SENIOR EXECUTIVE RETIREMENT AGREEMENT
THIS SENIOR EXECUTIVE RETIREMENT AGREEMENT, made and entered
into as of the 24th day of July, 1998, by and between WACHOVIA CORPORATION (the
"Corporation"), a North Carolina corporation, and XXXXXX X. XxXXX, XX. (the
"Executive"), a senior management employee of the Corporation;
RECITALS
The Executive is a senior management employee of the
Corporation, and as such has rendered and is expected to continue to render
valuable services in behalf of the Corporation. The Management Resources and
Compensation Committee (the "Committee") of the Corporation desires for the
Corporation to provide the Executive with supplemental retirement benefits
partially in recognition of such services. In addition, the Committee has
determined that providing such benefits will make the Corporation's benefits
package more competitive with packages offered by many other employers and will
facilitate management succession planning for the Corporation.
NOW, THEREFORE, the Corporation and the Executive hereby
mutually agree as follows:
Section 1. Definitions. When used herein, the words and phrases below shall
have the meanings set forth, unless a different meaning is clearly required by
the context. Terms used but not defined herein, and which are defined in the
Retirement Plan, shall have the meaning assigned to them in the Retirement
Plan. Masculine pronouns include feminine pronouns wherever used and vice
versa.
1.1 "Board of Directors" means the Board of Directors of the
Corporation.
1.2 "Code" means the Internal Revenue Code of 1986, as it may
be amended from time to time.
1.3 "Effective Date" means July 24, 1998.
1.4 "Final Average Compensation" means the average of the
annual compensation of the Executive for the three full calendar years within
the final five full calendar years of his employment which will produce the
highest average. For this purpose, the compensation of the Executive shall mean
his total cash remuneration from the Corporation, including bonuses paid for
each year under the Corporation's Senior Management Incentive Plan, plus the sum
of: (a) any salary reduction amounts which the Executive elects to have
contributed with respect to him to a qualified cash or deferred arrangement
under Section 401(k) of the Code, to a benefit equalization plan in lieu of
contributions to such a qualified cash or deferred arrangement, to a cafeteria
plan under Section 125 of the Code, or to any similar plan or arrangement, and
(b) any amounts deferred under any deferred compensation plan or contract.
Amounts described in (a) and (b) shall be deemed received at the time the
Executive would have received them but for the programs described in (a) and
(b).
1.5 "Normal Retirement Date" means the first day of the month
coincident with or next following the date the Executive attains age sixty-two.
1.6 "Other Pension Plan" means any defined benefit pension
plan, other than the Retirement Plan, in which the Executive is a participant
and which is qualified under Section 401(a) of the Code and is maintained by
the Corporation or a subsidiary of the Corporation.
1.7 "Retirement Date" means the date the Executive retires
under this Agreement on account of early or normal retirement.
1.8 "Retirement Plan" means the Retirement Income Plan of
Wachovia Corporation and any successor thereto.
1.9 "Supplemental Benefit" means the monthly benefit payable
to the Executive under this Agreement.
Section 2. Normal Retirement. At his Normal Retirement Date, the Executive will
retire and will be entitled to receive the Supplemental Benefit, computed in
the form of a single life annuity for his life. The monthly amount of the
Supplemental Benefit shall equal one-twelfth of the product of fifty-five
percent (55%), increased by one percentage point for each year of creditable
service (as determined under the Retirement Plan) in excess of ten years,
provided that the maximum percentage as increased does not exceed sixty percent
(60%), multiplied by the Executive's Final Average Compensation, reduced by the
monthly amount payable under the Retirement Plan and any Other Pension Plan.
The offset shall equal the monthly amounts actually payable under the
Retirement Plan and any Other Pension Plan, based on the payment option elected
by the Executive.
Section 3. Early Retirement. If the Executive has attained his fifty-fifth
birthday but has not attained his Normal Retirement Date, and has ten or more
years of service, he may elect early retirement as of the first day of any
calendar month following written notice of at least ninety days to the
Corporation and the Committee. The Supplemental Benefit of the Executive who
elects early retirement shall equal the benefit determined under Section 2 as
of such date, reduced by five percent for each year (with proportionate
allowance for complete months) by which the starting date of the benefit
precedes attainment of his sixtieth birthday. With the consent of the
Committee, the Supplemental Benefit shall be payable to the Executive pursuant
to Section 2 commencing as of the first day of any calendar month on or after
his early retirement and before his Normal Retirement Date. The request for
benefit payment must be filed by the Executive in writing with the Committee at
least thirty days prior to the date payments are requested to commence.
