Exhibit 10.20
EXECUTIVE RETIREMENT AGREEMENT
THIS RETIREMENT AGREEMENT (this "Agreement") is entered into effective the 7th
day of March 2002 by and between Wackenhut Corrections Corporation ("Company")
and Xxxx X. X'Xxxxxx ("Executive"), or collectively, "the Parties", and
supersedes and replaces any prior written retirement agreement between the
Parties.
WHEREAS, Executive and Company have previously entered into an Executive
Severance Agreement (the "Severance Agreement") and Wackenhut Corrections
Corporation Retirement Agreement (the "Prior Retirement Agreement"), both
effective May 4, 2001, whereby, INTER ALIA, the Executive is to receive certain
payments and benefits upon a Change in Control (as defined in the Severance
Agreement) and subsequent termination of Executive's employment by the Company
within a one year period following the date of a Change in Control, or by the
resignation of Executive following a date that is more than one year, but less
than two years, following the date of a Change in Control; and
WHEREAS, The Wackenhut Corporation (TWC), a company listed on the New York Stock
Exchange and majority owner of Company, and Group 4 Xxxxx, a Danish company
registered on the Copenhagen Exchange, have announced an intention to merge TWC
with a subsidiary of Group 4 Xxxxx, and the announced merger, if completed, will
constitute a Change of Control under the terms of the Severance Agreement and
the terms of this Agreement; and
WHEREAS, the Executive and Company wish to cancel and terminate the Prior
Retirement Agreement and replace the Prior Retirement Agreement with this
Agreement in order to facilitate the continued employment of Executive under
restructured terms and conditions that will benefit the Company and better
achieve the objectives of Executive and Company as further set forth herein in
the event of a Change in Control (whether such Change in Control is the result
of the announced intended merger of TWC with a subsidiary of Group 4 Xxxxx, or
in the event such announced merger is not consummated, as a result of a
subsequent transaction constituting a Change in Control as defined below); and
WHEREAS, Executive and Company are entering into an Executive Employment
Agreement (the "Employment Agreement") contemporaneously with this Agreement;
and
WHEREAS, the basic terms and conditions of this Agreement and the Employment
Agreement were reviewed and approved by the Board of Directors of WCC and the
Nominating and Compensation Committee members of the Board of Directors of WCC
at a meeting held on the of March 7, 2002;
NOW THEREFORE, in consideration of the mutual covenants and agreements contained
herein, and for other valuable consideration the receipt and adequacy of which
is hereby acknowledged, the Parties hereby agree as follows:
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1. EMPLOYMENT. Company currently employs Executive as Senior Vice President,
Chief Financial Officer & Treasurer. Executive will devote his full energy,
skill and best efforts to the affairs of Company on a full-time basis.
2. RETIREMENT DATE. Executive is eligible to retire upon Executive's 60th
birthday, which is August 1, 2010 (the "Retirement Date").
3. TERMINATION. Either Company or Executive may terminate Executive's employment
at any time and for any reason upon ten (10) days written notice to the other in
accordance with the terms and conditions set forth in the Employment Agreement.
4. RETIREMENT RIGHTS FULLY VESTED. Notwithstanding the termination of
Executive's employment with the Company for any reason whatsoever, Executive's
rights hereunder are fully vested.
5. RETIREMENT PAYMENT/CONTINUED EMPLOYMENT. Upon the Retirement Date, Company
will pay to Executive, or in the event of Executive's death following the
Retirement Date, to Executive's Beneficiar(ies) or Estate, $12,500.00 monthly
for three hundred (300) consecutive months (the "Retirement Payments"). In the
event Executive dies prior to the Retirement Date (except as set forth in
Section 6), Executive's Beneficiar(ies) or Estate shall receive $6,250.00 for
one hundred fifty (150) consecutive months. Executive's continued employment
with the Company beyond the Retirement Date shall not affect Executive's right
to receive the Retirement Payments as set forth herein. Executive shall not be
entitled to any further Retirement Payments beyond what is due hereunder by
reason of Executive's continued employment beyond the Retirement Date.
