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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15 (d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 8, 1995
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NEW ENGLAND INVESTMENT COMPANIES, L.P.
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(Exact name of registrant as specified in its charter)
Delaware 1-9468 13-3405992
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(Name or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
399 Boylston Street, Boston, Massachusetts 02116
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 578-3500
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Item 5. Other Events
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(a) Financial Statement of New England Investment Companies, Inc.:
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NEW ENGLAND INVESTMENT COMPANIES, INC.
BALANCE SHEET
December 31, 1993 and 1994
<TABLE>
<CAPTION>
ASSETS: 1993 1994
---- ----
<S> <C> <C>
Cash $ - $ 251,076
Distribution receivable from NEIC, LP 88,000 46,200
Other receivables - 20,100
Investment in partnerships 301,997 235,067
----------- -----------
Total assets $ 389,997 $ 552,443
=========== ===========
LIABILITIES AND SHAREHOLDER'S EQUITY:
Liabilities:
Taxes payable $ 6,000 $ -
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Shareholder's Equity:
Common stock, $.01 par value,
authorized - 100 shares; issued
and outstanding - 50 shares 1 1
Paid-in capital 15,327,793 15,327,793
Demand note receivable from TNE (15,000,000) (15,000,000)
Retained earnings 56,203 224,649
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Total shareholder's equity 383,997 552,443
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Total liabilities and shareholder's $ 389,997 $ 552,443
equity =========== ===========
</TABLE>
See accompanying notes to financial statement
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New England Investment Companies, Inc.
Notes to Financial Statement
NOTE 1: BASIS OF PRESENTATION
New England Investment Companies, Inc. ("NEIC Inc." or the "General Partner"), a
wholly owned subsidiary of New England Mutual Life Insurance Company ("TNE"), is
the corporate general partner of New England Investment Companies, L.P. ("NEIC,
L.P." or the "Partnership"). On September 15, 1993, the unitholders of Reich &
Tang L.P., a Delaware limited partnership with units traded on the New York
Stock Exchange, consummated a transaction whereby certain advisory businesses
and substantially all of the related net assets were contributed by TNE in
exchange for approximately 22 million newly issued limited partnership units.
In addition, the net assets of Westpeak Investment Advisors, Inc. ("Westpeak"),
a wholly owned subsidiary of TNE, were contributed to Reich & Tang L.P. in
exchange for its general partner units and as a result, Westpeak succeeded Reich
& Tang, Inc. as the general partner of the Partnership. Westpeak changed its
name to New England Investment Companies, Inc. The Partnership was renamed New
England Investment Companies, L.P. The sole business of NEIC Inc. is that of
general partner of the Partnership. Therefore, the consolidated financial
statements of the Partnership should be read in connection with these financial
statements.
NOTE 2: INVESTMENT IN PARTNERSHIPS
NEIC Inc. owned 110,000 general partnership units of NEIC, L.P. (approximately
.34% of the total partnership units outstanding) as of December 31, 1993, and
December 31, 1994. NEIC Inc. accounts for its investment in NEIC, L.P. under
the equity method since it has the ability to exercise significant influence
over the management, conduct and operation of NEIC, L.P. The difference between
NEIC Inc.'s carrying amount of its investment in NEIC, L.P. of $235,067 and
$257,731 and its underlying equity in NEIC, L.P. of approximately $726,000 and
$795,000 at December 31, 1994 and December 31, 1993, respectively, is being
amortized over a fifteen year period.
NEIC Inc. also acquired R & T, Inc.'s 1% general partner interests in Fundtech
Services L.P. ("Fundtech") and Reich & Tang Distributors L.P. ("R & T
Distributors") as of September 15, 1993 and continued to hold these 1% interests
through September 30, 1994. Fundtech and R & T Distributors were sold to a
subsidiary of the Partnership, Reich & Tang Asset Management, L.P., on September
30, 1994 for $40,000.
NOTE 3: DEMAND NOTE RECEIVABLE
On September 15, 1993, TNE contributed $15,000,000 to the capital of NEIC Inc.
in the form of a note payable on demand of NEIC Inc. It is anticipated that
demand will be made only to satisfy liabilities of NEIC Inc. owed in its
capacity as General Partner of NEIC, L.P. that are not properly payable by the
Partnership or are properly payable by the Partnership but which the Partnership
is unable to pay and as to which NEIC Inc. has not disclaimed liability.
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Report of Independent Accountants
To the Shareholder of
New England Investment Companies, Inc.
In our opinion, the accompanying balance sheet presents fairly, in all material
respects, the financial position of New England Investment Companies, Inc. at
December 31, 1994 and December 31, 1993 in conformity with generally accepted
accounting principles. The financial statement is the responsibility of the
Company's management; our responsibility is to express an opinion on the
financial statement based on our audit. We conducted our audit of the financial
statement in accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statement is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statement, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit of the financial statement
provides a reasonable basis for the opinion expressed above.
Price Waterhouse LLP
Boston, MA
November 7, 1995
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Item 5. Other Events (continued)
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(b) Certain Employment and Severance Agreements
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NEIC and New England Investment Companies, Inc., the general partner of NEIC
(the "General Partner"), have entered into an Employment Agreement dated as of
August 16, 1995 (the "Employment Agreement") with Peter S. Voss providing for
the employment of Mr. Voss as Chairman of the Board, Chief Executive Officer and
President of NEIC and the General Partner for an initial term of three years.
The term of the Employment Agreement will be automatically extended for an
additional two year period unless terminated by any party prior to the second
anniversary of the Effective Date of the Employment Agreement. During the term
of the Employment Agreement, Mr. Voss will receive an annual salary established
from time to time by the Board of Directors of the General Partner (the
"Board"). In addition, Mr. Voss will be entitled to receive an annual bonus
determined by the Board. In the event that Mr. Voss is terminated by NEIC
without Cause or Mr. Voss elects to terminate his employment as a result of a
Constructive Discharge Event (as defined in the Employment Agreement), Mr. Voss
shall be entitled to lump sum payments equal to three times his Salary (as then
in effect) and three times his Bonus Amount (as defined in the Employment
Agreement). In addition, in the event of such a termination, Mr. Voss shall be
deemed to be fully vested in any restricted units or other equity incentives
held by him on the date of such termination. In the event that NEIC timely
elects not to extend the Employment Agreement for an additional two year period
as described above, Mr. Voss shall be entitled to one times his Salary and one
times his Bonus Amount.
In addition, NEIC and the General Partner have also entered into Agreements
dated as of August 16, 1995 (the "Severance Agreements") with each of G. Neal
Ryland, Sherry A. Umberfield and Edward N. Wadsworth (the "Named Executives")
providing, in each case, that if the employment of such Named Executive is
terminated by NEIC prior to the third anniversary of the Effective Date of such
Severance Agreements other than for Cause or disability or if NEIC
Constructively Discharges such Named Executive and if Peter S. Voss or his
designee, in his capacity as Administrator under the Severance Agreements,
determines that such termination of employment or Constructive Discharge was not
primarily related to such Named Executive's performance or the ordinary course
of business, then such Named Executive shall be entitled to lump sum payments
equal to one and one-half times his or her salary and his or her bonus amount.
Item 7. Financial Statements and Exhibits.
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(c) Exhibits
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The following exhibits required to be filed by Item 601 of Regulation S-K are
filed herewith:
(10) Material Contracts
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(i) Employment Agreement with Peter S. Voss
(ii) Agreement with G. Neal Ryland
(iii) Agreement with Sherry A. Umberfield
(iv) Agreement with Edward N. Wadsworth
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: November 9, 1995 By: /s/ G. Neal Ryland
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G. Neal Ryland
Executive Vice President and
Chief Financial Officer
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EXHIBIT 10(i)
EMPLOYMENT AGREEMENT AMONG
NEW ENGLAND INVESTMENT COMPANIES, L.P.,
NEW ENGLAND INVESTMENT COMPANIES, INC.
AND PETER S. VOSS
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THIS AGREEMENT made as of the sixteenth day of August, 1995, by and among
New England Investment Companies, L.P., a Delaware limited partnership
(hereinafter referred to as the "Limited Partnership"), New England Investment
Companies, Inc., a Massachusetts corporation which is the general partner of the
Limited Partnership (hereinafter referred to as the "General Partner"), parties
of the first part, and Peter S. Voss (hereinafter referred to as "Employee"),
party of the second part.
WITNESSETH:
-----------
WHEREAS:
A. Employee is currently employed by the Limited Partnership and the
General Partner as Chairman, Chief Executive Officer and President; and
B. The Limited Partnership and the General Partner wish to assure
themselves of the continued services of Employee so that they will have the
continued benefit of his ability, experience and services, and Employee is
willing to enter into an agreement to that end, upon the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby covenant and agree as follows:
1. Employment Agreement
--------------------
As used in this Agreement, the term "Company" means and includes the
Limited Partnership and the General Partner, or either of them. The Company
hereby agrees to continue to employ Employee, and Employee hereby agrees to
remain in the employ of the Company, on and subject to the terms and conditions
of this Agreement.
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2. Term of Employment
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(a) The term of Employee's employment under this Agreement (the "Term of
Employment") shall commence as of the date hereof (the "Effective Date") and
shall expire at the close of business on the third anniversary of that date
unless sooner terminated in accordance with the terms and conditions of this
Agreement (including without limitation paragraphs 2(c), 6(d) and 6(e) hereof)
or extended as hereinafter provided in this section 2.
(b) The Term of Employment shall be extended, automatically and without
action by the Company or Employee, for an additional two year period ending on
the fifth anniversary of the Effective Date unless either party gives the other
party written notice, in the manner set forth in section 13 below and prior to
the close of business on the second anniversary of the Effective Date, that the
party giving the notice does not wish to extend the Term of Employment beyond
the third anniversary of the Effective Date.
(c) If either party gives the other party timely written notice of non-
extension in accordance with paragraph 2(b) above, then in that event the party
receiving such notice may thereafter terminate the Term of Employment at any
time prior to the third anniversary of the Effective Date by giving the other
party written notice, in the manner set forth in section 13 below, of such
termination at least 90 days in advance of the effective date of such
termination.
3. Position, Duties and Responsibilities
-------------------------------------
(a) During the Term of Employment, Employee shall serve as, and with the
title, office and authority of, Chairman of the Board, Chief Executive Officer
and President of the Company, shall report only to the Board of Directors of the
Company (the "Board"), and shall have effective supervision and control over,
and responsibility for, the strategic direction and general and active day-to-
day leadership and management of the business and affairs of the Company and the
direct and indirect subsidiaries of the Company, subject to the authority of the
Board (any direct or indirect subsidiary of the Company, including
2
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partnerships, limited liability companies, business trusts and other entities as
well as corporations, being hereinafter referred to as a "subsidiary" or,
collectively, as "subsidiaries"), and shall have all of the powers, authority,
duties and responsibilities usually incident to the positions and offices of
Chairman of the Board, Chief Executive Officer and President of the Company,
including but not limited to the authority to employ and discharge all employees
of the Company and subsidiaries of the Company.
(b) During the Term of Employment, the Company shall use its best efforts
to cause Employee to be elected and re-elected (i) as a member of the Board,
(ii) as a member of the board of directors of any subsidiary on which board of
directors Employee is serving on the date of this Agreement, and (iii) as a
member of the board of directors of any entity which becomes a subsidiary after
the date of this Agreement on which board of directors the Chairman of the
Board, Chief Executive Officer and President of the Company would customarily
serve. Employee agrees to serve on the foregoing boards of directors during the
Term of Employment, without compensation in excess of that provided under this
Agreement.
(c) During the Term of Employment, Employee agrees to devote substantially
all of his business time, efforts and skills to the performance of his duties
and responsibilities under this Agreement, and to refrain from rendering
services for any enterprise other than the Company and subsidiaries of the
Company, but nothing in this Agreement shall preclude Employee from devoting
reasonable periods required for (i) managing his personal investments, (ii)
participating in professional, educational, philanthropic, public interest,
charitable, social or community activities, or (iii) serving as a director or
member of an advisory committee of any corporation or other entity not in
competition with the Company or any subsidiary of the Company, provided that
such activities do not materially interfere with Employee's regular performance
of his duties and responsibilities hereunder.
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4. Office Location and Required Business Travel
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During the Term of Employment, (a) Employee shall be based at the principal
executive offices of the Company, which shall be located at their present
location or within 35 miles thereof, and (b) the Company shall not substantially
increase the business travel required of Employee above present levels unless
the additional travel is both appropriate for Employee's positions described
above and substantially related to the business and affairs of the Company or a
subsidiary of the Company.
5. Compensation and Related Matters
--------------------------------
In consideration of all services rendered by Employee in any capacity
during the Term of Employment, the Company shall pay or provide Employee the
amounts and benefits set forth in this section 5.
(a) Salary. The Company shall pay Employee a salary at an annual rate
------
which shall be established from time to time by the Board, but which shall not
be less than $440,000. Employee's salary shall be paid in substantially equal
installments at monthly or more frequent intervals, in accordance with the
normal payroll practices of the Company. Employee's salary rate shall be
reviewed by the Board at least annually following the date of this Agreement to
ascertain whether, in the sole, good faith judgment of the Board, such rate
should be increased in light of Employee's performance, competitive pay levels
or such other factors (if any) as the Board may deem relevant. Any increase in
salary shall not limit or reduce any other obligation of the Company under this
Agreement and, once established at an increased specified rate, Employee's
salary shall not thereafter be reduced. Employee's annual salary under this
Agreement, at the rate specified above and including any increases, is hereafter
referred to as his "Salary".
