Exhibit 10.17
DEFERRED COMPENSATION AGREEMENT
between
American Home Products Corporation
and
AGREEMENT made this _____ day of _____by and between
American Home Products Corporation and its subsidiaries ________
(hereinafter referred to as "EMPLOYER") and _________
hereinafter referred to as "EMPLOYEE").
W I T N E S S E T H:
WHEREAS, EMPLOYEE has been _____________ of EMPLOYER since
(Title)
____________ [and theretofore was employed by EMPLOYER or its
subsidiaries in other executive or managerial capacities]; and
WHEREAS, it is the wish of EMPLOYER that EMPLOYEE continue
in its employ (and in furtherance of such wish the Board of
Directors of the EMPLOYER has authorized the EMPLOYER to enter
into this Agreement with EMPLOYEE);
NOW, THEREFORE, in consideration of the above and in order
to induce EMPLOYEE to continue in the employ of EMPLOYER, it is
agreed between the parties as follows:
PART A - DEFERRAL OF CASH AWARD UNDER
THE MANAGEMENT INCENTIVE PLAN ("MIP")
1. The percentage designated on the Attachment Schedule is
a percentage of the cash portion of EMPLOYEE'S MIP compensation
from EMPLOYER for [Year] and payable in [Year], if any, which
shall be deferred and distributed as hereinafter provided (the
"Deferred MIP Compensation").
2. The Deferred MIP Compensation will accrue deemed
interest from the date of the award at a deemed rate of interest
based on the average of the quarter end yields for a ten year
period (ending September 30 of the prior year) of 10 Year U.S.
Treasury notes plus 2 percent. Deemed interest payable hereunder
will be calculated, accrued and compounded quarterly. Such deemed
interest shall accrue up to date of distribution.
3. EMPLOYER shall distribute to EMPLOYEE the total Deferred
MIP Compensation, together with deemed interest accrued thereon
in accordance with the deferral period and distribution period
designated on the Attachment Schedule.
PART B - DEFERRAL OF SALARY
1. The percentage designated on the Attachment Schedule is
a percentage of the EMPLOYEE'S total [Year] authorized base
salary which shall be deferred and distributed as hereinafter
provided ("Deferred Salary Compensation"). It is understood that
six percent (6%) of such Deferred Salary Compensation will be
deferred and be subject to the terms of the American Home
Products Corporation Supplemental Employee Savings Plan ("SESP").
2. The Deferred Salary Compensation not deferred under the
SESP will accrue deemed interest from the date such Deferred
Salary Compensation would have otherwise been paid at a deemed
interest rate based on the average of the quarter end yields for
a ten year period (ending September 30 of the prior year) of 10
Year U.S. Treasury notes plus 2 percent. Deemed interest payable
hereunder will be calculated, accrued and compounded quarterly.
Such deemed interest shall accrue up to date of distribution.
The deferral under the provisions of the SESP shall accrue
interest/earnings pursuant to the provisions of the SESP.
3. Except for the portion deferred under the SESP, the
EMPLOYER shall distribute to the EMPLOYEE the total Deferred
Salary Compensation together with deemed interest accrued thereon
in accordance with the deferral period and distribution period
designated on the Attachment Schedule.
The portion deferred under the SESP will be distributed in
accordance with the provisions of the SESP.
4. Upon thirty (30) days' written notice to the Vice
President - Finance of American Home Products Corporation,
EMPLOYEE may prospectively terminate this Agreement as to all
future deferrals of authorized base salary pursuant to Section 1
above, it being understood that such termination shall not affect
the treatment hereunder of amounts deferred prior to the giving
of such written notice.
GENERAL PROVISIONS APPLICABLE TO PART A AND PART B
1. In the event EMPLOYEE shall separate from service with
the EMPLOYER for reasons other than death, prior to receipt of
any or all of the Deferred MIP Compensation and/or Deferred
Salary Compensation, such amount shall be distributed to EMPLOYEE
together with deemed interest accrued hereunder on such amount
through the date of such distribution as designated on the
Attachment Schedule. In the event EMPLOYEE shall die prior to
the receipt of any or all of the Deferred MIP Compensation and/or
Deferred Salary Compensation, such amount shall be distributed to
his estate or beneficiary(ies) as designated on the Attachment
Schedule within ninety (90) days of death together with deemed
interest accrued hereunder on such amount through the date of
such distribution.
