(Form)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT
("Agreement") is made as of May 1,
2000 (the "Effective Date"), by and between
[______________________] (the "Executive")
and American General Corporation, a Texas
corporation (the "Company").
WHEREAS, during the course of
Executive's employment with the Company, the
Executive has performed outstanding services
for the Company; and
WHEREAS, it is deemed by the Company to
be in the best interests of the Company to
assure continuation of Executive's
employment; and
WHEREAS, the Company and the Executive
have determined to enter into this Agreement
pursuant to which the Company will continue
to employ the Executive on the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the
premises and the mutual covenants herein
contained, the parties hereto agree as
follows:
1. Defined Terms. The definitions of
capitalized terms used in this Agreement (if
not provided where a capitalized term
initially appears) are provided in the last
Section hereof.
2. Employment. The Company hereby
agrees to employ the Executive, and the Executive
hereby accepts such employment, on the terms
and conditions hereinafter set forth.
3. Term.
(a) Duration of Term. Unless earlier
terminated as provided in Section 3(b)hereof,
the Executive's employment with the Company
under this Agreement shall commence at
the Effective Date and shall end on the
final day of the Term. For purposes of this
Agreement, the "Term" shall mean the full
three-year term of the Agreement from the
Effective Date until the day before the
third anniversary thereof, plus any extensions
made as provided in this Section 3. On
the first day of each month occurring after
the Effective Date, the Term shall
automatically be extended for an additional
month unless,
prior to any such first day of
a month, the Company or the Executive shall
have given notice not to extend the Term.
Nothing in this Section shall limit the
right of the Company or the Executive to
terminate the Executive's employment
hereunder on the terms and conditions set
forth in Section 7 hereof. The Company and
the Executive agree that any such notice by
the Company shall not constitute Good Reason
for the Executive to terminate the
Executive's employment.
(b) Termination of Employment during
the Term. Nothing in this Section 3 shall
limit the right of the Company or the Executive
to terminate the Executive's employment under
this Agreement during the Term hereof on the
terms and conditions set forth in Section 7
hereof. Further, notwithstanding any other
provision of this Agreement, the Company
shall have the right to terminate the
Executive's employment under this Agreement
at any time prior to the expiration of the
Term for any other reason whatsoever,
including termination without Cause, in the
sole discretion of the Company's Board of
Directors (the "Board"); provided, however,
that, any termination of the employment
relationship by the Company prior to the
expiration of the Term other than a
termination by the Company on the terms and
conditions set forth in Section 7 hereof
shall be deemed to be a termination without
Cause within the meanings of Section 8(c)
hereof.
(c) After the Term: "At-Will"
Relationship and Termination of Employment.
If the Executive remains employed by the
Company beyond the expiration of the Term, such
employment shall automatically convert to an
"at-will" relationship (upon the expiration
of the Term hereof) terminable at any time
by either the Company or the Executive for
any reason whatsoever, with or without
Cause. Upon a termination of employment
after the Term hereof, the Company shall pay
the Executive's full salary to the Executive
through the date of such termination at the
rate in effect immediately prior to such
termination, together with all compensation
and benefits payable to the Executive under
the terms of any compensation or benefit
plan, program or arrangement maintained by
the Company during the Executive's
employment by the Company. In addition to
any payments or benefits due hereunder upon
such a termination, the Executive shall
receive such post-termination compensation
and benefits as shall be determined under,
and paid in accordance with, the Company's
retirement, insurance and other compensation
or benefit plans, programs and
arrangements as in effect immediately prior to
such termination.
4. Position and Duties. On and
after the Effective Date, the Executive shall
serve as Vice Chairman and Group Executive
of the Company and shall have such additional
duties and responsibilities as may be assigned
to the Executive by the Chief Executive Officer
of the Company. The Executive shall report to
the Chief Executive Officer of the Company. The
Executive agrees to devote substantially all the
Executive's full working time, attention and
energies during normal business hours to the
performance of the Executive's duties for
the Company, provided that the Executive may
serve as a director on the boards of such
companies and organizations as the Chief
Executive Officer of the Company may
specifically approve in writing.
5. Place of Performance. The
principal place of employment and office
of the Executive shall be in Houston, Texas,
or such other location as may be designated by
the Chief Executive Officer of the Company.
6. Compensation and Related Matters.
(a) Base Salary. As compensation for
the performance by the Executive of the
Executive's duties hereunder, during the
Employment Period the Company shall pay the
Executive an annual base salary no less than
the annual base salary in effect on the
Effective Date (such amount, as it may be
increased from time to time, is hereinafter
referred to as "Base Salary"). Base Salary
shall be payable in accordance with the
Company's normal payroll practices, shall be
reviewed at least annually by the Committee
and may be increased (but not decreased)
upon review.
(b) Annual Bonus. During the Employment
Period, the Executive shall participate, on
comparable terms, in the Company's performance-
based annual incentive plan in which similarly
situated executives of the Company participate.
(c) Other Compensation and Benefit
Plans and Arrangements; Fringe Benefits.
During the Employment Period, the Executive
shall be entitled to participate, at a level
appropriate to the Executive's position with
the Company, in such other employee benefit
and compensation plans and arrangements
(including, without limita-
tion, long-term incentive arrangements,
medical and dental care, life insurance,
disability protection and pension and
retirement plans, whether tax-qualified
or supplemental) and fringe benefits as
are generally available to similarly
situated executives of the Company
from time to time, and any successors
thereto.
(d) Expenses. The Company shall reimburse
the Executive for all reasonable business
expenses incurred during the Employment
Period, subject to the applicable and
reasonable policies and procedures of the
Company in force from time to time.
(e) Automobile Allowance. At all times
during the Employment Period, the Company
shall provide the Executive with an
automobile (and pay related expenses)
pursuant to the Company's policy as in
effect on the Effective Date, as such policy
may be amended from time to time (the
"Automobile Policy").
(f) Vacation. During the Employment Period,
the Company shall provide the Executive with
the number of paid vacation days annually to
which the Executive is entitled on the basis
of years of service with the Company in
accordance with the Company's normal
vacation policy in effect on the date
hereof.
