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EXHIBIT 10.16
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
THIS AGREEMENT is made as of the 1st day of February, 1998, by and
between AMERICAN GENERAL CORPORATION, a Texas corporation (the "Company"), and
Xxx X. Xxxxxx (the "Executive").
WHEREAS, the Executive has been employed by the Company in valuable
executive service to the Company; and
WHEREAS, the Company desires to reward such past service and to
encourage and reward the continued employment of Executive with the Company
until his retirement and to promote his devotion to his duties on behalf of the
Company without uncertainty or concern as to his retirement income security or
that of his spouse;
NOW, THEREFORE, the Company and the Executive hereby enter into this
Supplemental Executive Retirement Agreement as hereinafter provided:
ARTICLE I.
GENERAL
Effective Date. This Agreement shall be effective as of February 1,
1998 (the "Effective Date").
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 Article hereof.
ARTICLE II.
RETIREMENT BENEFITS
Normal Retirement Benefit. If the Executive retires on or after his
Normal Retirement Date, the Retirement Benefit shall be an annual retirement
benefit payable to the Executive for his lifetime, with a ten-year term certain
(the "Normal Retirement Benefit"), in an annual amount equal to (X) minus (Y),
calculated as follows:
(A) The amount of (X) equals (a) multiplied by (b):
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(a) sixty-seven-and-2/10ths percent (67.2%)
of such Executive's Final Average Compensation;
(b) the fraction equal to his Years of Service (not in
excess of twenty-eight (28) years) divided by
twenty-eight (28); and
(B) The amount of (Y) equals (e) plus (f) plus (g):
(e) the Social Security Benefit;
(f) the Qualified Plan Benefit; and
(g) the Restoration Plan Benefit.
Early Retirement Benefit. If the Executive retires on or after his
Early Retirement Date (but before his Normal Retirement Date), the Retirement
Benefit shall be the annual Retirement Benefit computed under Section 2.1,
reduced as follows:
(A) If payment of the Retirement Benefit commences after the
Executive has attained age sixty (60), the Retirement Benefit
shall be reduced by two-and-one-half percent (2.5%) per year
for each complete year between such commencement and the
Executive's Normal Retirement Date; the reduction per year
shall be pro-rated for incomplete years;
(B) If payment of the Retirement Benefit commences
before the Executive attains age sixty (60),
the Retirement Benefit shall be further reduced
(beyond the reduction imposed by Section 2.2(A)
hereof) by five percent (5%) per year for each
complete year between such commencement and the
Executive's attaining age sixty (60); the reduction
per year shall be pro-rated for incomplete years.
Termination of Employment Prior to Early Retirement Date and Normal
Retirement Date. If the Executive incurs a termination of employment with the
Company after satisfying the vesting requirement under Section 2.7, but before
attaining either an Early Retirement Date or a Normal Retirement Date, he shall
receive a Retirement Benefit determined under Section 2.1, but, unless such
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termination is described in Section 2.6 hereof, such benefit shall be calculated
by using his actual Years of Service (including all periods credited as Years of
Service pursuant to this Agreement) and actual compensation at the time of his
termination and the actual Social Security Benefit that he is entitled to
receive at his Normal Retirement Date. Unless such termination is described in
Section 2.6 hereof, payment of such benefit shall commence after, but not more
than sixty (60) days after, his Normal Retirement Date.
Disability. If the Executive is receiving either short-term or
long-term disability benefits under any Company plan, then, during the period
of payment of such disability benefits, the Executive shall be treated as
employed for all purposes of the Agreement, including, without limitation,
attainment of the age, service and vesting requirements under the Agreement. The
parties hereto agree that such disability benefits will cease and the Executive
will no longer be considered employed by the Company on the date on which the
Executive attains his Normal Retirement Age. Payment of the Executive's
Retirement Benefit shall commence after, but not more than sixty (60) days
after, his Normal Retirement Date.
