EXHIBIT 10.24
SUPPLEMENTAL RETIREMENT INCOME AGREEMENT OF
XXXXXXX COMPANIES, INC.
AND XXXXXXX X. XXXX
(Execution Date: February 25, 1997)
SUPPLEMENTAL RETIREMENT INCOME AGREEMENT
THIS SUPPLEMENTAL RETIREMENT INCOME AGREEMENT by and between XXXXXXX
COMPANIES, INC., an Oklahoma corporation (the "Company") and XXXXXXX X. XXXX, an
individual (the "Executive") dated this 25th day of February, 1997 (the
"Agreement").
WITNESSETH:
WHEREAS, the Executive has previously executed that certain Offer For
Compensation dated July 7, 1995 (the "Offer") which provided the Executive a
"supplemental retirement income" (the "Prior Benefit") in addition to other
benefits; and
WHEREAS, subsequent to the Offer, the Company selected the Executive to be a
participant in that certain nonqualified retirement plan entitled "Supplemental
Retirement Income Plan of Xxxxxxx Companies, Inc. and Its Subsidiaries" (the
"Prior Plan"); and
WHEREAS, the Company and the Executive never executed an agreement to evidence
the participation of the Executive in the Prior Plan; and
WHEREAS, the Executive and the Company desire to cancel that portion of the
Offer which provided for the Prior Benefit upon the execution of this Agreement;
and
WHEREAS, the Company desires to provide a "supplemental retirement income"
pursuant to the terms of this Agreement.
NOW, THEREFORE, in consideration of the covenants, provisions and other
valuable consideration, the receipt of which is hereby acknowledged by the
Executive, the parties hereto agree as follows:
1. Supplemental Retirement Income and Cancellation of Prior Benefit.
(a) Supplemental Retirement Income. The Executive shall be entitled to receive
annual supplemental retirement income (the "Supplemental Retirement Income")
upon his termination from the employ of the Company or any subsidiary (the
"Subsidiary") of which the Company owns 80% or more of the outstanding voting
common stock, provided, he remains continuously employed as of the following
applicable dates:
Vested
Attained Date Annual Supplemental
Year of Employment Retirement Income
After year 1 7/24/1996 -0-
2 7/24/1997 -0-
3 7/24/1998 -0-
4 7/24/1999 -0-
5 7/24/2000 $ 81,000
6 7/24/2001 92,570
7 7/24/2002 104,140
8 7/24/2003 115,710
9 7/24/2004 127,280
10 7/24/2005 138,850
11 7/24/2006 150,420
12 7/24/2007 162,000
Further, in the event that the Executive terminates employment between any of
the applicable required attained dates of employment, the Executive's
Supplemental Retirement Income will be interpolated by subtracting the most
recent vested amount of Supplemental Retirement Income from the next vested
amount of Supplemental Retirement Income, dividing such difference by 12 and
multiplying the quotient by the number of completed whole months of employment
between the last attained date of employment and the date of termination of
employment of the Executive.
For example, if the Executive terminates employment with the Company or a
Subsidiary on October 15th, 2000, then, the Executive's Supplemental Retirement
Income would equal $82,928.32 calculated as follows:
Supplemental Retirement Income at 7/24/2001: $92,570
Supplemental Retirement Income at 7/24/2000 = $81,000
Difference 11,570
Divided by 12 = $964.17
Completed months of service from 7/24/2000-10/15/2000 x 2
Additional Supplemental Retirement Income $1,928.34
Vested Supplemental Retirement Income @ 7/24/2000 81,000.00
Total Supplemental Retirement Income $82,928.34
(b) Cancellation of Prior Benefit. In consideration of the Supplemental
Retirement Income provided in this Agreement, the Prior Benefit is hereby
cancelled and rescinded in all respects. Except to the extent that the Offer
has been amended to delete the Prior Benefit, the Offer shall continue in
accordance with its terms.
2. Manner of Payment of Supplemental Retirement Income. The Supplemental
Retirement Income will be paid to the Executive and his designated beneficiary
(the "Beneficiary"), if applicable, in the manner elected below: (Check and
initial One Box Only)
Methods of Payment
Option 1. [ ] Life of Executive Only (Single Life Basis)
Option 2. [ ] 50% Joint Annuitant Survivor Benefit
Option 3. [ ] 75% Joint Annuitant Survivor Benefit
Option 4. [ ] 100% Joint Annuitant Survivor Benefit
Option 5. [ ] 5 Year Period Certain
Option 6. [ ] 10 Year Period Certain
Option 7. [ ] 15 Year Period Certain
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The actual amounts payable to the Executive will depend upon the date that the
Executive terminates employment. The Supplemental Retirement Income will be
paid at least quarterly as determined by the Compensation and Organization
Committee (the "Committee") of the Company. If no election is made, the benefit
will automatically be paid on a "single life basis" under Option 1, above.
