EMPLOYMENT AGREEMENT

                                      

                                by and between

 

                      MARSH & McLENNAN RISK CAPITAL CORP.

 

                                      and

 

                             JEFFREY W. GREENBERG

 

                        Effective as of October 1, 1995

 

 

                               TABLE OF CONTENTS

 

                             EMPLOYMENT AGREEMENT

 

     1.  Employment . . . . . . . . . . . . . . . . .   1

     2.  Employment Period. . . . . . . . . . . . . .   1

     3.  Position and Duties. . . . . . . . . . . . .   1

     4.  Place of Performance . . . . . . . . . . . .   3

     5.  Compensation and Related Matters . . . . . .   3

          (a)  Base Salary. . . . . . . . . . . . . .   3

          (b)  Incentive Compensation . . . . . . . .   3

          (c)  Deferred Compensation. . . . . . . . .   3

          (d)  Initial Equity Grants. . . . . . . . .   4

          (e)  Ongoing Equity Grants. . . . . . . . .   5

          (f)  Trident Performance Payments . . . . .   6

          (g)  Expenses . . . . . . . . . . . . . . .   8

          (h)  Vacation . . . . . . . . . . . . . . .   8

          (i)  Services Furnished . . . . . . . . . .   8

          (j)  Personal Investments . . . . . . . . .   8

          (k)  Other Benefits . . . . . . . . . . . .   9

          (l)  Perquisites. . . . . . . . . . . . . .   9

     6.  Termination. . . . . . . . . . . . . . . . .   9

          (a)  Death. . . . . . . . . . . . . . . . .   9

          (b)  Disability . . . . . . . . . . . . . .  10

          (c)  Cause. . . . . . . . . . . . . . . . .  10

          (d)  Good Reason. . . . . . . . . . . . . .  11

          (e)  Other Terminations . . . . . . . . . .  14

          (f)  Notice of Termination. . . . . . . . .  14

     7.  Compensation Upon Termination or During

          Disability. . . . . . . . . . . . . . . . .  15

          (a)  Disability Period. . . . . . . . . . .  15

          (b)  Death. . . . . . . . . . . . . . . . .  15

          (c)  Disability . . . . . . . . . . . . . .  16

          (d)  Cause or By Executive other than for

               Good Reason. . . . . . . . . . . . . .  18

          (e)  Termination by Company without Cause

               or by the Executive with Good Reason .  18

     8.  Gross-Up for Excise Tax. . . . . . . . . . .  20

     9.  Mitigation . . . . . . . . . . . . . . . . .  21

     10. Confidential Information, Removal of Docu-

          ments, Non-Competition. . . . . . . . . . .  21

          (a)  Confidential Information . . . . . . .  21

          (b)  Removal of Documents . . . . . . . . .  21

          (c)  Non-Competition. . . . . . . . . . . .  22

          (d)  Remedies . . . . . . . . . . . . . . .  23

          (e)  Continuing Operation . . . . . . . . .  23

          (f)  Nondisparagement by the Company. . . .  23

     11.  Indemnification . . . . . . . . . . . . . .  23

     12.  Successors; Binding Agreement . . . . . . .  24

          (a)  Company's Successors . . . . . . . . .  24

          (b)  Executive's Successors . . . . . . . .  24

     13.  Notice. . . . . . . . . . . . . . . . . . .  24

     14.  Miscellaneous . . . . . . . . . . . . . . .  25

     15.  Withholding . . . . . . . . . . . . . . . .  26

 

     16.  Arbitration . . . . . . . . . . . . . . . .  26

     17.  Transfer of Employment. . . . . . . . . . .  26

     18.  Attorneys' Fees . . . . . . . . . . . . . .  26

     19.  Validity. . . . . . . . . . . . . . . . . .  27

     20.  Counterparts. . . . . . . . . . . . . . . .  27

     21.  Entire Agreement. . . . . . . . . . . . . .  27

 

INDEX OF DEFINED TERMS

 

Term                                              Section

Auditor . . . . . . . . . . . . . . . . . . . . . . . . 8

Award Certificate . . . . . . . . . . . . . . . . 5(d)(1)

Base Salary . . . . . . . . . . . . . . . . . . . . .5(a)

beneficial owner. . . . . . . . . . . . . . . .6(d)(x)(1)

Board . . . . . . . . . . . . . . . . . . . . . .Preamble

Cause . . . . . . . . . . . . . . . . . . . . . . . .6(c)

CEO Employment Period . . . . . . . . . . . . . . . . . 3

Change in Control of the Company. . . . . . . . . 6(d)(x)

Change in Control of the Parent . . . . . . . . . 6(d)(x)

Clements Agreement. . . . . . . . . . . . . . . . 5(f)(1)

Clements Trust Agreement. . . . . . . . . . . . . 5(f)(3)

Code. . . . . . . . . . . . . . . . . . . . . . . . . . 8

Company . . . . . . . . . . . . . . . . . . . . .Preamble

Competitive Business. . . . . . . . . . . . 10(c)(iii)(A)

Deferral Plan . . . . . . . . . . . . . . . . . . . .5(c)

Deferred Award. . . . . . . . . . . . . . . . . . . .5(c)

Disability. . . . . . . . . . . . . . . . . . . . . .6(b)

Disability Period . . . . . . . . . . . . . . . . . .7(a)

Effective Date. . . . . . . . . . . . . . . . . . . . . 2

Employment Period . . . . . . . . . . . . . . . . . . . 2

Enhanced Performance Payment. . . . . . . . . . . 5(f)(1)

Exchange Act. . . . . . . . . . . . . . . . . .6(d)(x)(1)

Excise Tax. . . . . . . . . . . . . . . . . . . . . . . 8

Excluded Investments. . . . . . . . . . . . . . . 5(f)(2)

Execution Date. . . . . . . . . . . . . . . . . . . .5(b)

Executive . . . . . . . . . . . . . . . . . . . .Preamble

Future Option(s). . . . . . . . . . . . . . . . . 5(e)(2)

Future Stock Awards . . . . . . . . . . . .5(e)(1)(B)(ii)

Future 25% Stock Award(s) . . . . . . . . .5(e)(1)(A)(ii)

Future 40% Stock Award(s) . . . . . . . . .5(e)(1)(B)(ii)

Good Reason . . . . . . . . . . . . . . . . . . . . .6(d)

Gross-Up Payments . . . . . . . . . . . . . . . . . . . 8

Incentive Compensation. . . . . . . . . . . . . . . .5(b)

Incentive Plan. . . . . . . . . . . . . . . . . . . .5(b)

Initial Period. . . . . . . . . . . . . . . . . . . . . 3

Initial Restricted Stock Award. . . . . . . . . . 5(d)(1)

Initial Stock Option Award. . . . . . . . . . . . 5(d)(2)

Letter Agreement. . . . . . . . . . . . . . . . . . . .21

Marsh & McLennan Entity . . . . . . . . . . . . . . .5(j)

Notice of Termination . . . . . . . . . . . . . . . .6(f)

Option. . . . . . . . . . . . . . . . . . . . . . 5(d)(2)