Termination by Reason of Death. If the Executive dies (i) while in the
employment of the Company, (ii) after the attainment of age fifty-five (55),
(iii) having been credited with ten (10) Years of Service, and (iv) prior to
the commencement of the payment of the Retirement Benefit hereunder, the
Executive's surviving spouse, if any, shall receive for her lifetime an annual
benefit equal to the two-thirds (2/3) survivor annuity she would have received
had the Executive retired on the day before his death, deeming the Executive,
for purposes of this Section 2.5 only, to have elected a joint and survivor
annuity payable immediately at a reduced amount with a two-thirds (2/3) survivor
annuity. The payment of spouse's benefit shall commence not later than sixty
(60) days after the Executive's death.
Termination on or after Change in Control; Certain Other Terminations.
Notwithstanding any other provision of this Agreement, upon any termination of
the Executive's employment, whether or not a Change in Control (as defined in
the Executive's employment agreement with the Company dated as of February 1,
1998,
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as it may be amended from time to time (the "Employment Agreement")) has
occurred, which termination is (i) by the Company without Cause, (ii) by the
Executive with Good Reason, or (iii) by the Executive in a Special Termination
(as such terms are defined in the Employment Agreement), the Company shall pay
the Executive within the five (5) business days immediately following such
termination a lump sum amount, in cash, equal to the actuarial equivalent of the
Normal Retirement Benefit which the Executive would have accrued, if the
Executive had accumulated (after his termination of employment) thirty-six (36)
additional months of service and age credit (but in no event shall the Executive
be deemed to have accumulated additional service and age credit after the
Executive's sixty-fifth birthday). For purposes of this Section 2.6, an
"actuarial equivalent" shall be determined using the same assumptions utilized
under the American General Retirement Plan (or any successor plan thereto)
immediately prior to the Executive's termination of employment, or, if more
favorable to the Executive, immediately prior to the Change in Control. The
Retirement Benefit so calculated shall be based on a projected Social Security
Benefit that is determined under the provisions of the Social Security Act as in
effect on the date of such Change in Control, using the estimated "primary
insurance amount" the Executive would be entitled to under such Act at his
Normal Retirement Date, assuming (i) the amount of income he is receiving on the
date such Change in Control becomes effective which would be treated as wages
for purposes of such Act would remain constant through his Normal Retirement
Date, and (ii) an annual cost-of-living adjustment equal to four percent (4%).
Vesting of Retirement Benefit. The Executive shall have a vested right
to his Retirement Benefit upon the occurrence of any of the following while the
Executive is employed by the Company:
(i) his completion of ten (10) Years
of Service;
(ii) the attainment of his Normal
Retirement Age;
(iii) the termination of the Executive's
employment pursuant to Section 8(c)
of the Employment Agreement; or
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(iv) the occurrence of a Change in Control
at any time.
Time and Form of Payment.
(A) Time of Payment. Except where specifically otherwise
provided herein, the payment of any Retirement Benefit to which the Executive
has become entitled shall commence after, but no more than sixty (60) days
after, the Executive's date of retirement. The Executive shall give the Company
reasonable advance notice in writing of his intention to retire (which shall be
given at least one month before his intended retirement date).
(B) Normal Form of Payment. A life annuity with a ten-year
term certain is the normal form of payment of the Retirement Benefit for the
Executive and any actuarial equivalents to be calculated pursuant to this
Agreement will be based on the normal form of payment. If the Executive dies
after payment of the Retirement Benefit in the normal form has commenced,
payments shall continue for the remainder of the ten-year term certain to the
beneficiary or beneficiaries designated by the Executive by written instruction
delivered to the Administrator during the Executive's lifetime. The Executive
may designate one or more primary and contingent beneficiaries to receive the
remaining payments of the Retirement Benefit, and may designate the proportions
in which such beneficiaries are to receive such payments. The Executive may
change such designations from time to time, and the last written designation
filed with the Administrator prior to the Executive's death shall control. If
the Executive fails to specifically designate a beneficiary, or if no
designated beneficiary survives the Executive, payment shall be made by the
Administrator in the following order of priority:
(i) to the Executive's surviving spouse,
or, if none,
(ii) to the Executive's children, or, if
none,
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(iii) to the Executive's estate.