(b) Bonus. The Company shall provide Employee with the opportunity to earn
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an annual bonus for each calendar year that coincides with the Term of
Employment, in whole or in part, equal to at least 125% of his Salary for such
year if the Company attains the target bonus performance objective designated by
the Board (or a committee thereof)
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for such calendar year, and equal to at least 250% of his Salary for such year
if the Company attains the maximum bonus performance objective designated by the
Board (or a committee thereof) for such calendar year. Such performance
objectives shall be determined by the Board in its discretion acting in good
faith and upon consultation with Employee. In making such determinations, the
Board shall take into account the Company's business plan for the applicable
year, historical performance objectives for Employee's annual bonus opportunity,
and the annual bonus opportunities for other senior executives of the Company
and similarly situated senior executives of other companies comparable in size
and character to the Company. If the Term of Employment terminates (i) on the
third anniversary of the Effective Date in accordance with paragraphs 2(a) and
2(b) above, (ii) before such third anniversary in accordance with paragraph 2(c)
above, or (iii) on the fifth anniversary of the Effective Date in accordance
with paragraph 2(b) above, then, in full satisfaction of any bonus obligation
under this paragraph 5(b) in respect of the last calendar year that coincides in
whole or in part with the Term of Employment, the Company shall pay Employee a
prorated bonus for such calendar year, such prorated bonus award to be paid
within ten days after such termination and to be determined by multiplying the
"Bonus Amount" as defined in paragraph 7(d) below by a fraction the numerator of
which is the number of days in the calendar year of termination that precede the
date of termination and the denominator of which is the number 365.
(c) Other Incentive Plans. During the Term of Employment, Employee shall
---------------------
participate in all other compensation or incentive plans of a long or short term
nature in which other senior executives of the Company then participate, subject
to the terms and conditions of such plans. Employee's incentive compensation
opportunities under such plans shall be determined by the Board in its
discretion acting in good faith and upon consultation with Employee. In making
such determinations, the Board shall take into account the aggregate incentive
compensation opportunities for other senior executives of the Company and the
aggregate incentive compensation opportunities typically offered to CEOs of
companies similar in size and character to the Company.
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(d) Perquisites; Reimbursement of Expenses. During the Term of
--------------------------------------
Employment, Employee shall be entitled to perquisites of office, including
without limitation air travel privileges, office facilities and secretarial
staff, and to fringe benefits, at least equal to and on the same terms and
conditions as those provided to Employee on the date of this Agreement, as well
as to reimbursement, upon proper accounting, of all reasonable expenses and
disbursements incurred by him in the course of his duties.
(e) Employee Benefits. Employee, his dependents and beneficiaries,
-----------------
including without limitation any beneficiary of a joint and survivor or other
optional method of payment applicable to the payment of benefits under the
Company's tax-qualified retirement plans, shall be entitled to all payments,
coverages, benefits and age, pay and service credit for benefits as a result of
employment during the Term of Employment to which other senior officers of the
Company, their dependents and beneficiaries are then entitled under the employee
benefit plans and practices of the Company and subsidiaries of the Company,
including without limitation any qualified or non-qualified pension, profit
sharing and savings plans, death benefit plans (including split dollar life
insurance plans and group life insurance plans providing group term life
insurance, accidental death and dismemberment insurance, and travel accident
insurance), sickness and disability benefit plans, vacation pay plans, and
medical, dental, health and welfare plans. Nothing in this Agreement shall
preclude the Company from amending or terminating any employee benefit plan or
practice, but it being the intent of the parties that Employee, his dependents
and beneficiaries shall continue to be entitled during the Term of Employment to
payments, coverages, benefits and age, pay and service credit for benefits under
employee benefit plans substantially equivalent to those attached to his
position on the date of this Agreement, in the event of any amendment or other
change in any employee benefit plan or practice that would substantially reduce
such payments, coverages, benefits or age, pay or service credit for benefits
from their present levels, the Company shall itself pay or provide Employee, his
dependents and beneficiaries with tax- equivalent payments, coverages, benefits
and age, pay and service credit for benefits or make other arrangements
reasonably satisfactory to
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Employee.
(f) Loan. If the vesting of any restricted units heretofore or hereafter
----
granted to Employee under the Company's Restricted Unit Plan (the "RUP") is
accelerated as a result of the provisions of Section 8.2 of the RUP, then in
that event the Company shall simultaneously lend Employee, on substantially the
terms and conditions set forth in this paragraph, funds equal to Employee's full
Federal, state and local income tax and employment tax liabilities (including
Medicare tax liability) with respect to the units whose vesting is accelerated.
Such loan shall be evidenced by a promissory note signed by Employee, which
shall bear interest at the lowest rate that, in the judgment of the Company's
counsel, will not result in imputed income to Employee under applicable tax
rules, which shall be secured by a pledge of the units in question entitling the
Company to the rights and remedies of a secured creditor under the applicable
provisions of the Uniform Commercial Code, but which shall otherwise be without
recourse to Employee, and under which principal and interest shall be due and
payable in a single lump sum on the first to occur of (i) the second anniversary
of the accelerated vesting of the units, (ii) sale or other disposition of the
units, (iii) any termination of Employee's employment for Cause as defined in
this Agreement, (iv) any voluntary termination by Employee of his employment in
violation of the terms and conditions of this Agreement (it being understood
that a termination by Employee in accordance with the provisions of section 6(d)
hereof [relating to Constructive Discharge] or pursuant to a notice given by
Employee in accordance with the provisions of paragraph 2(b) or 2(c) of this
Agreement shall not be deemed to constitute such a voluntary termination), (v)
Employee's filing of a bankruptcy petition, and (vi) the appointment of a
receiver for Employee or his property. Any provision of this paragraph to the
contrary notwithstanding, the Company's obligation to make the loan provided for
in this paragraph shall be subject to any applicable regulations of the Board of
Governors of the Federal Reserve System and any other agency having jurisdiction
of the subject matter, provided that the Company and its affiliates shall have
taken all such actions on their part as are necessary to comply therewith.
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(g) Indemnification. The Company shall indemnify and hold harmless
---------------
Employee from and against any claim, loss or cause of action arising from or out
of Employee's performance as an officer, director or employee of the Company or
any subsidiary of the Company or in any other capacity, including serving as a
fiduciary, in which Employee serves at the request of, or for the benefit of,
the Company (including without limitation serving as administrator under other
employment or severance agreements of the Company), to the maximum extent
permitted under applicable law. During the Term of Employment and for six years
thereafter (or, if less, throughout the period of any applicable statute of
limitations) the Company shall maintain appropriate directors and officers
liability insurance which shall cover Employee, unless the Board shall determine
that such insurance cannot be maintained at commercially reasonable rates.
(h) Parachute Tax Indemnity. If any payment (within the meaning of
-----------------------
Section 280G(b)(2) of the Internal Revenue Code of 1986 as amended) or
distribution by or on behalf of the Company to or for the benefit of Employee,
whether paid or distributed pursuant to the terms of this Agreement or otherwise
(a "Payment"), including any payment pursuant to this paragraph, is subject to
the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986 as
amended, or any interest or penalties are incurred by Employee with respect to
such excise tax (such excise tax, together with any such interest and penalties,
being hereinafter collectively referred to as the "Excise Tax"), then Employee
shall be entitled to receive on demand an additional payment from the Company
under this Agreement (a "Tax Payment") in an amount such that after payment by
Employee of all taxes (including any interest and penalties imposed with respect
to such taxes), including but not limited to any Excise Tax, imposed upon the
Tax Payment, Employee retains an amount of the Tax Payment equal to the Excise
Tax imposed upon the Payment.
6. Termination of Employment
-------------------------
(a) Death. The Term of Employment shall terminate upon the death of
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Employee.
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(b) Disability. The Term of Employment shall terminate in the event of
----------
Disability of Employee. As used in this Agreement, the term "Disability" means
an accident or physical or mental illness which prevents Employee from
substantially performing his duties and responsibilities hereunder for six
consecutive calendar months. The Term of Employment shall terminate at the
close of business on the last day of such six month period, but without
prejudice to any payments due Employee in respect of disability under any
pension or welfare plan. The amount of any Salary or other compensation payable
to Employee during such six month period as a result of this paragraph may be
reduced by any payments which Employee receives for the same period because of
disability under any disability or pension plan of the Company or any subsidiary
of the Company.
(c) Cause. The Company may terminate the Term of Employment for Cause.
-----
For purposes of this Agreement, Employee shall be considered to be terminated
for "Cause" only
(i) if Employee is convicted of a felony under the laws of the
United States or any state thereof;
(ii) if Employee engages in willful malfeasance having a material
adverse effect on the Company; or
(iii) if Employee willfully and repeatedly fails to substantially
perform his duties and responsibilities described in section 3 above, except by
reason of total or partial incapacity due to accident or physical or mental
illness.
However, in no event (other than clause 6(c)(i) above) shall Employee be
considered to be terminated for "Cause" unless and until the following
conditions are satisfied:
(A) Employee is given reasonable notice of and a reasonable opportunity to
be heard at a meeting of the Board called for the purpose of determining whether
"Cause" exists for termination of Employee's employment;
(B) A resolution is duly adopted at such meeting by the affirmative vote
of not less than two-thirds of the
9
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entire membership of the Board directing the Secretary of the Company to give
Employee written notice (the "Warning Notice") of the Board's determination to
terminate Employee's employment for "Cause" if the acts or omissions specified
in the Warning Notice are not discontinued, and the Secretary of the Company
gives Employee such written notice;
(C) Employee does not discontinue the acts or omissions in question within
30 days of his receipt of the Warning Notice;
(D) Employee is given reasonable notice of and a reasonable opportunity to
be heard at a meeting of the Board after such 30 day period called for the
purpose of determining whether to terminate Employee's employment for "Cause";
(E) A resolution is duly adopted at such meeting by the affirmative vote
of not less than two-thirds of the entire membership of the Board directing the
Secretary of the Company to give Employee written notice of the Board's decision
to terminate Employee's employment for "Cause" and of the specific acts or
omissions in question, and the Secretary of the Company gives Employee such
written notice.
Anything in this paragraph 6(c) to the contrary notwithstanding, the employment
of Employee shall in no event be considered to be terminated by the Company for
Cause if termination of his employment takes place (I) as the result of bad
judgment or negligence on the part of Employee other than willful or reckless
misconduct, (II) for any act or omission in respect of which a determination
could properly be made that Employee met the applicable standard of conduct
prescribed for indemnification or reimbursement or payment of expenses of an
officer or director under the Bylaws or Limited Partnership Agreement of the
Company or the laws of Delaware or Massachusetts or the directors' and officers'
liability insurance of the Company, in each case as in effect at the time of
such act or omission, (III) as the result of an act or omission which occurred
more than twelve calendar months prior to Employee's having been given Notice of
Termination for such act or omission unless the commission of such act or
omission was not at the time of such commission or omission known to a member of
the Board (other than Employee), in which case more than twelve calendar months
from the date the commission of such act or
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omission was so known, (IV) as the result of a continuing course of action which
commenced and was known to a member of the Board (other than Employee) more than
twelve calendar months prior to Notice of Termination having been given to
Employee, or (V) because of an act or omission reasonably believed by Employee
in good faith to have been in or not opposed to the interests of the Company.
(d) Constructive Discharge. Employee may terminate his employment under
----------------------
this Agreement on 10 days' advance written notice to the Company given within 90
days after the occurrence of a Constructive Discharge Event. For purposes of
this Agreement, "Constructive Discharge Event" means any act or omission
identified below in this paragraph 6(d) to which Employee does not consent in
writing and which does not occur in connection with termination of Employee's
employment for Cause or Disability as defined in this Agreement; provided that
no such act or omission shall constitute a Constructive Discharge Event, and the
90 day period referred to above in the first sentence of this paragraph 6(d)
shall not commence to run, unless and until Employee shall have given the Board
written notice describing the act or omission in reasonable detail within 60
days after the Employee first knew (or should have known) of the act or omission
and the act or omission shall not have been cured within 45 days after the Board
received such written notice:
(i) Any (A) failure to re-designate Employee as, or (B) removal of Employee
from, or failure to re-elect Employee to, any of the following positions:
(I) Chairman of the Board, President and Chief Executive Officer of
the Company, or
(II) a member of the Board of Directors of (aa) the Company, (bb) any
subsidiary of the Company on whose Board of Directors Employee now serves, and
(cc) any future subsidiary of the Company on whose Board of Directors the
Chairman of the Board, President and Chief Executive Officer of the Company
would customarily serve;
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(ii) (A) Any conduct by the Company, any affiliate of the Company, the
Board, any member of the Board or by any person acting under the authority of
the Board or a member of the Board, or
(B) any assignment to Employee of any duties, functions, authority or
responsibilities,
that in either case (A) or (B) --
(I) is inconsistent with the Employee's positions described in
section 3 above, or
(II) calls for Employee to report to anyone other than the
Board, or
(III) deprives Employee of effective supervision and control
over, and responsibility for, the strategic direction and general and active
day-to-day leadership and management (including the structure and organization
of such leadership and management) of the business and affairs of the Company
and its subsidiaries, subject to the authority of the Board, or
(IV) deprives Employee of any of the duties, functions,
authority or responsibilities usually incident to his positions described above,
including the authority to hire and discharge all employees of the Company and
its subsidiaries, or
(V) gives Employee additional responsibilities that are not
materially related to Company business or do not benefit unitholders of the
Limited Partnership generally, or
(VI) substantially interferes with Employee's ability to
substantially perform the duties, functions or responsibilities, or exercise the
authority, of his positions described in section 3 above;
including, without limitation, in the case of (A) hereof, recurring interference
with the duties, functions, authority or responsibilities of Employee, or
engaging in activities which are materially disruptive to the management or
employees of the Company or its subsidiaries,
12
<PAGE>
or unrequested participation or attempts to participate in daily operational
matters, by the Company, any affiliate of the Company, the Board, a member of
the Board or by any person acting under the authority of the Board or a member
of the Board, which has one of the results described in clauses (I) through (VI)
hereof;
(iii) any objectively demonstrable failure by the Company to comply with
the provisions of section 4 above (relating to office location and required
business travel) or section 5 above (relating to compensation and related
matters) other than paragraph 5(d) or 5(e) above (relating to perquisites and
employee benefits); or
(iv) any substantial, objectively demonstrable failure by the Company
to comply with the provisions of paragraph 5(d) or 5(e) above.
