EXHIBIT 10.5
RETIREMENT AGREEMENT
This AGREEMENT is entered into this 1st day of May, 2002 by and between
The Xxxxxxxx Companies, Inc. ("Xxxxxxxx") (as authorized and approved by the
Compensation Committee of the Xxxxxxxx Board of Directors at its January 17,
2002 meeting) and Xxxxx X. Xxxxxx ("Xx. Xxxxxx"),
WHEREAS, Xx. Xxxxxx is retiring from his employment with Xxxxxxxx
effective May 31, 2002; and
WHEREAS, Xxxxxxxx wishes to retain the services of Xx. Xxxxxx and
obtain certain covenants from him, and Xx. Xxxxxx wishes to perform services for
Xxxxxxxx and provide such covenants, on the terms and conditions set forth in
this Agreement; and
WHEREAS, Xxxxxxxx seeks to achieve a final and amicable resolution of
the employment relationship and assure a smooth transition of job functions;
NOW, THEREFORE, in consideration of the mutual promises made herein,
and for other good and valuable consideration, the parties hereby agree as
follows:
COVENANTS AND OBLIGATIONS OF XXXXXXXX
1. Lump Sum Payments. In consideration of the covenants and obligations
entered into herein, and in lieu of a 2002 discretionary stock option award,
Xxxxxxxx agrees to pay Xx. Xxxxxx a total gross amount of $2,000,000. In
recognition of his contributions as Chairman, and in further consideration of
the covenants and obligations entered into herein and under the Release
Agreement attached hereto as Exhibit A, Xxxxxxxx agrees to pay Xx. Xxxxxx, on
the effective date of the Release Agreement a total gross amount of $2,400,000.
2. EICP Bonus. Xx. Xxxxxx shall be eligible to receive a prorated bonus
under the Executive Incentive Compensation Program for the 2002 calendar year.
Such bonus will be based on a target opportunity of 100% of base pay, actual WMB
financial and stock performance, and personal performance based on an "achieves,
achieves" level. The bonus will be paid in a lump sum at the same time payment
is made to other participants.
3. Restricted and Deferred Stock Awards. All of Xx. Xxxxxx'x unvested
restricted and deferred stock awards shall vest and become payable upon his
retirement.
4. Stock Option Loan. Xx. Xxxxxx'x outstanding stock option loan in
effect on the date of his retirement from Xxxxxxxx shall continue in force
through the remainder of its original term.
5. Home Office Support. Xxxxxxxx shall provide and maintain Xx.
Xxxxxx'x computer and access to Xxxxxxxx' network and telephone systems via his
home offices through December 31, 2003.
6. Financial Services. Xxxxxxxx shall provide Xx. Xxxxxx with access to
Xxxxxxxx' Financial Planning Services group for assistance with 2001 and 2002
tax years.
7. Travel Expenses. Xxxxxxxx shall provide Xx. Xxxxxx with
transportation and reimbursement of travel expenses for a period of one year
following retirement for any obligation that relates to commitments made as an
active Xxxxxxxx employee and benefits Xxxxxxxx. Transportation may be provided
through use of Xxxxxxxx
aircraft pursuant to approval by Xxxxxxxx' Chairman.
8. Reimbursement of Expenses. Xxxxxxxx shall reimburse Xx. Xxxxxx for
all reasonable expenses incurred after his retirement in response to legal
actions relating to his responsibilities while employed by Xxxxxxxx. Xxxxxxxx
shall also reimburse Xx. Xxxxxx for all otherwise unreimbursed reasonable
expenses related to his service on the AEGIS Board of Directors.
9. Insurance and Indemnification. To the extent permitted by law and as
provided in its Certificate of Incorporation and By-Laws, Xxxxxxxx shall use its
best efforts to maintain directors and officers insurance providing coverage to
Xx. Xxxxxx for, and shall indemnify and hold harmless Xx. Xxxxxx from, all
claims made against him to the extent they relate to, or arise out of, his
employment at Xxxxxxxx as a director, officer or employee.
10. Benefits. Nothing contained herein shall be construed to abrogate
Xx. Xxxxxx'x rights under any employee benefit or incentive compensation plan.