(C) Election of Alternative Forms of Payment. Subject to
Section 2.6 hereof, the Executive can elect that his Retirement Benefit be paid
in any of the following forms by an irrevocable election in writing which is
delivered to the Company within sixty (60) days after the Effective Date, or,
with the permission of the Committee, by an irrevocable election in writing
which is delivered to the Company at any time before his retirement becomes
effective:
(i) a joint and survivor annuity payable
at a reduced amount for the life of
the Executive with a survivor annuity
for the life of the Executive's
surviving spouse which shall be one
hundred percent (100%) of the annuity
payable during the joint lives
of the Executive and the surviving
spouse;
(ii) a joint and survivor annuity payable
at a reduced amount for the life of
the Executive with a survivor annuity
for the life of the Executive's
surviving spouse which shall be
seventy-five percent (75%) of the
annuity payable during the joint
lives of the Executive and the
surviving spouse;
(iii) a joint and survivor annuity payable
at a reduced amount for the life of
the Executive with a survivor annuity
for the life of the Executive's
surviving spouse which shall be
fifty percent (50%) of the annuity
payable during the joint lives of
the Executive and the surviving
spouse; or
(iv) a lump-sum payment of the actuarial present
value of the normal form of payment of the
Retirement Benefit.
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In calculating an alternative form of payment for the Retirement Benefit, the
Administrator shall use the same assumptions utilized under the American General
Retirement Plan (or any successor plan thereto) immediately prior to the
Executive's termination of employment, or, if a Change in Control shall have
occurred prior to the Executive's termination of employment, the assumptions so
utilized immediately prior to the Change in Control, if more favorable to the
Executive.
ARTICLE III.
ADMINISTRATION
General. Except as otherwise specifically provided in the Agreement,
the Administrator shall be responsible for administration of the Agreement.
Administrative Rules. The Administrator may adopt such rules of
procedure as it deems desirable for the conduct of its affairs, except to the
extent that such rules conflict with the provisions of the Agreement.
Duties. The Administrator shall have the following rights, powers and
duties:
(A) The decision of the Administrator in matters within its
jurisdiction shall be final, binding and conclusive upon the
Company and upon any person affected by such decision, subject
to the claims procedure hereinafter set forth.
(B) The Administrator shall have the duty and authority to
interpret and construe the provisions of the Agreement, to
determine eligibility for a Retirement Benefit and the
appropriate amount of any Retirement Benefit, to decide any
question which may arise regarding the rights of the Executive
hereunder and to exercise such powers as the Administrator
may deem necessary for the administration of the Agreement.
(C) The Administrator shall maintain full and complete records of
its decisions. Its records shall contain all relevant data
pertaining to the Executive and his rights and duties under
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the Agreement. The Administrator shall maintain a bookkeeping
account with respect to payment of any Retirement Benefit.
(D) Notwithstanding any other provision of this
Agreement, upon and after the occurrence of a
Change in Control and within the six-month
period immediately preceding a Change in Control,
the Administrator's authority and powers
shall not be used to interpret or construe the
provisions hereof in any way (or to take any
other action) which would adversely affect any
right given the Executive by this Agreement.
Fees. No fee or compensation shall be paid to any person for services
as the Administrator.
ARTICLE IV.
CLAIMS PROCEDURE
General. Any claim for a Retirement Benefit under the Agreement shall
be filed by the Executive or beneficiary (either of which is referred to in
this Article as the "claimant") in the manner prescribed by the Administrator.
Denials. If a claim for a Retirement Benefit under the Agreement is
wholly or partially denied, notice of the decision shall be furnished to the
claimant by the Administrator within a reasonable period of time after receipt
of the claim by the Administrator.
Notice. Any claimant who is denied a claim for Retirement Benefits
shall be furnished written notice setting forth:
(i) the specific reason or reasons for the
denial;
(ii) specific reference to the pertinent provision
of the Agreement upon which the denial is based;
(iii) a description of any additional material or
information necessary of the claimant to perfect the
claim; and
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(iv) an explanation of the claims review procedure
under the Agreement.
Appeals Procedure. In order that a claimant may appeal a denial of a
claim, the claimant or the claimant's duly authorized representative may:
(i) request a review by written application to the
Committee, no later than sixty (60) days after receipt
by the claimant of written notification of denial of a
claim;
(ii) review pertinent documents; and
(iii) submit issues and comments in writing.
