Exhibit 10.2
ORIGINAL
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (“Agreement”) entered into and effective as of this 1st day
of March, 1999, by and between SOMERSET MARINE, INC. (“Employer”), a New York
corporation with its principal place of business in New York, New York and
Michael L. Civisca (the “Executive”).
RECITALS
WHEREAS, Employer desires to retain and employ the services of Executive as Vice
President of Employer; and
WHEREAS, Executive has been employed by Employer for 11 years; and
WHEREAS, the parties hereto wish to provide herein for the terms and conditions
of Executive’s continued employment and to secure for Employer the benefits of
Executive’s continued contributions by reason of Executive’s experience, skills
and knowledge pertaining to Employer’s business, and to increase Executive’s
salary in exchange for Executive making a long term commitment to Employer.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, Employer and Executive agree as follows:
SECTION 1. EMPLOYMENT.
(a) Position. Employer hereby employs Executive and Executive hereby accepts
such employment for the provision of executive services on behalf of Employer as
Vice President. Executive agrees to serve in such capacity with the duties set
forth in Section 1(b) for a term beginning on March 1, 1999, and ending on
December 31, 2001, unless renewed pursuant to Section. 1(c) hereof, or
terminated pursuant to Section 6.
(b) Duties. Executive’s duties and responsibilities shall be those consistent
with and appropriate to the position of Vice President, as may be established
and directed from time to time, by the Board of Directors. Executive shall
devote his full time and attention to his duties and responsibilities as Vice
President, which he will carry out to the best of his abilities. Executive shall
treat his position with Employer as his exclusive occupation and employment,
refraiming from engaging in all other active business activities, except as may
be approved by Employer’s Board of Directors.
(c) This Agreement may be renewed by the Employer by sending notice to Executive
at least 180 days prior to the end of the term sat forth in Section 1(a), and
the Executive delivering written acceptance to Employer within 10 days of
receipt of such notice.

 

 

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SECTION 2. COMPENSATION.
(a) Allocation of Base Annual Salary. Employer shall pay to Executive during the
term of this Agreement a base annual salary of no less than $150,000. Such base
annual salary may be changed upon annual review by the Board of Directors or its
Compensation Committee. Such annual review shall occur prior to the end of
February each year beginning in the year 2000 for the express purpose of
considering increments. All compensation payments shall be paid in accordance
with Employer’s regular payroll schedule and practice, and shall be subject to
all applicable withholding. It is specifically agreed by Executive that $30,000
of the aforesaid base salary is allocated to the Covenant Not to Compete
contained in Section 5. Executive further acknowledges that absent the Covenant
Not to Compete contained in Section 5, Employer would not agree to the aforesaid
base salary, and would only agree to a reduced base salary.
(b) Bonuses. Executive shall be eligible to participate in and receive periodic
bonuses under Employer’s current Bonus Payment Plan. In addition, Employer, in
its sole discretion, may elect to pay to Executive such periodic bonuses as it
deems appropriate.
(c) Business Expenses. Upon presentation of appropriate documentation, Employer
shall reimburse Executive for expenses reasonably incurred in the course of his
employment, in accordance with policies established by Employer.
SECTION 3. BENEFITS
In addition to the compensation specified in Section 2, Employer shall provide
Executive with the following fringe benefits:
(a) Executive Benefits. In addition to any other benefits provided in this
Section 3, Executive shall be entitled to those fringe benefits to which all
other employees of Employer are entitled during employment. Nothing in this
Agreement shall require the Employer to establish, maintain or continue any of
the fringe benefits already in existence or hereafter adopted for employees of
Employer and nothing in this Agreement shall restrict the right of the Employer
to amend, modify or terminate such fringe benefit programs.
(b) Vacation. Executive shall be entitled to twenty two (22) days of compensated
vacation time in each year of this Agreement.
(c) Professional Meetings. Executive shall be entitled to attend professional
meetings and to attend to such outside professional duties in the insurance
industry as may be appropriate and commensurate with his position hereunder.
(d) Professional Dues. Employer agrees to pay the applicable dues to
professional associations and societies of which Executive is a member.

 

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(e) Insurance. Employer shall provide insurance coverage (so long as all other
Employees of Employer are provided with such coverage) as follows:

  1.   Employer shall provide life insurance coverage for Executive in
accordance with Employer’s policy in an amount of $150,000, payable to the
beneficiary or beneficiaries of his choice.

