
which the premiums were paid by the Company, is equal to Executive's
Salary at the rate in effect at the time of such termination.
In that regard, Executive, following such termination of this
Agreement, shall be considered an employee solely for the purpose of
applying for and receiving disability payments (both the temporary
and long-term disability) in accordance with the terms and
conditions of such disability plans in effect at the time.
(c) The Company may, at its option upon resolution of a majority of the
entire Board of Directors, terminate the Executive's employment
under this Agreement for cause, upon: (A) the Executive's conviction
of a felony (as evidenced by a binding and final judgment, order or
decree of a court of competent jurisdiction, in effect after
exhaustion or lapse of all rights of appeal), (B) the continued
willful failure by the Executive to perform substantially his duties
with the Company (other than any such failure resulting from his
incapacity due to physical injury or physical or mental illness) for
a period of thirty (30) days after a demand for substantial
performance is delivered to the Executive by the Board of Directors
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of the Company which specifically identifies the manner in which the
Board of Directors believes that the Executive has not substantially
performed his duties, or (C) willful misconduct in the performance
of the Executive's duties and obligations to the Company which
constitute common law fraud or other gross malfeasance of duty. In
the event of termination of the Executive's employment pursuant to
this paragraph 7(c), Executive shall be entitled to receive (i) his
Salary accrued to the date of such termination and (ii) benefits
accrued to Executive under the Plans to the date of such
termination, to the extent that such benefits may be payable to
Executive under the provisions of the Plans in effect on the date of
termination of employment.
(d) Notwithstanding anything to the contrary in this Agreement, the
Company may, by action duly taken by the Board of Directors,
terminate the Executive's employment hereunder at any time and for
any reason. In such event, the Executive, provided he does not
violate the provisions of Section 9 hereof, shall be entitled to
receive (i) as severance pay an amount equal to his Salary, at the
rate in effect at the time of termination of employment hereunder,
for a period of two (2) years after the date of such termination,
payable in monthly installments, and (ii) the certain benefits
provided for in Section 8 hereof, for a period of two (2) years
after the date of such termination or such shorter period as
provided in Section 8.
8. Certain Benefits After Termination of Employment. Upon the termination of
Executive's employment pursuant to Section 4(a), Section 7(a), Section
7(b) or Section 7(d) hereof, Executive (or his legal representative) shall
receive the benefits, if any, to which Executive is entitled under the
provisions of the Plans in effect at the time of such termination. In
addition, the Company shall maintain in full force and effect for the
continued benefit of the Executive and his dependents for a period
terminating on the earlier of (i) the termination of the period of such
post-termination benefits set forth in Section 4(a), Section 7(a), Section
7(b) or Section 7(d), as applicable, or (ii) the commencement date of
equivalent benefits from a new employer (the "Extended Benefit Period"),
all insured and self-insured employee welfare benefit plans in which the
Executive was entitled to participate immediately prior to the date of
termination, provided that the Executive's continued participation is not
barred under the general terms and provisions of such plans. In the event
that the Executive's participation in any such plan is barred by its
terms, the Company, at its sole cost and expense, shall arrange to have
issued for the benefit of the Executive and his dependents individual
policies of insurance providing benefits substantially similar (on an
after-tax basis) to those which the Executive otherwise would have been
entitled to receive under such plans pursuant to this Section 8. If, at
the end of the Extended Benefit Period, the Executive has not previously
received or is not receiving equivalent benefits from a new employer, or
is not otherwise receiving such
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benefits, the Company shall arrange, at its sole cost and expense, to
enable him to convert his and his dependents' coverage under such plans to
individual policies or programs upon the same terms as employees of the
Company may apply for such conversions upon termination of employment.
9. Nondisclosure of Confidential Information and Trade Secrets. The Executive
agrees that he will not, either during the term of employment under this
Agreement or thereafter, disclose to any other person or entity any
confidential information or trade secret of the Company or its
subsidiaries, except for disclosures to directors, officers, key
employees, independent accountants and counsel of the Company and its
subsidiaries as may be necessary or appropriate in the performance of his
duties hereunder. The Executive agrees not to take with him upon leaving
the employ of the Company any document or paper relating to any
confidential information or trade secret of the Company and its
subsidiaries.
10. Other Employees. The Executive agrees that, for a period of two (2) years
after the termination of employment under this Agreement, he will not
directly or indirectly solicit or induce or attempt to solicit or induce
or cause any of the employees of the Company or the Company's subsidiaries
to leave the employ of the Company or of such subsidiaries.
11. Injunctive Relief. The Executive acknowledges that monetary damages will
not adequately compensate the Company for any violation of Sections 9 or
10 hereof and consents to the entry of an injunction in any court of
competent jurisdiction to enforce the provisions of Section 9 or Section
10 hereof.
12. Representations. The Executive represents and warrants that neither the
execution and delivery of this Agreement nor the performance of his duties
hereunder violates the provisions of any other agreement to which he is a
party or by which he is bound.
13. Nonassignability. No right or benefit under this Agreement shall be
assigned, transferred, pledged or encumbered (a) by the Executive except
by a beneficiary designation made in the manner provided herein or by will
or the laws of descent and distribution, (b) by any beneficiary designated
in the manner provided herein except by will or the laws of descent and
distribution, or (c) by the Company except that the Company may assign
this Agreement and all of its rights hereunder to any entity with which it
may merge or consolidate or to which it may sell all or substantially all
of its assets provided said entity shall assume (by contract or by
operation of law) the Company obligations hereunder. Subject to the
foregoing, this Agreement shall be binding upon and inure to the benefit
of the Company, its successors and assigns, and the Executive, his heirs,
legal representatives and any beneficiary or beneficiaries designated
hereunder.
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14. Notice. Any notice, request, or other communication given hereunder shall
be in writing, and, if given by the Executive to the Company, shall be
delivered personally or sent by certified or registered mail, return
receipt requested, postage prepaid, addressed to the Company at Wantage
Avenue, Branchville, New Jersey 07890, Attention: President. If given by
the Company to the Executive, it shall be delivered personally or sent by
certified or registered mail, return receipt requested, postage prepaid,
addressed to the Executive at Executive's address hereinabove set forth.
Either party may change the address to which notices, requests and other
communications are to be addressed by notice given to the other in
accordance with the provisions of this Section 14. Notices, requests and
other communications shall be deemed to be given when received, which, in
the case of notice given by mail, shall be the time indicated on the
receipt therefor.
15. Severability. If any provision of this Agreement shall be declared to be
invalid or unenforceable, in whole or in part, such invalidity and
unenforceability shall not affect the remaining provisions hereof which
shall remain in full force and effect.
16. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New Jersey applicable to
contracts made and performed in New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
Executive and on behalf of the Company by its duly authorized officer, all as of
the day and year first above written.
SELECTIVE INSURANCE COMPANY OF AMERICA
By:_____________________________________
Gregory E. Murphy,
Chairman, President and Chief
Executive Officer
________________________________________
Dale A. Thatcher
In consideration of the covenants of the Executive hereinabove set forth,
Selective Insurance Group, Inc., holder of all of the issued and outstanding
capital stock of the Company, hereby guarantees to the Executive the full
performance by the Company of all of its obligations under the foregoing
Employment Agreement.
SELECTIVE INSURANCE GROUP, INC.
By:_____________________________________
Gregory E. Murphy,
Chairman, President and Chief
Executive Officer
