HomeMy WebLinkAbout98-04432
~
~'l
-I
~,
'i
\,
11i
,
!Z
, I
~1
\oil
'h" I
...,1
I
'It'
lJ
~
~
~
ot
'-
~
~
o
cJ
([
i
,
.
,/
/
//
,~
;
;
i
,
I
I
I
~i
T
'~
.Q)
r-l]
;;?
~
~l
~
.~.
d
~
cncompassing thc Commonwcallh of Pcnnsylvania, thc Stalc of Maryland, and lhe State of New
Jcrscy.
6. At all times rclcvant herclo is bclicvcd and thcrcforc averred that Dcfcndant BGS&G
was and is also cngagcd in the business of selling and marketing general commcrcial and personal
insurance within the samc gcographic arca as paragraph 5.
7. On or about August I, 1994, Dcfendant Ford entered into an Employmcnt Agrcement
whercby he agreed to bc employed for the purposc of obtaining clicnts and sclling insurancc for and
on behalf of Acordia of Ccnlral Pennsylvania, Inc., the predecessor of Acordia Northcast, Inc.,
Plaintiff herein. A tme and correct copy of the Agreement which was executed by Defcndant Ford
in Cumberland County, Pennsylvania is attached hereto and incorporated herein by reference and
marked as Exhibit "A".
8. Plaintiff avers that one item of consideration in the Employment Agreement between
Defendant Ford and Plaintiff was a restrictive covenant under the tenns of which Defendant Ford
agreed not to compete with Plaintifffor three (3) years after his termination from employment with
Plaintiff The restrictive covenant set forth in the agreement between the parties is set forth in its
entirety in Section 5.7, Non-Solicitation, in the Employment Agreement attached as Exhibit "A"
as follows:
(a) Employee will not take any action or make any public statement in degradation
of the good name or business interests of the Corporation. Employee will not solicit or encourage
any other employee of the Corporation to do any act that is disloyal to the Corporation or
inconsistent with the interests of the Corporation or in violation of any provisions of this Agreement;
(b) Employee will not discuss with any Existing Client or Potential ofthe Corporation
the present or future availability of services or products by a business, if Employee has or expects
to acquire a proprietary interest in such business or is or expects to be an employee, officer or
director of such business, where such services or products are competitive with services or products
with the Corporation provides and where the acquisition of such proprietary interest or Employee's
becoming an employee, officer or director of such business will or may materially injure an interest
-
...
or the Corporation.
(c) Employec will not makc any statcmcnt or do any act intcnded to causc any
Existing Client or Potcntial Clicnt of the Corporation to makc use of thc scrviccs or purchase the
products of any compctitivc busincss in which thc Employcc has or cxpeets to acquirc a proprietary
intcrcst or in which thc Employee is or expects to be made an cmployee, ofliccr or director, i fsuch
scrviccs or products in any way relatc to or arise out of services or products or thc Corporation sold
or providcd or attcmptcd to bc sold or provided by thc Employec to any Existing Client or Potcntial
Client;
(d) Employcc will not directly or indirectly (as a dircctor, offieer, partner, sole
proprietor, employec, manager, consultant, independent contractor, advisor or otherwise) engage in,
own any interest in, perform any services for, participate in or be conncctcd with (I) any business
or organization that directly cngages in competition with the Corporation in any geographical area
where any business is presently carried on by the Corporation, or (ii) any business or organization
that directly engages in competition with the Corporation in any geographical area where any
business shall be hereafter, during the period of Employee's employment by the Corporation, carried
on by the Corporation, if such business is then being carried on by the Corporation in such
geographical area; provided, however, that the provisions of this subparagraph (d) shall only be
effective during Employee's employment by the Corporation and shall not be deemed to prohibit
Employee's ownership of not more than [1%] of the total shares of all classes of stock outstanding
of any publicly held company.
(e) If, during the said two (2) year period, any commission or any insurance business
becomes payable to the Employee or to any person, firm or corporation by whom the Employee is
then employed or affiliated, as a result of Employee's violation of the provisions of subparagraph
(b) or (c) of this Section 5.7, the Employee agrees to pay promptly to the Corporation an amount
equal to 150% of such commission.
(I) If, following termination or expiration of the period of employment including any
renewal ternl, the Employee accepts other employment or enters into a business relationship with
any person, partnership, corporation or the entity doing business of the kind then being performed
by the Corporation, the Employee shall obtain from said second Employer and shall provide to the
Company a written acknowledgment by the successor Employer of its notification ofthe terms of
Article V of this Agreement.
(g) Employee agrees that he will not entice or induce, directly or indirectly any other
Employee of the Corporation to leave the employ of the Corporation.
9. Defendant Ford was employed in said capacity with the Plaintiff August I, 1994
through and including September 3, 1997 at which time said employment was terminated.
10. Plaintiff avers that on some date, the exact date being unknown to Plaintiff,
J
,
Dcfcndant Ford bccamc employed with Dcfcndant BGS&G and continues to bc so employed.
II. Plaintiff avcrs thal it did on two (2) scparate occasions subscqucnt to Dcfendant
Ford's dcparturc from employment providc Dcfendanl Ford noticc of its cxpcctation and dcmand
that Defendant Ford comply with the tcnns of its Employmcnt Agrccmcnt. A true and corrccl copy
of the corrcspondcncc is attach cd hereto incorporatcd hereby reference as sct forth in Exhibit "B"
and "C".
12. Plaintiff avers that true and correct copies of both such lettcrs, the first datcd
Scptember 26, 1997 and the second dated Novembcr 3, 1997 were also sent to Defendant Ford's new
employer, Defendant BGS&G.
13. Plaintiffavers that as of September 3, 1997, Defendant Ford was no longer employed
with Plaintiff.
14. Plaintiff avers that since Defendant Ford left the cmployment of Plaintiff, Plaintiff
has determined that on several occasions Defendant Ford has directly and/or indirectly solicited and
obtained the insurance business of existing clients of Plaintiff and, has in fact "pirated" numerous
accounts from Plaintiff in violation of the terms of the Employment Agreement in general and
specifically the non-solicitation provisions set forth above.
15. Plaintiff believes and therefore avers that during the time when Defendant Ford was
stilI employed by Plaintiff that Defendant Ford began negotiating on an ongoing basis to obtain a
new position in employment with Defendant BGS&G.
16. Defendant Ford's employment with Defendant BGS&G is in direct violation of the
restrictive covenant because Defendant BGS&G competes with Plaintiff Acordia in the same
business in the same geographic areas.
17. Plaintiff avers that Defendant Ford has and will contact other of Plaintiffs clients and
.
,
thcrcby continue to violatc thc restrictive covcnants of the Employmcnt Agrccmcnt.
18. During thc coursc of Dcfcndant rord's cmploymcnt with Plaintiff, Dcfendant Ford
becamc intimately acquaintcd with Plaintiffs inner workings, bccamc familiar with thc pricing and
commission structures, was given unlimited access to Plaintiffs client lists and further has
spccializcd knowlcdgc and experience in the way in which Plaintiff opcratcs its business and pricing
structures.
19. Plaintiff bclicvcs and thcrcforc avers that since tcrmination of Defendant Ford's
employment with Plaintiff that Defendant Ford has directly and indirectly solicited more than one
of Plaintiffs clients in direct violation of the restrictive covenant of the Employment Agreement,
to-wit, Defendant Ford was known to have contacted and obtained the business of the following
accounts:
Client Premium Amount
(a) Fair Oaks of Pittsburgh $16,243.00
(b) Pickering Valley Golf $17,753.00
(c) Bermedlen, Inc. $151,574.00
(d) Culhanes Steakhouse $10,037.00
(e) Latshaw Menditto, Inc. $20,806.00
COUNT I
ACORDlA NORTHEAST. INC. VS. JOHN J. FORD. III
20. The avennents of paragraphs I through 19 are incorporated herein by reference as set
forth at length.
21. Defendant Ford is employed by Defendant BGS&G and has been for some time since
his cmploymcntwith Plaintiff was tcrminalcd and Dcfcndant Ford is soliciting business and/or
rcferrals from clicnls of Plaintiff in direct violation oflhc rcslrictivc covenant of Defendant Ford's
Employmcnt Agrccment with Plaintiff.