7. Termination. The Executive's
employment hereunder may be terminated, and
the Employment Period hereunder shall be
ended,as follows:
(a) Death. The Executive's employment
shall terminate upon the Executive's death.
Upon such a termination, the Executive's estate,
designated beneficiary or surviving spouse,
as the case may be, shall become entitled to
the payments provided in Section 8(b) hereof
in accordance with the terms of such
Section.
(b) Disability. The Company may terminate
the Executive's employment hereunder for
Disability. During the Disability Period (as
defined in Section 8(a) hereof) and upon
such a termination, the Executive shall be
entitled to the payments and benefits provid
ed in Section 8(a) hereof in accordance with
the terms of such Section.
(c) Cause. The Company may terminate
the Executive's employment hereunder for Cause.
The decision as to whether Cause exists
shall be made in good faith by the
Committee. Upon such a termination, the
Executive shall become entitled to the payments
provided in Section 8(b) hereof in accordance
with the terms of such Section.
(d) Termination by the Executive.
(i) The Executive may terminate the
Executive's employment hereunder for Good
Reason. Upon a Good Reason termination, the
Executive shall become entitled to the
payments and benefits provided in Section
8(c) hereof in accordance with the terms of
such Section.
(ii) The Executive may terminate the
Executive's employment hereunder without
Good Reason, upon giving notice of one month
to the Company. In the event of such a
termination, the Executive shall comply with
any reasonable request of the Company to
assist in providing for an orderly transition
of authority, but such assistance shall not
delay the Executive's termination of employment
longer than six months beyond the giving of
the Executive's Notice of Termination. Upon
such a termination, the Executive shall
become entitled to the payments and benefits
provided in Section 8(b) hereof in
accordance with the terms of such Section.
(e) Notice of Termination. Any purported
termination of the Executive's employment
(other than termination pursuant to Section
7(a) hereof) shall be communicated by
written Notice of Termination to the other
party hereto in accordance with Section 16
hereof. For purposes of this Agreement, a
"Notice of Termination" shall mean a notice
that shall indicate the specific termination
provision in this Agreement relied upon and
shall set forth in reasonable detail the
facts and circumstances claimed to provide a
basis for termination of the Executive's
employment under the provision so indicated.
Further, a Notice of Termination for Cause
is required to include a copy of the
resolution regarding such termination duly
adopted by the Board or by the Executive
Termination Review Committee.
(f) Date of Termination. For purposes of
this Agreement, "Date of Termination" shall
mean the following: (i) if the Executive's
employment is terminated by the Executive's
death, the date of the Executive's death;
(ii) if the Executive's employment is
terminated
for Disability pursuant to Section 7(b) hereof,
thirty (30) days after the Notice of
Termination is given (provided that the
Executive shall not have returned
to the full-time performance of the
Executive's duties during such thirty-(30)-
day period); (iii) if the Executive's
employment is terminated for Cause pursuant
to Section 7(c) hereof, the date specified in
the Notice of Termination; (iv) if the
Executive's employment is terminated
pursuant to Section 7(d)(ii) hereof, the
date determined in accordance with said Section,
and (v) if the Executive's employment is
terminated for any other reason, the date
specified in the Notice of Termination
(which, in the case of a termination by the
Company, shall not be less than thirty (30)
days and, in the case of a termination by
the Executive, shall not be less than
fifteen (15) days nor more than sixty (60)
days, respectively, from the date such
Notice of Termination is given).
8. Compensation During Disability or Upon
Termination.
(a) Disability Period and Termination for
Disability. During any period during the
Employment Period that the Executive fails
to perform the Executive's full-time duties
hereunder as a result of incapacity due to
physical or mental illness ("Disability
Period"), the Company shall pay the
Executive's full salary to the Executive at
the rate in effect at the commencement of
any such period, together with all
compensation and benefits payable to the
Executive under the terms of any
compensation or benefit plan, program or
arrangement maintained by the Company during
such period, until the Executive's
employment is terminated by the Company for
Disability; provided, however, that such
salary payments shall be reduced by the sum
of the amounts, if any, payable to the
Executive at or prior to the time of any
such salary payment under disability benefit
plans of the Company or under the Social
Security disability insurance program, which
amounts were not previously applied to
reduce any such salary payment. Upon
termination of the Executive's employment
for Disability, the Company shall have no
additional obligations to the Executive
under this Agreement except to the extent
provided in Sections 6(c), 6(d), 7(b) and 14
hereof and the last sentence of this Section
8(a) (and, to the extent applicable,
Sections 9 and 10 hereof) and to pay to the
Executive the Executive's normal
post-termination compensation and benefits
as such payments become due. Such
post-termination compensation and benefits
shall be
determined under, and paid in
accordance with, the Company's retirement,
insurance and other compensation or benefit
plans, programs and arrangements as in
effect from time to time. As soon as
practicable after such termination, the
Company shall pay the Executive a pro rata
portion to the Date of Termination of the
Annual Bonus for the year in which the Date
of Termination occurs, calculated by using a
fraction (the numerator of which shall be
the number of days of employment in such
year up to and including the Date of Termination
and the denominator of which shall be
three-hundred-sixty-five (365)) to multiply
the award that the Executive would have
earned for the entire year (if the
Executive's employment had continued), based
on the Company's actual performance for such
year, and assuming the achievement, at the
target level, of any individual performance
objectives established with respect to such
award; provided, however, that any amount
otherwise payable pursuant to this sentence
shall be reduced by any payment already
received by the Executive pursuant to the
applicable Annual Bonus plan with respect to
the year in which the Date of Termination
occurs
(b) Termination (x) by the Company with
Cause, (y) by the Executive without Good
Reason, or (z) by Reason of Death. If the
Executive's employment hereunder is terminated
(x) by the Company with Cause, (y) by the
Executive without Good Reason, or (z) by
reason of death, then:
(i) as soon as practicable, the
Company shall pay the Executive's Base
Salary to the Executive through the Date of
Termination at the rate in effect
immediately prior to the Date of
Termination, together with all compensation
and benefits payable to the Executive
through the Date of Termination under the
terms of the Company's compensation and
benefit plans, programs or arrangements as
in effect immediately prior to the Date of
Termination; and
(ii) the Company shall have no additional
obligations to the Executive under this
Agreement except to the extent provided in
Sections 6(c), 6(d) and 14 hereof (and, to
the extent applicable, Sections 9 and 10
hereof) and to pay to the Executive the
Executive's normal post-termination
compensation and benefits as such payments
become due. Such post-termination
compensation and benefits shall be
determined under, and paid in
accordance with, the Company's retirement,
insurance and other compensation or benefit
plans,programs and arrangements as in effect
from time to time; and
(iii) only if such termination is by
reason of the Executive's death, the Company
shall pay the Executive a pro rata portion
to the Date of Termination of the Annual
Bonus for the year in which the Date of
Termination occurs, calculated by using a
fraction (the numerator of which shall be
the number of days of employment in such
year up to and including the Date of
Termination and the denominator of which shall
be three-hundred-sixty-five (365)) to multiply
the award that the Executive would have
earned for the entire year (if the
Executive's employment had continued), based
on the Company's actual performance for such
year, and assuming the achievement, at the
target level, of any individual performance
objectives established with respect to such
award; provided, however, that any amount
otherwise payable pursuant to this clause
(iii) shall be reduced by any payment
already received by the Executive pursuant
to the applicable Annual Bonus plan with
respect to the year in which the Date of
Termination occurs.
