Exhibit 10.5
Xxxx X. Xxxxxxx Company
2005 Supplemental Retirement Agreement
THIS AGREEMENT (the "Agreement"), dated as of January 1, 2005, between
Xxxx X. Xxxxxxx Company, a Georgia corporation (the "Company"), and Xxxxxxx
X. Xxxx ("Employee").
WHEREAS, the Employee serves as Chairman, Chief Executive Officer and Director
of the Company, and is in a position to contribute materially to the continued
growth, development and future business of the Company; and
WHEREAS, the Company desires to provide enhanced supplemental retirement
benefits to the Employee, in accordance with the employment letter dated April
21, 2005, which will be in addition to the benefits provided under the
Supplemental Retirement Agreement between the Company and Employee dated as of
January 1, 2002;
NOW, THEREFORE, the Company and the Employee agree as follows:
A. Supplemental Retirement Benefits.
(1) Benefit: Employee shall be eligible to receive from the
Company or its successor a supplemental retirement benefit in
the amount set forth in Table A based on the date of his
termination of employment and the reason for such termination;
provided he remains continuously employed with the Company in
the capacity of Chairman, Chief Executive or other senior
executive officer until he terminates employment. If
Employee's employment with the Company terminates on a date
other than December 31, the amount of the benefit payable
shall be determined on a directly proportional basis using
straight-line interpolation between the values of December 31
preceding and following his date of termination based on the
number of completed calendar months of employment during the
calendar year in which termination occurs and for
clarification, Table A contains an example of such
interpolation.
(2) Form and Payment:
(i) Termination Other than Retirement for Non-Business Reasons. If
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Employee's employment with the Company terminates for reasons other
than Retirement for Non-Business Reasons or termination by the
Company with Cause, then payment of his supplemental retirement
benefit shall be made to Employee (or in the event of his death, to
his Beneficiary) in a lump sum on the first day of the calendar month
that coincides with or immediately follows the date that is six (6)
"months" after Employee's "separation from service" with the
Company or, if payment is made to his Beneficiary, as soon as
practicable after the date of his death. For this purpose, the
terms "months" and "separation from service" shall have the same
meaning as now or hereafter used in Section 409A of the Internal
Revenue Code of 1986, as amended, (the "Code").
(ii) Retirement for Non-Business Reasons. If Employee Retires for
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Non-Business Reasons, payment of his supplemental retirement
benefit shall be made to Employee in substantially equal
installments commencing on the first day of the calendar month that
coincides with or immediately follows the date that is six (6)
"months" after Employee's "separation from service" with the
Company and continuing on the first day of every third (3rd)
calendar month thereafter during the Restricted Period. If
Employee dies prior to receipt of payments, the sum of the
remaining payments due Employee shall be paid to
his Beneficiary in a lump sum as soon as practicable after his death.
(3) Forfeiture. Employee will not be entitled to any benefit
whatsoever if he is terminated by the Company with Cause or he
terminates his employment before December 31, 2007 for any
reason other than his death or his disability, his termination
by the Company without Cause, his resignation for Good Reason,
his Retirement for Non-Business Reasons or his termination or
resignation after a Change in Control. For the avoidance of
doubt, a termination at any time by the Company without Cause
shall not result in a forfeiture under this paragraph (3). In
addition, if Employee's benefit is being paid as a result of
Retirement for Non-Business Reasons, Employee agrees that he
will not engage in Gainful Employment during the Restricted
Period. If Employee violates this Agreement by engaging in
Gainful Employment during the Restricted Period, Employee
agrees that he will forfeit the entire benefit if payment has
not commenced or if payment has commenced, he will forfeit any
remaining payments that would have been made if he had not
engaged in Gainful Employment during the Restricted Period.
(4) Definitions: The following capitalized terms shall have the
following meanings when used in this Agreement:
(i) "Beneficiary" means the person designated by the
Employee as beneficiary on a form provided by the
Company and in the event the Employee makes more than
one such designation, the most recent properly
completed designation delivered to the Company before
his death.
(ii) "Cause" has the same meaning as in the Noncompete
Agreement.
(iii) "Change in Control" has the same meaning as in the
Noncompete Agreement.