6. CHANGE IN CONTROL. Upon the occurrence of a "Change in Control" (as defined
in the Employment Agreement between Executive and Company entered into
contemporaneously with this Agreement, which definition is incorporated by
reference as though fully rewritten herein), the Executive's Retirement Date
shall automatically be changed for all purposes to August 1, 2005 or, in the
event a Change in Control occurs after August 1, 2005 but before August 1, 2010,
upon the actual date of Change in Control. If a Change in Control occurs, the
Company shall, upon the Retirement Date (as automatically accelerated herein),
pay to Executive, or in the event that Executive dies following a Change in
Control but prior to the Retirement Date to Executive's Beneficiar(ies) or
Estate, the present value of the Retirement Payments, determined after giving
effect to the acceleration of the Retirement Date to August 1, 2005 or, in the
event a Change in Control occurs after August 1, 2005 but before August 1, 2010,
after giving effect to the acceleration of the Retirement Date to the actual
date of Change in Control. If a Change in Control occurs after August 1, 2010,
the Company shall pay to Executive the present value of the then unpaid
Retirement Payments. The present value of the Retirement Payment shall be
calculated (i) using discount rates equal to the lower of the applicable rates
provided in Internal Revenue Code Section 280G(d)(4), or six and one half
percent (6 1/2%), and (ii) without regard to any mortality factors or related
probabilities. The Employment Agreement provides for the payment of a Gross-Up
Payment (as defined therein) with respect to amounts payable under this
Agreement to the extent that such amounts give rise to an Excise Tax (as defined
in the
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Employment Agreement). Accordingly, to the extent that the provisions of this
Agreement or amounts payable hereunder give rise to an Excise Tax, the Company
shall pay to the Executive a Gross-Up Payment pursuant to the Employment
Agreement at the earlier of the time that said amounts are paid to the
Executive, or the time when any Excise Tax relating to said amounts becomes due
and payable. Nothing in this Agreement shall be construed to obligate the
Company to pay to the Executive any additional Gross-Up Payments relating to
this Agreement and the payments hereunder to the extent that said Gross-Up
Payments are paid to the Executive pursuant to the terms of the Employment
Agreement.
7. SMALL AMOUNTS. In the event the amount of any monthly payments provided
herein shall be less than Twenty Dollars ($20), the Company in its sole
discretion may in lieu thereof pay the commuted value of such payments
(calculated on the basis of the interest rate and mortality assumptions being
used by The Northwestern Mutual Life Insurance Company of Milwaukee, Wisconsin,
to calculate immediate annuity rates on the date of this Agreement) to the
person entitled to such payments.
8. BENEFICIARY. The Beneficiary (or Beneficiaries) of any payments to be made
after Executive's death shall be as designated by Executive and shown on Exhibit
A attached hereto or such other person or persons as Executive shall designate
in writing to the Company. If Executive has made no effective designation of
Beneficiaries, any such payments shall be made to Executive's estate.
9. RESTRICTION AND NON-COMPETITION. Executive shall not for a period of two
years following Executive's employment with the Company, either directly or
indirectly, accept employment with, render service, assistance or advice to,
own, manage, operate, control or participate in the ownership, or allow his name
to be used by any competitor of the Company unless approved by the Board of
Directors of the Company. Determination by the Board of Directors of the Company
that Executive has engaged in any such activity shall be binding and conclusive
on all parties, and in addition to all other rights and remedies which Company
shall have, neither Executive nor Beneficiary shall be entitle to any payments
hereunder.
10. INSURANCE. If Company shall elect to purchase a life insurance contract to
provide Company with funds to make payments hereunder, Company shall at all
times be the sole and complete owner and beneficiary of such contract, and shall
have the unrestricted right to use all amounts and exercise all options and
privileges there under without knowledge or consent of Executive or Beneficiary
or any other person, it being expressly agreed that neither Executive nor
Beneficiary nor any other person shall have any right, title or interest
whatsoever in or to any such contract.
11. SOURCE OF PAYMENTS. Executive, Beneficiary and any other person or persons
having or claiming a right to payments hereunder or to any interest in this
Agreement shall rely solely on the unsecured promise of Company set forth
herein, and nothing in this Agreement shall be construed to give Executive,
Beneficiary or any other person or persons any right, title, interest or claim
in or to any specific asset, fund, reserve, account or property of any kind
whatsoever owned by Company or in which it may have any right, title or interest
now or in the future, but
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Executive shall have the right to enforce his claim against Company in the same
manner as any unsecured creditor.
12. AMENDMENT. This Agreement may be amended at any time or from time to time by
written agreement of the parties.
13. ASSIGNMENT. Neither Executive, nor Beneficiary, nor any other person
entitled to payments hereunder shall have power to transfer, assign, anticipate,
mortgage or otherwise encumber in advance any of such payments, nor shall such
payments be subject to seizure for the payment of public or private debts,
judgments, alimony or separate maintenance, or be transferable by operation of
law in event of bankruptcy, insolvency or otherwise.
14. BINDING EFFECT. This Agreement shall be binding upon the parties hereto,
their heirs, executors, administrators, successors and assigns. The Company
agrees it will not be a party to any merger, consolidation or reorganization,
unless and until its obligations hereunder shall be expressly assumed by its
successors.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
date first above written.
WACKENHUT CORRECTIONS CORPORATION
/s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx
Chairman
EXECUTIVE
/s/ Xxxx X. X'Xxxxxx
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Xxxx X. X'Xxxxxx
Senior Vice President, Chief Financial
Officer & Treasurer
Approved by a majority of the members of the Company Nominating & Compensation
Committee at a duly convened meeting of that committee held on the 7th day of
March 2002.
/s/ Xxxxxxxx X. Xxxxxxxxx
-----------------------------------
Xx. Xxxxxxxx X. Xxxxxxxxx, Chairman
/s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Xx. Xxxxxxx X. Xxxxxxx, Member
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