Review. A decision on review of a denied claim shall be made by the
Committee not later than sixty (60) days after receipt of a request for review,
unless special circumstances require an extension of time for processing, in
which case a decision shall be rendered within a reasonable period of time, but
not later than one-hundred-and-twenty (120) days after receipt of a request for
a review. The decision on review shall be in writing and shall include the
specific reason(s) for the decision and the specific reference(s) to the
pertinent provisions of the Agreement on which the decision is based.
Section 4.6 Arbitration. Any further dispute or controversy arising
under or in connection with this Agreement which is not resolved by agreement
pursuant to Sections 4.1 through 4.5 hereof 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.
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
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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.
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.
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
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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.
ARTICLE V.
MISCELLANEOUS PROVISIONS
Amendment and Termination. This Agreement may be amended or modified
only with the written consent of the parties hereto. This Agreement supersedes
the supplemental retirement benefit provision in the Company's Memorandum of
Understanding addressed to the Executive and dated February 10, 1993, as
amended February 16, 1993.
No Assignment. The Executive shall not have the power to pledge,
transfer, assign, anticipate, mortgage or otherwise encumber or dispose of in
advance any interest in amounts payable hereunder of any of the payments
provided for herein, nor shall any interest in amounts payable hereunder or in
any payments be subject to seizure for payments of any debts, judgments, alimony
or separate maintenance, or be reached or transferred by operation of law in the
event of bankruptcy, insolvency or otherwise.
Successors and Assigns. The provisions of the Agreement are binding
upon and inure to the benefit of each Company, its successors and assigns, and
the Executive, his beneficiaries, heirs and legal representatives.
Governing Law. The Agreement shall be subject to and construed in
accordance with the laws of the State of Texas to the extent not preempted by
the provisions of ERISA.
No Guarantee of Employment. Nothing contained in the Agreement shall be
construed as a contract of employment
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or deemed to give the Executive the right to be retained in the employ of an
Company or any equity or other interest in the assets, business or affairs of an
Company.
Severability. If any provision of the Agreement shall be held illegal
or invalid for any reason, such illegality or invalidity shall not affect the
remaining provisions of the Agreement, but the Agreement shall be construed and
enforced as if such illegal or invalid provision had never been included herein.
Notification of Addresses. The Executive and each beneficiary shall
file with the Administrator, from time to time, in writing, the post office
address of the Executive, the post office address of each beneficiary, and each
change of post office address. Any communication, statement or notice addressed
to the last post office address filed with the Administrator (or if no such
address was filed with the Administrator, then to the last post office address
of the Executive or beneficiary as shown on the Company's records) shall be
binding on the Executive and each beneficiary for all purposes of the Agreement
and neither the Administrator nor the Company shall be obliged to search for or
ascertain the whereabouts of the Executive or beneficiary.
Bonding. The Administrator and all agents and advisors employed by it
shall not be required to be bonded, except as may otherwise be required by
ERISA.
Taxes. The Company shall have the right to withhold from any cash or
other amounts due or to become due from the Company to a Executive (including by
reducing the amount of any Retirement Benefit payable in the future) the amount
of any federal, state and local taxes required to be withheld or otherwise
deducted and paid by the Company with respect to the vesting or payment of any
Retirement Benefit hereunder.
Section 5.10 No Funding. There shall be no funding of the benefit
amounts to be paid pursuant to this Agreement. The Agreement shall not confer
upon the Executive (or beneficiary or any other person) any security interest
or any other right, title or interest of any kind in or to any property of the
Company. The
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Agreement shall constitute merely the unsecured promise of the Company to make
the benefit payments provided for herein. Notwithstanding the foregoing
provisions of this Section 5.10, the Company, in its discretion, may establish a
trust to pay the benefit amounts hereunder, which trust shall be subject to the
claims of the Company's general creditors in the event of the Company's
bankruptcy or insolvency. If such a trust is established, the Company shall
remain responsible for the payment of any benefit amounts provided hereunder
which are not paid in accordance with the provisions hereof by such trust.
ARTICLE VI.