Refer to Exhibit "A" for a complete description of the Methods of Payment.
3. Termination of Employment.
(a) Termination Prior to July 24, 2000. In the event that the Executive
terminates employment for any reason prior to July 24, 2000, then, except as
provided in Section (b) below, the Executive shall have no rights of any kind
whatsoever in the Supplemental Retirement Income (or any other benefit)
otherwise paid pursuant to this Agreement.
(b) Acceleration of Accrual of Supplemental Retirement Income Upon Change of
Control. In the event that there is a "change of control" ("Change of Control")
as defined in the Prior Plan (or any successor plan thereto), and within three
years following such Change of Control, the Executive's employment is terminated
for any reason by either the Company or the Executive, the Executive shall be
entitled to his Supplemental Retirement Income earned by such Executive as of
his date of termination of employment but in no event will the amount be less
than the benefit which the Executive would have been entitled to if the
Executive remained in the continuous employ of the Company until July 24, 2000
($81,000 paid annually on a single life basis), with such Supplemental
Retirement Income to be paid beginning immediately upon the termination of
employment.
4. Restrictions on Alienation of Benefits. No right or benefit under this
Agreement shall be subject to anticipation, alienation, sale, assignment,
pledge, encumbrance, or charge, and any attempt to anticipate, alienate, sell,
assign, pledge, encumber, or charge the same shall be void. No right or benefit
hereunder shall in any manner be liable for or subject to the debts, contracts,
liabilities, or torts of the person entitled to such benefit. If the Executive
or Beneficiary under this Agreement should become bankrupt or attempt to
anticipate, alienate, sell, assign, pledge, encumber, or charge any right to a
benefit under this Agreement, then such right or benefit shall, in the
discretion of the Committee, be held or applied for the benefit of the Executive
or Beneficiary, his spouse, children, or other dependents, or any of them, in
such manner and in such portion as the Committee, in its sole and absolute
discretion, may deem proper.
5. No Trust. No action under this Agreement by the Company, its Board of
Directors or the Committee shall be construed as creating a trust, escrow or
other secured or segregated fund in favor of the Executive, his Beneficiary, or
any other persons otherwise entitled to his Supplemental Retirement Income. The
status of the Executive and his Beneficiary with respect to any liabilities
assumed by the Company hereunder shall be solely those of unsecured creditors of
the Company and/or any Subsidiary. Any asset acquired or held by the Company or
any Subsidiary in connection with liabilities assumed by it hereunder, shall not
be deemed to be held under any trust, escrow or other secured or segregated fund
for the benefit of the Executive or his Beneficiaries or to be security for the
performance of the obligations of the Company or any Subsidiary, but shall be,
and remain a general, unpledged, unrestricted asset of the Company or any
Subsidiary at all times subject to the claims of general creditors of the
Company or any Subsidiary.
6. Withholding and Other Employment Taxes. The Company shall comply with all
federal and state laws and regulations respecting the withholding, deposit and
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payment of any income or other taxes relating to any payments made under this
Agreement.
7. Claims Procedure.
(a) The Committee shall make all determinations as to the right of any person
to benefits. If any request for a benefit is wholly or partially denied, the
Committee shall notify the person requesting the pension benefits, in writing,
of such denial, including in such notification the following information:
(b) the specific reason or reasons for such denial;
(c) the specific references to the pertinent Agreement provisions upon which
the denial is based;
(d) a description of any additional material and information which may be
needed to clarify the request, including an explanation of why such information
is required; and
(e) an examination of this Agreement's review procedure with respect to denial
of benefits.
Provided, that any such notice to be delivered to any Executive or Beneficiary
shall be mailed by certified or registered mail and shall be written to the best
of the Committee's ability in a manner that may be understood without legal
counsel.
8. Review Procedure. The Executive or Beneficiary whose claim has been denied
in accordance with Section 7 herein may appeal to the Committee for review of
such denial by making a written request therefor within 60 days of receipt of
the notification of such denial. The Executive or Beneficiary may examine
documents pertinent to the review and may submit to the Committee written issues
and comments. Within 60 days after receipt of the request for review, the
Committee shall communicate to the claimant, in writing, its decision, and the
communication shall set forth the reason or reasons for the decision and
specific reference to those Agreement provisions upon which the decision is
based.
9. Records and Reports. The Committee shall exercise such authority and
responsibility as it deems appropriate in order to comply with governmental
regulations relating to records of the Executive's accounts and benefits which
may be paid under the Agreement; and to notify the Executive and Beneficiaries
as required.