(iv) "Committee" means the Governance Committee of the
Board of Directors of the Company.
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(v) "Gainful Employment" means gainful employment as an
officer of any entity. Employee will not be treated
as engaging in gainful employment if he is engaged as
a director of any entity that is not engaged in
Restricted Businesses or such employment is otherwise
approved by the Committee. The Committee shall have
complete discretion in deciding whether to grant or
deny such approval, but shall not unreasonably
withhold or delay its approval if the relevant
business is not a Restricted Business.
(vi) "Good Reason" has the same meaning as in the
Noncompete Agreement.
(vii) "Noncompete Agreement" means Noncompete and
Termination Agreement between the Company and
Employee dated as of January 1, 2005
(viii) "Restricted Businesses" has the same meaning as in
the Noncompete Agreement.
(ix) "Restricted Period" means the two (2)-year period
Employee is restricted from competing with the
Company following his termination of employment under
the Noncompete Agreement.
(x) "Retirement for Non-Business Reasons" means Employee
separates from service with the Company (as
determined under Section 409A of the Code) and does
not engage in any Gainful Employment during the
Restricted Period.
B. General.
(1) This Agreement is intended to be an unfunded plan of deferred
compensation maintained for the Employee. The Company intends
that this Agreement come within the various exceptions and
exemptions to the Employee Retirement Income Security Act of
1974, as amended, ("ERISA") for an unfunded deferred
compensation plan maintained primarily for a select group of
management or highly compensated employees within the meaning
of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, and any
ambiguities in this Agreement shall be construed to effect
that intent.
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(2) The obligation of the Company to make payments hereunder shall
constitute a general unsecured obligation of the Company to
the Employee. Such payments shall be from the general assets
of the Company, and the Company shall not be required to
establish or maintain any special or separate fund or
otherwise segregate assets to assure that such payments shall
be made. Neither the Employee nor his estate shall have any
interest in any particular asset of the Company by reason of
the Company's obligations hereunder. Nothing contained herein
shall create or be construed as creating a trust or any other
fiduciary relationship between the Company and the Employee or
any other person. To the extent that any person acquires a
right to receive payments from the Company hereunder, such
right shall be no greater than the right of an unsecured
creditor of the Company.
(3) No portion of the benefit hereunder shall be subject in any
manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge, and any attempt to
do so shall be void. No portion of such benefit shall be
payable to any assignee, receiver or trustee; be applied to
satisfy the Employee's debts, contracts or other liabilities;
or be subject to any legal process.
(4) If any individual entitled to receive any payment under this
Agreement shall be physically, mentally or legally incapable
of receiving or acknowledging receipt of such payment, the
Committee, upon the receipt of satisfaction evidence (i) of
his incapacity, (ii) that another person or institution is
maintaining him, and (iii) that no guardian or committee has
been appointed for him, may cause any payment otherwise
payable to him to be made to such person or institution.
Payment to such person or institution shall be in full
satisfaction of all claims by or through the Employee to the
extent of the amount thereof.
(5) A benefit shall be deemed forfeited if the Company is unable
after a reasonable period of time to locate the Employee;
provided, however, that such benefit shall be reinstated if a
valid claim is made by or on behalf of the Employee for the
forfeited benefit.
(6) This Agreement shall be administered by the Committee. The
Committee shall have the exclusive right to interpret the
terms and provisions of this Agreement and to determine any
and all questions arising under the Agreement or in connection
with its administration, including, without limitation, the
right to remedy or resolve possible ambiguities,
inconsistencies, or omissions by general rule or particular
decision, all in its sole and absolute discretion. The
Committee may appoint other persons to assist it in performing
its duties and responsibilities hereunder. Any claim for a
benefit under this Agreement shall be filed with and resolved
by the Committee in accordance with the claims procedure
described in the then current summary plan description for the
Company's 401(k) Plan and which claims procedure is hereby
incorporated in this Agreement by reference.
(7) Nothing contained in this Agreement shall be construed as a
contract of employment between the Company and the Employee,
or as a right of the Employee to be continued in the
employment of the Company, or as a limitation on the right of
the Company to discharge the Employee at any time, with or
without cause.