22. Dcfcndant Ford's violation of the rcstrictivc covcnant is continuing and is causing
irreparable haml to thc business of Plainti 1'1' for which a rcmcdy at law for damages is not adequatc.
23. The restrictive covenant in the said Agreement expressly entitles Plaintiffrelicf at law
and in equity.
24. Greater injury will result from the denial of an injunction than from the granting of
the injunction.
25. Plaintiffhas no adequate remedy at law and unless it obtains injunctive relief it will
continue to suffer irreparable haml to its business.
26. Plaintiff avers that pursuant to the terms of the Employment Agreement, in addition
to injunctive relief, it is entitled to receive damages from Defendant Ford in an amount equal to
150% of any commission earned in violation of the Agreement.
27. Plaintiff avers that the total commission lost to date as a result of just the
aforementioned accounts which have been "pirated" total $27,478.98.
WHEREFORE, Plaintiff Acordia Northeast, Inc. requests this Honorable Court enter a
Decree
(A) Permanently enjoining Defendant John J. Ford, III from in anyway breaching or
violating the restrictive covenant of set forth in the Employment Agreement within the Tri-State area
of Pennsylvania, Maryland, and New Jersey in which competition with Plaintiff Acordia Northeast,
Inc. for a period of three (3) years from the date of the Decree;
(B) Direct Defendant Ford and to provide an accounting of all client accounts Defendant
constructive noticc of the restrictivc covcnanls of the Employment Agrecmcnl hctwccn Dcfendant
Ford and Plainti fl'.
35. Plaintiffavers that dcspitc knowing of the same, that Dcfcndant Scrccn pcrmilled and
faeililated Defcndant Ford's violation of the reslrictive covenant and, in fact, cven allowcd
Defcndant Ford to solicit c1icnts and secure accounts in Defendant Scrccn's name so as to avoid any
appcarancc of any violation of the Employment Agreement.
36. By permitting Defendant Ford to solicit Plaintirrs clients and placing his namc on
the accounts, Defendant Screen tortiously interfered and continues to tortiously interfcrc with
Plaintiffs contractual relations with its clients.
37. As a direct and proximate result of Defendant Screen's tortious interferencc with the
restrictive covenant, Defendant Screen has becn unfairly and unjustly enriched to the extent that
Defendant Screen has received the benefit of all revenues heretofore and hcreafter derived by
Defendants in connection with Defendant Ford's wrongful employment and breach of the restrictive
covenant of the Employment Agreement.
WHEREFORE, Plaintiff Acordia Northeast, Inc. requests this Honorable Court enter a
Decree
(A) Prohibiting Defendant Screen from in anyway employing or continuing to employ
Defendant Ford his business in any manner or capacity for a period of three (3) years from the date
of the Decree in the Tri-State area of Pennsylvania, Maryland, New Jersey in which Acordia
Northeast conducts business;
(B) Pemlanently enjoining Defendant Scrcen from anyway interfering with the restrictive
covenant or in anyway encouraging or facilitating Defendant Ford's breach during the effective term
thereof as Ordered by this Court;
, .
$30,000 (or such other amount as may be agreed to in writing from time to time
by Employee and the Company), payable in installments in accordance with the Company's
salary administration practices as they may from time to time exist and subject to withholdings
and payroll deductions. For purposes of this Agreement, the term "Affiliate" shall mean any
company that directly or indirectly, through one or more intermediaries, controls or is
controlled by or is under common control with the Company. Advances or loans on any type
ofrenumeration are not permitted.
2.2 Benefits. In addition to his renumeration as provided for in Section 2.1 hereof,
Employee shall be entitled to participate in all employee benefit plans and programs provided
by Corporation under which he is eligible, in accordance with the terms of such plans and
programs. Corporation expressly reserves unto itself the right to alter, modify, amend or
terminate any such benefit plans and programs at any time and for any reason at its sole
discretion.
2.3 Business Expenses. Corporation shall, in accordance with, and to the extent of
its policies for all employees in effect from time to time, reimburse Employee for all
reasonable, ordinary, and necessary business expenses incurred by Employee in performing his
duties as an employee of the Corporation, provided that Employee accounts promptly for such
expenses to the Corporation in the manner prescribed from time to time by the Corporation.
2.4 Vacation BenefiL~. Employee shall be entitled to vacation for each calendar
year during the term of this Agreement. The amount of vacation shall be determined by the
personnel policies applicable to all employees of the Corporation.
, ARTICLE 3
EMPLOYMENT AND DUTIES
3.1 Dllties and Responsihilities. Employee agrees to devote his full time and effort
to the performance of the following duties:
(a) All duties of a sales and marketing representative for the Corporation, faithfully,
competently, and diligently performing duties as the needs of the Corporation may
require under the control and supervision of the Chief Executive Officer of the
Corporation or his designee;
(b) All duties which customarily are performed by persons holding comparable posi-
tions with companies which are comparable in business and size to Corporation,
which business is the daily administration, solicitation and sale of insurance or
related products; and
(c) Such other tasks on behalf of the Corporation as may reasonably be requested by
the Chief Executive Officer or his designee.
2
..
.
-
ARTICLE 4
TERMINATION
4.1 For Cause. In addition to any rights of termination specified elsewhere in this
Agreement, the Corporation may immediately upon written notice terminate Employee for
cause. "Cause" shall include failure to achieve reasonable performance expectations; failure to
perform in accordance with the specific directives or policies of the Chief Executive Officer of
the Corporation or his designee; violation of Corporation policies; dishonesty; neglect of
duties; grave misconduct; theft; fraud; conviction of a felony; willful misconduct which
seriously impairs or is reasonably expected to seriously impair the Corporation's ability to
conduct its ordinary business in the usual manner; the revocation of the Employee's insurance
agent or broken license by his state of residence and such revocation becomes final; or breach
of any provision of this Agreement. The Corporation shall have no further liability to
Employee under this Agreement for any period subsequent to the termination for cause.
4.2 Wi!hoUl Cause. Either party may terminate this Agreement at any time without
cause, upon th I rty (30 ) days prior written notice to the other party. If the Corpora-
tion terminates this Agreement without cause, in addition to any amount due to Employee
under the Corporation's policies applicable to all of its employees, the Corporation shall pay
the Employee a lump sum equal to the lesser I)f (i) the remaining installments that would
have been due and payable to Employee for the period from the date of termination through
the remaining term of employment or (ii) three months base salary.
4.3 Death or Disabilitv. This Agreement shall terminate immediately upon the
Employee's death or disability, as that'term is defined in the long term disability program of
the Corporation.
ARTICLE 5
NON-SOLICITATION AND NON-DISCLOSURE
5.1 Emplovment Relationship. The Employee acknowledges that Employee's
employment by the Corporation creates a relationship of confidence and trust between the
Employee and the Corporation with respect to cenain information applicable to the business of
the Corporation and its Affiliates or applicable to the business of any client or customer or
potential client (as defined in Section 5.7) of the Corporation or its Affiliates which may be
made known to the Employee during the period of his or her employment (including, without
limitation, customer lists, and information regarding customer needs and renewal dates, pricing
and underwriting).
5.2 ProprietarY Information. Employee acknowledges that the Corporation
possesses and will continue to possess information that has been created, discovered or
developed by, or otherwise become known to it (including, without limitation, information
created, discovered, developed or made known by the Employee during the period of or arising
out of his or her employment) or in which property rights have been or may be assigned or
3
. '.
.
otherwise conveyed 10 the Corporation which information has commercial value in the
business in which the Corporation is engaged and is treated by the Corporation as confidential.
5.3 Non-Disclosure. The Employee shall not without the prior written consent of
[the Chief Executive Officer) of the Corporation (i) use for Employee's benefit or disclose at
any time during Employee's employmenl by the Corporation, or thereafter, except to the extent
required by the performance by Employee of his or her duties as an employee of the
Corporation, any information obtained or developed by Employee while in the employ of the
Corporation with respect to any customers, suppliers, products, employees, financial affairs,
business methods or service of the Corporation or any of its Affiliates (including, without
limitation, customer or client lists, trade secrets, pricing, marketing, financial or sales
information, forecasts, business and strategic plans), or any confidential matter, except
information which at the time is generally known to the public other than as a result of
disclosure by Employee not permitted hereunder, or (ii) take with Employee upon leaving the
employ of the Corporation any document or paper relating to any of the foregoing or any
physical property of the Corporation or any of its sources with which insurance is placed,
policyholders. expiration or renewal dates, inspection or credit reports, and data on insurance
risks being written.