10. Other Committee Powers and Duties. The Committee shall have such duties
and powers as may be necessary to discharge its duties hereunder, including, but
not by way of limitation, the following:
(a) to construe and interpret the Agreement in its sole and absolute
discretion, decide all questions of eligibility and determine the amount, manner
and time of payment of any benefits hereunder;
(b) to prescribe procedures to be followed by the Executive or Beneficiary
filing applications for benefits;
(c) to prepare and distribute, in such manner as the Committee determines to be
appropriate, information explaining the Agreement;
(d) to receive from the Company and from the Executive and Beneficiaries such
information as shall be necessary for the proper administration of the
Agreement;
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(e) to furnish the Company, upon request, such reports with respect to the
administration of the Agreement as are reasonable and appropriate;
(f) to appoint and employ individuals and any other agents it deems advisable,
including legal counsel, to assist in the administration of the Agreement and to
render advice with respect to any responsibility of the Committee, or any of its
individual members, under the Agreement;
(g) to allocate among themselves who shall be responsible for specific duties
and to designate fiduciaries (other than Committee members) to carry out
responsibilities under the Agreement; provided that any such allocations shall
be reduced to writing, signed by all Committee members, and filed in a permanent
Committee minute book; and
(h) to maintain continuing review of applicable laws, implementing regulations
thereto and suggest changes and modifications to the Company in connection with
delegations of responsibility, as appropriate, and amendments to the Agreement.
11. Rules and Decisions. The Committee may adopt such rules as it deems
necessary, desirable, or appropriate. When making a determination or
calculation, the Committee shall be entitled to rely upon information furnished
by a Executive or Beneficiary, the Company or the legal counsel of the Company.
12. Committee Procedures. The Committee may act at a meeting or in writing
without a meeting. The Committee shall have a chairman, and appoint a
secretary, who may or may not be a Committee member. The secretary shall keep a
record of all meetings in a permanent Committee minute book and forward all
necessary communications to the Company. The Committee may adopt such bylaws
and regulations as it deems desirable for the conduct of its affairs. All
decisions of the Committee shall be made by the vote of the majority including
actions in writing taken without a meeting. A dissenting Committee member who,
within a reasonable time after he has knowledge of any action or failure to act
by the majority, registers his dissent in writing delivered to the other
Committee members, to the extent permitted by law, shall not be responsible for
any such action or failure to act.
13. Assumption of Agreement. The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform the Company's and any Subsidiary's obligations under
this Agreement in the same manner and to the same extent that the Company or
such Subsidiary would be required to perform if no such succession had taken
place. Failure of the Company to obtain such assumption and agreement prior to
the effectiveness of any succession shall be a breach by the Company of its
obligations under this Agreement and shall entitle the Executive to payment from
the Company in the same amount and on the same terms as the Executive would be
entitled to hereunder if the Executive's employment was terminated immediately
following a Change of Control, except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective shall be
deemed the date of termination of employment.
14. Forfeiture of All Benefits. In the event that (i) the Executive is
discharged from employment service with the Company for acts of dishonesty,
fraud, theft, embezzlement, (ii) upon the conviction by a court of competent
jurisdiction of a crime that is deemed to be a felony under the laws of the
State of Oklahoma (or any other state) or laws of the United States, or (iii) in
the event the Executive commits any other act or acts which are injurious and
adversely impacts the Company in any manner whatsoever, then, in such events,
the Committee, in its sole discretion, may determine that any benefit
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which would otherwise be provided to the Executive under the Agreement or the
Agreement shall be forfeited in its entirety, and it shall thereafter be
deemed as if the Executive never was selected for participation in the
Agreement.
15. Minimum Benefit. Notwithstanding any provision of this Agreement to the
contrary, in the event that the Company selects and the Executive agrees to be a
participant in the Prior Plan or any successor thereto, then, the Supplemental
Retirement Income accrued under this Agreement shall be the minimum benefits to
be provided to the Executive under such Prior Plan.
16. Miscellaneous.
16.1 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Oklahoma, without reference to
principles of conflict of laws.
16.2 Headings. The captions of this Agreement are not part of the provisions
hereof and shall have no force and effect.
16.3 Taxes. The Executive acknowledges that the payments and benefits to which
he is entitled to under this Agreement will be includable in his taxable income.
Accordingly, Executive agrees (i) to pay all required income, employment and
other taxes attributable to such payments and benefits and (ii) that the Company
may be required to withhold all applicable taxes from such payments and
benefits.
16.4 Amendment. This Agreement may not be amended or modified otherwise than
by a written agreement executed by the parties hereto or their respective heirs,
successors, assigns or the legal representatives, as the case may be.