A termination by Employee in accordance with the provisions of this paragraph
6(d) shall not be deemed a voluntary termination of employment by Employee for
the purpose of this Agreement or any plan or practice of the Company or its
subsidiaries.
(e) Termination by Company Not for Cause. Notwithstanding any provision of
------------------------------------
this Agreement to the contrary, subject to the Bylaws and Limited Partnership
Agreement of the Company, the Board shall have the right to terminate Employee's
employment for any reason other than Cause at any time, subject to the
consequences of such termination as set forth in this Agreement.
(f) Notice of Termination. Any termination by the Company for Disability
---------------------
or Cause as defined in paragraph 6(b) and (c) or by Employee pursuant to
paragraph 6(d) hereof (relating to Constructive Discharge Events) shall be
communicated by written Notice of Termination from the Company or the Employee
(as the case may be) to the other party. For purposes of this Agreement, a
"Notice of Termination" shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Employee's employment under the provision so indicated. If any
dispute concerning termination of Employee's employment
13
<PAGE>
under paragraphs 6(b), (c) or (d) above results in a final determination that a
proper basis for such termination did not exist, Employee's employment hereunder
shall be treated as having been terminated other than pursuant to paragraph
6(b), (c) or (d), as the case may be, by the party who gave Notice of
Termination.
7. Compensation for Termination and Related Matters
------------------------------------------------
The parties recognize and agree that, if the Company terminates Employee's
employment under this Agreement other than for Disability pursuant to paragraph
6(b) above or Cause pursuant to paragraph 6(c), or if Employee terminates his
employment in accordance with paragraph 6(d) above following a Constructive
Discharge Event, the actual damages to Employee would be difficult if not
impossible to ascertain. Accordingly, the parties agree that, if the Company
terminates Employee's employment under this Agreement other than for Disability
pursuant to paragraph 6(b) above or Cause pursuant to paragraph 6(c), or if
Employee terminates his employment in accordance with paragraph 6(d) above
following a Constructive Discharge Event, then Employee shall thereupon be
relieved of any further obligation under this Agreement (other than section 8A
below, if applicable) and his sole remedy shall be a right to receive from the
Company, as liquidated damages, severance pay or both, the payments and benefits
provided in paragraphs 7(a) through (and including) 7(i) below; provided that no
provision of this section 7 is intended to curtail, reduce or otherwise affect
adversely Employee's rights under section 16 below or any rights Employee may
have in respect of termination of employment under any compensation, incentive
or employee benefit plan (other than a severance pay plan). Employee shall not
be required to mitigate the amount of any payment or benefit provided for in
this section 7 by seeking other employment or otherwise, nor shall any
compensation earned by Employee in other employment or otherwise reduce the
amount of any payment or benefit provided for in this section.
(a) The Company shall pay Employee his Salary (as defined in paragraph
5(a) above) prorated through the date of termination;
14
<PAGE>
(b) The Company shall pay Employee any accrued but unpaid bonus award for
Employee's services in the calendar year preceding the date of termination, and
a prorated bonus award for the calendar year in which the date of termination
occurs, such prorated bonus award to be determined by multiplying the "Bonus
Amount" as defined in paragraph 7(d) below by a fraction the numerator of which
is the number of days in the calendar year of termination that precede the date
of termination and the denominator of which is the number 365;
(c) The Company shall pay Employee a lump sum amount, on or before the
tenth day after the date of termination, equal to three times his Salary (as
defined in paragraph 5(a) above, based on the highest rate in effect during the
Term of Employment);
(d) The Company shall pay Employee a lump sum amount, on or before the
tenth day after the date of termination, equal to three times the "Bonus Amount"
as hereafter defined. For purposes of this section 7, the "Bonus Amount" shall
mean Employee's Salary (as defined in paragraph 5(a) above, based on the highest
rate in effect during the Term of Employment), multiplied by the greater of (A)
the average annual percentage of salary awarded to Employee as a bonus for
services in each of the three calendar years immediately preceding the effective
date of this agreement (1992 Bonus shall be annualized), and (B) the percentage
of his Salary (as defined in paragraph 5(a) above) which Employee was given the
opportunity to earn as an annual bonus for services in the calendar year in
which the date of termination occurs if the Company attains the target bonus
performance objective designated by the Board (or a committee thereof) for such
calendar year;
(e) The Company shall pay or provide Employee, his dependents and
beneficiaries with the payments, coverages, benefits and age, pay and service
credit for benefits which they would receive under paragraph 5(e) of this
Agreement if the Term of Employment were to continue for three years after the
date of termination and the compensation described in paragraphs 7(c) and (d)
above were paid to him ratably over such three year period; provided, however,
that if and to the extent the Company determines that such payments, coverages,
benefits and age,
15
<PAGE>
pay and service credit for benefits cannot be paid or provided
under the plans in question due to Internal Revenue Code or other restrictions,
the Company shall provide tax-equivalent payments, coverages, benefits and age,
pay and service credit for benefits through other means reasonably satisfactory
to Employee, and, provided further, that if Employee obtains full time
employment within three years after his date of termination, any payments under
welfare benefit plans to be provided under this paragraph shall be reduced to
the extent Employee receives payments under comparable plans of the successor
employer;
(f) Employee's benefits accrued through the date of termination, and any
benefits accrued pursuant to the provisions of paragraph 7(e) above, under any
and all qualified or non-qualified defined benefit pension plans or defined
contribution pension, profit sharing or stock bonus plans shall become
immediately vested and non-forfeitable on the date of termination; if and to the
extent the Company determines that such vesting cannot be accomplished under the
plan in question due to Internal Revenue Code or other restrictions, the Company
shall provide tax-equivalent benefits to Employee through other means reasonably
satisfactory to Employee;
(g) If Employee's right to retain any restricted units or to retain or
exercise any other equity or long-term incentives heretofore or hereafter
granted to Employee under the Company's Restricted Unit Plan ("RUP") or any
other plan or arrangement shall be subject to continued employment or other
terms or conditions which have not been satisfied on the date of termination
(including but not limited to terms and conditions set forth in Sections 6.4 and
8.1 of the RUP) , then such terms and conditions shall be conclusively deemed to
be satisfied on such date, the intent of this paragraph being to accelerate
vesting and exercisability of any such units and incentives in the event of such
termination; to the extent necessary to effectuate the foregoing provisions of
this paragraph, the terms and conditions of any such units and incentives
(whether heretofore or hereafter granted) shall be deemed amended or
supplemented accordingly;
16
<PAGE>
(h) The Company will continue to indemnify and hold harmless Employee as
provided in paragraph 5(g) above; and
(i) The Company will make the payments provided for in paragraphs 5(f) and
5(h) hereof, if applicable.
8. Non-Renewal Compensation
------------------------
If the Company gives Employee timely written notice in accordance with
paragraph 2(b) above that it does not wish to extend the Term of Employment
beyond the third anniversary of the Effective Date, and Employee's employment
does not terminate before such third anniversary, or is terminated by Employee
before such third anniversary pursuant to a notice given by Employee in
accordance with the provisions of paragraph 2(c) above (or terminates by reason
of Employee's death after such a notice has been given), then the Company shall
pay Employee, in addition to any other amounts payable to Employee hereunder,
the sum of (i) his Salary (as defined in paragraph 5(a) above, based on the
highest rate in effect during the Term of Employment), plus (ii) the Bonus
Amount as defined in paragraph 7(d) above. The Company shall pay such amount on
the third anniversary of the Effective Date, if Employee's employment does not
terminate before such third anniversary (whether Employee's employment actually
terminates at that time or thereafter), or on termination of his employment, if
his employment terminates before such third anniversary because Employee gives
notice in accordance with the provisions of paragraph 2(c) above or by reason of
death after such a notice has been given. The Company shall also continue to
provide Employee, his dependents and beneficiaries, until the third anniversary
of the Effective Date or for such longer period as may be required by law, the
benefits described in paragraph 5(e) above, subject to the last sentence of
paragraph 5(e).
8A. Restrictive Covenants
---------------------
Employee agrees that, if his employment terminates under circumstances that
entitle him to receive payments pursuant to section 7 or section 8 above and the
Company pays all amounts and provides all the benefits to which he
17
<PAGE>
is entitled pursuant thereto, or if his employment is terminated for Cause, then
for one year after his employment terminates, he will neither (a) solicit
business of the kind engaged in by the Company or any subsidiary at the time of
termination of his employment from any person (which for purposes of this
section 8A shall include an enterprise) who at the time of termination of
Employee's employment was a client of the Company or a subsidiary, nor (b)
induce or attempt to persuade any employee of the Company or a subsidiary to
terminate his employment relationship. Employee agrees that the breach of the
restrictive covenants set forth above in this section 8A may result in immediate
and irreparable injury to the Company for which the Company will not have an
adequate remedy at law, and that the Company shall be entitled to a decree of
specific performance of those covenants and to a temporary and permanent
injunction enjoining the breach thereof.
9. Successors; Binding Agreement
-----------------------------
(a) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company, including without limitation any entity
formed or availed of to hold the interests of the public shareholders 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. Failure of the Company to obtain such
agreement prior to the effectiveness of any such succession shall entitle
Employee to compensation under section 7 above, in the same amount and on the
same terms as he would be entitled to hereunder if his employment were
terminated by the Company other than for Disability or Cause, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed the date of termination.
(b) As used in this Agreement, the "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which executes and delivers an agreement provided for in this section
9 or which otherwise becomes bound by all the terms and
18
<PAGE>
provisions of this Agreement by operation of law.
(c) This Agreement and all rights of Employee hereunder shall inure to the
benefit of and be enforceable by Employee's personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. If Employee should die while any amounts are due and payable to him
hereunder, all such amounts, unless otherwise provided herein, shall be paid to
Employee's designated beneficiary or, if there be no such designated
beneficiary, whether because none was designated or because none is alive or in
existence at the time any amount becomes payable hereunder, to the legal
representatives of Employee's estate.
(d) Except as to withholding of any tax under the laws of the United
States or any other country, state or locality, neither this Agreement nor any
right or interest hereunder nor any amount payable at any time hereunder shall
be subject in any manner to alienation, sale, transfer, assignment, pledge,
attachment, or other legal process, or encumbrance of any kind by Employee or
the beneficiaries of Employee or by his legal representatives without the
Company's prior written consent, nor shall there be any right of set-off or
counterclaim in respect of any debts or liabilities of Employee, his
beneficiaries or legal representatives; provided, however, that nothing in this
paragraph shall preclude Employee from designating a beneficiary to receive any
benefit payable on his death, or the legal representatives of Employee from
assigning any rights hereunder to the person or persons entitled thereto under
his will or, in case of intestacy, to the person or persons entitled thereto
under the laws of intestacy applicable to his estate.
10. Agreement Binding
-----------------
This Agreement shall be binding upon and shall inure to the benefit of
Employee, his heirs and legal representative(s), and the Company, its successors
and assigns and any person, firm, corporation or other entity which succeeds to
all or substantially all of the business, assets or property of the Company, as
provided in section 9 hereof.
19
<PAGE>
11. General
-------
(a) This Agreement contains the entire understanding of the parties with
respect to the subject matter hereof and cancels and supersedes any and all
other agreements between the parties with respect to the subject matter hereof.
(b) Any modification of this Agreement shall not be binding unless in
writing and signed by the Company and Employee.
12. Enforceability
--------------
In the event that any provision of this Agreement is determined to be
invalid or unenforceable, the remaining terms and conditions of this Agreement
shall be unaffected and shall remain in full force and effect, and any such
determination of invalidity or unenforceability shall not affect the validity or
enforceability of any other provision of this Agreement.
13. Notices
-------
All notices which may be necessary or proper for either the Company or
Employee to give to the other shall be in writing and shall be delivered by hand
or sent by registered or certified mail, return receipt requested, or by air
courier, to Employee at:
Peter S. Voss
302 Marlborough Street
Boston, MA 02116
with a copy to:
[insert personal attorney's name and address]
and shall be sent in the manner described above to the Company, c/o the General
Partner, at 399 Boylston Street, 10th floor, Boston, MA 02116, Attention:
Secretary, or delivered by hand to the Secretary of the General Partner, and
shall be deemed given when sent, provided that any Notice of Termination or
notice given pursuant to section 2
20
<PAGE>
hereof shall be deemed given only when received. Any party may by like notice to
the other party change the address at which he or they are to receive notices
hereunder.
14. Arbitration
-----------
Any controversy or claim arising out of, or related to, this Agreement, or
the breach thereof, shall be settled by binding arbitration in the City of
Boston, in accordance with the rules then obtaining of the American Arbitration
Association, and the arbitrator's decision shall be binding and final, and
judgment upon the award rendered may be entered in any court having jurisdiction
thereof, except that, with respect to any controversy or claim arising out of,
or related to, the provisions of paragraph 5(g) or 7(h) above (relating to
indemnification), Employee may have the matter settled by judicial determination
in lieu of arbitration by bringing a court action, if he is the plaintiff, or,
if he is not the plaintiff, by demanding such judicial determination within the
time to answer any complaint in any arbitration action that may be commenced.
15. Governing Law
-------------
This Agreement is executed in the Commonwealth of Massachusetts and shall
be governed by and enforceable in accordance with the laws thereof without
giving effect to the principles of conflict of laws thereof.
