EMPLOYMENT
AGREEMENT
This Restated Employment Agreement is entered
into as of the 23rd day of September, 2009 (the “Effective
Date”) by and between NYMAGIC, INC., a New York corporation
(together with its successors and assigns, the
“Company”), and Glenn R. Yanoff (the
“Executive”).
WHEREAS, the Company and the Executive entered
into an employment agreement dated April 7, 2008, effective
May 1, 2008 (the “Employment Agreement”) and an
award agreement under the Company’s Amended and Restated 2004
Long-Term Incentive Plan dated April 7, 2008 (the “Award
Agreement”);
WHEREAS, the Company and the Executive desire to
amend and restate the Employment Agreement and to terminate the
Award Agreement as provided for herein.
NOW, THEREFORE, in consideration of the premises
and mutual covenants contained herein and for other good and
valuable consideration, the receipt of which is mutually
acknowledged, the Company and the Executive (individually a
“Party” and together the “Parties”) agree
as follows:
The Employment Agreement and the Award Agreement
are hereby novated and are of no further force and effect, and
neither the Company nor the Executive shall have any obligation to
the other thereunder.
The term of the Executive’s employment
under this Agreement shall commence on the Effective Date and end
on April 30, 2013 (the “Term of Employment”),
unless terminated earlier in accordance herewith. Thereafter, this
Agreement may be extended with the consent of the Company and the
Executive.
3. Position,
Duties and Responsibilities .
(a) Generally . The Executive shall
serve as President of MMO Agencies, an operating division of the
Company, and for so long as he is an employee of the Company the
Executive agrees to serve as a member of the board of directors of
such subsidiaries of the Company as the Company shall request. The
Executive shall perform such duties and responsibilities as are
assigned to him from time to time by the Company’s President
and Chief
Executive
Officer, to whom he shall report, it being understood and agreed
that the Executive’s primary role will be to continue to
develop MMO Agencies as an underwriting department of the Company
dedicated to producing business through the appointment of agents
to represent the Company, with such agents having the authority to
bind, and issue insurance on behalf of, the Company. In furtherance
of such role, the Executive shall devote substantially all of his
business time and attention (except for periods of vacation or
absence due to illness), and his best efforts, abilities,
experience, and talent to the position of President of MMO
Agencies. In the event of termination of the Executive’s
employment under this Agreement, the Executive’s membership
on any of the boards of directors of any of the Company’s
subsidiaries and any committees thereof shall also be terminated
effective on the date of termination of the Executive’s
employment.
(b) Place of Employment . The
Executive’s principal place of employment shall be Delray
Beach, Florida.
(c) In addition to his position as
President of MMO Agencies, the Executive shall maintain his
position as Executive Vice President of the Company.
The Executive shall be paid an annualized
salary, payable in accordance with the regular payroll practices of
the Company, of not less than $400,000 per year (“Base
Salary”), which shall be guaranteed through April 30,
2013. The Company further acknowledges that the Executive is
accepting this position in reliance upon the Company guaranteeing
the aforesaid Base Salary.
5. Annual
Incentive Awards .
(a) The Executive shall participate in the
Company’s annual incentive compensation plan with a bonus
range in the amount of $0 to $300,000, and a target of
$200,000.
(b) Notwithstanding the provisions of
Section 5(a), the Executive shall be guaranteed an Annual
Incentive Award $100,000 payable in March 2010 in respect of
2009; and, Annual Incentive Awards of $75,000 in each of March,
2011 , March, 2012 and March 2013 payable in respect of 2010 ,
2011 and 2012, respectively.
6. Employee
Benefit Programs .
(a) General Benefits . During the
Term of Employment the Executive shall be entitled to participate
in such employee benefit plans and programs of the Company as are
made available to the Company’s senior level executives or to
its employees generally, as such plans or programs may be in effect
from time to time, including, without limitation, health, medical,
dental, long-term disability, profit sharing and travel accident
and life insurance plans.
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7.
Reimbursement of Business and Other Expenses: Perquisites
.
(a) The Executive is authorized to incur
reasonable expenses in carrying out his duties and responsibilities
under this Agreement, and the Company shall promptly reimburse him
on a monthly basis for all such business expenses incurred in
connection therewith in the prior month, subject to documentation
in accordance with the Company’s policy.
8.
Termination of Employment .
(a) Termination Due to Death or
Disability . The Term of Employment shall be terminated
immediately upon the death or disability (as such term is defined
under the Company’s Long-Term Disability Plan) of the
Executive. In the event the Executive’s employment with the
Company is terminated due to his death or disability, the
Executive, his estate or his beneficiaries, as the case may be,
shall be entitled to and their sole remedies under this Agreement
shall be:
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(i)
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Base Salary through the date of
death or the commencement date of his eligibility for the
Company’s long-term disability benefits (the
“Commencement Date”) as the case may be, which shall be
paid in a single lump sum 15 days following the
Executive’s death or the Commencement Date, as the case may
be;
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(ii)
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pro
rata guaranteed Annual Incentive Award for the year in which the
Executive’s death, or the Commencement Date, as the case may
be, occurs, which shall be payable in a lump sum 30 days after
his death or on the first day following the six-month anniversary
of the Executive’s termination of employment by reason of
disability;
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(iii)
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elimination of all restrictions on
any Restricted Share Unit Grants outstanding at the time of his
death, or the Commencement Date, as the case may be;
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(iv)
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immediate vesting of all outstanding
stock options and the right to exercise such stock options as is
provided in any stock option award agreement to which the Executive
is a party;
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(v)
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immediate vesting of all outstanding
Performance Compensation Awards for which target performance has
been achieved through the date of death or the Commencement Date,
as the case may be, payable in a lump sum in cash or stock
30 days after his death or on the first day following the
six-month anniversary of the Executive’s termination of
employment by reason of disability, as the case may be;
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(vi)
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the
balance of any Annual Incentive Awards earned as of
December 31 of the prior year (but not yet paid), which shall
be paid in a single lump sum and in accordance with the terms of
such awards;
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(vii)
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settlement of all deferred
compensation arrangements in accordance with the Executive’s
duly executed Deferral Election Forms; and
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(viii)
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other or additional benefits then
due or earned, payable in accordance with applicable plans and
programs of the Company.