2. EMPLOYER has no obligation to set aside, earmark or
entrust any funds with which to pay its obligation under this
Agreement. EMPLOYER'S obligation shall not be secured in any way
and EMPLOYEE'S rights are in no way preferred over the general
creditors of the EMPLOYER.
3. In the event another company or group of related
companies obtains a 50% or more interest in EMPLOYER'S common
stock or otherwise obtains effective control of EMPLOYER, all
Deferred MIP Compensation and/or Deferred Salary Compensation
shall be paid to EMPLOYEE within thirty (30) days together with
deemed interest accrued through the date of such payment.
4. Except as concerns matters of compensation expressly
dealt with herein, this Agreement will have no effect on the
employee-employer relationship between EMPLOYEE and EMPLOYER or
EMPLOYEE'S duties to EMPLOYER or any other compensation
arrangements between EMPLOYEE and EMPLOYER. The EMPLOYEE'S
employment with the EMPLOYER shall remain at will, and the
EMPLOYEE is free to resign at any time, and the EMPLOYER may
terminate the EMPLOYEE'S employment at any time.
5. At the election of the EMPLOYER, to be ratified by a
majority of all non-officer members of the Board of Directors of
EMPLOYER, this Agreement may be terminated upon thirty (30) days'
notice to EMPLOYEE. If so terminated, such majority will also,
as soon as practicable, decide whether the EMPLOYER will
distribute all the Deferred MIP Compensation and/or Deferred
Salary Compensation and deemed interest accrued through the
deferred payment arrangements provided for hereinabove.
6. This Agreement shall be governed by and construed under
the law of the State of New Jersey.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the day and year first above written.
(Employee)
American Home Products Corporation
By:____________________________
Title: Vice President - Finance
ATTACHMENT SCHEDULE (REGARDING PART A)
_______________________________ , hereby elects to defer
(Print Name)
________ percent of the portion of any Management Incentive Plan
Award eligible to be taken in cash which may be awarded in
January [Year] for [Year] performance. This election under Part
A of the Deferred Compensation Agreement shall be irrevocable
upon execution of the Agreement.
I. (a) Check a period of deferral:
______ 10 years or ______ Until retirement
(b) Check a period of distribution:
______ Lump sum (payable within 90 days of termination of
the period designated in I(a) above or
______ 5 annual installments (first installment payable
within 90 days of termination of the period designated in I(a)
above and remaining installments payable within 90 days of the
anniversaries of that termination date)
II. I designate the following beneficiary(ies) to receive any
undistributed amount deferred under this Agreement together with
any deemed interest accrued in the event of my death:
________________________________________________________________
Beneficiary(ies)
________________________________________________________________
Contingent Beneficiary(ies)
ATTACHMENT SCHEDULE (REGARDING PART B)
_________________ , hereby elects to defer ________ percent of my
(Print Name)
eligible [Year] base salary with the understanding that 6 percent
of such deferred base salary will be deferred under the
Supplemental Employee Savings Plan for the year [Year]. This
election under Part B of the Deferred Compensation Agreement
shall be irrevocable upon execution of the Agreement.
III. (a) Check a period of deferral:
______ 10 years or ______ Until retirement
(b) Check a period of distribution:
______ Lump sum (payable within 90 days of termination of
the period designated in III(a) above) or
______ 5 annual installments (first installment payable
within 90 days of termination of the period designated in III(a)
and remaining installments payable within 90 days of the
anniversaries of that termination date)
IV. I designate the following beneficiary(ies) to receive any
undistributed amount deferred under this Agreement together with
any deemed interest accrued in the event of my death:
_________________________________________________________________
Beneficiary(ies)
_________________________________________________________________
Contingent Beneficiary(ies)
Signature ______________________________
Date ______________________________