(c) Termination (x) by Company without
Cause or (y) by the Executive with Good
Reason. For purposes of this Agreement,
termination of the Executive's employment
"by the Company without Cause" shall not
include termination by the Company for
Disability or termination by reason of the
Executive's death. If the Executive's
employment hereunder is terminated (x) by
the Company without Cause or (y) by the
Executive with Good Reason:
(i) the Company shall pay the
Executive's Base Salary to the Executive
through the Date of Termination at the rate
in effect immediately prior to the Date of
Termination, together with all compensation
and benefits payable to the Executive
through the Date of Termination under the
terms of the Company's compensation and
benefit plans, programs or arrangements as
in effect immediately prior to the Date of
Termination or, if more favorable to the
Executive, as in effect immediately prior to
the first occurrence of an event or
circumstance constituting Good Reason;
(ii) notwithstanding any provision of
any Annual Bonus plan to the contrary, the
Company shall pay to the Executive a lump
sum amount, in cash,
equal to the sum of (A) any Annual Bonus
which has been allocated or awarded (but not
yet paid or deferred) to the Executive for a
completed fiscal year preceding the Date of
Termination under any Annual Bonus plan, and
(B) a pro rata portion to the Date of Termination
of the Annual Bonus for the year in which the Date
of Termination occurs, calculated by using a
fraction (the numerator of which shall be
the number of days of employment in such
year up to and including the Date of Termination
and the denominator of which shall be
three-hundred-sixty-five (365)) to multiply
the award that the Executive would have
earned for the entire year (if the
Executive's employment had continued), based
on the Company's actual performance for such
year, and assuming the achievement, at the
target level, of any individual performance
objectives established with respect to such
award; provided, however, that any amount
otherwise payable pursuant to this clause
(B) of this Section 8(c)(ii) shall be
reduced by any payment already received by
the Executive pursuant to the applicable
Annual Bonus plan with respect to the year
in which the Date of Termination occurs;
(iii) in lieu of any further salary or
bonus payments as severance to the Executive
for periods subsequent to the Date of
Termination and (except as provided in
Section 8(d) hereof) in lieu of any
severance benefit otherwise payable to the
Executive, the Company shall pay to the
Executive a severance payment, in cash,
equal to three times the sum of (x) the
Executive's Base Salary as in effect
immediately prior to the Date of Termination
or, if higher, in effect immediately prior
to the first occurrence of an event or
circumstance constituting Good Reason, and
(y) the Average Annual Bonus. As determined
in the Company's sole discretion, such
severance payment may either be paid in
substantially equal monthly or more frequent
installments over the three-year period
immediately following the Date of
Termination or in a lump sum discounted to
present value using 120% of the rate
provided in section 1274(b)(2)(B) of the
Code;
(iv) For the thirty-six (36) month
period immediately following the Date of
Termination, the Company shall arrange to
provide the Executive with medical, dental,
life and accident insurance benefits
substantially similar to those provided to
the Executive (other than any "split-dollar"
life insurance) immediately prior to the
Date of Termination, at no greater cost to
the Executive than the cost to the Executive
immediately prior to such date or
occurrence. Benefits otherwise receivable by
the Executive pursuant to the immediately
preceding sentence shall be reduced to the
extent benefits of the same type are
received by or made available to the
Executive by a successor employer during the
thirty-six (36) month period following the
Executive's termination of employment (and
any such benefits received by or made
available to the Executive shall be reported
to the Company by the Executive).
(v) The Company shall provide the
Executive with outplacement services
suitable to the Executive's position for a
period of six months or, if earlier, until
the first acceptance by the Executive of an
offer of employment.
(vi) The Company shall have no additional
obligations to the Executive under this
Agreement except to the extent provided in
Sections 6(c), 6(d) and 14 hereof (and, to
the extent applicable, Sections 9 and 10
hereof) and to pay to the Executive the
Executive's normal post-termination
compensation and benefits as such payments
become due. Such post-termination
compensation and benefits shall be
determined under, and paid in accordance
with, the Company's retirement, insurance
and other compensation or benefit plans,
programs and arrangements as in effect from
time to time at the level of benefits and
coverage applicable to the Executive
immediately prior to such termination.
(d) Effect of Entitlements (if any)
under Severance Agreement. Notwithstanding
any provision of this Agreement, it is the
intention of the parties hereto that there
shall be no duplication of benefits if the
circumstances of the Executive's termination
of employment would otherwise entitle the
Executive to payments and benefits under
both this Agreement and the Executive's
Severance Agreement. Accordingly, in the
event of such a termination, if a particular
type of benefit is payable under both
agreements, the Company shall in good faith
compare the two benefits and the Executive
shall be paid the greater of the two
benefits. Such payment shall be accepted by
the Executive in lieu of the lesser benefit
provided by the second agreement. It is
understood that this procedure may result in
one type of benefit (for example, continuing
medical insurance) being provided under one
of the agreements while another type of
benefit (for example, severance pay) is
provided under the second agreement.
