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Exhibit 10.33
AGREEMENT AND RELEASE
THIS AGREEMENT is made on the 25nd day of August,
2006, by and among Henry O. Schramm
(hereinafter called "Employee") and PMA Capital
Corporation and Pennsylvania Manufacturers’ Association
Insurance Company and their affiliates, (hereinafter called
"Employer").
RECITAL
WHEREAS, Employer has determined to terminate
Employee’s employment; and
WHEREAS, the Employee has agreed to resign his
position, and Employee and Employer have agreed to enter into this
Agreement and Release ("Agreement") to resolve any and all issues
that may exist between them concerning Employee’s employment
and separation from employment.
NOW THEREFORE, Employer and Employee, for good
and valuable consideration, and intending to be legally bound,
agree as follows:
1. Resignation
Date . Employee’s employment with
Employer and its affiliates terminated effective August 10,
2006 ("Termination
Date").
2. Severance Pay
.
a) Employer shall
provide severance pay to Employee equal to twenty (20) weeks of
pay, calculated as two (2) weeks of pay for each year of service up
to a maximum of 26 weeks and a minimum of four (4) weeks
("Severance Period") as provided in the PMA Capital Corporation and
Pennsylvania Manufacturers’ Association Insurance Company
Amended and Restated Severance Pay Plan (the "Severance
Plan").
b) Based on the
foregoing, Employer shall provide severance pay to Employee in the
sum of $110,769.23 less all applicable withholding taxes and other
deductions ("Severance Pay"). The Severance Pay shall be payable in
accordance with its standard payroll periods the gross amount of
twelve thousand dollars ($12,000) until the gross sum of one
hundred ten thousand seven hundred sixty nine dollars and twenty
three cents ($110,769.23), less taxes and necessary withholdings,
has been paid. In addition, within thirty (30) days following the
Effective Date of this Agreement as defined in paragraph 21,
Employer shall pay Employee the gross sum of thirty three thousand
two hundred thirty dollars ($33,230.00), less taxes and necessary
withholdings, as additional consideration.
c) If Employee dies
before all amounts due Employee under this paragraph 2 have been
paid to Employee, then Employer will pay any remaining amounts due
Employee to Employee’s surviving spouse, or if there is no
surviving spouse, to Employee’s estate, in a lump sum within
90 calendar days after the date of death.
3. Benefits
. Except as otherwise set forth in sub-paragraphs a)
through c) below, all of Employee’s employee benefits,
including, but not limited to, health, welfare and disability
benefits, shall terminate as of the Termination Date.
a) Employee’s Group Term Life Insurance, Dependent Child
Life Insurance and Spousal Life Insurance group coverages will
terminate at the end of the Severance Period. Employee may convert
all or part of these group coverages to non-group coverages
provided that Employee shall be responsible for the payment of all
premiums after the end of the Severance Period.
b) In the event
Employee elects to continue health insurance coverage through the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
("COBRA"), and returns this executed Agreement, and further does
not revoke this Agreement within the seven day revocation period,
as provided under the Severance Plan, Employer will, during the
Severance Period ("Continuation Period"), continue to pay the same
monthly subsidy of the premiums for such health insurance
continuation as was being paid by Employer prior to the Termination
Date. The Continuation Period for payment of health insurance
premiums under this Agreement shall commence on August 11, 2006,
and conclude on December 29, 2006. Employee must, during the
Continuation Period, make timely monthly premium payments under
COBRA for such health insurance coverage to the extent that the
COBRA premium exceeds the monthly subsidy paid by the Employer.
After the Continuation Period, Employee must make the full monthly
COBRA premium payment to continue the COBRA health insurance
coverage. Notwithstanding the foregoing, to the extent that
Employee’s (or a qualified beneficiary’s) right to
COBRA continuation coverage terminates prior to the end of the
Continuation Period, Employer’s obligation to pay the monthly
premium subsidy shall cease.
c) The Continuation
Period for payment of health insurance premiums under this
Agreement shall be deemed to run concurrently with the continuation
period federally mandated by COBRA (generally 18 months), or any
other legally mandated federal, state, or local coverage period for
benefits provided to terminated employees under the
Employer’s group health care plan. The Continuation Period
will be deemed to commence on August 11, 2006, whether or not COBRA
coverage is actually elected at such time or deferred until the
expiration of the Continuation Period. Notwithstanding the
foregoing, COBRA coverage will only be available if Employee is
eligible for COBRA coverage elected in the time and manner
prescribed, and Employee timely remits Employee’s payments of
the premiums, as required, for COBRA coverage
d) Nothing in this
paragraph 3 will affect the Employee’s vested benefits, if
any, under PMA Capital Corporation’s qualified and
non-qualified employee plans; the existence, amount, and payment of
such benefits shall be determined pursuant to the applicable
provisions of the applicable plans, and as outlined in Addendum A
attached hereto.