Option Certificate. . . . . . . . . . . . . . . . 5(d)(2)

Parent. . . . . . . . . . . . . . . . . . . . . . . . . 3

Parent Board. . . . . . . . . . . . . . . . . . . . . . 3

Parent Stock. . . . . . . . . . . . . . . . . . . 5(d)(2)

person. . . . . . . . . . . . . . . . . . . . .6(d)(x)(1)

Restricted Stock. . . . . . . . . . . . . . . . . 5(d)(1)

Restricted stock units. . . . . . . . . . . . .5(e)(1)(A)

Salary Continuation Period. . . . . . . . . . . 7(e)(iii)

Severance Payments. . . . . . . . . . . . . . . . . . . 8

Signing Payment . . . . . . . . . . . . . . . . . . .5(b)

 

Stock Award Plan. . . . . . . . . . . . . . . . . 5(d)(1)

Trident . . . . . . . . . . . . . . . . . . . . . 5(f)(2)

Trident Performance Payment . . . . . . . . . . . 5(f)(2)

Trust . . . . . . . . . . . . . . . . . . . . . . 5(f)(3)

Trust Agreement . . . . . . . . . . . . . . . . . 5(f)(3)

Trustee . . . . . . . . . . . . . . . . . . . . . 5(f)(3)

 

 

 

                             EMPLOYMENT AGREEMENT

 

          AGREEMENT, effective as of October 1, 1995, by

and between Jeffrey W. Greenberg (the "Executive") and

Marsh & McLennan Risk Capital Corp., a Delaware

corporation (the "Company").

 

          WHEREAS, the Board of Directors of the Company

(the "Board") desires to employ the Executive and the

Executive desires to furnish services to the Company on

the terms and conditions hereinafter set forth; and

 

          WHEREAS, the parties desire to enter into this

agreement setting forth the terms and conditions of the

employment relationship of the Executive with the

Company;

 

          NOW, THEREFORE, in consideration of the premis-

es and the mutual agreements set forth below, the parties

hereby agree as follows:

 

          1.  Employment.  The Company hereby agrees to

employ the Executive, and the Executive hereby accepts

such employment, on the terms and conditions hereinafter

set forth. 

 

          2.  Employment Period.  The period of employ-

ment of the Executive by the Company hereunder (the

"Employment Period") shall commence as of October 1, 1995

(the "Effective Date") and shall end on September 30,

2000 or the Date of Termination (as defined in Section 6

below), if earlier, provided, however, that if the Execu-

tive's employment has not previously terminated, then

commencing on September 30, 2000 and each September 30

thereafter, the Employment Period shall automatically be

extended for one additional year unless, not later than

October 1 of the preceding year, the Company or the

Executive shall have given notice not to extend the

Employment Period.

 

          3.  Position and Duties.  During the period

from the Effective Date through a date not later than

March 31, 1996 (such period being referred to as the

"Initial Period"), the Executive shall serve as an em-

ployee of the Company with the title of Partner and shall

 

                                       1

 

report to the Chairman and Chief Executive Officer of the

Company, and shall have such duties and responsibilities

as may be assigned to him by the Chairman and Chief

Executive Officer of the Company.  During the portion of

the Employment Period commencing upon expiration of the

 

Initial Period (such period being referred to as the "CEO

Employment Period"), the Executive shall serve as Chair-

man and Chief Executive Officer of the Company and shall

report directly to the Chief Executive Officer of Marsh &

McLennan Companies, Inc. (the "Parent").  During the CEO

Employment Period, subject to the supervisory powers of

the Board, the Executive shall have those powers and

duties consistent with his position as Chief Executive

Officer as may be prescribed by the Board, and the Execu-

tive as Chief Executive Officer shall cause the Company

to comply with all general policies and procedures as

shall be in effect from time to time applicable to the

Parent's operating subsidiaries and that have been commu-

nicated to the Executive in writing, including the ap-

proval by the Parent of annual budgets and business plans

and any material changes thereto.  During the Employment

Period, the Executive agrees to devote substantially all

his full working time, attention and energies during

normal business hours to the performance of his duties

for the Company, and shall comply with all general poli-

cies of the Parent and the Company relating to conduct by

officers and employees that have been communicated to the

Executive in writing.  Anything herein to the contrary

notwithstanding, subject to Section 10(c) hereof, nothing

shall preclude the Executive from (i) serving on the

boards of directors of a reasonable number of other

corporations (subject to prior approval by the Chief

Executive Officer of the Parent) or the boards of a

reasonable number of trade associations and/or charitable

organizations, (ii) engaging in charitable activities and

community affairs, and (iii) managing his personal in-

vestments and affairs, provided that such activities do

not interfere with the proper performance of his duties

and responsibilities hereunder.  The Parent shall use its

best efforts to include the Executive on the management

slate of nominees for directors of the Parent at the

annual meeting of Parent shareholders to be held in 1996

and to have the Executive elected to the Board of Direc-

tors of the Parent (the "Parent Board") at such meeting.

 

                                       2

 

          4.  Place of Performance.  The principal place

of employment of the Executive shall be at the Company's

principal executive offices in New York State or Connec-

ticut or such other location as may be agreed to by the

Board and the Executive.

 

          5.  Compensation and Related Matters.

 

               (a)  Base Salary.  As compensation for the

performance by the Executive of his duties hereunder,

during the Initial Period the Company shall pay the

Executive a base salary at an annual rate of $1,200,000,

 

and during the CEO Employment Period the Company shall

pay the Executive a base salary at an annual rate of

$750,000 (the base salary, at the rate in effect from

time to time, is hereinafter referred to as the "Base

Salary").  The Base Salary shall be payable in accordance

with the Company's normal payroll practices, shall be re-

viewed annually (commencing as of January 1997) and may

be increased upon such review.

 

               (b)  Incentive Compensation.  Upon execu-

tion of this Agreement (as set forth on the signature

page hereof, the "Execution Date"), the Executive shall

receive a cash lump sum payment of $300,000 (the "Signing

Payment").  Commencing with respect to the Parent's 1996

fiscal year, the Executive shall be eligible to partici-

pate in the Parent's Senior Management Incentive Compen-

sation Plan (the "Incentive Plan"); provided, however,

that the amount to which the Executive is otherwise

entitled under the Incentive Plan with respect to 1996

shall be reduced by the amount of the Signing Payment.

Payments made to the Executive pursuant to the Incentive

Plan are hereinafter referred to as "Incentive Compensa-

tion."

 

               (c)  Deferred Compensation.  Effective as

of the Effective Date, the Executive shall receive an

award of $300,000 (the "Deferred Award"), which shall be

deferred and invested among Putnam funds in the same

manner as if such amount had been deferred in accordance

with the provisions of the Parent's 1995 Cash Bonus Award

Voluntary Deferral Plan (the "Deferral Plan"); provided,

however, that (i) from the Effective Date until the

Execution Date the Deferred Award shall be deemed to have

 

                                       3

 

been invested in the Putnam Money Market Fund and (ii)

from the Execution Date until the date the Executive

makes an investment election in accordance with the

provisions of the Deferral Plan the Deferred Award shall

be invested in the Putnam Money Market Fund.