16. Legal Fees and Expenses
-----------------------
To induce Employee to execute this Agreement and to provide Employee with
reasonable assurance that the purposes of this Agreement will not be frustrated
by the cost of its enforcement should the Company fail to perform its
obligations under this Agreement or should the Company or any subsidiary,
affiliate or shareholder of the Company contest the validity or enforceability
of this Agreement, the Company shall pay and be solely responsible for ninety
percent (90%) of any attorney's fees and expenses and court costs incurred by
Employee as a result of a claim that the Company has breached or otherwise
failed to perform this Agreement or any provision hereof to be performed by the
Company or as a result of the Company or any subsidiary, affiliate or
shareholder of the Company contesting the
21
<PAGE>
validity or enforceability of this Agreement or any provision hereof to be
performed by the Company, in each case regardless of which party, if any,
prevails in the contest.
22
<PAGE>
IN WITNESS WHEREOF, the Limited Partnership and the General Partner have
caused this Agreement to be signed by their proper representatives and Employee
has hereunto set his hand as of the date first above written.
NEW ENGLAND INVESTMENT COMPANIES, L.P.
By New England Investment Companies, Inc.
[Seal] as General Partner
Attest:
By Robert A. Shafto
----------------
Chairman, Compensation Committee of the Board
Edward N. Wadsworth New England Investment Companies, Inc.
- -------------------
Secretary
NEW ENGLAND INVESTMENT COMPANIES, INC.
[Seal]
Attest: By Robert A. Shafto
----------------
Chairman, Compensation Committee of the Board
Edward N. Wadsworth
- -------------------
Secretary
EMPLOYEE
Peter S. Voss
-------------
Peter S. Voss
23
<PAGE>
EXHIBIT 10(ii)
AGREEMENT AMONG
NEW ENGLAND INVESTMENT COMPANIES, L.P.,
NEW ENGLAND INVESTMENT COMPANIES, INC.
AND G. NEAL RYLAND
------------------
THIS AGREEMENT made as of the sixteenth day of August, 1995
(hereinafter referred to as the "Effective Date"), by and among New England
Investment Companies, L.P., a Delaware limited partnership (hereinafter referred
to as the "Limited Partnership"), New England Investment Companies, Inc., a
Massachusetts corporation which is the general partner of the Limited
Partnership (hereinafter referred to as the "General Partner"), parties of the
first part, and G. Neal Ryland (hereinafter referred to as "Employee"), party of
the second part.
WITNESSETH:
-----------
WHEREAS:
A. Employee is currently employed by the Limited Partnership and the
General Partner as an Executive Vice President; and
B. The Limited Partnership and the General Partner wish to provide
an inducement for Employee to remain in their employ so that they will have the
continued benefit of his ability, experience and services;
NOW, THEREFORE, in consideration of good and valuable consideration
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby covenant and agree as follows:
-1-
<PAGE>
1. Compensation on Termination
---------------------------
As used in this Agreement, the term "Company" means and includes the
Limited Partnership and the General Partner, or either of them. If the Company
terminates Employee's employment other than for Cause or Disability (as defined
in paragraphs 2(b) and 2(d) below) before the third anniversary of the Effective
Date (such three year period being hereinafter referred to as the "Term"), or
the Company Constructively Discharges Employee (as that Term is defined in
paragraph 2(c) below) during the Term, and the Administrator (as defined in
paragraph 2(a) below) determines in the good faith exercise of his sole
discretion that such termination of employment or Constructive Discharge (as the
case may be) is or was not primarily related to Employee's performance or the
ordinary course of business, then the Company shall pay Employee the following
amounts and provide him with the following benefits as severance compensation.
Employee shall not be required to mitigate the amount of any payment or benefit
provided for in this section 1 by seeking other employment or otherwise, nor
shall any compensation earned by Employee in other employment or otherwise
reduce the amount of any payment or benefit provided for in this section 1.
(a) The Company shall pay Employee his salary (as defined in
paragraph 2(c)(iii) below) prorated through the date of termination;
(b) The Company shall pay Employee any accrued but unpaid bonus award
for Employee's services in the calendar year preceding the date of termination,
and a prorated bonus award for the calendar year in which the date of
termination occurs, such prorated bonus award to be determined by multiplying
the "Bonus Amount" as defined in paragraph 1(d) below by a fraction the
numerator of which is the number of
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<PAGE>
days in the calendar year of termination that precede the
date of termination and the denominator of which is the number 365;
(c) The Company shall pay Employee a lump sum amount, on or before
the tenth day after the date of termination, equal to one and one-half (1 1/2)
times his salary ( as defined in paragraph 2(c)(iii) below, based on the highest
rate in effect during the Term);
(d) The Company shall pay Employee a lump sum amount, on or before
the tenth day after the date of termination, equal to one and one-half (1 1/2)
times the "Bonus Amount" as hereafter defined. For purposes of this section 1,
the "Bonus Amount" shall mean Employee's Salary (as defined in paragraph
2(c)(iii) below, based on the highest rate in effect during the Term),
multiplied by the greater of (i) and (ii) where (i) is 50%, and (ii) is the
percentage of his Salary (as defined in paragraph 2(c)(iii) below) which
Employee was given the opportunity to earn as an annual bonus for services in
the calendar year in which the date of termination occurs if the Company attains
the target bonus performance objective designated by the Board (or a committee
thereof) for such calendar year;
(e) The Company shall pay or provide Employee, his dependents and
beneficiaries with the payments, coverages, benefits and age, pay and service
credit for benefits described in clauses (A) and (B) of paragraph 2(c)(viii)
below for one and one-half years after the date of termination (with the
compensation described in paragraphs 1(c) and (d) above being considered paid to
him, for purposes of this paragraph 1(e), ratably over such one and one-half
year period); provided, however, that if and to the extent the Company
determines that such payments, coverages, benefits and age, pay and service
credit for benefits cannot
-3-
<PAGE>
be paid or provided under the plans in question due to Internal Revenue Code or
other restrictions, the Company shall provide tax-equivalent payments,
coverages, benefits and age, pay and service credit for benefits through other
means reasonably satisfactory to Employee, and, provided further, that if
Employee obtains full time employment within one and one-half years after his
date of termination, any payments under welfare benefit plans to be provided
under this paragraph shall be reduced to the extent Employee receives payments
under comparable plans of the successor employer;
(f) Employee's benefits accrued through the date of termination, and
any benefits accrued pursuant to the provisions of paragraph 1(e) above, under
any and all qualified or non-qualified defined benefit pension plans or defined
contribution pension, profit sharing or stock bonus plans shall become
immediately vested and non-forfeitable on the date of termination; if and to the
extent the Company determines that such vesting cannot be accomplished under the
plan in question due to Internal Revenue Code or other restrictions, the Company
shall provide tax equivalent benefits to Employee through other means reasonably
satisfactory to Employee; and
(g) If any payment (within the meaning of Section 280G(b)(2) of the
Internal Revenue Code of 1986 as amended) or distribution by or on behalf of the
Company to or for the Benefit of Employee pursuant to the terms of this
Agreement, either alone or in conjunction with any other payment or distribution
to or for the Benefit of Employee ( a "Payment"), including any payment pursuant
to this paragraph, is subject to the excise tax imposed by section 4999 of the
Internal Revenue Code of 1986 as amended, or any interest or penalties are
incurred by Employee with respect to such excise tax (such excise tax, together
with any such
-4-
<PAGE>
interest or penalties, being hereinafter collectively referred to as the "Excise
Tax"), then Employee shall be entitled to receive on demand an additional
payment from the Company under this Agreement (a "Tax Payment") in an amount
such that after payment by Employee of all taxes (including any interest and
penalties imposed with respect to such taxes), including but not limited to any
Excise Tax, imposed upon the Tax Payment, Employee retains an amount of the Tax
Payment equal to the Excise Tax imposed upon the Payment.
2. Certain Definitions
-------------------
(a) Administrator. As used in section 1 of this Agreement, the term
-------------
"Administrator" means Peter S. Voss or, if Peter S. Voss should at any time be
unable or unwilling to serve in that capacity, such other person or entity
(whether affiliated with the Company or not) as Peter S. Voss may designate in
writing as the person or entity who or which should act in his place and stead
to determine whether any termination of employment or Constructive Discharge of
Employee during the Term is or was not primarily related to Employee's
performance or the ordinary course of business with the meaning of section 1 of
this Agreement. If such person or entity is not an officer, director or employee
of the Company, such person or entity's reasonable fees and expenses for serving
in the capacity of Administrator shall be borne by the Company. The
Administrator's determination shall be final, binding and conclusive on the
Company, the Employee and all persons claiming under or through any of them. The
Company hereby agrees to indemnify and hold harmless any person or entity
serving as the Administrator against any claims, losses, judgments, and causes
of action arising out of or relating to such person's or entity's service as
Administrator under this Agreement.
-5-
<PAGE>
(b) Cause. For purposes of this Agreement, Employee shall be
-----
considered to be terminated for "Cause" only
(i) if Employee is convicted of a felony under the laws of the
United States or any state thereof;
(ii) if employee engages in willful malfeasance having a
material adverse effect on the Company; or
(iii) if Employee willfully and repeatably fails to substantially
perform the duties and responsibilities attached to his position on the
Effective Date, except by reason of total or partial incapacity due to accident
or physical or mental illness.
However, in no event (other than clause 2(b)(i) above)shall Employee be
considered to be terminated for "Cause" unless and until the following
conditions are satisfied:
(A) Employee is given reasonable notice and a reasonable opportunity
to be heard at a meeting of the Board of Directors of the Company called for the
purpose of determining whether "Cause" exists for termination of Employee's
employment;
(B) A resolution is duly adopted at such meeting by the affirmative
vote of not less than two-thirds of the entire membership of the Board directing
the Secretary of the Company to give Employee written notice (the "Warning
Notice") of the Board's determination to terminate Employee's employment for
"Cause" if the acts or omissions specified in the Warning Notice are not
discontinued, and the Secretary of the Company gives Employee such written
notice; and
-6-
<PAGE>
(C) Employee does not discontinue the acts or omissions in question
within 30 days of his receipt of the Warning Notice;
Anything in this paragraph 2(b) to the contrary notwithstanding, the employment
of Employee shall in no event be considered to be terminated by the Company for
Cause if termination of his employment takes place (I) as the result of bad
judgment or negligence on the part of Employee other than willful or reckless
misconduct, (II) for any act or omission in respect of which a determination
could properly be made that Employee met the applicable standard of conduct
prescribed for indemnification or reimbursement or payment of expenses of an
officer or director under the Bylaws or Limited Partnership Agreement of the
Company or the laws of Delaware or Massachusetts or the directors' and officers'
liability insurance of the Company, in each case as in effect at the time of
such act or omission, (III) as the result of an act or omission which occurred
more than twelve calendar months prior to Employee's having been given Notice of
Termination for such act or omission unless the commission of such act or
omission was not at the time of such commission or omission known to a member of
the Board, in which case more than twelve calendar months from the date the
commission of such act or omission was so known, (IV) as the result of a
continuing course of action which commenced and was known to a member of the
Board more than twelve calendar months prior to Notice of Termination having
been given to Employee, or (V) because of an act or omission reasonably believed
by Employee in good faith to have been in or not opposed to the interests of the
Company.
(c) Constructive Discharge. For purposes of this Agreement, the
Company shall be considered to
-7-
<PAGE>
"Constructively Discharge" Employee if any act or omission that is identified
below in this paragraph 2(c) occurs other than (x) in connection with
termination of Employee's employment for Cause or Disability as defined in this
Agreement, or (y) with Employee's written consent; provided that in no event
shall the Company be considered to "Constructively Discharge" Employee unless
and until (I) Employee gives the Board written notice describing the act or
omission in reasonable detail within 60 days after the Employee first knows (or
should have known) of the act or omission, (II) the act or omission is not cured
within 45 days after the Board receives such written notice, and (III) Employee
terminates his employment on 10 days' advance written notice to the Company
given within 90 days after the close of such 45 day cure period:
(i) Any (A) failure to re-designate Employee as, or (B) removal of
Employee from, or failure to re-elect Employee to, the position of, Executive
Vice President and Chief Financial Officer of the Company;
(ii) Any material limitation or expansion of the duties, functions,
authority or responsibilities attached to Employee's position on the Effective
Date;
(iii) Any failure by the Company to pay Employee a salary at an annual
rate equal to at least $235,000 plus such increases (if any) as may be approved
by the Board from time to time, in substantially equal installments at monthly
or more frequent intervals in accordance with the normal payroll practices of
the Company, or to review Employee's salary rate at least annually following the
date of this Agreement to ascertain whether, in the sole, good faith judgment of
the Board, such rate should be increased in light of Employee's performance,
competitive pay levels or such other factors (if any) as the Board may deem
relevant
-8-
<PAGE>
(Employee's annual base salary at the rate specified above and including any
increases being referred to in this Agreement as his "Salary");
(iv) Any removal of Employee's office from the Company's principal
executive offices or to a location that (A) is more than 35 miles from its
present location, and (B) increases Employee's commuting distance from his
residence; or
(v) Any objectively demonstrable, substantial increase in the business
travel required of Employee above present levels unless the additional travel is
both appropriate for Employee's position described above and substantially
related to the business and affairs of the Company or its direct or indirect
subsidiaries (any direct or indirect subsidiary of the Company, including
partnerships, limited liability companies, business trusts and other entities as
well as corporations, being hereinafter referred to as a "subsidiary"); or
(vi) Any objectively demonstrable failure by the Company to provide
Employee with the opportunity to earn an annual bonus for each calendar year
that coincides in whole or in part with the Term, equal to at least 50% of his
Salary for such year if the Company attains the target bonus performance
objective designated by the Board (or a committee thereof) for such calendar
year, and equal to at least 100% of his Salary for such year if the Company
attains the maximum bonus performance objective designated by the Board (or a
committee thereof) for such calendar year, or to provide Employee with the
opportunity to earn such a bonus based on performance objectives not
substantially more difficult to attain than those applicable to Employee's
target and maximum bonus opportunities for 1994;
-9-
<PAGE>
(vii) Any objectively demonstrable failure by the Company to select
Employee to participate in any other compensation or incentive plan of a long or
short term nature in which other senior executives of the Company having
responsibilities comparable to Employee's then generally participate, or to
provide Employee with a compensation opportunity under any such plan that is as
favorable as the compensation opportunity provided to any other participating
executive having responsibilities comparable to Employee's;
(viii) Any substantial, objectively demonstrable failure by the
Company to provide Employee, his dependents and beneficiaries, including without
limitation any beneficiary of a joint and survivor or other optional method of
payment applicable to the payment of benefits under the Company's tax-qualified
retirement plans, with (A) all payments, coverages, benefits and age, pay and
service credit for benefits as a result of employment to which other senior
officers of the Company, their dependents and beneficiaries are then entitled
under the employee benefit plans and practices of the Company and its
subsidiaries, including without limitation any qualified or non-qualified
pension, profit sharing and savings plans, death benefit plans (including split
dollar life insurance plans and group life insurance plans providing group term
life insurance, accidental death and dismemberment insurance, and travel
accident insurance), sickness and disability benefit plans, vacation pay plans,
and medical, dental, health and welfare plans, or (B) payments, coverages,
benefits and age, pay and service credit for benefits under employee benefit
plans substantially equivalent to those attached to his position on the
Effective Date, or, in the event of any amendment or other change in any
employee benefit plan or practice that would substantially reduce such payments,
coverages,
-10-
<PAGE>
benefits or age, pay or service credit for benefits from their present levels,
with tax-equivalent payments, coverages, benefits and age, pay and service
credit for benefits under other arrangements reasonably satisfactory to
Employee; or
(ix) Any failure by the Company to obtain the assumption of, and the
agreement to perform, this Agreement, by any successor as contemplated by
paragraph 3(a) below.