  2.   Employer shall provide comprehensive health, major medical and long-term
disability insurance for Executive and his family in accordance with Employer’s
group insurance plan.

  3.   Employer shall provide travel accident insurance covering Executive in
accordance with Employer’s standard policy.

SECTION 4. CONFIDENTIALITY
While employed under this Agreement or at any time thereafter, Executive agrees
that he will not, directly or indirectly (other than in the performance of the
services under this Agreement), make or cause to be made any disclosure, copy or
other use not authorized by Employer of any confidential information pertaining
to Employer or any of its affiliates acquired during the course of his
employment by Employer, unless such information is or becomes otherwise
generally available to the public. For purposes of this Agreement, the term
“confidential information” means any business and financial information of any
nature not generally known to the public at large regarding the business and
operations of Employer or any of its affiliates.
SECTION 5. COVENANT NOT TO COMPETE
(a) Covenant. During the period of his employment (including the period of any
post-employment benefits and payments, but not extending such period by the
duration of any pension benefit payments) and for a period of one (1) year
thereafter, Executive shall not, without the prior written consent of Employer,
directly or indirectly, for any reason;

  1.   Engage in, assist or have any interest in, including, without limitation,
as a principal, consultant, employee, owner, shareholder, director, officer,
partner, member, advisor, agent, or financier, any entity which is or which is
about to become engaged in any activity which is in competition with Employer or
its affiliates anywhere where Employer or its affiliates does or is about to do
business; provided, however, that this subsection shall not prohibit the
ownership of securities constituting more than five (5%) percent of the
outstanding securities of a publicly traded company;

  2.   Solicit any of Employer’s or its affiliates’ clients or customers except
on Employer’s behalf, or direct any current or prospective customer to anyone
other than Employer for the services which Employer provides;

  3.   Provide any services for any of Employer’s or its affiliates’ clients or
customers except on Employer’s behalf;

 

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  4.   Directly or indirectly influence any of Employer’s or its affiliates’
employees to terminate his or her employment with Employer or its affiliates or
accept employment with any of Employer’s or its affiliates’ competitors; or

  5.   Interfere with any of Employer’s or its affiliates’ business
relationships, including, without limitation, those with customers, clients,
consultants, attorneys, and other agents, whether or not evidenced by written or
oral agreement.

(b) Officer’s Acknowledgments. With respect to the restrictions contained in
this covenant, Executive acknowledges the following:

  1.   These restrictions are required to reasonably protect the legitimate
business interests of Employer. Executive understands that such covenant is an
essential element of this Agreement and Employer would not have entered into
this Agreement, and increased Executive’s base salary without it being included.

  2.   These restrictions are reasonable in scope and limitation in light of the
business interests of Employer. However, should any provision of this covenant
be determined to be invalid, illegal, or otherwise unenforceable to its full
extent, or if any such restriction is found by a court of competent jurisdiction
to be unreasonable under applicable law, then the restriction shall be enforced
to the maximum extent permitted by law, and the parties hereto hereby consent
and agree that such scope of protection, time, or geographic area (or any one of
them, as the case may be) shall be considered amended in whatever manner deemed
appropriate by such court and may be judicially modified accordingly in any
proceeding brought to enforce such restriction.

  3.   The validity, legality and enforceability of other restrictions shall not
be affected by any judicial modification.

  4.   The geographic scope of this covenant encompasses those places where
Employer is doing the business of insurance, and is actively writing and
soliciting such business. Attached as Appendix I to this Agreement is a listing
of those areas in which Employer is presently doing business and which areas
define the geographic scope of the covenant not to compete, Appendix I is hereby
incorporated by reference and made a part of this Agreement, Appendix I may be
amended by Employer, from time to time, by notice to Executive, so as to update
Appendix I.

  5.   Violation or attempted violation of any provision of this covenant by the
Executive will cause Employer to suffer irreparable harm and Employer’s remedies
at law will be inadequate. Executive understands that Employer will be entitled
to injunctive relief in the event of any violation of this covenant, and Officer
hereby waives any objection to Employer’s assertion that Employer has been
irreparably harmed by such violation.