Section 4. Spouse's Supplemental Benefit. If the Executive shall be married on
his Retirement Date, and shall die thereafter survived by such spouse, or if
the Executive shall die prior to his Retirement Date and shall be married on
the date of his death, such spouse shall be entitled to a monthly supplemental
benefit (herein the "Spouse's Supplemental Benefit") payable for life and equal
to 60% of the monthly amount of the Supplemental Benefit payable to the
Executive (assuming, for an Executive who shall die prior to his Retirement
Date, that the Executive had retired on the date immediately preceding the date
of his death and that the years of his creditable service included the years
and fractions thereof from the date of death to his Normal Retirement Date),
before applying the
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reduction for the monthly amount payable to the Executive under the Retirement
Plan and any Other Pension Plan, but reduced by the monthly amount, if any,
payable to the spouse under the Retirement Plan and any Other Pension Plan in
the calendar month next following the death of the Executive. The monthly amount
of the Spouse's Supplemental Benefit shall be payable on the first day of each
calendar month following the death of the Executive and preceding the death of
such spouse.
Section 5. Optional Forms of Payment. Notwithstanding the provisions of Sections
2 through 4, the present value of the sum of the Supplemental Benefit and the
Spouse's Supplemental Benefit (if any) may, at the request of the Executive and
with the consent of the Executive's spouse (if any) and the Committee, be
payable in cash in a lump sum within thirty days following the Retirement Date
of the Executive. Such present value shall be the actuarial equivalent (as
defined in the Retirement Plan) of the Supplemental Benefit and Spouse's
Supplemental Benefit (if any). The request for a lump sum distribution, and the
consent of the Executive's spouse, must be filed by the Executive with the
Committee at least sixty days prior to the Retirement Date. Such consent shall
be in writing on a form provided by the Committee.
Section 6. Disability. In the event the Executive suffers a disability (as
defined in the Retirement Plan) prior to the Retirement Date, the Executive
shall continue to accrue a Supplemental Benefit under this Agreement based upon
the Final Average Compensation of the Executive as of the last date the
Executive was paid by the Corporation (including sick pay) and taking into
account the period from the disability of the Executive to the Normal Retirement
Date as creditable service for purposes of this Agreement. The Supplemental
Benefit of the Executive who is disabled shall be determined and payable as of
the Normal Retirement Date of the Executive.
SECTION 7. Miscellaneous.
(a) The Executive shall forfeit any right to the Supplemental Benefit
or any other rights hereunder (including the Spouse's Supplemental Benefit) if
he (i) declines to retire at his Normal Retirement Date, (ii) terminates
employment with the Corporation prior to his Retirement Date without written
consent of the Committee, or (iii) is terminated for "cause." Termination for
cause shall arise if the Executive's employment by the Corporation is
terminated because of or arising out of: (A) criminal dishonesty, (B) refusal
to perform his employment duties for the Corporation on substantially a
full-time basis, (C) refusal to act in accordance with any specific
substantive instructions of the Corporation's Chief Executive Officer or Board
of Directors, or (D) engaging in conduct which could be materially damaging to
the Corporation without a reasonable good faith belief by the Executive that
such conduct was in the best interest of the Corporation. Notwithstanding the
foregoing provisions of this Section 7(a). in the event of a change of control
of the Corporation, the Executive shall be vested in the right to receive
payment of the Supplemental Benefit under this Agreement, which right shall not
be forfeited upon the termination of the Executive for any reason other than
for cause as defined in this Section 7(a). In the event the employment of the
Executive is terminated at any time following a change in control of the
Corporation, the Supplemental Benefit and Spouse's Supplemental Benefit (if
any) shall be paid commencing as of the later of the date of the termination of
the Executive
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or the date the Executive attains (or would have attained but for death) the age
of fifty-five. For the purposes herein, the term "change of control" shall have
the meaning given such term in the Wachovia Corporation Stock Plan, as it may be
hereafter amended.
(b) The Supplemental Benefit shall cease to be paid to the Executive
(and rights to the Spouse's Supplemental Benefit shall terminate) if he shall
disclose material confidential information or trade secrets concerning the
Corporation or any of its subsidiaries without the Corporation's consent, or
shall engage in any activity that is materially damaging to the Corporation
including, but not limited to, engaging in competitive employment at any time.