9. Time of Certain Payments. Any
lump sum cash payments provided to the
Executive or for the Executive's benefit in
Section 8(c)(i), 8(c)(ii)(A) and 8(c)(iii)
hereof shall be made not later than the fifth
(5th) business day following the Date of
Termination; provided, however, that if the
amounts of such payments cannot be finally
determined on or before such day, the
Company shall pay to the Executive on such
day an estimate of the payments under
Section 8(c), as determined in good faith by
the Company, the estimate in each case to be
of the minimum amount of such payments to
which the Executive is clearly entitled, and
shall pay the remainder of such payments
(together with interest on the unpaid
remainder (or on all such payments to the
extent the Company fails to make such
payments when due) at 120% of the rate
provided in section 1274(b)(2)(B) of the
Code) as soon as the amount thereof can be
determined but in no event later than the
thirtieth (30th) day after the Date of
Termination. In the event that the amount of
the estimated payments exceeds the amount
subsequently determined to have been due,
such excess shall constitute a loan by the
Company to the Executive, payable on the
fifth (5th) business day after demand by the
Company (together with interest at 120% of
the rate provided in section 1274(b)(2)(B)
of the Code). At the time that payments are
made under this Agreement, the Company shall
provide the Executive with a written
statement setting forth the manner in which
such payments were calculated and the basis
for such calculations including, without
limitation, any opinions or other advice the
Company has received from advisors or
consultants (and any such opinions or advice
which are in writing shall be attached to
the statement).
10. Legal and Arbitration Fees and
Expenses. The Company also shall pay to the
Executive all reasonable legal fees,
arbitration fees and expenses incurred by
the Executive in disputing in good faith any
issue hereunder relating to the termination
of the Executive's employment, in seeking in
good faith to obtain or enforce any benefit
or right provided by this Agreement. Such
payments shall be made within five (5)
business days after delivery of the
Executive's written requests for payment
accompanied with such evidence of fees and
expenses incurred as the Company reasonably
may require. Notwithstanding the foregoing
provisions of this Section 10, no such fees
and expenses shall be paid unless the
Executive prevails on at least one of the
issues the
Executive raises.
11. No Mitigation; Limited Offset.
The Company agrees that, if the Executive's
employment with the Company terminates
during the Term, the Executive is not
required to seek other employment or to
attempt in any way to reduce any amounts
payable to the Executive by the Company
pursuant to Section 8 hereof. Further, the
amount of any payment or benefit provided
for in this Agreement (other than Section
8(c)(iv) hereof) shall not be reduced by any
compensation earned by the Executive as the
result of employment by another employer, by
retirement benefits, by offset against any
amount claimed to be owed by the Executive
to the Company (unless such amount is
evidenced by a promissory note signed by the
Executive), or otherwise.
12. Ownership and Protection of
Information; Copyrights.
(a) All information, ideas, concepts,
improvements, discoveries, and inventions,
whether patentable or not, and all
expressions of ideas, which are created,
conceived, made, developed or acquired by
the Executive, individually or in
conjunction with others, during the
Executive's employment by Company, whether
tangible or intangible, which relate to
Company's business, products or services
(including, without limitation, all such
information relating to corporate
opportunities, mutual funds, insurance or
annuity products, research, financial and
sales data, pricing and trading terms,
evaluations, opinions, interpretations,
acquisition prospects, the identity of
customers or their requirements, the
identity of key contacts within the
customer's organizations or within the
organization of acquisition prospects, or
marketing and merchandising techniques,
prospective names, and marks) shall be
disclosed to Company. Executive acknowledges
that the Executive has heretofore disclosed
all such information, ideas, concepts,
improvements, discoveries, and inventions,
as well as all expressions of ideas, to
Company.
(b) All such information, ideas, concepts,
improvements, discoveries, and inventions
identified in Section 12(a) hereof are and
shall be the sole and exclusive property of
Company. Moreover, if, during the
Executive's employment by Company, the
Executive creates any work of authorship
fixed in any tangible medium of expression
which is the subject matter of
copyright(such as videotapes, written
presentations, computer programs, E-mail, voice
mail, electronic databases, drawings, maps,
architectural renditions, models, manuals,
brochures, or the like) relating to
Company's business, products, or services,
whether such work is created solely by the
Executive or jointly with others (whether
during business hours or otherwise and
whether on Company's premises or otherwise)
Company shall be deemed the author of such
work if the work is prepared by the
Executive in the scope of the Executive's
employment; or, if the work is not prepared
by the Executive within the scope of the
Executive's employment but is specially
ordered by Company as a contribution to a
collective work, as part of a motion picture
or other audiovisual work, as a translation,
as a supplementary work, as a compilation,
or as an instructional text, then the work
shall be considered to be work made for hire
and Company shall be the author of the work.
If such work relating to Company's business,
products, or services is neither prepared by
the Executive within the scope of the
Executive's employment nor a work specially
ordered that is deemed to be a work made for
hire, then the Executive hereby agrees to
assign, and by these presents does assign,
to Company all of the Executive's worldwide
right, title, and interest in and to such
work and all rights of copyright therein.
Additionally, all documents, drawings,
memoranda, notes, records, files,
correspondence, manuals, models,
specifications, computer programs, E-mail,
voice mail, electronic databases, maps, and
all other writings or materials of any type
embodying any of such information, ideas,
concepts, improvements, discoveries,
inventions and/or copyrightable expressions
are and shall be the sole and exclusive
property of Company. Executive acknowledges
that Company is the owner of all such
information, ideas, concepts, improvements,
discoveries, inventions and/or copyrightable
expressions that the Executive heretofore
created, conceived, made, developed or
acquired while employed by Company.