5.4 Return of Property. Upon terminalion of the Employee's employment for any
reason, or at any other time the Corporation requests in writing, the Employee shall
immediately deliver to the Corporation all memoranda, notes, plans, records, reports and other
documents (and copies thereof) and other property in Employee's possession or control relating
to the business of the Corporation or any of its Affiliates.
5.5 Bindin~ Nature. The Employee hereby expressly agrees that the foregoing
provisions of this Agreement shall be binding upon the Employee's heirs, successors and legal
representatives.
5.6 Confidential Information. Employee shall hold in confidence the terms of this
Agreement.
5.7 Non-Solicitation. During Employee's employment by the Corporation and
during the three (3) year period commencing on the date of Employee's termination of
employment (for any reason):
(a) Employee will not take any action or make any public statement in degradation of
the good name or business interests of the Corporation. Employee will not solicit
or encourage any other employee of the Corporation to do any act that is disloyal to
the Corporation or inconsistent with the interests of the Corporation or in violation
of any provisions of this Agreement; ,
(b) Employee will not discuss with any Existing Client or Potential Client of the
Corporation the present or future availability of services or products by a business,
if Employee has or expects to acquire a proprietary interest in such business or is or
expects to be an employee, officer or director of such business, where such services
4
'". '.
or products are competitive with services or products which the Corporation
provides and where the acquisition of such proprietary interest or Employee's
becoming an employee, officer or director of such business will or may materially
injure an interest of the Corporation.
(c) Employee will not make any statement or do any act intended to cause any Existing
Client or Potential Client of the Corporation to make use of the services or purchase
the products of any competitive business in which the Employee has or expects to
acquire a proprietary interest or in which the Employee is or expects to be made an
employee, officer or director, if such services or products in any way relate to or
arise out of services or products of the Corporation sold or provided or attempted to
be sold or provided by the Employee to any Existing Client or Potential Client;
(d) Employee will not directly or indirectly (as a director, officer, partner, sole
proprietor, employee, manager, consultant, independent contractor, advisor or
otherwise) engage in, own any interest in, perform any services for, participate in or
be connected with (i) any business or organization that directly engages in competi-
tion with the Corporation in any geographical area where any business is presently
carried on by the Corporation, or (ii) any business or organization that directly
engages in competition with the Corporation in any geographical area where any
business shall be hereafter, during the period of Employee's employment by the
Corporation, carried on by the Corporation, if such business is then being carried on
by the Corporation in such geographical area; provided, however, that the provi-
sions of this subparagraph (d) shall only be effective during Employee's
employment by the Corporation and shall not be deemed to prohibit Employee's
ownership of not more than [I %] of the total shares of all classes of stock
outstanding of any publicly held company.
(e) [OPTIONAL PARAGRAPH] If, during the said two (2) year period, any
commission or any insurance business becomes payable to the Employee or to any'
person, fIrm, or corporation by whom the Employee is then employed or affIliated,
as a result of Employee's violation of the provisions of subparagraph (b) or (c) of
this Section 5.7, the Employee agrees to pay promptly to the Corporation an
amount equal to 150% of such commission.
(f) If, following termination or expiration of the period of employment including any
renewal term, the Employee accepts other employment or enters into a business
relationship with any person, partnership, corporation or the entity doing business
of the kind then being performed by the Corporation, the Employee shall obtain
from said second Employer and shall provide to the Company a written
acknowledgment by the successor Employer of its notification of the terms of
Article V of this Agreement.
(g) Employee agrees that he will not entice or induce, directly or indirectly any other
Employee of the Corporation to leave the employ of the Corporation.
5
'.
For purposes of this Agreement, the tenn "Potential Client" shall mean a person or
entity who was the target of sales or marketing activity by the Employee during the [one]-year
period preceding Employee's tennination of employment or, in the event Employee has been
employed by the Corporation less than [two] years at the time of tennination, during the period
of Employee's employment with the Corporation. The tenn "Existing Client" shall mean a
person or entity who is a customer of the Corporation at the time of Employee's tennination of
employment and who was solicited by Employee or whose accounts were handled by
Employee during the period of Employee's employment with the Corporation.
Employee agrees that when Employee has or expects to acquire a proprietary interest
in, or is or expects to be made an employee, officer or director of any existing or future
business that provides or may provide services or products in competition with the
Corporation, Employee will, upon request by the Corporation, immediately furnish to the
Chief Executive Officer of the Corporation all material infonnation that may reasonably be of
assistance to the Corporation in acting promptly to protect its relationships with any Existing
Client or Potential Client with whom Employee has had any dealings as a result of Employee's
employment by the corporation. Employee further agrees that the limitations set forth in this
Article 5 shall survive the expiration or tennination of this Agreement.
For purposes of this Article 5, proprietary interest in a business is ownership, whether
through direct or indirect stock holdings or otherwise, of one percent (1 '70) or more of such
business. Employee shall be deemed to expect to acquire a proprietary interest in a business or
to be made an officer or director of such business if such possibility has been discussed with
any officer, director, employee, agent or promoter of such business. Notwithstanding anything
in this Article 5 to the contrary, Employee's engagement in, ownership of, perfonnance of or
services for, participation in or connection with any business or organization other than the
Corporation, with respect to which the Chief Executive Officer of the Corporation has
consented in writing, shall not be deemed a breach of this Agreement.
ARTICLE 6
MTSCELLANEOUS PROVTSTONS
6.1 Amendments. Any amendment of this Agreement shall be effective only if in
writing and signed by both Employee and Corporation.
6.2 Governina Law. This Agreement, the rights and obligations of the parties
hereto, and any claims or disputes thereto, will be governed by and considered in accordance
with the laws of the State of Pennsvl vani a
6.3 Headin~s. The paragraph headings contained in this Agreement are inserted for
convenience or reference only. will not be deemed to be part of this Agreement for any
purpose, and will not in any way define or affect the meaning, construction or scope of any of
the provisions hereof.
6.4 Notices. All notices, requests, or other communications which may be or are
required to be given or sent by either party to the other pursuant to this Agreement will be in
6
writing and will be mailed by first-class, registered or certified mail, return receipt requested,
postage prepaid, or transmitted by hand delivery, telegram or telex, addressed as follows:
If to Corporation: 4750 De1brook Road, POBox 1220 Mechanicsburg PA 17055
If to Employee:
19 Ma~l Road, Etters PA 17319
Either party may designate, by notice in writing, a new address for notice from time to time.
6.5 Severahilitv. If any part of any provision of this Agreement shall be adjudged
invalid or unenforceable under applicable law, such pan may be reformed by a court of
competent jurisdiction sitting in equity to the extent of such original invalidity or unenforce-
ability only, without affecting the remaining pans of such provision or remaining provisions of
the Agreement unnecessarily.
6.6 Survival. It is the express intention and agreement of the parties that the
covenants. agreements and statements made in Article 5 will survive the termination of this
Agreement for any reasons. '
6.7 Waiver. Neither the waiver by either pany hereto of a breach or of a default
under any of the provisions of this Agreement, nor the failure of either party on one or more
occasions, to enforce any of the provisions of this Agreement or to exercise any right of
privilege hereunder will thereafter be construed as a waiver of any subsequent breach or
default of a similar nature, or as a waiver of any such provision, rights or privileges hereunder.
6.8 Nonalienation. Except as may otherwise be required by law, no right to receive
payments under this Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, change, pledge, bankruptcy or hypothecation or to exclusion,
attachment, levy or similar process or assignment by operation of law, and any attempt,
voluntary or involuntary, to effect any such action shall be null, void and of no effect.
6.9 AssiQnment. The Corporation. in its sole discretion, may assign this Agreement
to any subsidiary or other Affiliate. This Agreement shall not be assignable by or on behalf of
the Employee. This Agreement shall be binding upon and inure to the benefit of the
Corporation and its successors and assigns and any purchaser of the Corporation or of
substantially all of the assets of the Corporation.
6.10 Entire Avreement: Modification. This Agreement, together with the
Confidentiality Agreement referred to above, constitutes the entire agreement of the parties
with respect to the subject matter hereof. This Agreement may be modified or amended only
by an instrument in writing signed by both parties hereto.t
7
.
