_______________________
DEFERRED COMPENSATION AGREEMENT
THIS AGREEMENT, made as of January 1, 1999, to be effective as of January
1, 1998, by and between Valhi, Inc., a Delaware corporation, (the "COMPANY") and
_____________ ("EMPLOYEE"), amends and restates in its entirety that certain
Deferred Compensation Agreement dated as of January 1, 1998, by and between the
Company and Employee.
W I T N E S S E T H:
WHEREAS, Employee has been and is presently employed by the Company and
currently serves as an employee thereof; and
WHEREAS, Employee possesses an intimate knowledge of the business and
affairs of the Company and its policies, procedures, methods and personnel; and
WHEREAS, the Company desires to further compensate Employee for services
performed by establishing a deferred compensation arrangement on Employee's
behalf.
NOW, THEREFORE, for and in consideration of the mutual premises,
representations and covenants herein contained, the parties hereto mutually
agree as follows:
1. Deferred compensation shall be credited by the Company to a reserve
account on its accounting books (the "RESERVE ACCOUNT"), on behalf of
Employee, and such deferred compensation shall be deferred and
accumulated.
2. The amount of deferred compensation to be credited to the Reserve
Account on behalf of Employee shall be such amount as agreed upon from
time to time by Employee and the Company.
3. An additional amount shall be credited to the Reserve Account, in lieu
of interest, at the end of each calendar quarter and on the date
payment is made pursuant to SECTION 4 of this Agreement, equal to the
Prime Rate plus two percent (2%) per annum, as may be adjusted from
time to time, multiplied by the balance outstanding in the Reserve
Account on a daily basis during each calendar quarter. The "Prime
Rate" for purposes of this Agreement shall mean the fluctuating
interest rate per annum in effect from time to time equal to the base
rate on corporate loans as reported as the Prime Rate in the Money
Rates column of The Wall Street Journal, Southwest Edition.
4. Upon the termination of Employee's employment with the Company,
voluntarily, involuntarily or by retirement, death or disability, the
Company shall pay in cash the full credit balance in the Reserve
Account to or on behalf of Employee in a lump sum within one-hundred
eighty (180) days of such termination.
5. It is specifically understood and agreed by the parties hereto that
the deferred compensation provided for in this Agreement shall not be
funded. The obligation of the Company hereunder is a contractual
obligation to make the payments of deferred compensation when due in
accordance with the terms hereof, and the parties hereto do not intend
that the amounts credited to the Reserve Account are to be held by the
Company in trust, escrow or other fiduciary capacity for Employee.
The amounts credited to the Reserve Account shall not be subject in
any manner to attachment or other legal process for debts of Employee
or his successors, legal representatives or assigns, for any reason;
and neither Employee, nor any legal representative, successor or
assign shall have any right against the Company with respect to any
portion of the amounts credited to the Reserve Account, except as a
general unsecured creditor of the Company. Neither Employee nor his
successors, assigns or legal representatives shall have any right to
assign, transfer, pledge, hypothecate, anticipate or otherwise
alienate any payment of deferred compensation to become due in the
future to such person, and any attempt to do so shall be void and will
not be recognized by the Company.
6. It is agreed by Employee and the Company that the correct outstanding
balance of the Reserve Account, computed as of December 31, 1997, was
$________.
IN WITNESS WHEREOF, the parties have hereunto affixed their signatures as
of January 1, 1999.
ATTEST: VALHI, INC.
______________________________ _________________________________
EMPLOYEE:
__________________________________