Xx. Xxxxxx'x rights under any employee benefit or incentive compensation plan
shall be governed by the terms of such plan.
COVENANTS AND OBLIGATIONS OF XX. XXXXXX
1. Continuation of Present Employment. From the execution of this
Agreement through May 31, 2002, Xx. Xxxxxx agrees to use his best efforts on
behalf of Xxxxxxxx to fulfill his assigned responsibilities and effect a
successful transition of job functions to his successor.
2. Consulting Services. For a period of two years following his
retirement, Xx. Xxxxxx shall, upon the reasonable request of Xxxxxxxx, assist
Xxxxxxxx at such times and in such manner as Xx. Xxxxxx and Xxxxxxxx shall
mutually agree. Xx. Xxxxxx'x on-location requirements will not exceed twelve
(12) days per calendar quarter without his consent.
3. Litigation Assistance. Xx. Xxxxxx agrees, upon the reasonable
request of Xxxxxxxx, to provide assistance to Xxxxxxxx as may reasonably be
required in connection with any litigation that Xxxxxxxx is or may become a
party to relating to events occurring during Xx. Xxxxxx'x employment with the
Company.
4. AEGIS Board. Xx. Xxxxxx agrees to continue to serve on the AEGIS
Board of Directors after his retirement.
5. Execution of Release. Xx. Xxxxxx agrees to execute no earlier than
June 1, 2002, the Release Agreement attached hereto as Exhibit A.
6. Covenant Not to Compete. To the maximum extent permitted by law, and
in further consideration of the payments received herein, Xx. Xxxxxx agrees that
for a period of two and one-half years following his retirement he shall not,
without the prior written consent of the Chairman of Xxxxxxxx for himself or on
behalf of any person, partnership, corporation or other business entity,
directly or indirectly engage in the same or substantially similar activities as
those management activities he performed for Xxxxxxxx, for or in any other
person, firm or entity in competition with the business of Xxxxxxxx, in the
continental United States.
7. Confidentiality. Xx. Xxxxxx agrees to keep the existence, terms and
substance of this Agreement confidential and further agrees that he will not
disclose the terms of this Agreement to anyone outside his immediate family,
attorney or financial advisor, except as may be required by law.
GENERAL PROVISIONS
1. Severability. In the event that any provision of this Agreement
should be held to be void, voidable, or unenforceable, the remaining portions
hereto shall remain in full force and effect. If any provision shall be deemed
invalid due to its scope or breadth, such provision shall be deemed valid to the
extent permitted by law.
2. Governing Law. This Agreement shall be subject to and construed in
accordance with the laws of the State of Oklahoma.
3. Waiver or Amendment. No waiver, alteration, or modification of any
of the provisions of this Agreement shall be binding unless in writing and
signed both by Xx. Xxxxxx and a duly authorized representative of Xxxxxxxx.
4. Entirety. This Agreement, including the Exhibit A hereto,
constitutes the entire agreement between the parties with respect to the subject
matter hereof. This Agreement supersedes any and all other negotiations,
understandings or agreements, whether oral or in writing between the parties
with respect to the subject matter hereof including, without limitation, any and
all compensation or benefits payable to Xx. Xxxxxx.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first shown above.
THE XXXXXXXX COMPANIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
Title: Sr. V.P. Human Resources /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
EXHIBIT "A"
RELEASE
THIS RELEASE (this "Agreement") is entered into this 1st day of June,
2002 by and between The Xxxxxxxx Companies, Inc. ("Xxxxxxxx") and Xxxxx X.
Xxxxxx ("Xx. Xxxxxx") and is effective seven days after the execution hereof by
Xx. Xxxxxx.
WHEREAS, the parties entered into a Retirement Agreement dated May 1,
2002 ("Retirement Agreement"); and
WHEREAS, such Retirement Agreement provided for the execution of this
Agreement on or after June 1, 2002;
NOW, THEREFORE, in consideration of the mutual promises made herein,
and for other good and valuable consideration, the parties hereby agree as
follows:
COVENANTS AND OBLIGATIONS OF XXXXXXXX
1. Retirement Agreement Payment. On the effective date of this
Agreement, Xxxxxxxx shall pay to Xx. Xxxxxx the lump sum payment provided for in
the Retirement Agreement.