 

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(c) Enforcement. In the event of any such violation or attempted violation,
Employer shall be entitled to a temporary restraining order, temporary or
permanent injunctions, specific performance, and other equitable relief, without
any showing of irreparable harm or damage or the posting of any bond or other
security, in addition to any other rights or remedies which then may be
available to Employer.
(d) Effect of Termination. Notwithstanding any other provision of this
Agreement, the covenant not to compete set forth in this Section shall extend
12 months beyond the termination of this Agreement.
(e) Assignment. Notwithstanding any other provisions of this Agreement, Employer
may assign this covenant not to compete to any purchaser, successor, or other
party who may acquire any interest in the business of Employer.
(f) Extension of Covenant. The duration of this covenant shall be extended by
the length of time of any litigation relating to the enforcement of this
non-compete covenant.
SECTION 6. TERMINATION
Executive’s employment hereunder shall terminate as follows:

(a)   Termination Notice. Either party may terminate Executive’s employment,
with or without cause, upon thirty (30) days written notice to the other party.
Executive and Employer may agree that Executive may cease work after notice has
been given but before the expiration of thirty (30) days in which case the
effective date of the termination of Executive’s employment shall be the date on
which Executive ceases performing duties on behalf of Employer.

(b)   Death or Disability. Executive’s employment shall terminate without notice
upon Executive’s date of death or disability as that term is defined herein. For
purposes of this subsection, disability shall mean a period of six
(6) consecutive months or an aggregate of eight (8) months in any twelve (12)
consecutive month period during which Executive is disabled from performing his
duties and responsibilities hereunder by reason of any illness, accident, injury
or other health or medical condition of any kind.

(c)   With Cause. Employer may terminate this Agreement, without advance notice,
upon a breach by Executive, for insubordination or disloyalty, for failure to
follow the legal directives of the Board of Directors, or upon the conviction of
Executive of any felony or of any criminal act in the course of, or pertaining
to, Executive’s employment hereunder. Such termination by Employer shall
constitute a termination with cause.

(d)   Change of Control; Change of Executive’s Duties. In the event of a “change
of control” of Employer, as such term is hereinafter defined, or a “change of
Executive’s duties” as such term is also hereinafter defined, Executive may, but
shall not be required to, elect to terminate his employment hereunder and treat
the termination of such employment as a termination by Employer without cause.
Any such election must be made within one (1) year from the date of occurrence
of the events giving rise to either a change of control of Employer or a change
of Executive’s duties. In such event, Executive shall provide to Employer the
thirty (30) day notice referred to in subsection (a) above, indicating his
election to treat such termination of employment as a termination by Employer
without cause.

 

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For purposes of this Agreement, a “change of control” of Employer shall be
deemed to have occurred in the event of the occurrence of any of the following:
(i) the sale of 50% or more of the common stock, or the assets, of The
Navigators Group, Inc., to parties unaffiliated with Terence N. Deeks, in a
transaction or series of transactions occurring within a one year period; (ii) a
merger of Employer with any other entity, such that the other entity or any of
its parents or affiliates have the right to control the business operations of
Employer or, as a result of such a merger, Employer is not the surviving or
continuing business entity.
For purposes of this Agreement, a change of Executive’s duties shall be deemed
to have occurred in the event of the Executive’s duties and responsibilities are
materially reduced and a significant portion of his duties and responsibilities
arc assigned to one or more other employees of Employer.

(e)   Without Cause. Except as set forth in subsections (b) and (c) above, the
termination of Executive’s employment by Employer shall constitute a termination
without cause.

SECTION 7. EFFECT OF TERMINATION: SEVERANCE BENEFITS

(a)   Termination Benefits For Termination Without Cause. If Employer terminates
the employment of Executive without cause, Executive shall be entitled to
receive from Employer;

1.   An amount equal to one year’s base salary, as in effect for the twelve
(12) month period immediately preceding the effective date of such termination
of employment.

2.   Executive shall be entitled to continued comprehensive health and major
medical insurance coverage, at Employer’s cost, under Employer’s group insurance
plan, COBRA if necessary, for a period of six (6) months after the effective
date of such termination of employment. Thereafter, to the extent eligible,
Executive may continue such coverage, at his own cost, under COBRA.

3.   During the period that termination benefits are paid under this Agreement,
Executive shall not be required to perform any duties for Employer or report to
the Employer offices.