(8) Any notice under this Agreement shall in writing and shall be
mailed by United States first class mail, postage prepaid, as
follows:
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To the Company:
Xxxx X. Xxxxxxx Company
0000 Xxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Vice President, Human Resources
To the Employee:
Xxxxxxx X. Xxxx
0000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Either party may change the address to which notices shall be
mailed upon written notice.
(9) This Agreement shall be binding upon the Company and its
successors and assigns, and upon the Employee, his
beneficiaries, heirs, executors and administrators.
(10) This Agreement shall be construed and governed in all respect
under and by the laws of the State of Georgia. If any
provision of this Agreement shall be held by a court of
competent jurisdiction to be invalid or unenforceable, the
remaining provisions hereof shall continue to be fully
effective.
(11) This Agreement is intended by the parties hereto to be the
final expression of their agreement with respect to
supplemental retirement benefits earned for periods after
December 31, 2004 and is the complete and exclusive statement
thereof notwithstanding any prior representation or statements
to the contrary. This Agreement is limited to compensation
deferred after December 31, 2004 and does not add or enhance
any benefits or rights under or have any effect whatsoever on
the Supplemental Retirement Agreement between the Company and
the Employee dated as of January 1, 2002. In the event of any
conflict or inconsistency between the provisions of this
Agreement and the provisions of the letter agreement between
the parties dated April 21, 2005 regarding supplemental
retirement benefits earned after December 31, 2004, the terms
of this Agreement shall control.
(12) This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument.
(13) This Agreement may be amended, modified or terminated only in
writing executed by the Employee and a representative of the
Committee; provided, however, that neither party shall
unreasonably withhold its or his consent to any amendment that
the other party determines is necessary or desirable to comply
with the requirements of Section 409A of the Code.
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IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first set forth above.
Attest: Xxxx X. Xxxxxxx Company
By:
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G. Xxxxxx Xxxxxxxx
Chair, Governance Committee
of the Board of Directors
Date: June 27, 2005
Witness: Employee
Xxxxxxx X. Xxxx
Date: June 27,2005
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2005 Supplemental Retirement Agreement
TABLE A
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Reason for Termination
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----------------------- ------------------------ --------------------- ----------------------- ----------------------
A B C D
Termination for
Resignation by the Death, Disability, by
Date of Termination Executive for any the Company Without
Reason other than for Cause, by Executive
a reason described in Retirement for for Good Reason or Termination by the
Columns B, C or D Non-Business Reasons after a Change in Company for Cause
Control
----------------------- ------------------------ --------------------- ----------------------- ----------------------
----------------------- ------------------------ --------------------- ----------------------- ----------------------
December 31, 2005 $0 $166,491 $832,457 $0
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----------------------- ------------------------ --------------------- ----------------------- ----------------------
December 31, 2006 $0 $424,943 $1,062,357 $0
----------------------- ------------------------ --------------------- ----------------------- ----------------------
----------------------- ------------------------ --------------------- ----------------------- ----------------------
December 31, 2007 $460,069 $828,953 $1,381,588 $0
----------------------- ------------------------ --------------------- ----------------------- ----------------------
----------------------- ------------------------ --------------------- ----------------------- ----------------------
December 31, 2008 $1,146,459 $1,375,889 $1,719,861 $0
----------------------- ------------------------ --------------------- ----------------------- ----------------------
----------------------- ------------------------ --------------------- ----------------------- ----------------------
December 31, 2009 $2,121,532 $2,121,532 $2,121,532 $0
----------------------- ------------------------ --------------------- ----------------------- ----------------------
If Executive terminates employment on a date other than December 31, the amount
of the benefit payable shall be determined on a directly proportional basis
using straight-line interpolation based on the number of completed calendar
months of employment during the calendar year in which termination occurs. For
example, if Employee terminates employment on July 15, 2009, for a reason
described in Column C, the benefit he will be entitled to receive will be
$1,920,697, which is the sum of X and Y below where:
X = $1,719,861 [the amount determined for the preceding December 31 under
Column C]
Y = $200,836 [6/12 x $401,671 (the difference between $2,121,532 and
$1,719,861)]
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