(c) Executive will not, at any time
during or after the Executive's employment by
Company, make any unauthorized disclosure of
any confidential business information or
trade secrets of Company, or make any use
thereof, for the Executive's benefit or for
the benefit of others, except in the
carrying out of the Executive's employment
responsibilities hereunder. As a result of
the Executive's employment by Company, the
Executive shall also from time to time have
access to, or
knowledge of, confidential business
information or trade secrets of third parties,
such as customers, suppliers, partners, joint
venturers, and the like, of Company. Executive
also agrees to preserve and protect the
confidentiality of such third party confidential
information and trade secrets to the same extent,
and on the same basis, as Company's confidential
business information and trade secrets. Upon
termination of the employment relationship
for any reason, the Executive shall promptly
deliver to Company all documents and things
containing Company trade secrets or
confidential information. Executive may
disclose those aspects of Company's
confidential information as to which the
Executive has received the written advice of
counsel that such disclosure thereof is
necessary under applicable federal, state,
local, or foreign law or other regulations
applicable to the Executive (including,
without limitation, any confidential
information that the Executive is legally
compelled to disclose as a result of
depositions, interrogatories, request for
documents, subpoenas, civil investigative
demands, or similar processes), provided,
however, that the Executive has first
provided Company with prompt prior written
notice of such requirement so that Company
may seek a protective order or other
appropriate remedy and/or waive compliance
with the terms of this Agreement. In the
event that such protective order or other
remedy is not obtained, or that Company does
not waive compliance with the provisions
hereof, the Executive agrees to furnish only
that portion of Company's confidential
information which the Executive is advised
in writing by the Executive's counsel is
legally required to be disclosed and to
exercise all reasonable efforts to obtain
assurance that confidential treatment will
be accorded such confidential information.
(d) Both during the period of the
Executive's employment by Company and
thereafter, the Executive shall assist
Company or its nominees, at any time, in the
protection of Company's worldwide right,
title, and interest in and to information,
ideas, concepts, improvements, discoveries,
and inventions, and its copyrighted works,
including without limitation, the execution
of all formal assignment documents requested
by Company or its nominees and the execution
of all lawful oaths and applications for
applications for patents and registration of
copyright in the United States and foreign
countries. To the extent any assistance is
required from the Executive following the
termination of the Executive's employment
with Company, Company shall make
reasonable efforts to coordinate the assistance
required with the Executive's other business
and personal commitments and the Executive
shall likewise make reasonable efforts to
accommodate Company's needs and time
considerations.
(e) Executive acknowledges that money
damages would not be sufficient remedy for
any breach of this Section 12 by the
Executive, and Company shall be entitled to
enforce the provisions of this Section 12 by
terminating any payments then owing to the
Executive under this Agreement and/or
entitled to specific performance and
injunctive relief as remedies for such
breach or any threatened breach. Such
remedies shall not be deemed the exclusive
remedies for a breach of this Section 12,
but shall be in addition to all remedies
available at law or in equity to Company,
including the recovery of damages from the
Executive and the Executive's agents
involved in such breach.
13. Non-Competition and Non-Solicitation
Obligations.
(a) As part of the consideration for the
compensation and benefits to be paid to the
Executive hereunder, to protect the trade
secrets and confidential information of
Company or its subsidiaries or affiliates or
their customers or clients that have been
and will in the future be disclosed or
entrusted to the Executive, the business
goodwill of Company or its subsidiaries or
affiliates that has been and will in the
future be developed in the Executive, or the
business opportunities that have been and
will in the future be disclosed or entrusted
to the Executive by Company or its
subsidiaries or affiliates; and as an
additional incentive for Company to enter
into this Agreement, the Executive agrees to
the non-competition and non-solicitation
obligations hereunder: the Executive shall
not, anywhere in the United States or any
other country in which Company is offering
financial services, directly or indirectly
for the Executive or for others (i) during
the term of the Executive's employment,
compete in any manner with Company or any
subsidiary or affiliate of Company by whom
the Executive is employed at any time, (ii)
solicit or attempt to convert to other
financial services companies providing the
same or similar products or services
provided by Company, any customers or
policyholders of Company or its subsidiaries
or affiliates; or (iii) solicit for
employment or employ any employee of
Company. The obligations under clauses (i),
(ii) and (iii) of the immediately preceding
sentence shall extend throughout the
Executive's period of employment hereunder
and, unless the Executive's termination of
employ-
ment is by the Company without Cause
or by the Executive with Good Reason or
occurs after a Change in Control (as defined
in the Executive's Severance Agreement), for
a period of three (3) years following
termination of the employment relationship;
provided, however, that, if such termination
shall have been preceded by the Company's
having given notice not to extend the Term
of this Agreement, such three-year period
shall be reduced (but not to less than one
year) by the period of the Executive's
continued employment subsequent to the
giving of such notice.
(b) Executive understands that the
foregoing restrictions may limit the
Executive's ability to engage in certain
businesses in the areas specified above
during the period provided for above, but
acknowledges that the Executive will receive
sufficiently high remuneration and other
benefits under this Agreement to justify
such restriction. Executive acknowledges
that money damages would not be sufficient
remedy for any breach of this Section 13 by
the Executive, and Company shall be entitled
to enforce the provisions of this Section 13
by terminating any payments then owing to
the Executive under this Agreement and/or to
specific performance and injunctive relief
as remedies for such breach or any
threatened breach. Such remedies shall not
be deemed the exclusive remedies for a
breach of this Section 13, but shall be in
addition to all remedies available at law or
in equity to Company, including, without
limitation, the recovery cf damages from the
Executive and the Executive's agents
involved in such breach.
(c) It is expressly understood and agreed
that Company and the Executive consider the
restrictions contained in this Section 13 to
be reasonable and necessary to protect the
trade secrets and confidential information
of Company or its subsidiaries or
affiliates, the business goodwill of Company
or its subsidiaries or affiliates developed
in the Executive, and/or the business
opportunities disclosed or entrusted to the
Executive by Company or its subsidiaries or
affiliates. Nevertheless, if any of the
aforesaid restrictions are found to
be unreasonable, or overly broad as to
geographic area or time, or otherwise
unenforceable, the parties intend for the
restrictions therein set forth to be
modified so as to be reasonable and
enforceable and, as so modified, to be fully
enforced.