Vacation Pay . Payment for
accrued unused vacation days will be made as soon as practicable
after the Termination Date. Employees who participate in the
Purchased Personal Time program will be reimbursed for any amounts
paid for days not used. Employee agrees that the amount of
Severance Pay defined in paragraph 2(a) to which the
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Employee would be eligible will be reduced by any
amounts due from the Employee for days used, but not fully paid
for, under the Purchased Personal Time program.
4. Unemployment
Compensation . If Employee elects to file a
claim for unemployment compensation benefits, Employer will not
contest Employee’s eligibility. Employer will, upon request,
confirm the resignation of Employee’s employment.
5. Outplacement
Assistance . Employer agrees to engage the
services, on Employee’s behalf and at employer’s
direction and expense, the services of an outplacement company, who
will assist employee with job search support. Services will be
available for six months, beginning immediately upon the expiration
of the revocation period as described in section 21 of this
document.
6. Business
Expenses . Employer agrees to reimburse
Employee for regular, pre-approved, business expenses incurred
prior to the Termination Date; provided that Employee submits
appropriate and complete documentation that is satisfactory to
Employer to support Employee’s claim for such reimbursement
and requests such reimbursement upon acceptance of this Agreement.
Employee warrants that Employee has surrendered any and all credit
cards issued to Employee through Employer on or prior to the date
hereof, and shall not incur any additional expenses on behalf of
Employer nor seek reimbursement therefor after the date of this
Agreement.
7. Referrals of
Employment . All referrals for verification
of employment should be directed solely to Andrew J. McGill, Vice
President, Human Resources, Pennsylvania Manufacturers’
Association Insurance Company. Upon request, verification will note
that Employee resigned his position, and received positive
evaluations during his tenure.
8. Agreements and
Covenants . Employee agrees
that:
a) Employee
has no claim to, nor will Employee seek or receive, any other money
or consideration from Company.
b) Employee
returned to Employer on August 18, 2006 all known company property
including, but not limited to, company-provided automobiles, cell
telephones, identification cards, access cards, personal laptop
computers, company manuals, equipment, records and files, including
any and all copies of same, as well as electronic and paper records
whether or not they are stored on the Employer’s
premises.
c) Employee will
not disclose or make known to anyone (other than in the good faith
performance of Employee’s services to Employer before the
Termination Date) other than employees of Employer, or use for
Employee’s benefit, or the benefit of any corporation, firm,
entity or person unrelated to Employer any knowledge, information
or materials belonging to Employer or its Affiliates about their
products, services, know-how, customers, business plans or
financial, marketing, pricing, compensation and other proprietary
matters ("Confidential Information"), whether or not subject to
trademark, copyright, trade secret or other protection, which was
made known to Employee (whether or not with the knowledge and
permission of Employer, whether or not developed, devised or
otherwise created in whole or in part by the efforts of Employee
and whether or not a matter
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of public knowledge unless as a result of
authorized disclosure) by reason of Employee’s employment by
Employer. However, after such Confidential Information has become
public knowledge, Employee shall have no further obligation under
this paragraph regarding that publicly known Confidential
Information so long as Employee was in no manner responsible,
directly or indirectly, for permitting such Confidential
Information to become public knowledge without the consent of
Employer or the applicable Affiliate.
d) Employer
and Employee will not make any public or private statements or
other utterances, written or oral, or act in any manner that is
intended to, or does in fact disparage or damage the other party,
or the goodwill of the business of Employer, or the business or
personal reputation of any of its directors, officers, agents or
employees, clients or suppliers.
e) A
violation on the part of the Employer or Employee of the covenants
contained in paragraphs (c) or (d) above will cause irreparable
damage to the parties such that it is and will be impossible to
estimate or determine the damage that will be suffered by the
parties in the event of a breach of such covenants. Therefore, the
parties further agree that the parties shall be entitled, as a
matter of course, to an injunction out of any court of competent
jurisdiction, restraining any further violation of such covenant or
covenants. This right to an injunction shal
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