 

               (d)  Initial Equity Grants.  The Executive

has been granted, as of October 4, 1995:

 

          (1)  An award (the "Initial Restricted Stock

Award") of Twenty Thousand (20,000) shares of restricted

stock of the Parent ("Restricted Stock") pursuant to the

terms of the Marsh & McLennan Companies 1992 Incentive

and Stock Award Plan (the "Stock Award Plan").  The

shares of Restricted Stock subject to the Initial Re-

stricted Stock Award shall vest with respect to 20% of

the shares subject to such award on each of the first,

second, third, fourth and fifth anniversaries of the

 

Effective Date.  The Restricted Stock subject to the

Initial Restricted Stock Award shall be subject to all

other terms and conditions of the Stock Award Plan, the

rules and regulations in effect thereunder, the appli-

cable provisions of this Agreement and the document

setting forth the terms and conditions of the restricted

stock award (the "Award Certificate") substantially in

the form of Exhibit A hereto.

 

          (2)  A non-qualified stock option (an "Option")

to purchase 50,000 shares of common stock, par value

$1.00 per share, of the Parent ("Parent Stock") pursuant

to the Stock Award Plan (the "Initial Stock Option

Award").  The Initial Stock Option Award is subject to

the following conditions: (i) the exercise price per

share of Parent Stock shall be $86.875, (ii) the Initial

Stock Option Award shall vest and become exercisable with

respect to 25% of the shares of Parent Stock subject to

such award on each of the first, second, third and fourth

anniversaries of the Effective Date, and (iii) the Ini-

tial Stock Option Award shall be subject to the noncompe-

tition provisions set forth in the applicable Option

Certificate (as defined below).  The Initial Stock Option

Award shall be subject to all other terms and conditions

of the Stock Award Plan, the rules and regulations there-

under, the applicable provisions of this Agreement and

the document setting forth the terms and conditions of

 

                                       4

 

the Option (the "Option Certificate") substantially in

the form of Exhibit B hereto. 

 

               (e)  Ongoing Equity Grants.  During the

Employment Period, the Executive shall be entitled to

receive the following additional equity grants:

 

          (1) Stock Awards. (A)  In or about January,

1997 and each January thereafter during the Employment

Period, an award of that number of whole shares of Re-

stricted Stock (or "restricted stock units") equal to (i)

25% of the Executive's total base salary paid or accrued

for the prior twelve months, divided by (ii) the fair

market value of the Parent Stock as of the date of grant

(such awards are referred to individually as a "Future

25% Stock Award" and collectively as the "Future 25%

Stock Awards").  The shares of Restricted Stock (or

restricted stock units) subject to Future 25% Stock

Awards shall vest on the third anniversary of the date of

grant of each such award.

 

          (B)  In or about March, 1997 and each March

thereafter during the Employment Period, an award of that

number of whole shares of Restricted Stock (or restricted

 

stock units) equal to (i) 40% of the Executive's Base

Salary, divided by (ii) the fair market value of the

Parent Stock as of the date of grant (such awards are

referred to individually as a "Future 40% Stock Award"

and collectively as the "Future 40% Stock Awards", and

Future 25% Stock Awards and Future 40% Stock Awards are

referred to collectively as "Future Stock Awards.")  The

shares of Restricted Stock (or restricted stock units)

subject to Future 40% Stock Awards shall vest on January

1 next following the tenth anniversary of the date of

grant of each such award. 

 

          (C)  The Company or the Parent shall determine,

in its discretion, whether a Future Stock Award shall be

made in the form of Restricted Stock or restricted stock

units.  Future Stock Awards shall be subject to the

applicable provisions of this Agreement and to such other

terms and conditions as shall be applicable to similar

awards granted at the same time to senior executives of

the Parent and its operating subsidiaries. 

 

                                       5

 

          (2) Options.  In or about May, 1996 and each

May thereafter during the Employment Period, an Option to

acquire not less than 20,000 shares of Parent Common

Stock (such options are referred to individually as a

"Future Option" and collectively as "Future Options").

Each Future Option shall (i) have an exercise price per

share not less than the fair market value of Parent Stock

on the date of grant, (ii) vest and become exercisable

with respect to 25% of the shares subject thereto on each

of the first, second, third and fourth anniversaries of

the date of grant and (iii) be subject to the noncompeti-

tion provisions set forth in the applicable Option Cer-

tificate (which shall be substantially similar to those

set forth in Exhibit B hereto).

 

               (f)  Trident Performance Payments.

 

          (1)  As used in this Section 5(f), the term

"Enhanced Performance Payment" shall have the meaning set

forth in the Amended and Restated Employment Agreement by

and between the Company and Robert Clements, effective as

of December 31, 1993, as amended as of the Execution Date

(the "Clements Agreement"), but without any reduction

resulting from the application of Sections 8(b), (c) or

(e) of the Clements Agreement.

 

          (2)  Subject to paragraph (4) below, within

forty-five (45) days following the receipt by the Company

of the final liquidating distribution from The Trident

Partnership, L.P., a limited partnership registered under

the laws of the Cayman Islands ("Trident"), the Company

 

shall pay to the Executive in a cash lump sum an amount

("Trident Performance Payment") equal to 75% of (a) the

Enhanced Performance Payment multiplied by (b) a frac-

tion, the denominator of which is the aggregate amount of

all investments made by Trident, and the numerator of

which is the aggregate amount of all investments made by

Trident prior to the date the Executive ceases to be the

Chairman and Chief Executive Officer of the Company, ex-

cluding, however, any investments made or committed prior

to the Effective Date with respect to Affinity Group

Plans, Inc., Hiscox Dedicated Insurance Fund PLC, Venton

Holdings Ltd. and Risk Capital Holdings, Inc. ("Excluded

Investments").  For purposes of this Agreement, the

 

                                       6

 

aggregate amount of the Excluded Investments shall equal

$117,167,527.

 

          (3)  As soon as practicable following the

Execution Date, the Company shall establish a grantor

trust (the "Trust"), of which a bank of nationally recog-

nized standing with consolidated shareholders' equity of

not less than $500 million shall be trustee (the "Trust-

ee") and the Executive shall be the beneficiary.  The

Trust shall be established pursuant to a trust agreement

(the "Trust Agreement") to be entered into by the Compa-

ny, the Parent, the Executive and the Trustee, the provi-

sions of which shall be substantially the same as the

provisions of the trust agreement established pursuant to

Section 5(c)(4) of the Clements Agreement (the "Clements

Trust Agreement"), with such changes as the parties

hereto shall, reasonably and in good faith, agree to so

that, to the extent practicable, the Trust Agreement

shall relate to the Executive's right to receive the

Trident Performance Payment to the same extent that the

Clements Trust Agreement relates to Mr. Clements' right

to receive the Enhanced Performance Payment.  In any

case, for the purposes of this Section 5(f)(3), the En-

hanced Performance Payment shall be deemed to equal 5% of

the Marsh & McLennan Trident Compensation (as defined in

the Clements Agreement).