(d) These duties and obligations of the
Executive specified in this Section 13 are
not exclusive. Executive owes Company the
duties and obligations agreed to elsewhere
in this Agreement and as are imposed by the
law, e.g., the duty to refrain from
tortiously interfering with Company's
contractual and business relationships with
others.
14. Indemnification and Liability
Insurance. The Company shall indemnify the
Executive to the full extent authorized by
law and the Charter and By-Laws of the
Company, as applicable, for all expenses,
costs, liabilities and legal fees which the
Executive may incur in the discharge of the
Executive's duties hereunder. The Executive
shall be insured under the Company's
directors' and officers' liability insurance
policy as in effect from time to time. Any
termination of the Executive's employment or
of this Agreement shall have no effect on
the continuing operation of this Section 14.
15. Successors; Binding Agreement.
(a) In addition to any obligations imposed
by law upon any successor to the Company,
the Company will require any successor
(whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all
or substantially all of the business and/or
assets of the Company to expressly assume
and agree to perform this Agreement in the
same manner and to the same extent that the
Company would be required to perform it if
no such succession had taken place. Failure
of the Company to obtain such assumption and
agreement prior to the effectiveness of any
such succession shall be a breach of this
Agreement and shall entitle the Executive to
compensation from the Company in the same
amount and on the same terms as the
Executive would be entitled to hereunder if
the Executive were to terminate the
Executive's employment for Good Reason,
except that, for purposes of implementing
the foregoing, the date on which any such
succession becomes effective shall be deemed
the Date of Termination.
(b) This Agreement shall inure to the
benefit of and be enforceable by the
Executive's personal or legal
representatives, executors, administrators,
successors, heirs, distributees, devisees
and legatees. If the Executive shall die
while any amount would still be payable to
the Executive hereunder (other than amounts
which, by their terms, terminate upon the
death of the Executive) if the Executive had
continued to live, each such amount, unless
otherwise provided herein, shall be paid in
accordance with the terms of this Agreement
to the executors, personal representatives
or administrators of the Executive's estate.
16. Notices. For the purpose of this
Agreement, notices and all other
communications provided for in the Agreement
shall be in writing and shall be deemed to
have been duly given when delivered or
mailed by United States registered mail,
return receipt requested, postage prepaid,
addressed, if to the Executive, to the
address inserted below the Executive's
signature on the final page hereof and, if
to the Company, to the address set forth
below, or to such other address as either
party may have furnished to the other in
writing in accordance herewith, except that
notice of change of address shall be
effective only upon actual receipt:
To the Company:
American General Corporation
0000 Xxxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000
Attention: General Counsel
17. Miscellaneous. No provision of
this Agreement may be modified, waived or
discharged unless such waiver, modification
or discharge is agreed to in writing and
signed by the Executive and such officer as
may be specifically designated by the Board.
No waiver by either party hereto at any time
of any breach by the other party hereto of,
or of any lack of compliance with, any
condition or provision of this Agreement to
be performed by such other party shall be
deemed a waiver of similar or dissimilar
provisions or conditions at the same or at
any prior or subsequent time. This Agreement
supersedes any other agreements or
representations, oral or otherwise, express
or implied, with respect to the subject
matter hereof which have been made by either
party, including, without limitation, any
employment memorandum, memorandum of
understanding, or severance
arrangements (other than the Severance
Agreement). Captions and Section headings in
this Agreement are provided merely for
convenience and shall not affect the
interpretation of any of the provisions
herein. The validity, interpretation,
construction and performance of this
Agreement shall be governed by the laws of
the State of Texas. All references to
sections of the Exchange Act or the Code
shall be deemed also to refer to any
successor provisions to such sections. Any
payments provided for hereunder shall be
paid net of any applicable withholding
required under federal, state or local law
and any additional withholding to which the
Executive has agreed. The obligations of the
Company and the Executive under this
Agreement which by their nature may require
either partial or total performance after
the expiration of the Term (including,
without limitation, those under Section 8
hereof) shall survive such expiration.
18. Validity. The invalidity or
unenforceability of any provision of this
Agreement shall not affect the validity or
enforceability of any other provision of
this Agreement, which shall remain in full
force and effect.
19. Counterparts. This Agreement may be
executed in several counterparts, each of
which shall be deemed to be an original but
all of which together will constitute one
and the same instrument.
20. Settlement of Disputes; Arbitration.
(a) All claims by the Executive for
benefits under this Agreement shall be
directed to and determined by the Committee
and shall be in writing. Any denial by the
Committee of a claim for benefits under this
Agreement shall be delivered to the
Executive in writing and shall set forth the
specific reasons for the denial and the
specific provisions of this Agreement relied
upon. The Committee shall afford a
reasonable opportunity to the Executive for
a review of the decision denying a claim and
shall further allow the Executive to appeal
to the Committee a decision of the Committee
within sixty (60) days after notification by
the Committee that the Executive's claim has
been denied.
(b) Except for equitable relief as
specified in Section 20(f) hereof and except
for the Executive's claim under any Company
benefit or compensation plans, programs,
arrangements or awards (whether heretofore
or hereafter established) which have a claim
or dispute resolution procedure specifically
applicable thereto, any dispute or
controversy which is not resolved by
agreement pursuant to Section 20(a) hereof,
including all claims, demands, causes of
action, disputes, controversies, and other
matters in question arising out of or
relating to this Agreement, any provision
hereof, the alleged breach thereof, or in
any way relating to the subject matter of
this Agreement involving the Executive, the
Company, and/or their respective
representatives, even though some or all of
such claims allegedly are extra-contractual
in nature, whether such claims sound in
contract, tort, or otherwise, at law or in
equity, under state or federal law, whether
provided by statute or the common law, for
damages or any other relief, shall be
resolved by binding arbitration pursuant to
the Federal Arbitration Act in accordance
with the Employment Dispute Resolution Rules
then in effect with the American Arbitration
Association. The arbitration proceeding
shall be conducted in Houston, Texas. This
agreement to arbitrate shall be enforceable
in either federal or state court.