A Constructive Discharge in accordance with the provisions of this paragraph
2(c) shall not be deemed a voluntary termination of employment by Employee for
the purpose of this Agreement or any plan or practice of the Company or its
subsidiaries.
(d) Disability. As used in this Agreement, the term "Disability"
----------
means an accident or physical or mental illness which prevents Employee from
substantially performing the duties and responsibilities attached to his
position described in paragraph 2(c)(i) above on the Effective Date for six
consecutive calendar months. Employee shall not be considered under a
Disability for purposes of this Agreement until the close of business on the
last day of such six months' period. If the amount of any Salary or other
compensation payable to Employee during such six month period is reduced by any
payments which Employee receives for the same period because of disability under
any disability or pension plan of the Company or any subsidiary of the Company,
such reduction shall not be considered a failure to pay Employee the amount of
salary so reduced for purposes of paragraph 2(c)(iii) above.
(e) Notice of Termination. Any termination by the Company for Cause
---------------------
or Disability as defined in paragraphs 2(b) and (d) above or by Employee for
Constructive Discharge
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<PAGE>
as defined in paragraph 2(c) above shall be communicated by written Notice of
Termination from the Company or the Employee (as the case may be) to the other
party. For purposes of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision in this Agreement
relied upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of Employee's employment under the
provision so indicated. If any dispute concerning termination of Employee's
employment under paragraphs (b), (c) or (d) above results in a final
determination that a proper basis for such termination did not exist, Employee's
employment hereunder shall be treated as having been terminated other than
pursuant to paragraph (b), (c) or (d), as the case may be, by the party who gave
Notice of Termination.
3. Successors; Binding Agreement:
------------------------------
(a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, including
without limitation any entity formed or availed of to hold the interests of the
public shareholders 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. Failure of the
Company to obtain such agreement prior to the effectiveness of any such
succession shall entitle Employee to compensation under section 1 above, in the
same amount and on the same terms as she would be entitled to hereunder if his
employment were terminated by the Company other than for Disability or Cause and
the Administrator were to determine that such termination was not primarily
related to Employee's performance or the ordinary course of business,
-12-
<PAGE>
except that for purposes of implementing the foregoing, the date on which any
such succession becomes effective shall be deemed the date of termination.
(b) As used in this Agreement, the "Company" shall mean the Company as
herein before defined and any successor to its business and/or assets as
aforesaid which executes and delivers an agreement provided for in paragraph
3(a) above or which otherwise becomes bound by all the terms and provisions of
this Agreement by operation of law.
(c) This Agreement and all rights of Employee hereunder shall inure to
the benefit of and be enforceable by Employee's personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devisees and legatees. If Employee should die while any amounts are due and
payable to his hereunder, all such amounts, unless otherwise provided herein,
shall be paid to Employee's designated beneficiary or, if there be no such
designated beneficiary, whether because none was designated or because none is
alive or in existence at the time any amount becomes payable hereunder, to the
legal representatives of Employee's estate.
(d) Except as to withholding of any tax under the laws of the United
States or any other country, state or locality, neither this Agreement nor any
right or interest hereunder nor any amount payable at any time hereunder shall
be subject in any manner to alienation, sale, transfer, assignment, pledge,
attachment, or other legal process, or encumbrance of any kind by Employee or
the beneficiaries of Employee or by his legal representatives without the
Company's prior written consent, nor shall there be any right of set-off or
counterclaim in respect of any debts or liabilities of Employee, his
beneficiaries or legal representatives; provided, however, that nothing in this
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<PAGE>
paragraph shall preclude Employee from designating a beneficiary to receive any
benefit payable on his death, or the legal representatives of Employee from
assigning any rights hereunder to the person or persons entitled thereto under
his will or, in case of intestacy, to the person or persons entitled thereto
under the laws of intestacy applicable to his estate.
4. Agreement Binding.
-----------------
This Agreement shall be binding upon and shall inure to the benefit of
Employee,his heirs and legal representatives, and the Company, its successors
and assigns and any person, firm, corporation or other entity which succeeds to
all or substantially all of the business, assets or property of the Company, as
provided in section 3 hereof.
5. General Provisions.
------------------
(a) This Agreement contains the entire understanding of the parties
with respect to the subject matter hereof and cancels and supersedes any and all
other agreements between the parties with respect to the subject matter hereof.
However, this Agreement is not intended to diminish, compromise or otherwise
affect adversely any rights Employee may have in respect of termination of
employment (other than rights to severance pay in the circumstances covered by
section 1 above) under any plan or arrangement other than this Agreement.
(b) Any modification of this Agreement shall not be binding unless in
writing and signed by the Company and Employee.
(c) No provision of this Agreement shall impair or diminish any rights
which the Company may have to terminate
-14-
<PAGE>
Employee's employment with or without Cause, subject to the consequences of such
termination set forth in this Agreement. No provision of this Agreement shall be
construed to create any right on the part of the Employee to continue in the
employ of the Company for any period of time or at any particular rate of
compensation.
(d) In no event shall Employee be entitled to any payments under this
Agreement unless and until the Company terminates Employee's employment other
than for Cause or Disability during the Term, or Constructively Discharges
Employee during the Term, and the Administrator determines that such termination
of employment or Constructive Discharge (as the case may be) is or was not
primarily related to Employee's performance or the ordinary course of business.
(e) This Agreement is being executed in two or more counterparts, each
of which shall be considered an original.
6. Enforceability.
--------------
In the event that any provision of this Agreement is determined to be
invalid or unenforceable, the remaining terms and conditions of this Agreement
shall be unaffected and shall remain in full force and effect, and any such
determination of invalidity or unenforceability shall not affect the validity or
enforceability of any other provision of this Agreement.
7. Notices.
-------
All notices which may be necessary or proper for either the Company or
Employee to give to the other shall be in writing and shall be delivered by hand
or sent by registered
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<PAGE>
or certified mail, return receipt requested, or by air courier, to Employee at:
G. Neal Ryland
Beaver Pond Road
Beverly Farms, MA 01915
and shall be sent in the manner described above to the Company, c/o the General
Partner, at 399 Boylston Street, 10th Floor, Boston, MA 02116, Attention:
Secretary, or delivered by hand to the Secretary of the General Partner, and
shall be deemed given when sent, provided that any Notice of Termination or
notice given pursuant to section 2 hereof shall be deemed given only when
received. Any party may by like notice to the other party change the address at
which she or they are able to receive notices hereunder.
8. Arbitration.
-----------
Any controversy or claim arising out of, or related to, this
Agreement, or the breach thereof, shall be settled by binding arbitration in the
City of Boston, in accordance with the rules then obtaining of the American
Arbitration Association, and the arbitrator's decision shall be binding and
final, and judgment upon the award rendered may be entered in any court having
jurisdiction thereof.
9. Governing Law.
-------------
The Agreement is executed in the Commonwealth of Massachusetts and
shall be governed by and enforceable in accordance with the laws thereof without
giving effect to the principles of conflict of laws thereof.
10. Legal Fees and Expenses.
-----------------------
To provide Employee with reasonable assurance that the purposes of
this Agreement will not be frustrated by the
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<PAGE>
cost of its enforcement should the Company fail to perform its obligations under
this Agreement or should the Company or any subsidiary, affiliate or shareholder
of the Company contest the validity or enforceability of this Agreement, the
Company shall pay and be solely responsible for any attorney's fees and
expenses, including arbitration costs and court costs, incurred by Employee as a
result of the Company's failure to perform this Agreement or any provision
hereof to be performed by the Company or as a result of the Company or any
subsidiary, affiliate or shareholder of the Company contesting the validity or
enforceability of this Agreement or any provision hereof to be performed by the
Company.
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<PAGE>
IN WITNESS WHEREOF, the Limited Partnership and the General Partner
have caused this Agreement to be signed by their proper representatives and
Employee has hereunto set his hand as of the date first above written.
NEW ENGLAND INVESTMENT COMPANIES, L.P.
By New England Investment Companies, Inc.
as General Partner
[Seal]
By Robert A. Shafto
----------------
Attest: Chairman, Compensation Committee of the Board
New England Investment Companies, Inc.
Edward N. Wadsworth
- -------------------
Secretary
NEW ENGLAND INVESTMENT COMPANIES, INC.
[Seal]
Attest: By Robert A. Shafto
----------------
Chairman, Compensation Committee of the Board
Edward N. Wadsworth
- -------------------
Secretary
EMPLOYEE
G. Neal Ryland
--------------
G. Neal Ryland
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<PAGE>
EXHIBIT 10(iii)
AGREEMENT AMONG
NEW ENGLAND INVESTMENT COMPANIES, L.P.,
NEW ENGLAND INVESTMENT COMPANIES, INC.
AND SHERRY A. UMBERFIELD
------------------------
THIS AGREEMENT made as of the sixteenth day of August, 1995
(hereinafter referred to as the "Effective Date"), by and among New England
Investment Companies, L.P., a Delaware limited partnership (hereinafter referred
to as the "Limited Partnership"), New England Investment Companies, Inc., a
Massachusetts corporation which is the general partner of the Limited
Partnership (hereinafter referred to as the "General Partner"), parties of the
first part, and Sherry A Umberfield (hereinafter referred to as "Employee"),
party of the second part.
WITNESSETH:
-----------
WHEREAS:
A. Employee is currently employed by the Limited Partnership and the
General Partner as an Executive Vice President; and
B. The Limited Partnership and the General Partner wish to provide
an inducement for Employee to remain in their employ so that they will have the
continued benefit of her ability, experience and services;
NOW, THEREFORE, in consideration of good and valuable consideration
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby covenant and agree as follows:
-1-
<PAGE>
1. Compensation on Termination
---------------------------
As used in this Agreement, the term "Company" means and includes the
Limited Partnership and the General Partner, or either of them. If the Company
terminates Employee's employment other than for Cause or Disability (as defined
in paragraphs 2(b) and 2(d) below) before the third anniversary of the Effective
Date (such three year period being hereinafter referred to as the "Term"), or
the Company Constructively Discharges Employee (as that Term is defined in
paragraph 2(c) below) during the Term, and the Administrator (as defined in
paragraph 2(a) below) determines in the good faith exercise of her sole
discretion that such termination of employment or Constructive Discharge (as the
case may be) is or was not primarily related to Employee's performance or the
ordinary course of business, then the Company shall pay Employee the following
amounts and provide him with the following benefits as severance compensation.
Employee shall not be required to mitigate the amount of any payment or benefit
provided for in this section 1 by seeking other employment or otherwise, nor
shall any compensation earned by Employee in other employment or otherwise
reduce the amount of any payment or benefit provided for in this section 1.