,.
NEW BUSINESS BONUS
In addition to the formula which establishes the base compansation, a new
business bonus will be paid on "net new" production in the quarter which
the new business is billed. If billed on an installment basis, bonus
will be paid for first 12 months or four quarters the business is on the
books. '
The amount of bonus so calculated will be determined quarterly based on
producer production runs generated reflecting results according to
producer management and compensation program. A cash bonus payment at
that time will be made within thirty (30) days of receipt of approved
Bonus Calculation Form (See Attached Addendum) to the Account Executive.
This cash payment will be made in accordance with the follO\dng payment
plan:
January 1 to March 31
April 1 to June 30
July 1 to September 30
October 1 to December 31
- 80% of Earned Bonus
- 80% of Earned Bonus
- 80% of Earned Bonus
- 100% of Earned Bonus
for year.
(Any negative figure will be carried
over to next year and applied against
future bonuses earned until offset)
Bonuses are not a vested interest of the producer. To be e1 igib1e for
payment, the producer must be an employee of the company on the day the
actual bonus payment is to be made. Unpaid bonuses will be forfeited in
the event of resignation or termination of employment for any reason.
New Business is defined as New Clients or New Coverages, not previously
written, on existing clients. Additions to existing coverages or
additional policies, (i.e. new divisions or subsidiaries) are not New
Bus i ness. Only the fi rst year Bonds on a Surety Account qua 1 i fy as New
Business.
New Property and Casualty Business - 15% (First 12 months commission)
New Business Bonus will be reduced
if any commission reduction is taken
unless approved by Division Manager.
New Life or Disability
- 75% (First 12 months commission)
- 50% (First 12 months commission)
New Personal Lines
1. Unauthori zed Commi ss ion Reducti ons On new or renewa 1
business, if a producer accepts a commission reduction without
written agreement of the Branch Manager, the amount of reducti on
will be deducted from their next salary period.
2. "El ite Producer" Bonus - To recognize the accompl ishments of
our most successful Producers, those with total commission income
in excess of $400,000 during the 12 month calculation period,
Base Salary will be increased by 10% of the Adjusted Base.
,
J\ ,
GINGRICH. SMITH, KLINGENSMITH & DOLAN
ATTORNEYS AT LAW
222 SOUTH MARMeT STRtET, SUITE 201
P Q. DOlt 207
ELIZABETHTOWN, PA 17022.02e7
(717) 387.1370
F"AX 17171 3157.3219
.JOHN M. SMITH
THOMAS G, KLINGENSMITH
KEVIN O. COLAN
HERBI:RT R HENDERSON, D
..JE,.,.AEY S. SH"NK
4e CAST ORANoe STRE:tT
LANCASTER, PA 17602
17171 393.3150'"
f'AX 17171 393.0e~3
or COUNal:L
HENRY F. GINGRICH
September 26, 1997
Mr. John J. Ford, III
98 Byron Nelson Circle
Etters, PA 17319
Re: Employment Agreement/Non-Solicitation and Non-Disclosure
Dear Mr. Ford:
Please be advised that I represent Acordia of Central Pennsylvania. It is my understanding you
voluntarily terminated your Employment Agreement with Acordia which you signed on August 1,
1994. Pursuant to Article S, Non-Solicitation and Non-Disclosure you are prohibited from disclosing
any proprietary information regarding Acordia as defined in that Article. You are specifically prohibited
by Article S.7 for a period of three years commencing on the date of your termination of employment
from:
_ Taking any action or making any public statement in degradation of the good name or
business interest of Acordia; soliciting or encouraging any other employee of Acordia to do any act that
is disloyal to Acordia or inconsistent with the interests of Acordia or in violation of the provisions of
your Employment Agreement;
_ Discussing with any existing client or potential client of Acordia that the present or future
availability of services or products by a business if you have or expect to acquire a proprietary interest
in such business is or expects to be an employee, officer or director of any such business, where such
services or products are competitive with services or products which Acordia provides and where the
acquisition of the proprietary interest or your employment will or may materially injure the interest of
Acordia; .
- You will not make any statement or act or commit any act intended to cause an existing client
or potential client of Acordia to make or use the services or purchase products of any competitive
business in which you have or expect to acquire a proprietary interest in which you are or expect to
become or to be made an employee, officer or director if such services or products in any way relate
to or arise out of services or products Acordia sold or provided or attempted to be sold or provided by
you to an existing client or potential client;
- The Agreement also provides that following your termination of employment that if you accept
employment or enter into a business relationship with any person, partnership, corporation or entity
EXHIBIT
!
B
r-4 "-
'"
~ '~J'o.
C'"
"<
~ f' r' ~~~
.,
-0 \,j" J)
:r \,., ... u~
.' ~ <:>
t>> "
-\
~
<f
(0
.....
~.~ ,... >-
, ;':
LJ .' i
, ':.1'
(, .,.~ :"(
Li .....
"
" ~..:.: ,
;!> ( --:.!
....) "
, , '. 1
" .
LJ~. , C'- /
;..:. ; :Ci
......; ; Cl.-
,
() cr:: ~'J
en U
'"
<
::E
i><<<: 0 Ql
OH .--l :r: m
~~ ro l- e
0 ,
'" lJl Z i5
Q3g Q) 4-< '" < Ql
4-< C Z I;; !!!
''''; .--l ro < :S
15~ B '" ro 1J ~
::E ~
~ c Vl 0<: Z
~ ''''; '" ~ ~ W ,,;
U U-I
011'" H ro Q) ~ ~ ~
pj ~ ~ ii: ~ ~
"" ~
o " " " u. '" ~
~~ '" I H Q 0 ~ z
'9 H ~ ;Z. 7- Z
H ~ 0 0 w
00 ~ ~ ~ "-
0 0 l
~i ~ < .
N :r: M
C"l 0 ~
--r z !;;
--r ~ >= Z
I '"' :t
00 H ...., '" 0
!~ (j\ ~ ~ ..,
. ~ ::E
:2 ~ lJl <
HU :> ...., '"'
t.;9..
u-.....
- ~
..s.
rt
~
1
.)
~
F=
'....
'. .-1"':
rq Cr}.i";.-II.I....,,...,1"1./
: ,~",.I." 'Y' ~...' ':' : ',I'~i ,
(:: 1: :': ,
." "
\'~ \ i"
Co:l r,:. .
\,.... "'\
': \!,\io,J
VJ
'i--
ct:.
cu~\<.::,,'
"
...',',~'.; ;.,(
.
, .'
p:
~1
--.:..
-
"'-
<xl
1
.~
'i-i
r
~
.
4, Plaintiff/Pctitioncr has brought its Complaint and sccks this Preliminary Injunctive
Rclicl' to cnjoin thc continuing hrcachcs and violations of a rcstrictivc covenant contained in an
EmploynlCnt AgrccnlCnt hctwecn Plaintiff and Dcl'cndant Ford and the tortious intcrfcrcnce of
Dcfcndant IKiS&G and Dcfcndant Scrccn.
5. As nlOrc Hilly set forth in the Verified Complaint attached hcrcto as Exhibit "I ", thc
Illllllers at issue arise out 0(' a rcstrictivc covenant which the Pctitioncr belicves and hereby avers is
hcing violatcd by Dcfcndant/Rcspondcnt Ford which violation is being assisted, aided, and
pcrpctratcd in and by both Defendant/Respondent BGS&G and Defcndant/Respondent Screen.
G. As Illore fully sct forth in the Complaint, the same of which is attached hereto,
Dcfcndant/Respondent Ford continues to breach and violatc a rcstrictive covenant contained in his
Employmcnt Agrccmcntwith Plaintiff/Petitioner and Defendants/Respondents BGS&G and Screen
arc tortiously interfering and continuing to tortiously interfcre with thc restrictive covenant by
cmploying and continuing to employ him; by allowing Defcndant/Respondent Ford to obtain and
solicit clients in violation ofthe covenant; and placing Defendant!Respondent Screen's name on
several accounts to avoid thc appearance of a violation and enjoying the financial benefits derived
thcrefrom.
7. Plaintiff/Pctitioner will suffer immediate and irreparablc harm ifinjunctivc relief is not
granted. The said injunctive relief being requested is necessary to prevent immediate and irreparable
harm which cannot be adequately compensated by damages.