(c) The enforcement of this agreement to
arbitrate and all procedural aspects of this
agreement to arbitrate, including but not
limited to, the construction and
interpretation of this agreement to
arbitrate, the issues subject to arbitration
(i.e., arbitrability), the scope of the
arbitrable issues, allegations of waiver,
delay or defenses to arbitrability, and the
rules governing the conduct of the
arbitration, shall be governed by and
construed pursuant to the Federal
Arbitration Act and shall be decided by the
arbitrators. In deciding the substance of
any such claims, the arbitrators shall apply
the substantive laws of the State of Texas
(excluding Texas choice-of-law principles
that might call for the application of some
other state's law); provided, however, it is
expressly agreed that the arbitrators shall
have no authority to award treble,
exemplary, or punitive damages under any
circumstances regardless of whether such
damages may be available under Texas law,
the parties hereby waiving their right, if
any, to recover treble, exemplary, or
punitive damages in connection with any such
claims.
(d) The arbitration may be initiated by
any party by providing to the other parties a
written notice of arbitration specifying the
claims. Within thirty (30) days of the
notice of initiation of the arbitration
procedure, (1) the Executive shall
denominate one arbitrator and (2) the
Company shall denominate one arbitrator. The
two arbitrators shall select a third
arbitrator failing agreement on which within
sixty (60) days of the original notice,
either the Executive or the Company shall
apply to the Senior Active United States
District Judge for the Southern District of
Texas, who shall appoint a third arbitrator.
While the third arbitrator shall be neutral,
the two party-appointed arbitrators are not
required to be neutral and it shall not be
grounds for removal of either of the two
party-appointed arbitrators or for vacating
the arbitrators' award that either of such
arbitrators has past or present minimal
relationships with the party that appointed
such arbitrator. Evident partiality on the
part of an arbitrator exists only where the
circumstances are such that a reasonable
person would have to conclude there in fact
existed actual bias and a mere appearance or
impression of bias will not constitute
evident partiality or otherwise disqualify
an arbitrator.
(e) The three arbitrators shall by
majority vote resolve all disputes between
the parties. There shall be no transcript
of the hearing before the arbitrators. The
arbitrators' decision shall be in writing,
but shall be as brief as possible. The
arbitrators shall not assign the reasons for
their decision. The arbitrators shall
certify in their award that they have
faithfully applied the terms and conditions
of this Agreement and that no part of their
award includes any amount for exemplary or
punitive damages. All proceedings conducted
hereunder and the decision of the
arbitrators shall be kept confidential by
the parties, e.g., the arbitrators' award
shall not be released to the press or
published in any of the various arbitration
reporters. Judgment upon any award rendered
in any such arbitration proceeding may be
entered by any federal or state court having
jurisdiction.
(f) Notwithstanding any provision of this
Agreement to the contrary, (i) in the event
of a breach or threatened breach by the
Executive of any of the covenants set forth
in Section 12 or 13 hereof, the Company
shall be entitled to seek equitable relief,
including an injunction, in any court of
proper jurisdic-
tion to maintain the status quo pending the
resolution of the dispute by binding arbitration
as provided above, and (ii) the Executive shall
be entitled to seek specific performance of the
Executive's right to be paid until the Date of
Termination during the pendency of any
dispute or controversy arising under or in
connection with this Agreement. With respect
to any such action, the Executive and the
Company hereby irrevocably submit to the non-
exclusive jurisdiction of any Federal or
State court sitting in the City of Houston,
Texas, and agree that process in any such
action shall be valid and effective for all
purposes if served upon the respective party
in accordance with the notice provisions of
Section 16 hereof.
21. Definitions. For purposes of this
Agreement, the following terms shall have
the meanings indicated below:
(a) "Affiliate" shall have the meaning set
forth in Rule 12b-2 promulgated under
Section 12 of the Exchange Act.
(b) "Average Annual Bonus" shall mean the
average annual bonus earned by the Executive
pursuant to any annual bonus or incentive
plan maintained by the Company in which the
Executive participated in respect of any of
the two calendar years ending immediately
prior to the calendar year in which occurs
the Date of Termination; provided, however,
that if only one bonus is earned by the
Executive in the applicable two-year period,
such bonus shall be deemed to be the Average
Annual Bonus.
(c) "Board" shall mean the Board of
Directors of the Company.
(d) "Cause" for termination by the
Company of the Executive's employment shall
mean only the following actions or inactions
by the Executive: (i) a willful material
misrepresentation pertaining to the business
or property of the Company or its
Affiliates, (ii) misappropriation of a
material aspect of the business or property
of the Company or its Affiliates, (iii)
willfully causing material damage to the
property or business of the Company or its
Affiliates, (iv) willful gross neglect to
substantially perform the Executive's duties
with the Company (other than any such
failure resulting from the Executive's
incapacity due to physical or mental
illness), (v) willful gross misconduct
result-
ing in demonstrable and material
economic harm to the Company or its
Affiliates,(vi) conviction of the Executive
for the commission of a felony involving
moral turpitude or involving some aspect of
the business or property of the Company or
its Affiliates, or (vii) use of alcohol or
drugs which interferes with the performance
of the Executive's duties.
(e) "Code" shall mean the Internal Revenue
Code of 1986, as amended from time to time.
(f) "Committee" shall mean the Personnel
Committee of the Board.
(g) "Company" shall mean American General
Corporation, a Texas corporation and shall
include any successor to its business and/or
assets which assumes and agrees to perform
this Agreement by operation of law, or
otherwise.
(h) "Date of Termination" shall have the
meaning set forth in Section 7(f) hereof.