The Executive shall be deemed to engage in competitive employment if he shall
render services as a employee, officer, director, consultant or otherwise, for
any employer which conducts a principal business or enterprise that competes
directly with the Corporation or any subsidiary or affiliate of the
Corporation. The Committee shall have authority to cease payments under this
paragraph (b), and the determination of the Committee shall be final and
conclusive. Upon the request of the Executive, the Commitee may grant an
advance opinion as to whether a proposed activity would violate the provisions
of this paragraph (b).
(c) The Executive acknowledges that he has entered into this
Agreement of his own free will and without duress. In consideration of the
mutual obligations and covenants hereunder, the Executive unconditionally
releases the Corporation and its subsidiaries, and their respective directors,
officers, employees and shareholders, from any and all claims, liabilities and
obligations of any nature pertaining to termination of the Executive's
employment by the Corporation or any of its subsidiaries, including but not
limited to (i) any claims under federal, state or local laws prohibiting
discrimination including without limitation the Age Discrimination in Employment
Act of 1967, as amended, or (ii) any claims growing out of any alleged legal
restrictions on the Corporation's right to terminate the Executive's employment,
such as any alleged implied contract of employment or termination contrary to
public policy. The Executive acknowledges that he has been advised to consult
with an attorney prior to signing this Agreement, that he has had no less than
twenty-one days to consider this Agreement prior to the execution hereof, and
that he may revoke this Agreement at any time within seven days following
execution hereof.
(d) This Agreement shall be administered and interpreted by the
Committee or its duly authorized designee, whose decisions shall be final.
Wherever applicable, interpretation of this Agreement shall be consistent with
the terms of the Retirement Plan.
(e) Nothing in this Agreement shall be construed as giving the
Executive the right to be retained in the employ of the Corporation or any
subsidiary of the Corporation at all or for any specified period in any
particular position, or any right to any payment whatsoever except to the
extent provided for by this Agreement.
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(f) Notwithstanding any other provisions hereof, if any person
entitled to receive payments hereunder (the "recipient") shall be physically or
mentally or legally incapable of receiving or acknowledging receipt of such
payment, the Corporation, upon the receipt of satisfactory evidence that another
person or institution is maintaining the recipient and that no guardian or
committee has been appointed for the recipient, may cause such payment to be
made to such person or institution so maintaining the recipient.
(g) Nothing in this Agreement and no action taken pursuant to the
provisions of this Agreement shall create or shall be construed as creating a
trust of any kind, or a fiduciary relationship between the Corporation and the
Executive or any other person. Any amounts which are or may be set aside
hereunder shall continue for all purposes to be a part of the general funds of
the Corporation, and no person other than the Corporation shall, by virtue of
the provisions of this Agreement, have any interest in such funds. To the
extent that any person acquires a right to receive payments from the
Corporation hereunder, such right shall be no greater than the right of any
unsecured general creditor of the Corporation.
(h) The benefits payable under this Agreement may not be assigned by
the Executive or any other person nor anticipated in any way.
(i) The Committee may, in its sole discretion, terminate, suspend or
amend this Agreement at any time or from time to time, in whole or in part;
provided, that except as otherwise specifically provided herein no such
termination, suspension or amendment made following the date that payments
commence hereunder will affect the right of any person to receive benefits
earned hereunder. Upon a change of control of the Corporation as defined in
Section 7(a), this Agreement may not be amended or terminated without the
express written consent of the Executive.
(j) This Agreement shall be governed by and construed in accordance
with the laws of the State of North Carolina.
(k) In no event shall the Supplemental Benefit or Spouse's
Supplemental Benefit payable under this Agreement be less than the benefit
determined pursuant to the South Carolina National Corporation Supplemental
Executive Retirement Plan (referred to herein as the "Predecessor SERP") had
such Predecessor SERP remained in effect until the Retirement Date of the
Executive. The execution of this Agreement by the Executive constitutes a
release by the Executive of all rights and benefits under the Predecessor SERP.
(1) This Agreement amends, replaces and supersedes the prior Executive
Retirement Agreement between the Executive and the Corporation dated February
1, 1992, as amended July 23, 1993, January 27, 1995 and October 25, 1996.
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IN WITNESS WHEREOF, this Agreement has been executed in behalf of the
Corporation by its duly authorized officers and by the Executive as of the day
and year first above stated.
WACHOVIA CORPORATION
By:[SIGNATURE APPEARS HERE]
--------------------------
Chief Executive Officer
Attest:
[SIGNATURE APPEARS HERE]
-------------------------
Secretary
[Corporate Seal]
[SIGNATURE APPEARS HERE] (SEAL)
-------------------------
Xxxxxx X. XxXxx, Xx.
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