COVENANTS AND OBLIGATIONS OF XX. XXXXXX
1. Release. Except for the obligations specifically set forth in this
Agreement and the Retirement Agreement, Xx. Xxxxxx fully and forever relieves,
releases and discharges Xxxxxxxx and all of its agents, representatives,
officers, directors, shareholders and affiliates from all claims, debts,
liabilities, demands, obligations, promises, acts, agreements, costs, expenses,
damages, actions, and causes of action whether in law or in equity, whether
known or unknown, suspected or unsuspected, arising from Xx. Xxxxxx'x employment
with Xxxxxxxx or the termination thereof, including but not limited to any and
all claims pursuant to Title VII of the Civil Rights Act of 1964, 42 U.S.C.
Section 2000e, et seq., as amended by the Civil Rights Act of 1991; the Civil
Rights Act of 1966, 42 U.S.C. Section 1981; the Age Discrimination in Employment
Act, and the Older Workers' Benefit Protection Act; 29 U.S.C. Section 621, et.
seq.; the Employment Retirement Income Security Act of 1974, as amended, 29
U.S.C. Section 1001, et seq.; the Americans with Disabilities Act; the Family
and Medical Leave Act; 29 U.S.C. Section 621, et. seq.; any other statute,
ordinance, regulation or order; or any other common law authority.
2. Confidentiality. Xx. Xxxxxx agrees to keep the existence, terms and
substance of this Agreement confidential and further agrees that he will not
disclose the terms of this Agreement to anyone outside his immediate family,
attorney or financial advisor, except as may be required by law.
3. Representations and Warranties.
(a) Xx. Xxxxxx agrees and covenants that he will not initiate any
litigation based on events, occurrences, acts or omissions
which relate in any way to his employment with Xxxxxxxx, or
the termination thereof.
(b) Xx. Xxxxxx acknowledges that he has been extended a period of
21 days within which to consider this Agreement.
(c) For a period of 7 days following his execution of this
Agreement, Xx. Xxxxxx may revoke this Agreement by notifying
Xxxxxxxx, in writing, of his desire to do so. After the 7-day
period has elapsed, this Agreement shall become effective and
enforceable.
(d) Xx. Xxxxxx acknowledges that he has been advised by Xxxxxxxx
to consult with an attorney before executing this Agreement.
GENERAL PROVISIONS
1. No Admission of Liability. This Agreement and compliance with this
Agreement shall not be construed as an admission by Xxxxxxxx of any liability,
or as an admission by Xxxxxxxx of any violation of the rights of Xx. Xxxxxx or
any other person, or any violation of any order, law, statute, duty or contract.
2. Severability. In the event that any provision of this Agreement
should be held to be void, voidable, or unenforceable, the remaining portions
hereto shall remain in full force and effect. If any provision shall be deemed
invalid due to its scope or breadth, such provision shall be deemed valid to the
extent permitted by law.
3. Governing Law. This Agreement shall be subject to and construed in
accordance with the laws of the State of Oklahoma.
4. Waiver or Amendment. No waiver, alteration, or modification of any
of the provisions of this Agreement shall be binding unless in writing and
signed both by Xx. Xxxxxx and a duly authorized representative of Xxxxxxxx.
5. Entirety. This Agreement and the Retirement Agreement constitute the
entire agreement between the parties with respect to the subject matter hereof.
This Agreement and the Retirement Agreement supersede any and all other
negotiations, understandings or agreements, whether oral or in writing between
the parties with respect to the subject matter hereof including, without
limitation, any and all compensation or benefits payable to Xx. Xxxxxx.
6. Authorization. Each person signing this Agreement as a party or on
behalf of a party represents that he is duly authorized to sign this Agreement
on such party's behalf, and is executing this Agreement voluntarily, knowingly,
and without any duress or coercion.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first shown above.
THE XXXXXXXX COMPANIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
Title: Sr. V.P. Human Resources /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