DEFINITIONS AND USAGE
Definitions. Wherever used in the Agreement, the following words and
phrases shall have the meaning set forth below, unless the context plainly
requires a different meaning:
"Administrator" means the Company, acting through the Personnel
Committee of the Board, or other person or persons designated by the Personnel
Committee.
"Affiliate" shall have the meaning set forth in Rule 12b-2 promulgated
under Section 12 of the Exchange Act.
"Agreement" means this Supplemental Executive Retirement Agreement, as
set forth herein and as amended from time to time.
"Beneficial Owner" shall have the meaning set forth in Rule 13d-3 under
the Exchange Act.
"Board" means the Board of Directors of the Company.
"Change in Control" means a change in the control of the Company, which
shall be deemed to have occurred if the event set forth in any one of the
following paragraphs shall have occurred:
(I) any Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Company (not
including in the securities beneficially owned by such Person
any securities acquired directly from the
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Company or its Affiliates) representing thirty percent (30%)
or more of the combined voting power of the Company's then
outstanding securities, excluding any Person who becomes such
a Beneficial Owner in connection with a transaction described
in clause (i) of paragraph (III) below; or
(II) the following individuals cease for any
reason to constitute a majority of the number of directors
then serving: individuals who, on the date hereof, constitute
the Board and any new director (other than a director whose
initial assumption of office is in connection with an actual
or threatened election contest, including but not limited to a
consent solicitation, relating to the election of directors
of the Company) whose appointment or election by the Board or
nomination for election by the Company's shareholders was
approved or recommended by a vote of at least two-thirds (2/3)
of the directors then still in office who either were
directors on the date hereof or whose appointment, election or
nomination for election was previously so approved or
recommended; or
(III) there is consummated a merger or
consolidation of the Company or any direct or indirect
subsidiary of the Company with any other corporation (or a
share exchange between shareholders of the Company or any
direct or indirect subsidiary of the Company and another
corporation or entity pursuant to Article 5.02 (or any
successor provision thereto) of the Texas Business Corporation
Act), other than (i) a merger or consolidation which would
result in the voting securities of the Company outstanding
immediately prior to such merger or consolidation continuing
to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or
any parent thereof), in combination with the ownership of any
trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any subsidiary of the
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Company, at least fifty-one percent (51%) of the combined
voting power of the securities of the Company or such
surviving entity or any parent thereof outstanding immediately
after such merger or consolidation, or (ii) a merger or
consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no Person is or
becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing thirty percent (30%) or
more of the combined voting power of the Company's then
outstanding securities; or
(IV) the shareholders of the Company approve a
plan of complete liquidation or dissolution of the Company or
there is consummated an agreement for the sale or disposition
by the Company of all or substantially all of the Company's
assets, other than a sale or disposition by the Company of
all or substantially all of the Company's assets to an entity,
at least fifty-one percent (51%) of the combined voting power
of the voting securities of which are owned by shareholders of
the Company in substantially the same proportions as their
owner ship of the Company immediately prior to such sale.
Notwithstanding the foregoing, a "Change in Control" shall not be
deemed to have occurred by virtue of the consummation of any transaction or
series of integrated transactions immediately following which the record holders
of the common stock of the Company immediately prior to such transaction or
series of transactions continue to have substantially the same proportionate
ownership in an entity which owns all or substantially all of the assets of the
Company immediately following such transaction or series of transactions.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time. Any reference to a particular Code section shall include any provision
which modifies, replaces or supersedes it.
"Committee" shall mean the Personnel Committee of the Board until six
months prior to the occurrence of a
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Change in Control and thereafter shall mean (i) the individuals (not fewer than
three in number) who, on the date six months before a Change in Control,
constitute the Personnel Committee of the Board, plus (ii) in the event that
fewer than three individuals are available from the group specified in clause
(i) above for any reason, such individuals as may be appointed by the individual
or individuals so available (including for this purpose any individual or
individuals previously so appointed under this clause (ii)); provided, however,
that the maximum number of individuals constituting the Committee shall not
exceed five.
"Company" means American General Corporation, a Texas corporation, and,
except in determining under the definition of Change in Control herein whether
or not any Change in Control of the Company has occurred, shall include any
successor to its business and/or assets which assumes and agrees to perform this
Agreement by operation of law, or otherwise.