(i) "Disability" shall be deemed the
reason for the termination by the Company
of the Executive's employment, if, (i) as
a result of the Executive's incapacity due
to physical or mental illness, the Executive
shall have been absent from the full-time
performance of the Executive's duties with
the Company for a period of six (6)
consecutive months, (ii) a physician agreed
upon by the Executive (or the Executive's
legal representative) and the Company (or,
if the parties hereto are unable to agree
upon a single physician, a third physician
agreed upon by two physicians, each of whom
has been selected by either the Executive
(or the Executive's legal representative) or
the Company) shall have determined that the
Executive will be incapable, due to physical
or mental illness, of substantially
performing the Executive's duties and
responsibilities under this Agreement for
the remainder of the Term, (iii) the Company
shall have given the Executive a Notice of
Termination for Disability, and (iv) within
thirty (30) days after such Notice of
Termination is given, the Executive shall
not have returned to the full-time
performance of the Executive's duties.
(j) "Employment Period" shall mean the
period (which in no event shall extend
beyond the expiration of the Term and may
end earlier pursuant to Section 3(b) hereof)
during which Executive has an obligation to
render services hereunder, as described in
Section 4 hereof.
(k) "Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended
from time to time.
(l) "Executive" shall mean the individual
named in the first paragraph of this
Agreement.
(m) "Good Reason" for termination by
the Executive of the Executive's employment
shall mean the occurrence (without the
Executive's express written consent) of any
one of the following acts by the Company, or
failures by the Company to act, unless, in
the case of any act or failure to act
described in paragraph (I), (V), (VI), (VII)
or (VIII) below, such act or failure to act
is corrected prior to the Date of
Termination specified in the Notice of
Termination given in respect thereof:
(I) a substantial adverse alteration
in the nature or status of the Executive's
responsibilities from those in effect
immediately prior to the date hereof;
(II) a reduction by the Company in the
Executive's Base Salary;
(III) the failure by the Company to pay
to the Executive any portion of the
Executive's current compensation, or to pay
to the Executive any portion of an
installment of deferred compensation under
any deferred compensation program of the
Company, within seven (7) days of the date
such compensation is due;
(IV) except for any changes required by
applicable law, the failure by the Company
to continue in effect any compensation plan
in which the Executive participates
immediately prior to the date hereof which
is material to the Executive's total
compensation, including but not limited to
the Company's Performance-Based Plan for
Executive Officers, Supplemental Thrift
Plan, Restoration of Retirement Income
Plan, and 1997 Stock and Incentive Plan,
unless an equitable arrangement (embodied in
an ongoing substitute or alternative plan) has
been made with respect to such plan, or the
failure by the Company to continue the
Executive's participation therein (or in
such substitute or alternative plan) on a
basis not materially less favorable, both in
terms of the amount or timing of payment of
benefits provided and the level of the
Executive's participation relative to other
participants, as existed immediately prior
to the date hereof;
(V) except for any changes required by
applicable law, the failure by the Company
to continue to provide the Executive with
benefits substantially similar to those
enjoyed by the Executive under any of the
Company's pension, savings, life insurance,
medical, health and accident, or disability
plans in which the Executive was
participating immediately prior to the date
hereof, the taking of any other action by
the Company which would directly or
indirectly materially reduce any of such
benefits or deprive the Executive of any
material fringe benefit enjoyed by the
Executive as of the date hereof, or the
failure by the Company to provide the
Executive with at least the number of annual
paid vacation days to which the Executive is
entitled on the basis of years of service
with the Company in accordance with the
Company's normal vacation policy in effect
on the date hereof; notwithstanding the
foregoing provisions of this Section
21(m)(V), it shall not constitute Good
Reason that the Executive's benefits under
the Company's general medical, health and
accident plans are no longer substantially
similar to the benefits enjoyed by the
Executive immediately prior to the date
hereof, unless the changes in such benefits
constitute a material adverse alteration
thereof;
(VI) any purported termination of the
Executive's employment which is not effected
pursuant to a Notice of Termination
satisfying the requirements of Section 7(e)
hereof; for purposes of this Agreement, no
such
purported termination shall be
effective, except as provided in Section
3(b) hereof; or
(VII) the Company's breach of a material
term or condition of the Agreement.
It shall also constitute Good
Reason for termination by the Executive of
the Executive's employment if:
(X)if, at any time during the Term
hereof (whether or not a Change in
Control shall have occurred), Xxxxxx X.
Xxxxxx is not serving as Chief
Executive Officer of the Company (or,
if a merger, consolidation or share
exchange by the Company (or a Company
subsidiary) with another corporation
shall have occurred, as Chief Executive
Officer or second-in-command of the
Company), and
(Y) (i) there is a material diminution
in the duties, responsibilities or
title of the Executive,
(ii) a substantial adverse
alteration is made in the nature
or status of the Executive's
responsibilities from those in
effect immediately prior to Xxxxxx
X. Xxxxxx'x ceasing to so serve,
(iii) the Company relocates the
Executive's principal place of
employment to a location more than
fifty (50) miles from the
Executive's principal place of
employment immediately prior to
Xxxxxx X. Xxxxxx'x ceasing to so
serve, or
(iv) the Company requires the
Executive to be based anywhere
other than such principal place of
employment (or permitted
relocation thereof) except for
required travel on the Company's
business to an extent
substantially consistent with the
Executive's present business
travel obligations.
The Executive's right to terminate
the Executive's employment for Good Reason
shall not be affected by the Executive's
incapacity due to physical or mental
illness. The Executive's continued
employment shall not constitute consent to,
or a waiver of rights with respect to, any
act or failure to act constituting Good
Reason hereunder.
(n) "Notice of Termination" shall have the
meaning set forth in Section 7(e) hereof.
(o) "Pension Plans" shall mean all tax-
qualified and non-qualified supplemental or
excess benefit pension plans maintained by
the Company and any other plan or agreement
entered into between the Executive and the
Company which is designed to provide the
Executive with supplemental retirement
benefits.
(p) "Severance Agreement" shall mean the
Change in Control Severance Agreement (if
any) in effect between the Executive and the
Company from time to time, as amended from
time to time.
(q) "Term" shall mean the period of time
described in Section 3 hereof (including any
extension, continuation or termination
described therein).
American General Corporation
By:___________________________
Name: Xxxxxx X. Xxxxxx
Title: Chairman and Chief Executive Officer
______________________________
Executive
Address:
______________________________
______________________________
______________________________
(Please print carefully)