8. It is bclicvedand therefore averred that Defendant/Respondent Ford, having intimate and
protectcd infonnation regarding Plaintiff/Petitioner's pricing structure has and/or will continue to
solicit and advise current and/or future clients ofPlaintif(,lPetitioner of the samc in an effort to obtain
that client for himself and that his actions in doing so will cause PlaintifflPetitioner to suffcr
immediate and irreparable hann, damagc its business standing, rcputation and good will.
.."
"
'~'
J
..
9. It is believed and thercforc avcrrcd that greater injury will result by refusing to grant the
rcqucstcd relief than by granting it.
10. Plaintiff/Petitioner believes and hereby avers that the rcqucstcd relief will properly
restore the parties to their status as it existcd immediately prior to the alleged wrongful misconduct
of the Defendants/Respondents.
II. Plaintiff/Petitioner believes and hereby avers that the activities sought to be restrained
are actionable and the requested relief is reasonably suited to abate such activity.
12. PlaintifflPetitioner believes and hereby avers that its right to this relief is clear and the
wrong to be remedied is manifest.
13. PlaintifflPetitioner believes and avers that DefendantslRespondents will not suffer any
appreciable injury ifthe requested Preliminary Injunction is issued because the status quo between
the parties will be restored to where it was to be before the wrongful conduct of the
DefendantslRespondents began. DefendantslRespondents will merely be restrained from taking
advantage of their wrongful acts and continuing to violate a valid and enforceable and restrictive
covenant.
14. It is believed and therefore averred that the PlaintifflPetitioner is likely to succeed on the
merits of its claim and that the rights of the PlaintifflPetitioner are enforceable in equity and at law
and Plaintiff/Petitioner will be entitled, upon final hearing, to a permanent injunction against the
DefendantslRespondents and the other relief requested in Plaintiffs Complaint.
WHEREFORE, Plaintiff/Petitioner, Acordia Northeast, Inc., requests this Honorable Court:
(a) Immediately, Issue a temporary Preliminary Injunction restraining
DefendantslRespondents from continuing to violate the restrictive covenant ofPlaintifflPetitioner
and Defendant/Respondent Ford's Employment Agreement;
(b) Direct Defendants/Respondents BGS&G to provide an accounting for all clients which
.
or the Corporation.
(c) Employec will not make any statemcnt or do any act intended to calise any
Existing Client or Potcntial Client of the Corporation to makc usc of thc services or purclmsc thc
products of any competitive business in which the Employcc has or expects to acquire a proprictary
intcrcst or in which the Employee is or cxpccts to be madc an employee, oflkcr or dircctor, if such
serviccs or products in any way rclatc to or arisc out of scrviccs or products or the Corporation sold
or provided or attcmpted to bc sold or providcd by the Employce to any Existing Clicnt or Potcntial
Clicnt;
(d) Employcc will not dircctly or indirectly (as a director, officcr, partncr, solc
proprietor, employee, managcr, consultant, indepcndent contractor, advisor or otherwise) cngagc in,
own any intercst in, perform any scrviccs for, participatc in or be connected with (I) any business
or organization that directly engages in competition with the Corporation in any geographical area
where any business is presently earned on by the Corporation, or (ii) any business or organization
that directly engages in competition with the Corporation in any geographical area where any
business shall be hereafter, during the period of Employee's employment by the Corporation, carried
on by the Corporation, if such busincss is then being carried on by the Corporation in such
geographical area; provided, however, that the provisions of this subparagraph (d) shall only be
effective during Employee's employment by the Corporation and shall not be deemed to prohibit
Employee's ownership of not more than [1 %] of the total shares of all classes of stock outstanding
of any publicly held company.
(e) If, during the said two (2) year period, any commission or any insurance business
becomes payable to the Employee or to any person, firm or corporation by whom the Employee is
then employed or affiliated, as a result of Employee's violation of the provisions of subparagraph
(b) or (c) of this Section 5.7, the Employee agrees to pay promptly to the Corporation an amount
equal to 150% of such commission.
(f) If, following termination or expiration of the period of employment including any
renewal term, the Employee accepts other employment or enters into a business relationship with
any person, partnership, corporation or the entity doing business ofthe kind then being performed
by the Corporation, the Employee shall obtain from said second Employer and shall provide to the
Company a written acknowledgment by the successor Employer of its notification of the terms of
Article V of this Agreement.
(g) Employee agrees that he will not entice or induce, directly or indirectly any other
Employee of the Corporation to leave the employ ofthe Corporation.
9. Defendant Ford was employed in said capacity with the Plaintiff August I, 1994
through and including September 3, 1997 at which time said employment was terminated.
10. Plcintiff avers that on some date, the exact date being unknown to Plaintiff,
.
Dcfcndant Ford bccame cmploycd with Dcfcndanl BGS&G and continucs to bc so cmploycd.
11. Plaintiff avcrs that it did on two (2) separate occasions subscquent to Dcfcndant
Ford's dcparturc from cmploymcnt providc Defendant Ford notice of its cxpectation and demand
that Dcfendant Ford comply with the tcrms of its Employment Agrcemcnt. A truc and corrcct copy
of the correspondence is attachcd hcrcto incorporated hereby rcference as set forth in Exhibit "B"
and "C".
12. Plaintiff avers that truc and correct copies of both such Icttcrs, the first dated
September 26,1997 and the sccond dated November 3,1997 wcrc also sent to Defendant Ford's new
employer, Defendant BGS&G.
13. Plaintiff avers that as of September 3, 1997, Defendant Ford was no longer employed
with Plaintiff.
14. Plaintiff avers that since Defendant Ford left the employment of Plaintiff, Plaintiff
has determined that on several occasions Defendant Ford has directly and/or indirectly solicited and
obtained the insurance business of existing clients of Plaintiff and, has in fact "pirated" numerous
accounts from Plaintiff in violation of the terms of the Employment Agreement in general and
specifically the non-solicitation provisions set forth above.
15. Plaintiff believes and therefore avers that during the time when Defendant Ford was
still employed by Plaintiff that Defendant Ford began negotiating on an ongoing basis to obtain a
new position in employment with Defendant BGS&G.
16. Defendant Ford's employment with Defendant BGS&G is in direct violation of the
restrictive covenant because Defendant BGS&G competes with Plaintiff Acordia in the same
business in the same geographic areas.
17. Plaintiff avers that Defendant Ford has and will contact other of Plaintiffs clients and
thereby continue to violate the rcstrictive covenants of the Employment Agreement.
18. During the coursc of Defendant Ford's cmployment with Plaintiff, Defendant Ford
became intimately acquainted with Plaintiffs inner workings, became familiar with the pricing and
commission structures, was given unlimited access to Plaintiffs client lists and further has
specialized knowledge and experience in the way in which Plaintiff operates its business and pricing
structures.
19. Plaintiff believes and therefore avers that since termination of Defendant Ford's
employment with Plaintiff that Defendant Ford has directly and indirectly solicited more than one
of Plaintiffs clients in direct violation of the restrictive covenant of the Employment Agreement,
to-wit, Defendant Ford was known to have contacted and obtained the business of the following
accounts:
Client Premium Amount
(a) Fair Oaks of Pittsburgh $16,243.00
(b) Pickering Valley Golf $17,753.00
(c) Bermedlen, Inc. $151,574.00
(d) Culhanes Steakhouse $10,037.00
(e) Latshaw Menditto, Inc. $20,806.00
COUNT I
ACORDIA NORTHEAST. INC. VS. JOHN J. FORD. III
20. The averments of paragraphs I through 19 are incorporated herein by reference as set
forth at length.
21. Defendant Ford is employed by Defendant BGS&G and has been for some time since
his employment with Plaintiff was tcrminated and Defendant Ford is soliciting business and/or
referrals from clients of Plaintiff in direct violation ofthe restrictive covenant of Defendant Ford's
Employment Agreement with Plaintiff.
22. Defendant Ford's violation of the restrictive covenant is continuing and is causing
irreparable harm to the business of Plaintiff for which a remedy at law for damages is not adequate.
23. The restrictive covenant in the said Agreement expressly entitles Plaintiff relief at law
and in equity.
24. Greater injury will result from the denial of an injunction than from the granting of
the injunction.