"Early Retirement Date" means the first date on which the Executive (i)
has completed ten (10) Years of Service and (ii) has attained the age of
fifty-five (55).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time. Any reference to a particular ERISA section shall
include any provision which modifies, replaces, or supersedes it.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"Executive" means Xxx X. Xxxxxx
"Final Average Compensation" means the following sum divided by three
(3): the sum of the base salary received by the Executive during, and the
incentive payments received by the Executive pursuant to any annual bonus,
incentive compensation or similar plan maintained by the Company with respect
to, the three (3) calendar years (whether or not consecutive) ending within the
last sixty (60) months of the Executive's employment with the Company which
produce the highest total of such base salary and incentive payments (for
purposes of this sentence, any amount of such base salary or incentive payment
which is deferred by the Executive shall be
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included in the calculation of amounts received). Notwithstanding the
immediately preceding sentence, if the Executive's termination of employment is
described in Section 2.6 hereof and the Executive receives (pursuant to Section
8(c)(iii) of his Employment Agreement, or any successor provision thereto, and
in lieu of any further salary or bonus payments) a lump sum amount (the
"Severance Amount"), Final Average Compensation shall mean the Severance Amount
divided by three (3).
"Normal Retirement Age" means age sixty-two (62).
"Normal Retirement Date" means the date on which the Executive attains
his Normal Retirement Age.
"Person" shall have the meaning given in Section 3(a)(9) of the
Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except
that such term shall not include (i) the Company or any of its subsidiaries,
(ii) a trustee or other fiduciary holding securities under an employee benefit
plan of the Company or any of its Affiliates, (iii) an underwriter temporarily
holding securities pursuant to an offering of such securities, or (iv) a
corporation owned, directly or indirectly, by the shareholders of the Company
in substantially the same proportions as their ownership of stock of the
Company.
"Qualified Plan" means the American General Retirement Plan, together
with any other defined benefit retirement plan intended to be qualified under
Section 401(a) of the Code which is adopted and maintained by the Company and
under which the Executive is entitled to a retirement benefit at the date of his
retirement or other termination of employment.
"Qualified Plan Benefit" means the aggregate annual retirement benefit
to which the Executive (at the date of his retirement or other termination of
employment) is entitled under the plan or plans which comprise the Qualified
Plan (expressed in the form of a single life annuity with a ten-year term
certain commencing payment on the date payment of the Retirement Benefit
hereunder commences).
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"Restoration Plan Benefit" means the annual retirement benefit to
which the Executive (at the date of his retirement or other termination of
employment) is entitled under the American General Corporation Restoration of
Retirement Income Plan (expressed in the form of a single life annuity with a
ten-year term certain commencing payment on the date payment of the Retirement
Benefit hereunder commences).
"Retirement Benefit" means the benefit payable under this Agreement, as
determined under Article II.
"Social Security Benefit" means one-half of the annual benefit payable
under the Social Security Act, relating to Old-Age and Disability benefits, as
of the Executive's Normal Retirement Date, or upon actual retirement, if later.
"Years of Service" means the total number of years (measured in full
and partial years, in increments of one-twelfth years) of active employment with
the Company during which substantial services were rendered as an employee,
commencing on the date the Executive was first employed by the Company and
ending on the date he ceases to perform services for the Company (including
employment before the Effective Date), but in no event shall more than
twenty-eight (28) years be credited to the Executive regardless of his actual
period of service with the Company. Subject to such twenty-eight (28) year
maximum, the Executive shall also be credit with 2.0834 Years of Service for
each Year of Service (measured in full and partial years, in increments of
one-twelfth years) rendered by the Executive between March 1, 1993, and his
attaining age sixty-two (62); thus if the Executive
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continues to be employed by the Company until February 28, 1998, he will, upon
date, have a vested right to his Retirement Benefit under Section 2.7(i) hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
AMERICAN GENERAL CORPORATION
By /s/ XXXXX X. XXXXXX
------------------------------------
Chairman of the Personnel
Committee
/s/ XXX X. XXXXXX
--------------------------------------
Xxx X. Xxxxxx
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