 

          (4)  The Executive's right to the Trident

Performance Payment shall be forfeited if, prior to the

date such payment otherwise would have been made, the

Executive's employment is terminated by the Company for

Cause or by the Executive without Good Reason.

 

          (5)  If, at any time during the Employment

Period prior to the time the Executive ceases to be

Chairman and Chief Executive Officer of the Company, the

Company organizes a successor or supplemental insurance

venture capital investment fund to Trident with objec-

 

tives and purposes substantially similar to those of

Trident, the Executive and the Company will discuss in

good faith the Executive's entitlement to receive a

performance payment with respect to such fund(s) based on

concepts similar to those applicable to Trident and

reflecting the business conditions at the time of such

discussions.

 

                                       7

 

               (g)  Expenses.  During the Employment

Period, the Company shall reimburse the Executive for all

reasonable business expenses upon the presentation of

itemized statements of such expenses, subject to the

applicable policies and procedures then in force.

 

               (h)  Vacation.  The Executive shall be

entitled to vacation during the Employment Period in

accordance with policies applicable generally to senior

executives of the Parent and its operating subsidiaries.

 

               (i)  Services Furnished.  During the Em-

ployment Period, the Company shall furnish the Executive,

at the Company's principal executive offices, with appro-

priate office space and such other facilities and servic-

es as shall be suitable to the Executive's position and

adequate for the performance of his duties as set forth

in Section 3 hereof.

 

               (j)  Personal Investments.  During the Em-

ployment Period, the Parent, in its sole discretion, may

make available to the Executive and other similarly

situated senior executives of the Parent and its operat-

ing subsidiaries the opportunity for personal investments

in investments that the Company recommends to the enti-

ties it advises. 

 

          During the Employment Period, the Executive

will refrain from any personal investments in the insur-

ance industry, other than (i) investments made available

to the Executive in accordance with the preceding para-

graph or (ii) investments in stocks, bonds, or other

securities listed on any national or regional securities

exchange or that have been registered under Section 12(g)

of the Securities Exchange Act of 1934 if the Executive's

investment does not exceed, in the case of any class of

the capital stock of any one issuer, five percent (5%) of

the issued and outstanding shares, or, in the case of

other securities, five percent (5%) of the aggregate

principal amount thereof issued and outstanding; provid-

ed, however, that the restriction in this subparagraph

(ii) shall not be violated by an increase in the per-

centage of the Executive's investment in any entity where

such increase is attributable to a reduction in the

 

number of shares outstanding or to shares of others

 

                                       8

 

(other than the Executive's wife or children) that he is

deemed to own under any applicable attribution rules,

provided that in any such case the Executive shall take

such reasonable steps as may be necessary to eliminate

any conflict of interest arising therefrom.

 

          The Executive shall not, during the Employment

Period, make any personal investments which would prevent

or hinder, directly or indirectly, the transaction of

business by or the relationship of the Parent or any

corporation or partnership in which the Parent directly

or indirectly maintains a majority equity interest (a

"Marsh & McLennan Entity") with any governmental or

quasi-governmental or public entity (including pension

plans covering governmental or quasi-governmental employ-

ees), including any state, district, territory, or pos-

session of the United States or any governmental subdivi-

sion, agency, or instrumentality thereof or any insurance

market, including Lloyd's, by virtue of any statute, law,

regulation, or administrative practice.

 

               (k)  Other Benefits.  During the Employ-

ment Period, the Executive shall be eligible to partici-

pate in all tax-qualified defined contribution and de-

fined benefit retirement plans, and supplemental plans

relating thereto, and welfare plans and programs (includ-

ing group life insurance, medical and dental insurance,

and accident and disability insurance) in which employees

of the Parent and its United States subsidiaries are

generally eligible to participate. 

 

               (l)  Perquisites.  During the Employment

Period, the Company shall make available to the Executive

all perquisites that are made available to comparable

senior executives of the Parent and its operating subsid-

iaries.

 

          6.  Termination.  The Executive's employment

hereunder, as the case may be, may be terminated as

follows:

               (a)  Death.  The Executive's employment

shall terminate upon his death, and the date of his death

shall be the Date of Termination.

 

                                       9

 

               (b)  Disability.  If, as a result of the

Executive's incapacity due to physical or mental illness

(as determined by a medical doctor mutually agreed to),

the Executive shall have been absent from his duties

 

hereunder on a full-time basis for the entire period of

six consecutive months and, within thirty (30) days after

written Notice of Termination (as defined in Section 6(f)

hereof) is given, shall not have returned to the perfor-

mance of his duties hereunder on a full-time basis ("Dis-

ability"), the Company may terminate the Executive's em-

ployment hereunder.  In this event, the Date of Termina-

tion shall be thirty (30) days after Notice of Termina-

tion is given (provided that the Executive shall not have

returned to the performance of his duties on a full-time

basis during such thirty (30) day period).

 

               (c)  Cause.  The Company may terminate the

Executive's employment hereunder for Cause.  For purposes

of this Agreement, the Company shall have "Cause" to

terminate the Executive's employment hereunder:

 

                    (i)  upon the Executive's conviction

     for the commission of a felony involving moral

     turpitude; or

 

                    (ii)  if, in carrying out his duties

     hereunder, the Executive engages in conduct that

     constitutes willful gross misconduct or willful

     gross neglect resulting in material harm to the

     Parent or the Company, as the case may be, unless

     the Executive believed in good faith that such

     action or non-action was in, and not opposed to, the

     best interest of the Parent or the Company, as the

     case may be, which conduct is not cured within 30

     days after the written Notice of Termination de-

     scribed below has been delivered by the Parent or

     the Company, as the case may be.

 

          Cause shall not exist unless and until the

Parent or the Company has delivered to the Executive a

written Notice of Termination that specifically identi-

fies the events, actions, or non-actions, as applicable,

that the Parent or the Company believes constitute Cause

hereunder and the Executive has been provided with an

opportunity to be heard (which shall include an opportu-

 

                                      10

 

nity to address the Compensation Committee of the Parent

Board in writing) within 15 days after the delivery of

such notice.  The Date of Termination shall be the date

specified in the Notice of Termination; provided, howev-

er, that, in the case of a termination for Cause under

clause (ii) above, the Date of Termination shall not be

earlier than 30 days after delivery of the Notice of

Termination.