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(b)
Termination by the Company for Cause .
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(i)
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The
Term of Employment may be terminated by the Company for Cause.
“Cause” shall mean:
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(A)
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The
Executive’s willful and material breach of Sections 9,
10 or 11;
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(B)
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The
Executive is convicted of a felony or pleads guilty or nolo
contendre to an offense that is a felony in the jurisdiction where
committed;
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(C)
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The
Executive engages in conduct that constitutes willful gross neglect
or willful gross misconduct in carrying out his duties under this
Agreement, resulting, in either case, in material harm to the
financial condition or reputation of the Company;
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(D)
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The
Executive’s failure to cooperate, if requested by the
Company’s Board of Directors (the “Board”), with
any investigation or inquiry into his or the Company’s
business practices, whether internal or external, including, but
not limited to the Executive’s refusal to be deposed or to
provide testimony at any trial or inquiry;
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(E)
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The
Executive’s substantial and continued refusal to perform his
duties; and,
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(F)
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The
Executive’s violation of a material Company
Policy.
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For purposes of
this Agreement, an act or failure to act on the Executive’s
part shall be considered “willful” if it was done or
omitted to be done by him not in good faith, and shall not include
any act or failure to act resulting from any incapacity of the
Executive.
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(ii)
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A
termination for Cause shall not take effect unless the provisions
of this subsection (ii) are complied with. The Executive shall
be given written notice by the Company of its intention to
terminate him for Cause, such notice (A) to state in detail
the particular act or acts or failure or failures to act that
constitute the grounds on which the proposed termination for Cause
is based and (B) to be given within thirty (30) days of
the Company’s learning of such act or acts or failure or
failures to act. The Executive shall have 20 days after the
date that such written notice has been given to him in which to
cure such conduct, to the extent such cure is possible. If he fails
to cure such conduct, the Executive shall then be entitled to a
hearing before the Board at which the Executive is entitled to
appear. Such hearing shall be held within 25 days of such
notice to the Executive, provided he requests such hearing within
10 days of the written notice from the Company of the
intention to terminate him for Cause. If, within five days
following such hearing, the Executive is furnished written notice
by the Board confirming that, in its judgment, grounds for Cause on
the basis of the original notice exist, he shall thereupon be
terminated for Cause.
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(iii)
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In
the event the Company terminates the Executive’s employment
for Cause, he shall be entitled to and his sole remedies under this
Agreement shall be:
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(A)
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Base Salary through the date of the
termination of his employment for Cause, which shall be paid in a
single lump sum 15 days following the Executive’s
termination of employment;
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(B)
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any
Annual Incentive Awards earned as of December 31 of the prior
year (but not yet paid), which shall be paid in a single lump and
in accordance with the terms of such awards; and
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(C)
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other or additional benefits then
due or earned, payable in accordance with applicable plans or
programs of the Company.
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(c) Termination Without Cause . In
the event the Executive’s employment with the Company is
terminated without Cause (which termination shall be effective as
of the date specified by the Company in a written notice to the
Executive), other than due to death or
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disability, the
Executive shall be entitled to and his sole remedies under this
Agreement shall be:
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(i)
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Base Salary through the date of
termination of the Executive’s employment, which shall be
paid in a single lump sum 15 days following the Executive’s
termination of employment;
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(ii)
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Unpaid Base Salary and Annual
Incentive Awards guaranteed in accordance with Sections 4 and
5, respectively;
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(iii)
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elimination of all restrictions on
any Restricted Share Unit Grants outstanding at the time of
termination of employment;
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(iv)
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immediate vesting of all outstanding
Performance Compensation Awards for which target performance has
been achieved through the date of termination, payable on the first
day following the six-month anniversary of the date of the
Executive’s termination of employment;
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(v)
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other or additional benefits then
due or earned, payable in accordance with applicable plans and
programs of the Company.
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A termination without “Cause” shall
mean the Executive’s employment is terminated by the Company
for any reason other than Cause (as defined in Section 8(b))
or due to death or disability, or the Executive’s employment
is terminated by the Executive for “Good Reason.” For
purposes of this Agreement, “Good Reason” shall mean,
without the Executive’s prior written consent: (A) the
failure of the Company to pay or cause to be paid, or to provide or
cause to be provided, any part of the Executive’s
compensation, benefits or perquisites when due hereunder;
(B) the a
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