25. Plaintiff has no adequate remedy at law and unless it obtains injunctive relief it will
continue to suffer irreparable harm to its business.
26. Plaintiff avers that pursuant to the terms oflhe Employment Agreement, in addition
to injunctive relief, it is entitled to receive damages from Defendant Ford in an amount equal to
150% of any commission earned in violation of the Agreement.
27. Plaintiff avers that the total commission lost to date as a result of just the
aforementioned accounts which have been "pirated" total $27,478.98.
WHEREFORE, Plaintiff Acordia Northeast, Inc. requests this Honorable Court enter a
Decree
(A) Permanently enjoining Defendant John J. Ford, III from in anyway breaching or
violating the restrictive covenant of set forth in the Employment Agreement within the Tri-State area
of Pennsylvania, Maryland, and New Jersey in which competition with Plaintiff Acordia Northeast,
Inc. for a period of three (3) years from the date of the Decree;
(B) Direct Defendant Ford and to provide an accounting of all client accounts Defendant
constructive notice of the restrictive covenants of the Employmcnt Agrcement betwecn Dcfendant
Ford and Plaintiff.
35. Plaintiffavcrs that despite knowing of the samc, that Defendant Scrccn pern1illcd and
facilitated Dcfcndant Ford's violation of the restrictive covcnant and, in fact, evcn allowed
Defendant Ford to solicit clicnts and sccurc accounts in Defendant Screen's name so as to avoid any
appearance of any violation of the Employmcnt Agreement.
36. By permitting Defcndant Ford to solicit Plaintiffs clients and placing his name on
the accounts, Defendant Screen tortiously interfered and continues to tortiously interfere with
Plaintiffs contractual relations with its clients.
37. As a direct and proximate result of Defendant Screen's tortious interference with the
restrictive covenant, Defendant Screen has been unfairly and unjustly enriched to the extent that
Defendant Screen has received the benefit of all revenues heretofore and hereafter derived by
Defendants in connection with Defendant Ford's wrongful employment and breach ofthe restrictive
covenant ofthe Employment Agreement.
WHEREFORE, Plaintiff Acordia Northeast, Inc. requests this Honorable Court enter a
Decree
(A) Prohibiting Defendant Screen from in anyway employing or continuing to employ
Defendant Ford his business in any manner or capacity for a period of three (3) years from the date
of the Decree in the Tri-State area of Pennsylvania, Maryland, New Jersey in which Acordia
Northeast conducts business;
(B) Permanently enjoining Defendant Screen from anyway interfering with the restrictive
covenant or in anyway encouraging or facilitating Defendant Ford's breach during the effective term
thereof as Ordered by this Court;
(C) Ordering an accounting by Defcndant Scrccn of all rcvcnucs dcrivcd by him herctoforc
and hcrcundcr arising out of Dcfendant Ford's cmployment in violation of thc rcstrictivc covenant
and
(D) Awarding Plaintiff reasonable counscl fecs and costs incurrcd in this action as a rcsult
of Defendant Screen's willful, delibcrate, and intcntional actions and encouraging and facilitating
Defendant Ford's breach of the said restrictive covenant ofthc Agrcement.
COUNT IV
ACORDlA NORTHEAST. INC. VS. JOHN J. FORD. RANDALL B. SCREEN AND
BEALL. GARNER. SCREEN. & GEARE. INC, t/d/b/a THE BGS&G COMPANY
38. The averments of Paragraphs I through 37 are incorporated herein by reference as
set forth at length.
39. Plaintiff avers that by soliciting Plaintiffs clients that Defendant Ford has tortiously
interfered and continues to tortiously interfere with Plaintiffs contractual relations with its clients.
40. By permitting Defendant Ford to solicit Plaintiffs clients and also allowing
Defendant Screen to place his name on the accounts, Defendant BGS&G tortiously interfered and
continues to tortiously interfere with Acordia Northeast, Inc.'s contractual relations with its clients.
41. As a direct and approximate result of the tortious interference of Defendant Ford,
Defendant Screen, and Defendant BGS&G with Plaintiffs contractual relations with its clients,
the Defendants have been unfairly and justly enriched to the extent of all revenues heretofore and
hereafter derived from or in connection with or tortious interference with Plaintiffs contractual
relations with its clien~s.
42. Defendants have also been unjustly enriched by the good will imparted to Defendant
Ford as a result of his prior employment by Plaintiff.
.
"
..
JP
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("Agreement") is made as of the 1 st day
of August , 199~, between A:ordla of Central Pemsylvanla. Inc. ,a
corporation ("Corporation"), and
TTT , ("Emplo)'ee"),
.j,."",, ,i l:"",..rt ___
Whereas, the Corporation is principally engaged in the daily administration,
solicitation and sale of insurance and related products; ("Business") and
Whereas, Employee is an individual who possesses qualifications and experience in
these areas; and
Whereas, the Corporation desires to employ Employee to perform services on behalf
of the Corporation, and Employee is willing to accept such employmen t with the Corporation
upon the terms and conditions contained in this Agreement.
NOW, THEREFORE, for mutual consideration, and intending to be legally bound
hereby, the Corporation and Employee hereby agree as follows:
ARTICLE 1
TERM
1.1 Initial Term. This Agreement shall beforan initial term of one year
commencing on 8/1: 199.i. and terminating at the end of the business day on 8/1
1992... ("Initial Term"), unless sooner terminated pursuant to Article 4 of this Agreement.
1.2 Renewal Terms. If no termination has occurred pursuant to Article 4 of this
Agreement on or before the expiration of the Initial Term it being expressly understood and
agreed that the Corporation does not now, nor hereafter shall have, any obligation to continue
Employee in its employ after the expiration of the Initial Term, this Agreement shall
automatically be renewed on each anniversary thereof from year to year unless either party
gives written notice of non.renewal to the other at least thirty (30) days prior to the expiration
of the then current term of this Agreement.
ARTICLE 2
COMPENSATION &BENEmS
2.1 [MAY BE CHANGED TO ADAPTTO DIFFERENT PAY STRUCTURE,]
Salary. During the Initial Term of Employee's employment under this Agreement, the
Corporation will payor cause to be paid to Employee, and Employee shall accept from the
Corporation or one of its" Affiliates" (as hereinafter defined) as ful1 compensation for his
services and other obligations hereunder an annual base salary in the amount of
EXHIBIT
I
A
.
$30,000 (or such othcr amount as may bc agrccd to in writing from time to time
by Employee and the Company), payable in installments in accordance with the Company's
salary administration practices as they may from time to time exist and subject to withholdings
and payroll deductions. For purposes of this Agreement, the term" Affiliate" shall mean any
company that directly or indirectly, through one or more intermediaries, controls or is
controlled by or is under common control with the Company. Advances or loans on any type
of renumeration are not pennilted.
2.2 Benefil~. In addition to his renumeration as provided for in Section 2.1 hereof,
Employee shall be entitled to participate in all employee benefit plans and programs provided
by Corporation under which he is eligible, in accordance with the terms of such plans and
programs. Corporation expressly reserves unto itself the right to alter, modify, amend or
terminate any such benefit plans and programs at any time and for any reason at its sole
discretion,
2.3 Business Expenses. Corporation shall, in accordance with, and to the extent of
its policies for all employees in effect from time to time, reimburse Employee for all
reasonable, ordinary, and necessary business expenses incurred by Employee in performing his
duties as an employee of the Corporation, provided that Employee accounts promptly for such
expenses to the Corporation in the manner prescribed from time to time by the Corporation.
2.4 Vacation Benefits. Employee shall be entitled to vacation for each calendar
year during the term of this Agreement. The amount of vacation shall be detennined by the
personnel policies applicable to all employees of the Corporation.
. ARTICLE 3
EMPLOYMENT AND DUTIES
3.1 Duties and Responsihilities. Employee agrees to devote his full time and effort
to the performance of the following duties:
(a) All duties of a sales and marketing representative for the Corporation, faithfully,
competently, and diligently perfonning duties as the needs of the Corporation may
require under the control and supervision of the Chief Executive Officer of the
Corporation or his designee;
(b) All duties which customarily are perfonned by persons holding comparable posi-
tions with companies which are comparable in business and size to Corporation,
which business is the daily administration, solicitation and sale of insurance or
related products; and
(c) Such other tasks on behalf of the Corporation as may reasonably be requested by
the Chief Executive Officer or his designee.
