EXHIBIT 10.2
XXXXXXX RESEARCH CORPORATION
SUPPLEMENTAL RETIREMENT BENEFIT PLAN
Between
XXXXXXX RESEARCH CORPORATION
and
XXXXXXX X. LEADER
Dated: November 2, 1998
SUPPLEMENTAL RETIREMENT BENEFIT PLAN
THIS SUPPLEMENTAL RETIREMENT BENEFIT PLAN (the "Plan") is made and
entered into this 2nd day of November, 1998, by and between XXXXXXX RESEARCH
CORPORATION, a Delaware corporation, having its principal place of business at
0000 Xxxxx Xxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxxx (the "Company") and XXXXXXX X.
LEADER residing in the City of XxXxxx, Virginia (the "Employee").
W I T N E S S E T H:
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The Company adopted a defined contribution plan containing a cash or
deferred arrangement which plan is known as the Xxxxxxx Research Corporation
Retirement Plan (the "401(k) Plan"). Contributions to the 401(k) Plan by and on
behalf of participants are based, in part, on the compensation received by such
participants. Under Section 404(l) of the Internal Revenue Code of 1986 (the
"Code"), the amount of compensation which may be taken into account is limited
to $160,000, plus cost-of-living increases (the "Section 404 Limit"). The
Employee's compensation is expected to exceed the Section 404 Limit, and
accordingly, the amount contributed to the 401(k) Plan for the Employee's
benefit is limited. The Company desires to supplement the Employee's retirement
benefits by contributing to a nonqualified retirement plan for the benefit of
the Employee.
THEREFORE, to provide the Employee with additional incentive and to
supplement the deferred compensation benefits payable to the Employee, the
Company hereby adopts this Plan and the parties agree as follows:
1. The Company shall supplement the Company provided benefits available
under the 401(k) Plan by crediting to a book reserve or deferred compensation
account during the period of Employee's employment by the Company commencing
November 2, 1998, a sum equal to seven percent (7%) of the Employee's
compensation for each such fiscal year above the Section 404 Limit. For this
purpose, compensation shall mean all taxable wages reported on Form W-2.
2. The amount credited to the deferred compensation account as provided
in Section 1 above shall be paid to the trustee under that certain agreement of
trust between the Company and Fidelity Management Trust Company, dated as of the
date hereof and shall be held, administered and disposed in accordance with such
trust. Any appreciation or depreciation with respect to the funds invested in
accordance with the trust shall be credited or charged to the Employee's
deferred compensation account. The Employee shall assume the risk of diminution
in the value of his deferred compensation account in the event any invested
funds depreciate in value. Nothing contained in this Plan and no action taken
pursuant to the provisions of this Plan shall create or be construed to create a
fiduciary relationship between the Company and the Employee or any other person.
Any funds which may be invested under the provisions of this Plan shall continue
for all purposes to be part of the general funds of the Company and no person
other than the Company by virtue of the provisions of this Plan shall have any
interest in such funds. To the extent that any person acquires the right to
receive payments from the Company under this Plan, such rights shall be no
greater than the right of any unsecured general creditor of the Company. The
trust referred to above (and any amendment thereof) shall conform in all
material respects to the terms and provisions of the model trust described in
Revenue Procedure 92-64 adopted by the Internal Revenue Service. It is the
intention of the parties that the Plan constitute an unfunded deferred
compensation plan for tax purposes and for purposes of Title I of the Employee
Retirement Income Security Act of 1974.
3. The benefit to be paid as deferred compensation shall be as
follows:
(a) Commencing one month after termination of employment and for the
next 120 months thereafter, the Company shall pay or cause to be paid to
Employee an amount equal to the quotient of the fair market value of his
deferred compensation account as of the end of each month divided by 120 less
the number of full months since termination of employment. The balance of his
deferred compensation account shall be paid to the Employee 120 months after
termination of employment. The total amount payable to the Employee shall be
increased or decreased as the case may be, to reflect the appreciation or
depreciation in value of the deferred compensation account which remains
invested. Notwithstanding the foregoing, the Board of Directors of the Company
shall have the right in its discretion to accelerate the installment payments
due hereunder and may make such distribution in lump sum or over a shorter
period of time than 120 months as it may find appropriate.
(b) If the Employee should die before the entire supplemental
benefit has been credited, the Company shall be obligated to pay the balance of
the benefits due hereunder. If the Employee should die prior to termination of
his employment or after termination of his employment but before his entire
deferred compensation account has been paid to him, the unpaid benefit due
hereunder will be paid in a lump sum to a beneficiary or beneficiaries
designated in writing to the Company by the Employee. If no designation of
beneficiary has been made by the Employee, or if such designation has been
revoked, the unpaid balance shall be paid to the Employee's estate.
(c) The right of the Employee to payments under this Plan
shall be fully vested and nonforfeitable at all times. The right of Employee or
any other person to the payment of deferred compensation or other benefits under
this Plan shall not be subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment or the garnishment by
creditors of the Employee or the Employee's beneficiary.
(d) If the Board of Directors shall determine that the
Employee is unable to care for his affairs because of any physical or mental
impairment, any payment due (unless a prior claim therefore shall have been made
by a duly appointed guardian, conservator or other legal representative) may be
paid to or for the benefit of the Employee in such manner as the Board may
determine. Any such payment shall be in complete discharge of the liabilities of
the Company under this Plan.
4. Nothing contained herein shall be construed as conferring upon the
Employee the right to continue in the employ of the Company as an executive or
in any other capacity.
5. Any deferred compensation payable under this Plan shall not be
deemed salary or other compensation to the Employee for the purpose of computing
benefits to which he may be entitled under any other pension plan or other
deferred compensation arrangement of the Company for the benefit of its
employees.
6. The Board of Directors of the Company shall have full power and
authority to interpret, construe and administer this Plan and the Board's
interpretation and construction thereof, and actions thereunder, including any
valuation of the deferred compensation account, or the amount or recipient of
the payment to be made therefrom, shall be binding and conclusive upon all
persons for all purposes. No member of the Board shall be liable to any person
for any action taken or omitted in connection with the interpretation and
administration of this Plan unless attributable to willful misconduct. The
Company shall indemnify and hold harmless the members of the Board of Directors
against any liability or threatened liability, including attorneys' fees, court
costs, and damages, related or in any manner connected with decisions and
actions or inactions taken by such Board member in connection with the Plan,
except for such Board member's willful misconduct.
7. This Plan shall be binding upon and inure to the benefit of the
Company, successors and assigns, and the Employee, his heirs, executors,
administrator and legal representatives.
8. This Plan shall be construed in accordance with and governed by the
laws of the State of Alabama.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by
its duly authorized officers and the Employee has hereunto set his hand and seal
as of the date and year first above written.
XXXXXXX RESEARCH CORPORATION
By: Xxxxxxx X. Xxxx
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Its Chief Executive Officer
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Xxxxxxx X. Leader
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XXXXXXX X. LEADER, Employee