 

               (d)  Good Reason.  The Executive may

 

terminate his employment hereunder within sixty (60) days

after the occurrence of one or more of the following

events, without the written consent of the Executive,

that has not been cured within fifteen (15) business days

after written notice thereof has been given by the Execu-

tive to the Company and the Parent ("Good Reason"):

 

                    (i)  a reduction in the Executive's

     then current Base Salary, Incentive Compensation

     opportunity, or Parent equity opportunity or the

     termination or material reduction of any employee

     benefit set forth in Section 5(k) hereof (other than

     a reduction in benefits as part of an across-the-

     board reduction similarly affecting other senior

     executive officers of the Parent and its operating

     subsidiaries);

 

                    (ii)  during the Employment Period,

     the failure to continue the Executive in any of the

     positions described in Section 3 hereof (unless the

     Company has notified the Executive in writing of the

     existence of a basis for Cause or as otherwise

     provided in this Agreement) or removal of him from

     any such position;

 

                    (iii)  the failure to appoint the

     Executive to the position of Chairman and Chief

     Executive Officer of the Company on or before April

     1, 1996;

 

                    (iv)  the failure of the Executive to

     be elected to the Parent Board at the annual meeting

     of the shareholders of the Parent to be held in

     1996;

 

                                      11

 

                    (v)  the failure to employ the Execu-

     tive in a position with the Parent or the Company

     which is satisfactory to him as of June 1, 1999;

 

                    (vi)   except as contemplated by the

     provisions of Section 3, a material diminution in

     the Executive's duties, assignment of duties (in-

     cluding reduction of duties) which are materially

     inconsistent with the Executive's then current

     position or, during the CEO Employment Period, the

     appointment of anyone else to an executive position

     at the Company senior to that of the Executive or a

     change in the reporting relationship of the Execu-

     tive so that he no longer reports directly to the

     Chief Executive Officer of the Parent;

 

                    (vii)  during the Employment Period,

 

     the relocation of the Executive's office location as

     assigned to him by the Company to a location more

     than 50 miles from Manhattan;

 

                    (viii)  the failure of the Company to

     obtain the assumption in writing of its obligation

     to perform this Agreement by any successor to all or

     substantially all of the assets of the Company

     within 45 days after a merger, consolidation, sale

     or similar transaction or a failure of the Parent to

     obtain the assumption in writing of its guaranty of

     this Agreement by any successor to all or substan-

     tially all of the assets of the Parent within 45

     days after a merger, consolidation, sale or similar

     transaction;

 

                    (ix)  a "Change in Control of the

     Parent" (as defined below) or a "Change in Control

     of the Company" (as defined below); or

 

                    (x)  failure to pay the Executive

     Incentive Compensation of at least $637,000 (inclu-

     sive of the Signing Payment) with respect to 1996 or

     at least $750,000 with respect to any subsequent

     year.

 

The Executive's continued employment shall not constitute

consent to, or a waiver of rights with respect to, any

 

                                      12

 

act or failure to act constituting Good Reason hereunder.

In the event of a termination for Good Reason, the Date

of Termination shall be the date specified in the Notice

of Termination, which shall be no more than thirty (30)

days after the Notice of Termination.

 

          For purposes of this Agreement, a "Change in

Control of the Parent" shall have occurred if:

 

          (1)  any "person," as such term is used in Sec-

     tions 13(d) and 14(d) of the Securities Exchange Act

     of 1934, as amended (the "Exchange Act"), (other

     than the Parent, any trustee or other fiduciary

     holding securities under an employee benefit plan of

     the Parent or any corporation owned, directly or

     indirectly, by the stockholders of the Parent in

     substantially the same proportions as their owner-

     ship of stock of the Parent), is or becomes the

     "beneficial owner" (as defined in Rule 13d-3 under

     the Exchange Act), directly or indirectly, of secu-

     rities of the Parent representing 50% or more of the

     combined voting power of the Parent's then outstand-

     ing voting securities;

 

 

          (2)  during any period of not more than two

     consecutive years, individuals who at the beginning

     of such period constitute the Parent Board, and any

     new director (other than a director designated by a

     person who has entered into an agreement with the

     Parent to effect a transaction described in clause

     (1), (3), or (4) of this Section 6(d)) whose elec-

     tion by the Parent Board or nomination for election

     by the Parent's stockholders was approved by a vote

     of at least two-thirds (2/3) of the directors then

     still in office who either were directors at the

     beginning of the period or whose election or nomina-

     tion for election was previously so approved, cease

     for any reason to constitute at least a majority

     thereof;

 

          (3)  the stockholders of the Parent approve a

     merger or consolidation of the Parent with any other

     corporation, other than (A) a merger or consolida-

     tion which would result in the voting securities of

     the Parent outstanding immediately prior thereto

 

                                      13

 

     continuing to represent (either by remaining out-

     standing or by being converted into voting secu-

     rities of the surviving or parent entity) 50% or

     more of the combined voting power of the voting

     securities of the Parent or such surviving or parent

     entity outstanding immediately after such merger or

     consolidation or (B) a merger or consolidation

     effected to implement a recapitalization of the

     Parent (or similar transaction) in which no "person"

     (as hereinabove defined) acquired 50% or more of the

     combined voting power of the Parent's then outstand-

     ing securities; or

 

          (4)  the stockholders of the Parent approve a

     plan of complete liquidation of the Parent or an

     agreement for the sale or disposition by the Parent

     of all or substantially all of the Parent's assets

     (or any transaction having a similar effect).

 

For purposes of this Agreement, a "Change in Control of

the Company" shall have occurred if the Parent no longer

owns at least 50% of the value and voting power of the

Company.

 

               (e)  Other Terminations.  If the Executiv-

e's employment is terminated hereunder for any reason

other than as set forth in Sections 6(a) through 6(d)

hereof, the date on which a Notice of Termination is

given or any later date (within 30 days) set forth in

 

such Notice of Termination shall be the Date of Termina-

tion.

 

               (f)  Notice of Termination.  Any termina-

tion of the Executive's employment hereunder by the

Company or by the Executive (other than termination

pursuant to Section 6(a) hereof) shall be communicated by

written Notice of Termination to the other party hereto

in accordance with Section 13 hereof.  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 the Execut-

ive's employment under the provision so indicated.

 

                                      14

 

          7.  Compensation Upon Termination or During

Disability.

 

               (a)  Disability Period.  During any period

during the Employment Period that the Executive fails to

perform his duties hereunder as a result of incapacity

due to physical or mental illness ("Disability Period"),

the Executive shall continue to (i) receive his full Base

Salary, (ii) remain eligible to receive Incentive Com-

pensation under Section 5(b) hereof and Future Stock

Awards and Future Options under Section 5(e) hereof, and

(iii) participate in the programs described in Section

5(k) hereof (except to the extent such participation is

not permitted under the terms of such programs).  Such

payments made to the Executive during the Disability

Period shall be reduced by the sum of the amounts, if

any, payable to the Executive at or prior to the time of

any such payment under disability benefit plans of the

Company or under the Social Security disability insurance

program, and which amounts were not previously applied to

reduce any such payment.