2
'.
.
.-
ARTICLE 4
TERMINATION
4.1 For Cause. In addition to any rights of termination specified elsewhere in this
Agreement, the Corporation may immediately upon written notice tenninate Employee for
cause. "Cause" shall include failure to achieve reasonable perfonnance expectations; failure to
perform in accordance with the specific directives or policies of the Chief Executive Officer of
the Corporation or his designee; violation of Corporation policies; dishonesty; neglect of
duties; grave misconduct; theft; fraud; conviction of a felony; willful misconduct which
seriously impairs or is reasonably expected to seriously impair the Corporation's ability to
conduct its ordinary business in the usual manner; the revocation of the Employee's insurance
agent or broken license by his state of residence and such revocation becomes final; or breach
of any provision of this Agreement. The Corporation shall have no further liability to
Employee under this Agreement for any period subsequent to the tennination for cause.
4.2 Without Cause. Either party may tenninate this Agreement at any time without
cause, upon thi rty (30 ) days prior written notice to the other party. If the Corpora-
tion terminates this Agreement without cause, in addition to any amount due to Employee
under the Corporation's policies applicable to all of its employees, the Corporation shall pay
the Employee a lump sum equal to the lesser 'If (i) the remaining installments that would
have been due and payable to Employee for the period from the date of termination through
the remaining term of employment or (ii) three months base salary.
4.3 Death or Disabilitv. This Agreement shall tenninate immediately upon the
Employee's death or disability, as that'term is defined in the long tenn disability program of
the Corporation.
ARTICLE 5
NON-SOLICITATION A!\"D NON-DISCLOSURE
5.1 Emplovment Relationship. The Employee acknowledges that Employee's
employment by the Corporation creates a relationship of confidence and trust between the
Employee and the Corporation with respect to certain information applicable to the business of
the Corporation and its Affiliates or applicable to the business of any client or customer or
potential client (as defined in Section 5.7) of the Corporation or its Affiliates which may be
made known to the Employee during the period of his or her employment (including, without
limitation, customer lists. and information regarding customer needs and renewal dates, pricing
and underwriting).
5.2 ProprietarY Information. Employee acknowledges that the Corporation
possesses and will continue to possess information that has been created, discovered or
developed by, or otherwise become known to it (including, without limitation, information
created, discovered, developed or made known by the Employee during the peripd of or arising
out of his or her employment) or in which property rights have been or may be assigned or
3
.
. .
. '.
otherwise conveyed to the Corporation which infonnation has commercial value in the
business in which the Corporation is engaged and is treated by the Corporation as confidential.
5.3 Non-Di~c1os~ The Employee shall not without the prior written consent of
[the Chief Executive Officer] of the Corporation (i) use for Employee's benefit or disclose at
any time during Employee's employment by the Corporation, or thereafter, except to the extent
required by the perfonnance by Employee of his or her duties as an employee of the
Corporation, any infonnation obtained or developed by Employee while in the employ of the
Corporation with respect to any customers, suppliers, products, employees, financial affairs,
business methods or service of the Corporation or any of its Affiliates (including, without
limitation, customer or client lists, trade secrets, pricing, marketing, financial or sales
information, forecasts, business and strategic plans), or any confidential matter, except
information which at the time is generally known to the public other than as a result of
disclosure by Employee not permitted hereunder, or (ii) take with Employee upon leaving the
employ of the Corporation any document or paper relating to any of the foregoing or any
physical property of the Corporation or any of its sources with which insurance is placed,
policyholders, expiration or renewal dates, inspection or credit reports, and data on insurance
risks being written.
5.4 p.etum of Propertv. Upon termination of the Employee's employment for any
reason, or at any other time the Corporation requests in writing, the Employee shall
immediately deliver to the Corporation all memoranda, notes, plans, records, reports and other
documents (and copies thereof) and other property in Employee's possession or control relating
to the business of the Corporation or any of its Affiliates.
5.5 Bindin~ Nature. The Employee hereby expressly agrees that the foregoing
provisions of this Agreement shall be binding upon the Employee's heirs, successors and legal
representatives.
5.6 Confidential Information. Employee shall hold in confidence the terms of this
Agreement.
5.7 Non-Solicitation. During Employee's employment by the Corporation and
during the three (3) year period commencing on the date of Employee's termination of
employment (for any reason):
(a) Employee will not take any action or make any public statement in degradation of
the good name or business interests of the Corporation. Employee will not solicit
or encourage any other employee of the Corporation to do any act that is disloyal to
the Corporation or inconsistent with the interests of the Corporation or in violation
of any provisions of this Agreement;
(b) Employee will not discuss with any Existing Client or Potential Client of the
Corporation the present or future availability of services or products by a business,
if Employee has or expects to acquire a proprietary interest in such business or is or
expects to be an employee, officer or director of such business, where such services
4
. .
or products are competitive with services or products which the Corporation
provides and where the acquisition of such proprietary interest or Employee's
becoming an employee, officer or director of such business will or may materially
injure an interest of the Corporation.
(c) Employee will not make any statement or do any act intended to cause any Existing
Client or Potential Client of the Corporation to make use of the services or purchase
the products of any competitive business in which the Employee has or expects to
acquire a proprietary interest or in which the Employee is or expects to be made an
employee, officer or director, if such services or products in any way relate to or
arise out of services or products of the Corporation sold or provided or attempted to
be sold or provided by the Employee to any Existing Client or Potential Client;
(d) Employee will not directly or indirectly (as a director, officer, partner, sole
proprietor, employee, manager, consultant, independent contractor, advisor or
otherwise) engage in, own any interest in, perform any services for, participate in or
be connected with (i) any business or organization that directly engages in competi-
tion with the Corporation in any geographical area where any business is presently
carried on by the Corporation, or (ii) any business or organization that directly
engages in competition with the Corporation in any geographical area where any
business shall be hereafter, during the period of Employee's employment by the
Corporation, carried on by the Corporation, if such business is then being carried on
by the Corporation in such geographical area; provided, ~~, that the provi-
sions of this subparagraph (d) shall only be effective during Employee's
employment by the Corporation and shall not be deemed to prohibit Employee's
ownership of not more than [I %] of the total shares of all classes of stock
outstanding of any publicly held company.
(e) [OPTIONAL PARAGRAPH] If, during the said two (2) year period, any
commission or any insurance business becomes payable to the Employee or to any
person, fmn, or Corporation by whom the Employee is then employed or affiliated,
as a result of Employee's violation of the provisions of subparagraph (b) or (c) of
this Section 5.7, the Employee agrees to pay promptly to the Corporation an
amount equal to 150% of such commission.
(f) If, following termination or expiration of the period of employment including any
renewallerm, the Employee accepts other employment or enters into a business
relationship with any person, partnership, corporation or the entity doing business
of the kind then being performed by the Corporation, the Employee shall obtain
from said second Employer and shall provide to the Company a written
acknowledgment by the successor Employer of its notification of the terms of
Article V of this Agreement.
(g) Employee agrees that he will not entice or induce, directly or indirectly any other
Employee of the Corporation to leave the employ of the Corporation.
5
=
For purposes of this Agreement, the lenn "Potential Client" shall mean a person or
entity who was the target of sales or marketing activity by the Employee during the [one).year
period preceding Employee's tennination of employment or, in the event Employee has been
employed by the Corporation less than [two] years at the time of tennination, during the period
of Employee's employment with the Corporation, The tenn "Existing Client" shall mean a
person or entity who is a customer of the Corporation at the time of Employee's tennination of
employment and who was solicited by Employee or whose accounts were handled by
Employee during the period of Employee's employment with the Corporation.
Employee agrees that when Employee has or expects to acquire a proprietary interest
in, or is or expects to be made an employee, officer or director of any existing or future
business that provides or may provide services or products in competition with the
Corporation, Employee will, upon request by the Corporation, immediately fumish to the
Chief Executive Officer of the Corporation all material infonnation that may reasonably be of
assistance to the Corporation in acting promptly to protect its relationships with any Existing
Client or Potential Client with whom Employee has had any dealings as a result of Employee's
employment by the corporation. Employee further agrees that the limitations set forth in this
Article 5 shall survive the expiration or tennination of this Agreement.