4.   Employer shall pay to Executive the termination benefit referred to in
Section (a)(1) above by either paying such sum in installments on Employer’s
regular payroll dates for the one-year period in question, or, alternatively,
with the Executive’s prior written consent, to prepay such benefits in a single
lump-sum amount, actuarially reduced by reason of such prepayment. In the event
that Employer pays such sum in installments on its regular payroll dates, as
aforesaid, and only in such event, if Executive shall accept full-time
employment during the period in which such payments are being made, then
Executive shall, within ten (10) days of accepting such employment, advise
Employer of such fact, indicating the name and address of his new Employer and
the amount of his salary. If Executive’s salary at his new place of employment
is equal to or greater than his last salary at Employer, the payment by Employer
of the termination benefit and the providing to Executive of continued
comprehensive healthcare and major medical benefits under Employer’s plan and at
its expense shall terminate upon the commencement of Executive’s new employment.
If Executive’s salary in his new position is less than his last salary at
Employer, Employer’s

 

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continuing installment payments to Executive shall be reduced so as to pay to
Executive the difference between his salary rate at his new place of employment
and his last salary rate at Employer. Employer’s continuation of comprehensive
healthcare and major medical benefits shall also terminate at the commencement
of Executive’s new employment, unless he is not receiving comparable healthcare
insurance benefits under his new Employer’s insurance plan.

(b)   No Benefits for With Cause Termination. Upon termination of this Agreement
by Employer with cause, under the provisions of Section 6(c), or the termination
of this Agreement by reason of Executive’s death or disability under Section
6(b) (provided that Employer has a disability insurance policy in force for the
benefit of Employee at such time as Employee claims disability), Employer shall
not be obligated to pay to Executive (or his estate or representative in the
event of his death) any termination benefits and Employer’s obligations
hereunder shall terminate with the effective date of the termination of the
Executive’s employment. However, Executive’s obligations and covenants under
Sections 4 and 5 shall continue in full force and effect and shall survive the
termination of Executive’s employment.

SECTION 8. MISCELLANEOUS

(a)   Sole Agreement; Amendment. This Agreement constitutes the entire agreement
of the parties, supersedes all prior agreements and understandings, and may be
amended only by a written agreement executed by both of the parties hereto.

(b)   Severability. The invalidity or unenforceability of any particular
provision of this contract shall not affect its other provisions, and this
Agreement shall be construed in all respects as if such invalid or unenforceable
provision had been omitted.

(c)   Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of each of the parties hereto, their successors and assigns,
administrators, executors, legatees, and representatives, including, without
limitation, any corporation into which Employer may be merged or by which it may
be acquired.

(d)   Forum. This Agreement shall be construed and enforced under and in
accordance with the internal laws of the State of New York.

(e)   Counsel. Each of the parties have read this Agreement and execute it after
having an opportunity to consult with counsel.

(f)   Notices. Any and all notices required to be given under this Agreement
shall be given by, and be deemed given when, (i) delivered by personal delivery;
(ii) deposited in U.S. first-class mail, postage prepaid; or (iii) sent by
telecopy with confirmation of receipt and by first class mail, postage prepaid,
addressed as follows:

  If to Employer:     Somerset Marine, Inc.
123 William Street
New York, NY 10038
Attention: Terence N. Deeks
Fax: 212-346-6820

 

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If to Executive:   Michael L. Civisca
12 Trotters Trail
New City, NY 10956

or such other address as a party may designate in writing to the other party.
SIGNATURES
IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date first set forth above.

              SOMERSET MARINE, INC.       EXECUTIVE:
 
           
By:
  /s/ Terence N. Deeks       /s/ Michael L. Civisca
 
           
 
            Date: March 1, 1999       Date: March 2, 1999

 

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AMENDMENT TO EMPLOYMENT AGREEMENT
AMENDMENT TO EMPLOYMENT AGREEMENT (the “Amendment”), effective as of January 1,
2002, by and between NAVIGATORS MANAGEMENT COMPANY, INC. (“Employer”) and
MICHAEL L. CIVISCA (“Executive”).
RECITALS
WHEREAS, Executive and Employer (f/k/a Somerset Marine, Inc.) entered into an
Employment Agreement, effective as of March 1, 1999 (the “Employment
Agreement”); and
WHEREAS, the parties wish to renew and extend the Employment Agreement, as
modified by this Amendment.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, Employer and Executive agree as follows:
1. Term. The Employment Agreement is amended to provide that Executive’s
employment will continue through December 31, 2002 and will continue for
additional one-year periods, unless either party elects to terminate the
employment relationship by written notice to the other party at least sixty
(60) days prior to December 31, 2002 or prior to the expiration of any
subsequent one-year period.
2. Position. Sections 1(a) and (b) of the Employment Agreement are amended so as
to provide that Executive’s position with the Employer shall be Senior Vice
President.
3. Base Annual Salary. Section 2(a) of the Employment Agreement is amended to
reflect Executive’s current base salary of $172,500 and Executive shall be paid
a base salary of no less than $172,500 during the term of his employment.