 

               (b)  Death.  If the Executive's employment

hereunder is terminated as a result of death, then:

 

                    (i)   the Company shall pay the

     Executive's estate or designated beneficiary, as

     soon as practicable after the Date of Termination,

     any amounts earned, accrued or owing the Executive

     hereunder for services prior to the Date of Termina-

     tion;

 

                    (ii)  the Company shall pay the

     Executive's estate or designated beneficiary, in

     accordance with the Company's normal payroll prac-

     tice, an amount equal to the Executive's Base Salary

 

     for a period of 90 days following the Date of Termi-

     nation;

 

                    (iii)  the Company shall pay the

     Executive's estate or designated beneficiary, at the

     time it would otherwise have been payable, Incentive

     Compensation for the year in which the Date of

     Termination occurs on the basis of an annualized

     rate of no less than $750,000, prorated based upon

 

                                      15

 

     the number of days during such year or period the

     Executive was employed by the Company;

 

                    (iv)  the Company shall pay the

     Executive's estate or designated beneficiary, as and

     when otherwise payable, the Trident Performance Pay-

     ment;

 

                    (v)  all awards of Options, Restrict-

     ed Stock and restricted stock units previously

     granted to the Executive (including but not limited

     to the Initial Restricted Stock Award, the Initial

     Stock Option Award, and the Future Stock Awards and

     Future Options previously granted to the Executive)

     shall become fully vested and, with respect to the

     Options, fully exercisable, as of the Date of Termi-

     nation and all such Options shall remain exercisable

     for a period of one year following such Date of

     Termination; and

 

                    (vi)  the Company shall have no addi-

     tional obligations to the Executive under this

     Agreement except to the extent otherwise provided in

     the applicable plans and programs of the Company or

     the Parent.

 

               (c)  Disability.  If the Executive's

employment hereunder is terminated as a result of Dis-

ability, then:

 

                    (i)   the Company shall pay the

     Executive, as soon as practicable after the Date of

     Termination, any amounts earned, accrued or owing

     the Executive hereunder for services prior to the

     Date of Termination;

 

                    (ii)  the Executive shall receive,

     until the date the Executive reaches age 65 or, if

     earlier, until his death, the salary-related dis-

     ability benefits provided in accordance with, and

     subject to the conditions of, the long-term dis-

     ability program then in effect for senior executives

 

     of the Parent and its operating subsidiaries; pro-

     vided, however, that so long as the Executive elects

     and pays for any voluntary supplemental base salary

 

                                      16

 

     coverage, the level of such benefits shall not be

     less than 65% of his Base Salary as of the Date of

     Termination;

 

                    (iii)  the Company shall pay the

     Executive, at the time it would otherwise have been

     payable, Incentive Compensation for the year in

     which the Date of Termination occurs on the basis of

     an annualized rate of no less than $750,000, prorat-

     ed based upon the number of days during such year or

     period the Executive was employed by the Company;

 

                    (iv)  the Company shall pay the

     Executive, as and when otherwise payable, the Tri-

     dent Performance Payment;

 

                    (v)  all awards of Options, Restrict-

     ed Stock and restricted stock units previously

     granted to the Executive (including but not limited

     to the Initial Restricted Stock Award, the Initial

     Stock Option Award, and the Future Stock Awards and

     Future Options previously granted to the Executive)

     shall become fully vested and, with respect to the

     Options, fully exercisable, as of the Date of Termi-

     nation, and all such Options shall remain exercis-

     able for their original term;

 

                    (vi) for the remainder of the Employ-

     ment Period set forth in Section 2 hereof (deter-

     mined without regard to the Executive's termination

     for Disability), the Executive shall continue to

     participate in all employee welfare benefit plans

     and programs of the Company in which the Executive

     was entitled to participate immediately prior to the

     Date of Termination in accordance with the terms of

     such plans and programs as in effect from time to

     time; provided that the Executive's continued par-

     ticipation is permitted under the general terms and

     provisions of such plans and programs.  In the event

     that the Executive's participation in any such plan

     or program is barred, the Company shall arrange to

     provide the Executive and his dependents with bene-

     fits substantially similar to those which the Execu-

     tive and his dependents would otherwise have been

     entitled to receive under such plans and programs

 

                                      17

 

 

     from which their continued participation is barred;

     and

 

                    (vii) the Company shall have no addi-

     tional obligations to the Executive under this

     Agreement except to the extent otherwise provided in

     the applicable plans and programs of the Company or

     the Parent.

 

               (d)  Cause or By Executive other than for

Good Reason.  If the Executive's employment hereunder is

terminated by the Company for Cause or by the Executive

(other than for Good Reason), then:

 

                    (i)   the Company shall pay the

     Executive, as soon as practicable after the Date of

     Termination, any amounts earned, accrued or owing

     the Executive hereunder for services prior to the

     Date of Termination; and

 

                    (ii) the Company shall have no addi-

     tional obligations to the Executive under this

     Agreement except to the extent otherwise provided in

     the applicable plans and programs of the Company or

     the Parent.

 

               (e)  Termination by Company without Cause

or by the Executive with Good Reason.  If the Executive's

employment hereunder is terminated by the Company (other

than for Cause or Disability) or by the Executive for

Good Reason, then:

 

                    (i)  the Company shall pay the Execu-

     tive, as soon as practicable after the Date of

     Termination, any amounts earned, accrued or owing

     the Executive hereunder for services prior to the

     Date of Termination;

 

                    (ii)  the Company shall pay the

     Executive, at the time it would otherwise have been

     payable, Incentive Compensation for the year in

     which the Date of Termination occurs on the basis of

     an annualized rate of no less than $750,000, prorat-

     ed based upon the number of days during such year or

     period the Executive was employed by the Company;

 

                                      18

 

                    (iii)  the Company shall pay to the

     Executive over a period of twenty-four months fol-

     lowing the Date of Termination (the "Salary Con-

     tinuation Period"), and in accordance with the

     Company's payroll practices, an aggregate amount

     equal to two times the sum of (A) the Executive's

 

     Base Salary (at the annualized rate in effect at the

     time Notice of Termination is given) and (B) the

     higher of (x) the Executive's average annual Incen-

     tive Compensation with respect to the two full

     calendar years immediately preceding the Date of

     Termination and (y) $750,000;

 

                    (iv)  the Company shall pay the

     Executive, as and when otherwise payable, the Tri-

     dent Performance Payment;

 

                    (v)  all awards of Options, Restrict-

     ed Stock and restricted stock units previously

     granted to the Executive (including but not limited

     to the Initial Restricted Stock Award, the Initial

     Stock Option Award, and the Future Stock Awards and

     Future Options previously granted to the Executive)

     shall become fully vested and, with respect to the

     Options, fully exercisable, as of the Date of Termi-

     nation, with the Initial Stock Option Award remain-

     ing exercisable for its original term and all other

     Options (including Future Options) remaining exer-

     cisable for a period of one year after the Date of

     Termination;

 

                    (vi)  during the Salary Continuation

     Period, the Executive shall continue to participate

     in all employee welfare benefit plans and programs

     in which the Executive was entitled to participate

     immediately prior to the Date of Termination in

     accordance with the terms of such plans and programs

     as in effect from time to time; provided that the

     Executive's continued participation is permitted

     under the general terms and provisions of such plans

     and programs.  In the event that the Executive's

     participation in any such plan or program is barred,

     the Company shall arrange to provide the Executive

     and his dependents with benefits substantially simi-

     lar to those which the Executive and his dependents

 

                                      19

 

     would otherwise have been entitled to receive under

     such plans and programs from which their continued

     participation is barred; and

 

                    (vii)  the Company shall have no

     additional obligations to the Executive under this

     Agreement except to the extent otherwise provided in

     the applicable plans and programs of the Company or

     the Parent.