(a) The Company shall pay Employee her salary (as defined in
paragraph 2(c)(iii) below) prorated through the date of termination;
(b) The Company shall pay Employee any accrued but unpaid bonus award
for Employee's services in the calendar year preceding the date of termination,
and a prorated bonus award for the calendar year in which the date of
termination occurs, such prorated bonus award to be determined by multiplying
the "Bonus Amount" as defined in paragraph 1(d) below by a fraction the
numerator of which is the number of
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<PAGE>
days in the calendar year of termination that precede the date of termination
and the denominator of which is the number 365;
(c) The Company shall pay Employee a lump sum amount, on or before
the tenth day after the date of termination, equal to one and one-half (1 1/2)
times her salary ( as defined in paragraph 2(c)(iii) below, based on the highest
rate in effect during the Term);
(d) The Company shall pay Employee a lump sum amount, on or before the
tenth day after the date of termination, equal to one and one-half (1 1/2) times
the "Bonus Amount" as hereafter defined. For purposes of this section 1, the
"Bonus Amount" shall mean Employee's Salary (as defined in paragraph 2(c)(iii)
below, based on the highest rate in effect during the Term), multiplied by the
greater of (i) and (ii) where (i) is 40% and (ii) is the percentage of her
Salary (as defined in paragraph 2(c)(iii) below) which Employee was given the
opportunity to earn as an annual bonus for services in the calendar year in
which the date of termination occurs if the Company attains the target bonus
performance objective designated by the Board (or a committee thereof) for such
calendar year;
(e) The Company shall pay or provide Employee, her dependents and
beneficiaries with the payments, coverages, benefits and age, pay and service
credit for benefits described in clauses (A) and (B) of paragraph 2(c)(viii)
below for one and one-half years after the date of termination (with the
compensation described in paragraphs 1(c) and (d) above being considered paid to
her, for purposes of this paragraph 1(e), ratably over such one and one-half
year period); provided, however, that if and to the extent the Company
determines that such payments, coverages, benefits and age, pay and service
credit for benefits cannot
-3-
<PAGE>
be paid or provided under the plans in question due to Internal Revenue Code or
other restrictions, the Company shall provide tax-equivalent payments,
coverages, benefits and age, pay and service credit for benefits through other
means reasonably satisfactory to Employee, and, provided further, that if
Employee obtains full time employment within one and one-half years after her
date of termination, any payments under welfare benefit plans to be provided
under this paragraph shall be reduced to the extent Employee receives payments
under comparable plans of the successor employer;
(f) Employee's benefits accrued through the date of termination, and
any benefits accrued pursuant to the provisions of paragraph 1(e) above, under
any and all qualified or non-qualified defined benefit pension plans or defined
contribution pension, profit sharing or stock bonus plans shall become
immediately vested and non-forfeitable on the date of termination; if and to the
extent the Company determines that such vesting cannot be accomplished under the
plan in question due to Internal Revenue Code or other restrictions, the Company
shall provide tax equivalent benefits to Employee through other means reasonably
satisfactory to Employee; and
(g) If any payment (within the meaning of Section 280G(b)(2) of the
Internal Revenue Code of 1986 as amended) or distribution by or on behalf of the
Company to or for the Benefit of Employee pursuant to the terms of this
Agreement, either alone or in conjunction with any other payment or distribution
to or for the Benefit of Employee ( a "Payment"), including any payment pursuant
to this paragraph, is subject to the excise tax imposed by section 4999 of the
Internal Revenue Code of 1986 as amended, or any interest or penalties are
incurred by Employee with respect to such excise tax (such excise tax, together
with any such
-4-
<PAGE>
interest or penalties, being hereinafter collectively referred to as the "Excise
Tax"), then Employee shall be entitled to receive on demand an additional
payment from the Company under this Agreement (a "Tax Payment") in an amount
such that after payment by Employee of all taxes (including any interest and
penalties imposed with respect to such taxes), including but not limited to any
Excise Tax, imposed upon the Tax Payment, Employee retains an amount of the Tax
Payment equal to the Excise Tax imposed upon the Payment.
2. Certain Definitions
-------------------
(a) Administrator. As used in section 1 of this Agreement, the term
-------------
"Administrator" means Peter S. Voss or, if Peter S. Voss should at any time be
unable or unwilling to serve in that capacity, such other person or entity
(whether affiliated with the Company or not) as Peter S. Voss may designate in
writing as the person or entity who or which should act in his place and stead
to determine whether any termination of employment or Constructive Discharge of
Employee during the Term is or was not primarily related to Employee's
performance or the ordinary course of business with the meaning of section 1 of
this Agreement. If such person or entity is not an officer, director or employee
of the Company, such person or entity's reasonable fees and expenses for serving
in the capacity of Administrator shall be borne by the Company. The
Administrator's determination shall be final, binding and conclusive on the
Company, the Employee and all persons claiming under or through any of them. The
Company hereby agrees to indemnify and hold harmless any person or entity
serving as the Administrator against any claims, losses, judgments, and causes
of action arising out of or relating to such person's or entity's service as
Administrator under this Agreement.
-5-
<PAGE>
(b) Cause. For purposes of this Agreement, Employee shall be
-----
considered to be terminated for "Cause" only
(i) if Employee is convicted of a felony under the laws of the
United States or any state thereof;
(ii) if employee engages in willful malfeasance having a
material adverse effect on the Company; or
(iii) if Employee willfully and repeatably fails to
substantially perform the duties and responsibilities attached to her position
on the Effective Date, except by reason of total or partial incapacity due to
accident or physical or mental illness.
However, in no event (other than clause 2(b)(i) above)shall Employee be
considered to be terminated for "Cause" unless and until the following
conditions are satisfied:
(A) Employee is given reasonable notice and a reasonable opportunity
to be heard at a meeting of the Board of Directors of the Company called for the
purpose of determining whether "Cause" exists for termination of Employee's
employment;
(B) A resolution is duly adopted at such meeting by the affirmative
vote of not less than two-thirds of the entire membership of the Board directing
the Secretary of the Company to give Employee written notice (the "Warning
Notice") of the Board's determination to terminate Employee's employment for
"Cause" if the acts or omissions specified in the Warning Notice are not
discontinued, and the Secretary of the Company gives Employee such written
notice; and
-6-
<PAGE>
(C) Employee does not discontinue the acts or omissions in question
within 30 days of her receipt of the Warning Notice;
Anything in this paragraph 2(b) to the contrary notwithstanding, the employment
of Employee shall in no event be considered to be terminated by the Company for
Cause if termination of her employment takes place (I) as the result of bad
judgment or negligence on the part of Employee other than willful or reckless
misconduct, (II) for any act or omission in respect of which a determination
could properly be made that Employee met the applicable standard of conduct
prescribed for indemnification or reimbursement or payment of expenses of an
officer or director under the Bylaws or Limited Partnership Agreement of the
Company or the laws of Delaware or Massachusetts or the directors' and officers'
liability insurance of the Company, in each case as in effect at the time of
such act or omission, (III) as the result of an act or omission which occurred
more than twelve calendar months prior to Employee's having been given Notice of
Termination for such act or omission unless the commission of such act or
omission was not at the time of such commission or omission known to a member of
the Board, in which case more than twelve calendar months from the date the
commission of such act or omission was so known, (IV) as the result of a
continuing course of action which commenced and was known to a member of the
Board more than twelve calendar months prior to Notice of Termination having
been given to Employee, or (V) because of an act or omission reasonably believed
by Employee in good faith to have been in or not opposed to the interests of the
Company.
(c) Constructive Discharge. For purposes of this Agreement, the
Company shall be considered to
-7-
<PAGE>
"Constructively Discharge" Employee if any act or omission that is identified
below in this paragraph 2(c) occurs other than (x) in connection with
termination of Employee's employment for Cause or Disability as defined in this
Agreement, or (y) with Employee's written consent; provided that in no event
shall the Company be considered to "Constructively Discharge" Employee unless
and until (I) Employee gives the Board written notice describing the act or
omission in reasonable detail within 60 days after the Employee first knows (or
should have known) of the act or omission, (II) the act or omission is not cured
within 45 days after the Board receives such written notice, and (III) Employee
terminates her employment on 10 days' advance written notice to the Company
given within 90 days after the close of such 45 day cure period:
(i) Any (A) failure to re-designate Employee as, or (B) removal of
Employee from, or failure to re-elect Employee to, the position of, Executive
Vice President-Corporate Development of the Company;
(ii) Any material limitation or expansion of the duties, functions,
authority or responsibilities attached to Employee's position on the Effective
Date;
(iii) Any failure by the Company to pay Employee a salary at an annual
rate equal to at least $205,000 plus such increases (if any) as may be approved
by the Board from time to time, in substantially equal installments at monthly
or more frequent intervals in accordance with the normal payroll practices of
the Company, or to review Employee's salary rate at least annually following the
date of this Agreement to ascertain whether, in the sole, good faith judgment of
the Board, such rate should be increased in light of Employee's performance,
competitive pay levels or such other factors (if any) as the Board may deem
relevant
-8-
<PAGE>
(Employee's annual base salary at the rate specified above and including any
increases being referred to in this Agreement as her "Salary");
(iv) Any removal of Employee's office from the Company's principal
executive offices or to a location that (A) is more than 35 miles from its
present location, and (B) increases Employee's commuting distance from her
residence; or
(v) Any objectively demonstrable, substantial increase in the business
travel required of Employee above present levels unless the additional travel is
both appropriate for Employee's position described above and substantially
related to the business and affairs of the Company or its direct or indirect
subsidiaries (any direct or indirect subsidiary of the Company, including
partnerships, limited liability companies, business trusts and other entities as
well as corporations, being hereinafter referred to as a "subsidiary"); or
(vi) Any objectively demonstrable failure by the Company to provide
Employee with the opportunity to earn an annual bonus for each calendar year
that coincides in whole or in part with the Term, equal to at least 40% of her
Salary for such year if the Company attains the target bonus performance
objective designated by the Board (or a committee thereof) for such calendar
year, and equal to at least 80% of her Salary for such year if the Company
attains the maximum bonus performance objective designated by the Board (or a
committee thereof) for such calendar year, or to provide Employee with the
opportunity to earn such a bonus based on performance objectives not
substantially more difficult to attain than those applicable to Employee's
target and maximum bonus opportunities for 1994;
-9-
<PAGE>
(vii) Any objectively demonstrable failure by the Company to select
Employee to participate in any other compensation or incentive plan of a long or
short term nature in which other senior executives of the Company having
responsibilities comparable to Employee's then generally participate, or to
provide Employee with a compensation opportunity under any such plan that is as
favorable as the compensation opportunity provided to any other participating
executive having responsibilities comparable to Employee's;
(viii) Any substantial, objectively demonstrable failure by the
Company to provide Employee, her dependents and beneficiaries, including without
limitation any beneficiary of a joint and survivor or other optional method of
payment applicable to the payment of benefits under the Company's tax-qualified
retirement plans, with (A) all payments, coverages, benefits and age, pay and
service credit for benefits as a result of employment to which other senior
officers of the Company, their dependents and beneficiaries are then entitled
under the employee benefit plans and practices of the Company and its
subsidiaries, including without limitation any qualified or non-qualified
pension, profit sharing and savings plans, death benefit plans (including split
dollar life insurance plans and group life insurance plans providing group term
life insurance, accidental death and dismemberment insurance, and travel
accident insurance), sickness and disability benefit plans, vacation pay plans,
and medical, dental, health and welfare plans, or (B) payments, coverages,
benefits and age, pay and service credit for benefits under employee benefit
plans substantially equivalent to those attached to her position on the
Effective Date, or, in the event of any amendment or other change in any
employee benefit plan or practice that would substantially reduce such payments,
coverages, benefits or age, pay or service credit for benefits from
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<PAGE>
their present levels, with tax-equivalent payments, coverages, benefits and age,
pay and service credit for benefits under other arrangements reasonably
satisfactory to Employee; or
(ix) Any failure by the Company to obtain the assumption of, and the
agreement to perform, this Agreement, by any successor as contemplated by
paragraph 3(a) below.
A Constructive Discharge in accordance with the provisions of this paragraph
2(c) shall not be deemed a voluntary termination of employment by Employee for
the purpose of this Agreement or any plan or practice of the Company or its
subsidiaries.
(d) Disability. As used in this Agreement, the term "Disability"
----------
means an accident or physical or mental illness which prevents Employee from
substantially performing the duties and responsibilities attached to her
position described in paragraph 2(c)(i) above on the Effective Date for six
consecutive calendar months. Employee shall not be considered under a
Disability for purposes of this Agreement until the close of business on the
last day of such six months' period. If the amount of any Salary or other
compensation payable to Employee during such six month period is reduced by any
payments which Employee receives for the same period because of disability under
any disability or pension plan of the Company or any subsidiary of the Company,
such reduction shall not be considered a failure to pay Employee the amount of
salary so reduced for purposes of paragraph 2(c)(iii) above.
(e) Notice of Termination. Any termination by the Company for Cause
---------------------
or Disability as defined in paragraphs 2(b) and (d) above or by Employee for
Constructive Discharge as defined in paragraph 2(c) above shall be communicated
by
-11-
<PAGE>
written Notice of Termination from the Company or the Employee (as the case
may be) to the other party. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of
Employee's employment under the provision so indicated. If any dispute
concerning termination of Employee's employment under paragraphs (b), (c) or (d)
above results in a final determination that a proper basis for such termination
did not exist, Employee's employment hereunder shall be treated as having been
terminated other than pursuant to paragraph (b), (c) or (d), as the case may be,
by the party who gave Notice of Termination.
3. Successors; Binding Agreement:
------------------------------
(a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, including
without limitation any entity formed or availed of to hold the interests of the
public shareholders 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. Failure of the
Company to obtain such agreement prior to the effectiveness of any such
succession shall entitle Employee to compensation under section 1 above, in the
same amount and on the same terms as she would be entitled to hereunder if her
employment were terminated by the Company other than for Disability or Cause and
the Administrator were to determine that such termination was not primarily
related to Employee's performance or the ordinary course of business, except
that for purposes of implementing the foregoing, the
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<PAGE>
date on which any such succession becomes effective shall be deemed the date of
termination.
(b) As used in this Agreement, the "Company" shall mean the Company as
herein before defined and any successor to its business and/or assets as
aforesaid which executes and delivers an agreement provided for in paragraph
3(a) above or which otherwise becomes bound by all the terms and provisions of
this Agreement by operation of law.
(c) This Agreement and all rights of Employee hereunder shall inure to
the benefit of and be enforceable by Employee's personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devisees and legatees. If Employee should die while any amounts are due and
payable to her hereunder, all such amounts, unless otherwise provided herein,
shall be paid to Employee's designated beneficiary or, if there be no such
designated beneficiary, whether because none was designated or because none is
alive or in existence at the time any amount becomes payable hereunder, to the
legal representatives of Employee's estate.
(d) Except as to withholding of any tax under the laws of the United
States or any other country, state or locality, neither this Agreement nor any
right or interest hereunder nor any amount payable at any time hereunder shall
be subject in any manner to alienation, sale, transfer, assignment, pledge,
attachment, or other legal process, or encumbrance of any kind by Employee or
the beneficiaries of Employee or by her legal representatives without the
Company's prior written consent, nor shall there be any right of set-off or
counterclaim in respect of any debts or liabilities of Employee, her
beneficiaries or legal representatives; provided, however, that nothing in this
paragraph shall preclude Employee from designating a
-13-
<PAGE>
beneficiary to receive any benefit payable on her death, or the legal
representatives of Employee from assigning any rights hereunder to the person or
persons entitled thereto under her will or, in case of intestacy, to the person
or persons entitled thereto under the laws of intestacy applicable to her
estate.