 

 

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4. Car Allowance. Section 3 of the Employment Agreement is amended to add a new
subsection (f) entitled “Car Allowance” to reflect the current car allowance
provided to Executive.
5. Covenant Not To Complete. Section 5(a)(1) of the Employment Agreement is
amended so as to provide that the restrictions set forth in Subsection (a)(1) of
Section 5 of the Employment Agreement shall apply only to the states in the
eastern United States, as set forth in Schedule A to this Amendment.
6. Continuing Effectiveness of Employment Agreement. Except as expressly
modified by the provisions of this Amendment, all of the terms of the Employment
Agreement shall continue in full force and effect.

 
IN WITNESS WHEREOF, the parties have executed this Amendment effective as of
January 1, 2002.

              NAVIGATORS MANAGEMENT COMPANY, INC.       EXECUTIVE:
 
           
By:
  /s/ Stanley A. Galanski       /s/ Michael L. Civisca
 
           
 
            Dated: June 10, 2002       Dated: January 20, 2002

 

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SCHEDULE A
States which are subject to the restrictions set forth in the Covenant Not To
Compete (Section 5(a)(1):
Connecticut
Delaware
Florida
Georgia
Maine
Maryland
Massachusetts
New Hampshire
New Jersey
New York
North Carolina
Pennsylvania
Rhode Island
South Carolina
Vermont
Virginia

 

 

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AMENDMENT TO EMPLOYMENT AGREEMENT
AMENDMENT TO EMPLOYMENT AGREEMENT (the “Amendment”), effective as of January 1,
2003, by and between NAVIGATORS MANAGEMENT COMPANY, INC. (“Employer”) and
MICHAEL L. CIVISCA (“Executive”).
RECITALS
WHEREAS, Executive and Employer (f/k/a Somerset Marine, Inc.) entered into an
Employment Agreement, effective as of March 1, 1999 (the “Employment
Agreement”); and
WHEREAS, the parties wish to renew and extend the Employment Agreement, as
modified by this Amendment.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, Employer and Executive agree as follows:
1. Term. The Employment Agreement is amended to provide that Executive’s
employment will continue through December 31, 2003 and will continue for
additional one-year periods, unless either party elects to terminate the
employment relationship by written notice to the other party at least sixty
(60) days prior to December 31, 2003 or prior to the expiration of any
subsequent one-year period.
2. Position. Sections 1(a) and (b) of the Employment Agreement are amended so as
to provide that Executive’s position with the Employer shall be President of the
Marine and Energy Division.
3. Base Annual Salary. Section 2(a) of the Employment Agreement is amended to
reflect Executive’s current base salary of $200,000 and Executive shall be paid
a base salary of no less than $200,000 during the term of his employment.

 

 

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4. Car Allowance. Section 3 of the Employment Agreement is amended to add a new
subsection (f) entitled “Car Allowance” to reflect the current car allowance
provided to Executive.
5. Covenant Not To Complete. Section 5(a)(1) of the Employment Agreement is
amended so as to provide that the restrictions set forth in Subsection (a)(1) of
Section 5 of the Employment Agreement shall apply only to the states in the
eastern United States, as set forth in Schedule A to this Amendment.
6. Continuing Effectiveness of Employment Agreement. Except as expressly
modified by the provisions of this Amendment, all of the terms of the Employment
Agreement shall continue in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Amendment effective as of
January 1, 2003.

              NAVIGATORS MANAGEMENT COMPANY, INC.       EXECUTIVE:
 
           
By:
  /s/ Stanley A. Galanski
 
      /s/ Michael L. Civisca
 
 
  STANLEY A. GALANSKI       MICHAEL L. CIVISCA
 
            Dated: December 4, 2002       Dated: 12/16/02

 

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SCHEDULE A
States which are subject to the restrictions set forth in the Covenant Not To
Compete (Section 5(a)(1):
Connecticut
Delaware
Florida
Georgia
Maine
Maryland
Massachusetts
New Hampshire
New Jersey
New York
North Carolina
Pennsylvania
Rhode Island
South Carolina
Vermont
Virginia