 

          Notwithstanding the above, (A) if the Executive

terminates employment for Good Reason by reason of the

 

event described in Section 6(d)(v), then in lieu of the

payments described in Section 7(e)(iii), the Company

shall pay the Executive $500,000 in a single cash lump

sum as soon as practicable following the Date of Termina-

tion, and (B) if, after a Change in Control of the Parent

or a Change in Control of the Company, the Executive's

employment is terminated either by the Company (other

than for Cause or Disability) or by the Executive for

Good Reason, then, subject to (A) above, payment of the

aggregate amount described in Section 7(e)(iii) shall be

made in a single cash lump sum as soon as practicable

following the Date of Termination.  In either case, the

Salary Continuation Period shall be twenty-four months.

 

          8.  Gross-Up for Excise Tax.  In the event that

the Executive becomes entitled to the payments or bene-

fits pursuant to Section 7 of this Agreement (the "Sever-

ance Payments"), if any of the Severance Payments will be

subject to the excise tax (the "Excise Tax") under Sec-

tion 4999 of the Internal Revenue Code of 1986, as amend-

ed (the "Code"), the Company shall pay to the Executive,

within five (5) days following the Date of Termination or

as soon thereafter as practicable, an additional amount

(the "Gross-Up Payment") such that the net amount re-

tained by the Executive, after deduction of any Excise

Tax on the Severance Payments and any federal, state and

local income tax and Excise Tax upon the payment provided

for by this Section 8, shall be equal to the Severance

Payments.  The determination of whether an Excise Tax is

due, the amount of the Excise Tax and the amount of the

Gross-Up Payment shall be made by an independent auditor

(the "Auditor") jointly selected by the Company and the

Executive and paid by the Company.  If the Executive and

 

                                      20

 

the Company cannot agree on the firm to serve as the

Auditor, then the Executive and the Company shall each

select one nationally recognized accounting firm and

those two firms shall jointly select the nationally

recognized accounting firm to serve as the Auditor.

 

          9.  Mitigation.  The Executive shall not be re-

quired to mitigate amounts payable pursuant to Section 7

hereof by seeking other employment or otherwise, nor

shall there be any offset against such payments on ac-

count of (a) any remuneration attributable to any subse-

quent employment that he may obtain or (b) any claims the

Parent or the Company may have against the Executive.

However, to the extent that the Executive shall receive

from a subsequent employer benefits substantially similar

to those to be provided under Sections 7(c)(vi) and

7(e)(vi) hereof, the benefits to be provided under such

Sections shall be correspondingly reduced.

 

 

          10.  Confidential Information, Removal of Docu-

ments, Non-Competition.

 

               (a)  Confidential Information.  The Execu-

tive shall hold in a fiduciary capacity for the benefit

of the Marsh & McLennan Entities all trade secrets,

confidential information, and knowledge or data relating

to the Marsh & McLennan Entities and the businesses and

investments of the Marsh & McLennan Entities, which shall

have been obtained by the Executive during the Executive's

employment by the Company and which shall not have

been or now or hereafter have become public knowledge

(other than by acts by the Executive or representatives

of the Executive in violation of this Agreement).  Except

as may be required or appropriate in connection with his

carrying out his duties under this Agreement, the Execu-

tive shall not, without the prior written consent of the

Company or as may otherwise be required by law or legal

process, communicate or divulge any such trade secrets,

information, knowledge or data to anyone other than the

Company and those designated by the Company or the Par-

ent.

 

               (b)  Removal of Documents.  All records,

files, drawings, documents, models, equipment, and the

like relating to the business of the Marsh & McLennan

 

                                      21

 

Entities, which the Executive prepares, uses or comes

into contact with shall not be removed by the Executive

from the premises of any Marsh & McLennan Entity (without

the written consent of the Company or the Parent) during

or after the Employment Period unless such removal shall

be required or appropriate in connection with his carry-

ing out his duties under this Agreement, and, if so

removed by the Executive, shall be returned to such Marsh

& McLennan Entity immediately upon termination of the

Executive's employment hereunder.

 

               (c)  Non-Competition.  During (i) the

Executive's employment with the Company, (ii) in case of

termination by the Company (other than for Cause or

Disability) or by Executive for Good Reason (other than a

termination by the Executive for Good Reason by reason of

the event described in Section 6(d)(v) hereof), the

Salary Continuation Period, and (iii) in case of Termina-

tion by the Company with Cause or by the Executive with-

out Good Reason, the one (1)-year period after the Execu-

tive's Date of Termination, the Executive (A) shall not

engage, anywhere within the geographical areas in which

any Marsh & McLennan Entity has conducted its business

operations or provided services as of the date hereof or

 

at any time prior to the Date of Termination, directly or

indirectly, alone, in association with or as a sharehold-

er, principal, agent, partner, officer, director, employ-

ee or consultant of any other organization, in the insur-

ance brokerage business ("Competitive Business"); provid-

ed, however, that nothing herein shall preclude the

Executive from so engaging in that portion of the busi-

ness of any enterprise which does not constitute a Com-

petitive Business; (B) shall not solicit or encourage any

officer, employee or consultant of any of the Marsh &

McLennan Entities to leave the employ of any of the Marsh

& McLennan Entities for employment by or with any compet-

itor of any of the Marsh & McLennan Entities; (C) shall

not divert to any competitor of any of the Marsh & McLen-

nan Entities any customer of any of the Marsh & McLennan

Entities; and (D) shall not disparage any Marsh & McLenn-

an Entity or any employee, director or officer of any

Marsh & McLennan Entity; provided, however, that nothing

herein shall prohibit the Executive from making invest-

ments permitted by Section 5(j) hereof.  If, at any time,

the provisions of this Section 10(c) shall be determined

 

                                      22

 

to be invalid or unenforceable, by reason of being vague

or unreasonable as to area, duration or scope of activi-

ty, this Section 10(c) shall be considered divisible and

shall become and be immediately amended to only such

area, duration and scope of activity as shall be deter-

mined to be reasonable and enforceable by the court or

other body having jurisdiction over the matter; and the

Executive agrees that this Section 10(c) as so amended

shall be valid and binding as though any invalid or

unenforceable provision had not been included herein.

 

               (d)  Remedies.  In the event of a breach

or threatened breach of this Section 10, the Executive

agrees that the Company and the Parent shall be entitled

to injunctive relief in a court of appropriate jurisdic-

tion to remedy any such breach or threatened breach, the

Executive acknowledging that damages would be inadequate

and insufficient.  In addition, in the event of (i) a

material breach of Section 10(a) by the Executive, (ii) a

material and willful breach of Section 10(b) by the

Executive or (iii) a breach of Section 10(c) by the

Executive, the Company's obligations to the Executive

under Section 7(e) hereof shall immediately cease and the

Company shall have no further obligation to the Executive

under this Agreement.