4. Agreement Binding.
-----------------
This Agreement shall be binding upon and shall inure to the benefit of
Employee,her heirs and legal representatives, and the Company, its successors
and assigns and any person, firm, corporation or other entity which succeeds to
all or substantially all of the business, assets or property of the Company, as
provided in section 3 hereof.
5. General Provisions.
------------------
(a) This Agreement contains the entire understanding of the parties
with respect to the subject matter hereof and cancels and supersedes any and all
other agreements between the parties with respect to the subject matter hereof.
However, this Agreement is not intended to diminish, compromise or otherwise
affect adversely any rights Employee may have in respect of termination of
employment (other than rights to severance pay in the circumstances covered by
section 1 above) under any plan or arrangement other than this Agreement.
(b) Any modification of this Agreement shall not be binding unless in
writing and signed by the Company and Employee.
(c) No provision of this Agreement shall impair or diminish any rights
which the Company may have to terminate Employee's employment with or without
Cause, subject to the
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<PAGE>
consequences of such termination set forth in this Agreement. No provision of
this Agreement shall be construed to create any right on the part of the
Employee to continue in the employ of the Company for any period of time or at
any particular rate of compensation.
(d) In no event shall Employee be entitled to any payments under this
Agreement unless and until the Company terminates Employee's employment other
than for Cause or Disability during the Term, or Constructively Discharges
Employee during the Term, and the Administrator determines that such termination
of employment or Constructive Discharge (as the case may be) is or was not
primarily related to Employee's performance or the ordinary course of business.
(e) This Agreement is being executed in two or more counterparts, each
of which shall be considered an original.
6. Enforceability.
--------------
In the event that any provision of this Agreement is determined to be
invalid or unenforceable, the remaining terms and conditions of this Agreement
shall be unaffected and shall remain in full force and effect, and any such
determination of invalidity or unenforceability shall not affect the validity or
enforceability of any other provision of this Agreement.
7. Notices.
-------
All notices which may be necessary or proper for either the Company or
Employee to give to the other shall be in writing and shall be delivered by hand
or sent by registered or certified mail, return receipt requested, or by air
courier, to Employee at:
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<PAGE>
Sherry A. Umberfield
104 Pembroke Street
Boston, MA 02118
and shall be sent in the manner described above to the Company, c/o the General
Partner, at 399 Boylston Street, 10th Floor, Boston, MA 02116, Attention:
Secretary, or delivered by hand to the Secretary of the General Partner, and
shall be deemed given when sent, provided that any Notice of Termination or
notice given pursuant to section 2 hereof shall be deemed given only when
received. Any party may by like notice to the other party change the address at
which she or they are able to receive notices hereunder.
8. Arbitration.
-----------
Any controversy or claim arising out of, or related to, this
Agreement, or the breach thereof, shall be settled by binding arbitration in the
City of Boston, in accordance with the rules then obtaining of the American
Arbitration Association, and the arbitrator's decision shall be binding and
final, and judgment upon the award rendered may be entered in any court having
jurisdiction thereof.
9. Governing Law.
-------------
The Agreement is executed in the Commonwealth of Massachusetts and
shall be governed by and enforceable in accordance with the laws thereof without
giving effect to the principles of conflict of laws thereof.
10. Legal Fees and Expenses.
-----------------------
To provide Employee with reasonable assurance that the purposes of
this Agreement will not be frustrated by the cost of its enforcement should the
Company fail to perform its obligations under this Agreement or should the
Company
-16-
<PAGE>
or any subsidiary, affiliate or shareholder of the Company contest the
validity or enforceability of this Agreement, the Company shall pay and be
solely responsible for any attorney's fees and expenses, including arbitration
costs and court costs, incurred by Employee as a result of the Company's failure
to perform this Agreement or any provision hereof to be performed by the Company
or as a result of the Company or any subsidiary, affiliate or shareholder of the
Company contesting the validity or enforceability of this Agreement or any
provision hereof to be performed by the Company.
-17-
<PAGE>
IN WITNESS WHEREOF, the Limited Partnership and the General Partner
have caused this Agreement to be signed by their proper representatives and
Employee has hereunto set her hand as of the date first above written.
NEW ENGLAND INVESTMENT COMPANIES, L.P.
By New England Investment Companies, Inc.
as General Partner
[Seal]
By Robert A. Shafto
----------------
Attest: Chairman, Compensation Committee of the Board
New England Investment Companies, Inc.
Edward N. Wadsworth
- -------------------
Secretary
NEW ENGLAND INVESTMENT COMPANIES, INC.
[Seal]
Attest: By Robert A. Shafto
----------------
Chairman, Compensation Committee of the Board
Edward N. Wadsworth
- -------------------
Secretary
EMPLOYEE
Sherry A. Umberfield
--------------------
Sherry A. Umberfield
-18-
<PAGE>
EXHIBIT 10(iv)
AGREEMENT AMONG
NEW ENGLAND INVESTMENT COMPANIES, L.P.,
NEW ENGLAND INVESTMENT COMPANIES, INC.
AND EDWARD N. WADSWORTH
-----------------------
THIS AGREEMENT made as of the sixteenth day of August, 1995
(hereinafter referred to as the "Effective Date"), by and among New England
Investment Companies, L.P., a Delaware limited partnership (hereinafter referred
to as the "Limited Partnership"), New England Investment Companies, Inc., a
Massachusetts corporation which is the general partner of the Limited
Partnership (hereinafter referred to as the "General Partner"), parties of the
first part, and Edward N. Wadsworth (hereinafter referred to as "Employee"),
party of the second part.
WITNESSETH:
-----------
WHEREAS:
A. Employee is currently employed by the Limited Partnership and
the General Partner as an Executive Vice President; and
B. The Limited Partnership and the General Partner wish to provide
an inducement for Employee to remain in their employ so that they will have the
continued benefit of his ability, experience and services;
NOW, THEREFORE, in consideration of good and valuable consideration
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby covenant and agree as follows:
-1-
<PAGE>
1. Compensation on Termination
---------------------------
As used in this Agreement, the term "Company" means and includes the
Limited Partnership and the General Partner, or either of them. If the Company
terminates Employee's employment other than for Cause or Disability (as defined
in paragraphs 2(b) and 2(d) below) before the third anniversary of the Effective
Date (such three year period being hereinafter referred to as the "Term"), or
the Company Constructively Discharges Employee (as that Term is defined in
paragraph 2(c) below) during the Term, and the Administrator (as defined in
paragraph 2(a) below) determines in the good faith exercise of his sole
discretion that such termination of employment or Constructive Discharge (as the
case may be) is or was not primarily related to Employee's performance or the
ordinary course of business, then the Company shall pay Employee the following
amounts and provide him with the following benefits as severance compensation.
Employee shall not be required to mitigate the amount of any payment or benefit
provided for in this section 1 by seeking other employment or otherwise, nor
shall any compensation earned by Employee in other employment or otherwise
reduce the amount of any payment or benefit provided for in this section 1.
(a) The Company shall pay Employee his salary (as defined in
paragraph 2(c)(iii) below) prorated through the date of termination;
(b) The Company shall pay Employee any accrued but unpaid bonus award
for Employee's services in the calendar year preceding the date of termination,
and a prorated bonus award for the calendar year in which the date of
termination occurs, such prorated bonus award to be determined by multiplying
the "Bonus Amount" as defined in paragraph 1(d) below by a fraction the
numerator of which is the number of
-2-
<PAGE>
days in the calendar year of termination that precede the date of termination
and the denominator of which is the number 365;
(c) The Company shall pay Employee a lump sum amount, on or before
the tenth day after the date of termination, equal to one and one-half (1 1/2)
times his salary ( as defined in paragraph 2(c)(iii) below, based on the highest
rate in effect during the Term);
(d) The Company shall pay Employee a lump sum amount, on or before the
tenth day after the date of termination, equal to one and one-half (1 1/2) times
the "Bonus Amount" as hereafter defined. For purposes of this section 1, the
"Bonus Amount" shall mean Employee's Salary (as defined in paragraph 2(c)(iii)
below, based on the highest rate in effect during the Term), multiplied by the
greater of (i) and (ii) where (i) is 40% and (ii) is the percentage of his
Salary (as defined in paragraph 2(c)(iii) below) which Employee was given the
opportunity to earn as an annual bonus for services in the calendar year in
which the date of termination occurs if the Company attains the target bonus
performance objective designated by the Board (or a committee thereof) for such
calendar year;
(e) The Company shall pay or provide Employee, his dependents and
beneficiaries with the payments, coverages, benefits and age, pay and service
credit for benefits described in clauses (A) and (B) of paragraph 2(c)(viii)
below for one and one-half years after the date of termination (with the
compensation described in paragraphs 1(c) and (d) above being considered paid to
him, for purposes of this paragraph 1(e), ratably over such one and one-half
year period); provided, however, that if and to the extent the Company
determines that such payments, coverages, benefits and age, pay and service
credit for benefits cannot
-3-
<PAGE>
be paid or provided under the plans in question due to Internal Revenue Code or
other restrictions, the Company shall provide tax-equivalent payments,
coverages, benefits and age, pay and service credit for benefits through other
means reasonably satisfactory to Employee, and, provided further, that if
Employee obtains full time employment within one and one-half years after his
date of termination, any payments under welfare benefit plans to be provided
under this paragraph shall be reduced to the extent Employee receives payments
under comparable plans of the successor employer;
(f) Employee's benefits accrued through the date of termination, and
any benefits accrued pursuant to the provisions of paragraph 1(e) above, under
any and all qualified or non-qualified defined benefit pension plans or defined
contribution pension, profit sharing or stock bonus plans shall become
immediately vested and non-forfeitable on the date of termination; if and to the
extent the Company determines that such vesting cannot be accomplished under the
plan in question due to Internal Revenue Code or other restrictions, the Company
shall provide tax equivalent benefits to Employee through other means reasonably
satisfactory to Employee; and
(g) If any payment (within the meaning of Section 280G(b)(2) of the
Internal Revenue Code of 1986 as amended) or distribution by or on behalf of the
Company to or for the Benefit of Employee pursuant to the terms of this
Agreement, either alone or in conjunction with any other payment or distribution
to or for the Benefit of Employee ( a "Payment"), including any payment pursuant
to this paragraph, is subject to the excise tax imposed by section 4999 of the
Internal Revenue Code of 1986 as amended, or any interest or penalties are
incurred by Employee with respect to such excise tax (such excise tax, together
with any such
-4-
<PAGE>
interest or penalties, being hereinafter collectively referred to as the "Excise
Tax"), then Employee shall be entitled to receive on demand an additional
payment from the Company under this Agreement (a "Tax Payment") in an amount
such that after payment by Employee of all taxes (including any interest and
penalties imposed with respect to such taxes), including but not limited to any
Excise Tax, imposed upon the Tax Payment, Employee retains an amount of the Tax
Payment equal to the Excise Tax imposed upon the Payment.
2. Certain Definitions
-------------------
(a) Administrator. As used in section 1 of this Agreement, the term
-------------
"Administrator" means Peter S. Voss or, if Peter S. Voss should at any time be
unable or unwilling to serve in that capacity, such other person or entity
(whether affiliated with the Company or not) as Peter S. Voss may designate in
writing as the person or entity who or which should act in his place and stead
to determine whether any termination of employment or Constructive Discharge of
Employee during the Term is or was not primarily related to Employee's
performance or the ordinary course of business with the meaning of section 1 of
this Agreement. If such person or entity is not an officer, director or employee
of the Company, such person or entity's reasonable fees and expenses for serving
in the capacity of Administrator shall be borne by the Company. The
Administrator's determination shall be final, binding and conclusive on the
Company, the Employee and all persons claiming under or through any of them. The
Company hereby agrees to indemnify and hold harmless any person or entity
serving as the Administrator against any claims, losses, judgments, and causes
of action arising out of or relating to such person's or entity's service as
Administrator under this Agreement.
-5-
<PAGE>
(b) Cause. For purposes of this Agreement,
-----
Employee shall be considered to be terminated for "Cause" only
(i) if Employee is convicted of a felony under the laws of the
United States or any state thereof;
(ii) if employee engages in willful malfeasance having a
material adverse effect on the Company; or
(iii) if Employee willfully and repeatably fails to
substantially perform the duties and responsibilities attached to his position
on the Effective Date, except by reason of total or partial incapacity due to
accident or physical or mental illness.
However, in no event (other than clause 2(b)(i) above)shall Employee be
considered to be terminated for "Cause" unless and until the following
conditions are satisfied:
(A) Employee is given reasonable notice and a reasonable opportunity
to be heard at a meeting of the Board of Directors of the Company called for the
purpose of determining whether "Cause" exists for termination of Employee's
employment;
(B) A resolution is duly adopted at such meeting by the affirmative
vote of not less than two-thirds of the entire membership of the Board directing
the Secretary of the Company to give Employee written notice (the "Warning
Notice") of the Board's determination to terminate Employee's employment for
"Cause" if the acts or omissions specified in the Warning Notice are not
discontinued, and the Secretary of the Company gives Employee such written
notice; and
-6-
<PAGE>
(C) Employee does not discontinue the acts or omissions in question
within 30 days of his receipt of the Warning Notice;
Anything in this paragraph 2(b) to the contrary notwithstanding, the employment
of Employee shall in no event be considered to be terminated by the Company for
Cause if termination of his employment takes place (I) as the result of bad
judgment or negligence on the part of Employee other than willful or reckless
misconduct, (II) for any act or omission in respect of which a determination
could properly be made that Employee met the applicable standard of conduct
prescribed for indemnification or reimbursement or payment of expenses of an
officer or director under the Bylaws or Limited Partnership Agreement of the
Company or the laws of Delaware or Massachusetts or the directors' and officers'
liability insurance of the Company, in each case as in effect at the time of
such act or omission, (III) as the result of an act or omission which occurred
more than twelve calendar months prior to Employee's having been given Notice of
Termination for such act or omission unless the commission of such act or
omission was not at the time of such commission or omission known to a member of
the Board, in which case more than twelve calendar months from the date the
commission of such act or omission was so known, (IV) as the result of a
continuing course of action which commenced and was known to a member of the
Board more than twelve calendar months prior to Notice of Termination having
been given to Employee, or (V) because of an act or omission reasonably believed
by Employee in good faith to have been in or not opposed to the interests of the
Company.