For purposes of this Article 5, proprietary interest in a business is ownership, whether
through direct or indirecl stock holdings or otherwise, of one percent (1 %) or more of such
business. Employee shall be deemed to expect to acquire a proprietary interest in a business or
to be made an officer or director of such business if such possibility has been discussed with
any officer, director, employee, agent or promoter of such business. Notwithstanding anything
in this Article 5 to the contrary, Employee's engagement in, ownership of, perfonnance of or
services for, participation in or connection with any business or organization other than the
Corporation, with respect to which the Chief Executive Officer of the Corporation has
consented in writing, shall not be deemed a breach of this Agreement.
ARTICLE 6
11TSCELLA1\'EOUS PROVTSTONS
6.1 Amendments. Any amendment of this Agreement shall be effective only if in
writing and signed by both Employee and Corporation.
6.2 Governinv Law. This Agreement, the rights and obligations of the parties
hereto, and any claims or disputes therelo, will be governed by and considered in accordance
with the laws of the State of Pennsylvania
6.3 f/eadiMs. The paragraph headings contained in this Agreement are inserted for
convenience or reference only, will not be deemed to be part of this Agreement for any
purpose, and will not in any way define or affect the meaning, construction or scope of any of
the provisions hereof.
6.4 Notices. All notices, requests, or other communications which may be or are
required to be given or sent by either party to the other pursuant to this Agreement will be in
6
. .
writing and will be mailed by first-class, registered or certified mail, return receipt requested,
posUlge prepaid, or transmitted by hand delivery, telegram or telex, addressed as follows:
If to Corporation:
4750 De1brook Road, POBox 1220 Mechanicsburg PA 17055
If to Employee:
19 Mall Road, Etters PA 17319
Either party may designate, by notice in writing, a new address for notice from time to time,
6.5 Severa hili tv. If any part of any provision of this Agreement shall be adjudged
invalid or unenforceable under applicable law, such part may be reformed by a court of
competent jurisdiction sitting in equity to the extent of such original invalidity or unenforce-
ability only, without affecting the remaining partS of such provision or remaining provisions of
the Agreement unnecessarily.
6.6 Survival. It is the express intention and agreement of the parties that the
covenants, agreements and statements made in Article 5 will survive the termination of this
Agreement for any reasons. '
6.7 Waiver. Neither the waiver by either party hereto of a breach or of a default
under any of the provisions of this Agreement, nor the failure of either party on one or more
occasions, to enforce any of the provisions of this Agreement or to exercise any right of
privilege hereunder will thereafter be construed as a waiver of any subsequent breach or
default of a similar nature, or as a waiver of any such provision, rights or privileges hereunder.
6.8 Nonalienation. Except as may otherwise be required by law, no right to receive
payments under this Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, change, pledge. bankruptcy or hypothecation or to exclusion,
atUlchment, levy or similar process or assignment by operation of law, and any attempt,
voluntary or involuntary, to effect any such action shall be null, void and of no effect.
6.9 Assi~nment. The Corporation, in its sole discretion, may assign this Agreement
to any subsidiary or other Affiliate. This Agreement shall not be assignable by or on behalf of
the Employee. This Agreement shall be binding upon and inure to the benefit of the
Corporation and its successors and assigns and any purchaser of the Corporation or of
substantially all of the assets of the Corporation.
6.10 Entire A~reement: Modification. This Agreement, together with the
Confidentiality Agreement referred to above, constitutes the entire agreement of the parties
with respect to the subject matter hereof. This Agreement may be modified or amended only
by an instrument in writing signed by both parties hereto,
7
..
,.,
NEW BUSINESS BONUS
In addition to the formula which establishes the base compensation, a new
business bonus wfll be paid on "net new" production in the quarter which
the new business is billed. If billed on an installment basis, bonus
will be paid for first 12 months or four quarters the business is on the
books. .
The amount of bonus so calculated will be determined quarterly based on
producer production runs generated reflecting results according to
producer management and compensation program. . A cash bonus payment at
that time will be made within thirty (30) days of receipt of approved
Bonus Calculation Form (See Attached Addendum) to the Account Executive.
This cash payment wi 11 be made in accordance with the following payment
plan:
January 1 to March 31 - BO% of Earned Bonus
Apri lIto June 30 - BO% of Earned Bonus
July 1 to September 30 - BO% of Earned Bonus
October 1 to December 31 - 100% of Earned Bonus
for year.
(Any negative figure will be carried
over to next year and app 1 i ed aga i nst
future bonuses earned until offset)
Bonuses are not a vested interest of the producer. To be el igible for
payment, the producer must be an employee of the company on the day the
actual bonus payment is to be made. Unpaid bonuses will be forfeited in
the event of resignation or termination of employment for any reason.
New Bus i ness is defi ned as New Cl ients or New Coverages, not previ ously
written, on existing clients. Additions to existing coverages or
additional policies, (i.e. new divisions or subsidiaries) are not New
Busi ness. Only the fi rst year Bonds on a Surety Account qua 1 ify as New
Business.
New Property and Casualty Business - 15% (First 12 months commission)
New Business Bonus will be reduced
if any commission reduction is taken
unless approved by Division Manager.
New Life or Disability
- 75% (First 12 months commission)
- 50% (First 12 months commission)
New Personal Lines
1. Unauthori zed Commi ss i on Reducti ons On new or renewal
business, if a producer accepts a commission reduction without
written agreement of the Branch Manager, the amount of reduction
will be deducted from their next salary period.
2. "Elite Producer" Bonus - To recognize the accomplishments of
our most successful Producers, those with total commission income
in excess of $400,000 during the 12 month calculation period,
Base Salary will be increased by 10% of the Adjusted Base.
,
\
~. ,
GINGRICH. SMITH. KL-INGENSMITH & DOL-AN
ATTORNEVS AT L.AW
222 SOUTH MAFU'.CT STRCE-T, SUITE 201
PI Q. DOll. 267
ELIZABETHTOWN. PA 17022"0Ze7
(717) 367-1370
rAX 17171 307-3219
.JOHN M. SMITH
THOMAS G. KLINGENSMITH
KEVIN O. DOLAN
...~ EAST ORANOr. STRE.eT
LANCASTER, PA 17e02
{7171393-3684
FAX 17171 393-06'3
01" CouNaEI.
HENRY F. GINGRICH
HCRBERT P. HE.NDE.RSON, n
JEfl',REY S. SHANK
September 26, 1997
Mr. John J. Ford, III
98 Byron Nelson Circle
Etters, PA 17319
Re: Employment Agreement/Non-Solicitation and Non-Disclosure
Dear Mr. Ford:
Please be advised that I represent Acordia of Central Pennsylvania. It is my understanding you
voluntarily terminated your Employment Agreement with Acardia which you signed on August 1,
1994. Pursuant to Article 5, Non-Solicitation and Non-Disclosure you are prohibited from disclosing
any proprietary information regarding Acordia as defined in that Article. You are specifically prohibited
by Article 5.7 for a period of three years commencing on the date of your termination of employment
from:
_ Taking any action or making any public statement in degradation of the good name or
business interest of Acordia; soliciting or encouraging any other employee of Acardia to do any act that
is disloyal to Acardia or inconsistent with the interests of Acordia or in violation of the provisions of
your Employment Agreement;
_ Discussing with any existing client or potential client of Acordia that the present or future
availability of services or products by a business if you have or expect to acquire a proprietary interest
in such business is or expects to be an employee, officer or director of any such business, where such
services or products are competitive with services or products which Acordia provides and where the
acquisition of the proprietary interest or your employment will or may materially injure the interest of
Acordia; .
_ You will not make any statement or act or commit any act intended to cause an existing client
or potential client of Acordia to make or use the services or purchase products of any competitive
business in which you have or expect to acquire a proprietary interest in which you are or expect to
become or to be made an employee, officer or director if such services or products in any way relate
to or arise out of services or products Acordia sold or provided or attempted to be sold or provided by
you to an existing client or potential client;
_ The Agreement also provides that following your termination of employment that if you accept
employment or enter into a business relationship with any person, partnership, corporation or entity
EXHIBIT
I
B
'>- ~
CO., c':
i ~ 0' .,
(' ,,-,
( '. (. ,
i , , j
-
I
(' .:''J !
I
(
,. ,-
I ,
U ;)\ U
-