 

               (e)  Continuing Operation.  Any termina-

tion of the Executive's employment or of this Agreement

shall have no effect on the continuing operation of this

Section 10.

 

 

               (f)  Nondisparagement by the Company.

During the applicable period under Section 10(c) hereof,

neither the Company nor the Parent shall disparage the

Executive.

 

          11.  Indemnification.  The Company shall indem-

nify the Executive to the full extent authorized by law

and the Charter and By-laws of the Company or the Parent,

as applicable, for all expenses, costs, liabilities and

legal fees which the Executive may incur in the discharge

of all his duties hereunder.  The Executive shall be in-

sured under the Company's and the Parent's Directors' and

Officers' Liability Insurance Policy as in effect from

time to time.  Any termination of the Executive's employ-

 

                                      23

 

ment or of this Agreement shall have no effect on the

continuing operation of this Section 11.

 

          12.  Successors; Binding Agreement.

 

               (a)  Company's Successors.  No rights or

obligations of the Company under this Agreement may be

assigned or transferred by the Company except that such

rights or obligations may be assigned or transferred

pursuant to a merger or consolidation in which the Compa-

ny is not the continuing entity, or the sale or liquida-

tion of all or substantially all of the business and/or

assets of the Company, provided that the assignee or

transferee is the successor to all or substantially all

of the business and/or assets of the Company and such as-

signee or transferee assumes the liabilities, obligations

and duties of the Company, as contained in this Agree-

ment, either contractually or as a matter of law.  The

Company will require any such successor 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.  As used in this Agreement, "Company" shall mean

the Company as hereinbefore defined and any successor to

its business and/or assets as aforesaid which executes

and delivers the agreement provided for in this Section

12 or which otherwise becomes bound by all the terms and

provisions of this Agreement or by operation of law.

 

               (b)  Executive's Successors.  This Agree-

ment shall not be assignable by the Executive.  This

Agreement and all rights of the Executive hereunder shall

inure to the benefit of and be enforceable by the Execut-

ive's personal or legal representatives, executors,

administrators, successors, heirs, distributees, devisees

and legatees.  Upon the Executive's death, all amounts to

 

which he is entitled hereunder, unless otherwise provided

herein, shall be paid in accordance with the terms of

this Agreement to the Executive's devisee, legatee, or

other designee or, if there be no such designee, to the

Executive's estate.

 

          13.  Notice.  For the purposes of this Agree-

ment, notices, demands and all other communications

provided for in this Agreement shall be in writing and

 

                                      24

 

shall be deemed to have been duly given when delivered or

(unless otherwise specified) mailed by United States

certified or registered mail, return receipt requested,

postage prepaid, addressed as follows:

 

          If to the Executive:

 

 

               Jeffrey W. Greenberg

               950 Park Avenue, Apt. 10B

               New York, New York  10028

 

          If to the Company:

 

               Marsh & McLennan Risk Capital Corp.

               1166 Avenue of the Americas

               New York, New York  10036

               Attn:  Treasurer

 

          with a copy to:

 

               Marsh & McLennan Companies, Inc.

               1166 Avenue of the Americas

               New York, New York  10036

               Attn:  General Counsel

 

or to such other address as any party may have furnished

to the other in writing in accordance herewith, except

that notices of change of address shall be effective only

upon receipt.

 

          14.  Miscellaneous.  No provisions of this

Agreement may be modified unless such modification is

agreed to in writing signed by the Executive and such

officer of the Company as may be specifically designated

for the Company by the Board.  Any waiver or discharge

must be in writing and signed by the Executive or such an

authorized officer of the Company, as the case may be.

No waiver by either party hereto at any time of any

breach by the other party hereto of, or compliance with,

any condition or provision of this Agreement to be per-

formed by such other party shall be deemed a waiver of

 

similar or dissimilar provisions or conditions at the

same or at any prior or subsequent time.  The validity,

interpretation, construction and performance of this

 

                                      25

 

Agreement shall be governed by the laws of the State of

New York without regard to its conflicts of law princi-

ples.

 

          15.  Withholding.  Any payments provided for in

this Agreement shall be paid net of any applicable with-

holding required under federal, state or local law.

 

          16.  Arbitration.  Except as otherwise provided

herein, all controversies, claims or disputes arising out

of or related to this Agreement shall be settled under

the rules of the American Arbitration Association then in

effect in the State of New York, as the sole and exclu-

sive remedy of either party, and judgment upon such award

rendered by the arbitrator(s) may be entered in any court

of competent jurisdiction. 

 

          17.  Transfer of Employment.  Anything in this

Agreement to the contrary notwithstanding, if, during the

Employment Period, the Company, the Parent and the Execu-

tive agree in writing that the Executive's employment

hereunder shall be transferred to another Marsh & McLenn-

an Entity (the "Transferee") (which may be the Parent),

then the rights and obligations of the Company under this

Agreement (with such appropriate modifications to the

Agreement as the Parent, the Transferee and the Executive

may agree to) may be assigned or transferred by the

Company to the Transferee.  As used in this Agreement,

"Company" shall mean the Company as hereinbefore defined

and any Transferee that becomes the Company's successor

with respect to the Executive's employment in accordance

with this Section 17.

 

          18.  Attorneys' Fees.  The Company shall reim-

burse the Executive for all costs, including without

limitation reasonable attorneys' fees of the Executive,

in any dispute, arbitration or proceeding arising under

this Agreement so long as the Executive's position is ad-

vanced in good faith.  The Company shall pay (or reim-

burse the Executive for) all costs, including without

limitation reasonable attorneys' fees, incurred by the

Executive in connection with the negotiation of this

Agreement and matters preliminary thereto.

 

                                      26

 

          19.  Validity.  The invalidity or unenforce-

ability of any provision or provisions of this Agreement

 

shall not affect the validity or enforceability of any

other provision of this Agreement, which shall remain in

full force and effect.

 

          20.  Counterparts.  This Agreement may be exe-

cuted in one or more counterparts, each of which shall be

deemed to be an original but all of which together will

constitute one and the same instrument.

 

          21.  Entire Agreement.  This Agreement between

the Company and the Executive sets forth the entire

agreement of the parties hereto in respect of the subject

matter contained herein and supersedes all prior agree-

ments (including, but not limited to, the Letter Agree-

ment between the Executive and the Company dated October

4, 1995 (the "Letter Agreement")), promises, covenants,

arrangements, communications, representations or warran-

ties, whether oral or written, by the parties hereto in

respect of the subject matter contained herein; and any

prior agreement (including the Letter Agreement) of the

parties hereto in respect of the subject matter contained

herein is hereby terminated and cancelled.

 

                                      27

 

 

 

IN WITNESS WHEREOF, the parties hereto have

executed this Agreement on December 16, 1995 to be effec-

tive as of the date first above written.

 

                         MARSH & McLENNAN RISK CAPITAL

                           CORP.

 

 

                         By:/s/Robert Clements          

                            Name:  Robert Clements

                            Title: Chairman of the Board

                        

 

 

 

                         /s/Jeffrey W. Greenberg        

                         Jeffrey W. Greenberg

 

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