(c) Constructive Discharge. For purposes of this Agreement, the
Company shall be considered to
-7-
<PAGE>
"Constructively Discharge" Employee if any act or omission that is identified
below in this paragraph 2(c) occurs other than (x) in connection with
termination of Employee's employment for Cause or Disability as defined in this
Agreement, or (y) with Employee's written consent; provided that in no event
shall the Company be considered to "Constructively Discharge" Employee unless
and until (I) Employee gives the Board written notice describing the act or
omission in reasonable detail within 60 days after the Employee first knows (or
should have known) of the act or omission, (II) the act or omission is not cured
within 45 days after the Board receives such written notice, and (III) Employee
terminates his employment on 10 days' advance written notice to the Company
given within 90 days after the close of such 45 day cure period:
(i) Any (A) failure to re-designate Employee as, or (B) removal of
Employee from, or failure to re-elect Employee to, the position of, Executive
Vice President and General Counsel of the Company;
(ii) Any material limitation or expansion of the duties, functions,
authority or responsibilities attached to Employee's position on the Effective
Date;
(iii) Any failure by the Company to pay Employee a salary at an annual
rate equal to at least $212,500 plus such increases (if any) as may be approved
by the Board from time to time, in substantially equal installments at monthly
or more frequent intervals in accordance with the normal payroll practices of
the Company, or to review Employee's salary rate at least annually following the
date of this Agreement to ascertain whether, in the sole, good faith judgment of
the Board, such rate should be increased in light of Employee's performance,
competitive pay levels or such other factors (if any) as the Board may deem
relevant
-8-
<PAGE>
(Employee's annual base salary at the rate specified above and including any
increases being referred to in this Agreement as his "Salary");
(iv) Any removal of Employee's office from the Company's principal
executive offices or to a location that (A) is more than 35 miles from its
present location, and (B) increases Employee's commuting distance from his
residence; or
(v) Any objectively demonstrable, substantial increase in the business
travel required of Employee above present levels unless the additional travel is
both appropriate for Employee's position described above and substantially
related to the business and affairs of the Company or its direct or indirect
subsidiaries (any direct or indirect subsidiary of the Company, including
partnerships, limited liability companies, business trusts and other entities as
well as corporations, being hereinafter referred to as a "subsidiary"); or
(vi) Any objectively demonstrable failure by the Company to provide
Employee with the opportunity to earn an annual bonus for each calendar year
that coincides in whole or in part with the Term, equal to at least 40% of his
Salary for such year if the Company attains the target bonus performance
objective designated by the Board (or a committee thereof) for such calendar
year, and equal to at least 80% of his Salary for such year if the Company
attains the maximum bonus performance objective designated by the Board (or a
committee thereof) for such calendar year, or to provide Employee with the
opportunity to earn such a bonus based on performance objectives not
substantially more difficult to attain than those applicable to Employee's
target and maximum bonus opportunities for 1994;
-9-
<PAGE>
(vii) Any objectively demonstrable failure by the Company to select
Employee to participate in any other compensation or incentive plan of a long or
short term nature in which other senior executives of the Company having
responsibilities comparable to Employee's then generally participate, or to
provide Employee with a compensation opportunity under any such plan that is as
favorable as the compensation opportunity provided to any other participating
executive having responsibilities comparable to Employee's;
(viii) Any substantial, objectively demonstrable failure by the
Company to provide Employee, his dependents and beneficiaries, including without
limitation any beneficiary of a joint and survivor or other optional method of
payment applicable to the payment of benefits under the Company's tax-qualified
retirement plans, with (A) all payments, coverages, benefits and age, pay and
service credit for benefits as a result of employment to which other senior
officers of the Company, their dependents and beneficiaries are then entitled
under the employee benefit plans and practices of the Company and its
subsidiaries, including without limitation any qualified or non-qualified
pension, profit sharing and savings plans, death benefit plans (including split
dollar life insurance plans and group life insurance plans providing group term
life insurance, accidental death and dismemberment insurance, and travel
accident insurance), sickness and disability benefit plans, vacation pay plans,
and medical, dental, health and welfare plans, or (B) payments, coverages,
benefits and age, pay and service credit for benefits under employee benefit
plans substantially equivalent to those attached to his position on the
Effective Date, or, in the event of any amendment or other change in any
employee benefit plan or practice that would substantially reduce such payments,
coverages, benefits or age, pay or service credit for benefits from
-10-
<PAGE>
their present levels, with tax-equivalent payments, coverages, benefits and age,
pay and service credit for benefits under other arrangements reasonably
satisfactory to Employee; or
(ix) Any failure by the Company to obtain the assumption of, and the
agreement to perform, this Agreement, by any successor as contemplated by
paragraph 3(a) below.
A Constructive Discharge in accordance with the provisions of this paragraph
2(c) shall not be deemed a voluntary termination of employment by Employee for
the purpose of this Agreement or any plan or practice of the Company or its
subsidiaries.
(d) Disability. As used in this Agreement, the term "Disability"
----------
means an accident or physical or mental illness which prevents Employee from
substantially performing the duties and responsibilities attached to his
position described in paragraph 2(c)(i) above on the Effective Date for six
consecutive calendar months. Employee shall not be considered under a
Disability for purposes of this Agreement until the close of business on the
last day of such six months' period. If the amount of any Salary or other
compensation payable to Employee during such six month period is reduced by any
payments which Employee receives for the same period because of disability under
any disability or pension plan of the Company or any subsidiary of the Company,
such reduction shall not be considered a failure to pay Employee the amount of
salary so reduced for purposes of paragraph 2(c)(iii) above.
(e) Notice of Termination. Any termination by the Company for Cause
---------------------
or Disability as defined in paragraphs 2(b) and (d) above or by Employee for
Constructive Discharge as defined in paragraph 2(c) above shall be communicated
by
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<PAGE>
written Notice of Termination from the Company or the Employee (as the case
may be) to the other party. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of
Employee's employment under the provision so indicated. If any dispute
concerning termination of Employee's employment under paragraphs (b), (c) or (d)
above results in a final determination that a proper basis for such termination
did not exist, Employee's employment hereunder shall be treated as having been
terminated other than pursuant to paragraph (b), (c) or (d), as the case may be,
by the party who gave Notice of Termination.
3. Successors; Binding Agreement:
------------------------------
(a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, including
without limitation any entity formed or availed of to hold the interests of the
public shareholders 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. Failure of the
Company to obtain such agreement prior to the effectiveness of any such
succession shall entitle Employee to compensation under section 1 above, in the
same amount and on the same terms as she would be entitled to hereunder if his
employment were terminated by the Company other than for Disability or Cause and
the Administrator were to determine that such termination was not primarily
related to Employee's performance or the ordinary course of business, except
that for purposes of implementing the foregoing, the
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<PAGE>
date on which any such succession becomes effective shall be deemed the date of
termination.
(b) As used in this Agreement, the "Company" shall mean the Company as
herein before defined and any successor to its business and/or assets as
aforesaid which executes and delivers an agreement provided for in paragraph
3(a) above or which otherwise becomes bound by all the terms and provisions of
this Agreement by operation of law.
(c) This Agreement and all rights of Employee hereunder shall inure to
the benefit of and be enforceable by Employee's personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devisees and legatees. If Employee should die while any amounts are due and
payable to his hereunder, all such amounts, unless otherwise provided herein,
shall be paid to Employee's designated beneficiary or, if there be no such
designated beneficiary, whether because none was designated or because none is
alive or in existence at the time any amount becomes payable hereunder, to the
legal representatives of Employee's estate.
(d) Except as to withholding of any tax under the laws of the United
States or any other country, state or locality, neither this Agreement nor any
right or interest hereunder nor any amount payable at any time hereunder shall
be subject in any manner to alienation, sale, transfer, assignment, pledge,
attachment, or other legal process, or encumbrance of any kind by Employee or
the beneficiaries of Employee or by his legal representatives without the
Company's prior written consent, nor shall there be any right of set-off or
counterclaim in respect of any debts or liabilities of Employee, his
beneficiaries or legal representatives; provided, however, that nothing in this
paragraph shall preclude Employee from designating a
-13-
<PAGE>
beneficiary to receive any benefit payable on his death, or the legal
representatives of Employee from assigning any rights hereunder to the person or
persons entitled thereto under his will or, in case of intestacy, to the person
or persons entitled thereto under the laws of intestacy applicable to his
estate.
4. Agreement Binding.
-----------------
This Agreement shall be binding upon and shall inure to the benefit of
Employee,his heirs and legal representatives, and the Company, its successors
and assigns and any person, firm, corporation or other entity which succeeds to
all or substantially all of the business, assets or property of the Company, as
provided in section 3 hereof.
5. General Provisions.
------------------
(a) This Agreement contains the entire understanding of the parties
with respect to the subject matter hereof and cancels and supersedes any and all
other agreements between the parties with respect to the subject matter hereof.
However, this Agreement is not intended to diminish, compromise or otherwise
affect adversely any rights Employee may have in respect of termination of
employment (other than rights to severance pay in the circumstances covered by
section 1 above) under any plan or arrangement other than this Agreement.
(b) Any modification of this Agreement shall not be binding unless in
writing and signed by the Company and Employee.
(c) No provision of this Agreement shall impair or diminish any rights
which the Company may have to terminate Employee's employment with or without
Cause, subject to the
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<PAGE>
consequences of such termination set forth in this Agreement. No provision of
this Agreement shall be construed to create any right on the part of the
Employee to continue in the employ of the Company for any period of time or at
any particular rate of compensation.
(d) In no event shall Employee be entitled to any payments under this
Agreement unless and until the Company terminates Employee's employment other
than for Cause or Disability during the Term, or Constructively Discharges
Employee during the Term, and the Administrator determines that such termination
of employment or Constructive Discharge (as the case may be) is or was not
primarily related to Employee's performance or the ordinary course of business.
(e) This Agreement is being executed in two or more counterparts, each
of which shall be considered an original.
6. Enforceability.
--------------
In the event that any provision of this Agreement is determined to be
invalid or unenforceable, the remaining terms and conditions of this Agreement
shall be unaffected and shall remain in full force and effect, and any such
determination of invalidity or unenforceability shall not affect the validity or
enforceability of any other provision of this Agreement.
7. Notices.
-------
All notices which may be necessary or proper for either the Company or
Employee to give to the other shall be in writing and shall be delivered by hand
or sent by registered or certified mail, return receipt requested, or by air
courier, to Employee at:
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<PAGE>
Edward N. Wadsworth
44 Fayette Street
Boston, MA 02116
and shall be sent in the manner described above to the Company, c/o the General
Partner, at 399 Boylston Street, 10th Floor, Boston, MA 02116, Attention:
Secretary, or delivered by hand to the Secretary of the General Partner, and
shall be deemed given when sent, provided that any Notice of Termination or
notice given pursuant to section 2 hereof shall be deemed given only when
received. Any party may by like notice to the other party change the address at
which she or they are able to receive notices hereunder.
8. Arbitration.
-----------
Any controversy or claim arising out of, or related to, this
Agreement, or the breach thereof, shall be settled by binding arbitration in the
City of Boston, in accordance with the rules then obtaining of the American
Arbitration Association, and the arbitrator's decision shall be binding and
final, and judgment upon the award rendered may be entered in any court having
jurisdiction thereof.
9. Governing Law.
-------------
The Agreement is executed in the Commonwealth of Massachusetts and
shall be governed by and enforceable in accordance with the laws thereof without
giving effect to the principles of conflict of laws thereof.
10. Legal Fees and Expenses.
-----------------------
To provide Employee with reasonable assurance that the purposes of
this Agreement will not be frustrated by the
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<PAGE>
cost of its enforcement should the Company fail to perform its obligations under
this Agreement or should the Company or any subsidiary, affiliate or shareholder
of the Company contest the validity or enforceability of this Agreement, the
Company shall pay and be solely responsible for any attorney's fees and
expenses, including arbitration costs and court costs, incurred by Employee as a
result of the Company's failure to perform this Agreement or any provision
hereof to be performed by the Company or as a result of the Company or any
subsidiary, affiliate or shareholder of the Company contesting the validity or
enforceability of this Agreement or any provision hereof to be performed by the
Company.
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<PAGE>
IN WITNESS WHEREOF, the Limited Partnership and the General Partner
have caused this Agreement to be signed by their proper representatives and
Employee has hereunto set his hand as of the date first above written.
NEW ENGLAND INVESTMENT COMPANIES, L.P.
By New England Investment Companies, Inc.
as General Partner
[Seal]
By Robert A. Shafto
----------------
Attest: Chairman, Compensation Committee of the Board
New England Investment Companies, Inc.
Edward N. Wadsworth
- -------------------
Secretary
NEW ENGLAND INVESTMENT COMPANIES, INC.
[Seal]
Attest: By Robert A. Shafto
----------------
Chairman, Compensation Committee of the Board
Edward N. Wadsworth
Secretary
EMPLOYEE
Edward N. Wadsworth
-------------------
Edward N. Wadsworth
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