16.5 Notices. All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
If to Executive:
Xxxxxxx X. Xxxx
00000 Xxxxx Xxxxx Xxxxx
Xxxxxxxx Xxxx, Xxxxxxxx 00000
If to the Company:
Xxxxxxx Companies, Inc.
0000 Xxxxxxxxx Xxxxxxxxx
X.X. Xxx 00000
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Chairman and Chief Executive Officer
or such other address as either party shall have furnished to the other in
writing in accordance herewith. Notices and communications shall be effective
when actually received by the addressee.
16.6 Severability. The invalidity or enforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
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16.7 No Waiver. The Company's or the Executive's failure to insist upon strict
compliance with any provision hereof shall not be deemed to be a waiver of such
provision or any other provision hereof.
16.8 Entire Agreement. This Agreement contains the entire understanding of the
Company and Executive with respect to the subject matter hereof.
16.9 Binding Effect. This Agreement shall inure to the benefit of and be
binding upon the Company, Executive, their respective heirs, successors, assigns
or legal representatives, as the case may be.
IN WITNESS WHEREOF, Executive has hereunto set his hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents
to be executed in its name on its behalf, all as of the day and year first above
written.
EXECUTED the date and year first above written.
XXXXXXX COMPANIES, INC., a corporation
By: /s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx,
Chairman and
Chief Executive Officer
"COMPANY"
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx
"EXECUTIVE"
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EXHIBIT "A"
Description of Methods of Payment
METHOD 1 - Life of A Supplemental Retirement Income will be
Participant Only: paid for the Executive's life only. Upon the
Executive's death, all payments of Supplemental
Normal Retirement Income shall cease.
METHOD 2 - 50% A reduced amount of Supplemental Retirement
Joint Annuitant Income will be paid to the Executive for his
Survivor Benefit: life, then, at the Executive's death 50% of such
amount shall be paid to the Executive's
surviving Beneficiary. In the event that the
Executive's surviving Beneficiary has prede-
ceased him, or should otherwise die after the
Executive's death, then no further payments will
be paid under Method 2 or this Agreement.
METHOD 3 - 75% A reduced amount of Supplemental Retirement
Joint Annuitant Income will be paid to the Executive for his
Survivor Benefit: life, then, at the Executive's death 75% of
such amount shall be paid to the Executive's
surviving Beneficiary. In the event that the
Executive's surviving Beneficiary has
predeceased him, or should otherwise die after
the Executive's death, then no further
payments will be due under Method 3 or this
Agreement.
METHOD 4 - 100% A reduced amount of Supplemental Retirement
Joint Annuitant Income will be paid to the Executive for his
Survivor Benefit: life, then, at the Executive's death 100% of
such amount shall be paid to the Executive's
surviving Beneficiary. In the event that the
Executive's surviving Beneficiary has
predeceased him, or should otherwise die after
the Executive's death, then no further
payments will be due under Method 4 or this
Agreement.
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METHOD 5 - 5 Year A reduced amount of Supplemental Retirement
Period Certain: Income will be paid for a period of 5 years
certain. After the expiration of such 5 year
period, payments shall then continue for the
Executive's life in the same amount. In the
event of the Executive's death during the 5
year period certain, then, the balance of such
payments due only during such 5 year period
will be paid to the Executive's surviving
Beneficiary. After the expiration of such 5
year period, then all payments shall cease.
In the event of the expiration of such 5 year
period, and the Executive dies, then, no
further benefits will be paid under METHOD 5
or this Agreement.
METHOD 6 - 10 Year A reduced amount of Supplemental Retirement
Period Certain: Income shall be paid for a period of 10 years
certain. After the expiration of such 10 year
period, payments shall then continue for the
Executive's life in the same amount. In the
event of the Executive's death during the 10
year period certain, then, the balance of such
payments due only during such 10 year period
will be paid to the Executive's surviving
Beneficiary. After the expiration of such 10
year period, then all payments shall cease.
In the event of the expiration of such 10 year
period, and the Executive dies, then, no
further benefits will be paid under METHOD 6
or this Agreement.
METHOD 7 - 15 Year A reduced amount of Supplemental Retirement
Period Certain: Income shall be paid for a period of 15 years
certain. After the expiration of such 15 year
period, payments shall then continue for the
Executive's life in the same amount. In the
event of the Executive's death during the 15
year period certain, then, the balance of such
payments due only during such 15 year period
will be paid to the Executive's surviving
Beneficiary. After the expiration of such 15
year period, then all payments shall cease.
In the event of the expiration of such 15 year
period, and the Executive dies, then, no
further benefits will be paid under METHOD 7
or this Agreement.
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