EXHIBIT 10(r)
EXECUTIVE RETIREMENT AGREEMENT
THIS AGREEMENT made and entered into as of January 1, 1998, between
TECH-SYM CORPORATION (the "Company") and XXXX X. XXXX (the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive has rendered outstanding service to the Company
over a period of years and the Executive's experience and knowledge of the
affairs of the Company and his reputation and contacts are extremely valuable to
the Company; and
WHEREAS, in recognition of the Executive's service to the Company and to
encourage the Executive's continued service, the Company is desirous of offering
him, in addition to his regular compensation and termination benefits, certain
retirement benefits;
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants and agreements herein contained, the Company and the Executive hereby
agree as follows:
1. BENEFITS
1.1 QUALIFICATIONS FOR RETIREMENT BENEFITS. The Executive (or his surviving
spouse, as the case may be) shall be entitled to receive the retirement (or
death) benefits provided by this Agreement following his termination of
employment with the Company unless his employment with the Company is terminated
(i) voluntarily by the Executive prior to his attaining age 62, other than due
to a Total Disability (as defined below), or (ii) by the Company for Cause (as
defined below). A termination of employment that would entitle the Executive (or
his spouse) to receive retirement (or death) benefits as provided hereunder is
hereafter referred to as a "Qualified Termination."
For the purposes of this Agreement, the Company shall have "Cause" to terminate
the Executive's employment hereunder only upon (i) the willful and continued
failure by the Executive to perform substantially the Executive's duties with
the Company, other than any such failure resulting from the Executive's
incapacity due to physical or mental illness, after a demand for substantial
performance is delivered to the Executive by the Board of Directors of the
Company (the "Board") that specifically identifies the manner in which the Board
believes that the Executive has not substantially performed the Executive's
duties or (ii) the willful engaging by the Executive in gross misconduct
materially and demonstrably injurious to the Company. For purposes of this
paragraph, an act or failure to act on the Executive's part shall be considered
"willful" if done or omitted to be done by the Executive otherwise than in good
faith and without reasonable belief that the Executive's action or omission was
in the best interest of the Company.
1.2 AMOUNT OF RETIREMENT BENEFITS. Following a Qualified Termination the
Executive shall receive, beginning with the later of the date of such Qualified
Termination or the Executive's 65th birthday (the "Commencement Date"), an
annual retirement benefit equal to 65% of the highest rate of annual base salary
in effect for the Executive with the Company at any time prior to the
Executive's 61st birthday (the "Base Salary") with such benefit payable on each
January 1 on or after the Commencement Date on which he is living; provided,
however, that if the Executive's Commencement Date is other than on January 1,
the Executive shall receive a partial annual retirement benefit for the
remainder of the year in which such Commencement Date occurs in an amount equal
to the full annual benefit that will commence on the next January 1 but reduced
by a fraction, the numerator of which is the number of calendar months during
such year that have elapsed prior to the Commencement Date (with any partial
month rounded up to a complete month), and the denominator of which is 12 and
such partial benefit shall be paid to the Executive on the first day of the
month coinciding with or next following the Commencement Date; provided further,
however, that:
(a) if the Executive's employment terminates due to a Qualified Termination
prior to his reaching age 65, the Executive may elect to commence receiving
his retirement benefits hereunder as of the date of such Qualified
Termination or any date thereafter, provided the Executive is at least age
62 as of such Early Commencement Date, by giving written notice of such
election to the Company prior to such Early Commencement Date and the
amount of the annual retirement benefit (and partial benefit, if any)
payable hereunder shall be reduced by 1.39% for each full calendar month by
which his Early Commencement Date precedes his 65th birthday unless the
Board, in its sole discretion, elects to waive all or part of this
reduction; and
(b) if on the Early Commencement Date the Executive is also entitled to
receive benefits under a separate Termination Agreement with the Company
dated effective as of August 15, 1996 (as the same may be amended from
time-to-time thereafter), then for purposes of subparagraph (a) above the
Executive's age as of the Early Commencement Date shall be increased by
(but not beyond age 65) the length of the Termination Period (as defined in
the Termination Agreement) remaining as of the Early Commencement Date.
1.3 DEATH BENEFITS. If the Executive is married on his date of death and
such death occurs while he is an employee of the Company or on or after a
Qualified Termination, including one due to Total Disability, his surviving
spouse ("Spouse") shall receive an annual survivor's benefit hereunder in an
amount equal to 37 1/2% of the Executive's Base Salary. The Spouse's benefit
shall commence on the first day of the month coinciding with or next following
the Executive's date of death. Subsequent payment(s) of the Spouse's benefit
shall be made on each anniversary of the date such survivor payments first
began, provided that the Spouse is alive on such anniversary date, and shall
cease when either a total of 10 annual survivor benefit payments have been paid
to the Spouse hereunder or the Spouse dies, whichever occurs first.
1.4 LUMP SUMS. Notwithstanding Section 1.2 or Section 1.3 hereof to the
contrary, the Board, in its sole discretion, may at any time direct that the
present value of any retirement (or death) benefits accrued under this
Agreement, as determined in accordance with the applicable mortality table and
applicable interest rate then in effect under Section 417 of the Internal
Revenue Code of 1986, as amended, be immediately paid to the Executive (or his
Spouse, as the case may be) in a lump sum in cash (by check).
1.5 CONTINUED HEALTH BENEFITS. On and after a Qualified Termination, the
Executive shall be entitled to continue, for as long as he lives, his
participation and that of his qualified dependents, if any, in the Company's
group health plan for active employees in which the Executive participated
immediately prior to such Qualified Termination provided that the Executive
continues to pay the regular active employee premium, if any, required by such
plan; however, in the event that continued participation by the Executive in
such plan after the date of his Qualified Termination is not permitted by the
plan or such plan is terminated or benefits under such plan would be taxable to
the Executive, the Company shall either obtain comparable coverage under another
group health plan of the Company (and under which benefits to the Executive
would not be taxable) or, if there is none, an individual insurance policy
providing comparable benefits with the Executive paying an amount of the premium
therefor that is not greater than that which he would have been required to pay
from time to time under the Company's group health plan for active employees had
his participation continued in such plan and the Company paying the balance of
such cost and any taxes on any income the Executive would have as a result of
such Company-provided coverage.
2. TERMINATION AND AMENDMENT
2.1 TERMINATION OR AMENDMENT. The Company, by action of the Board, reserves
the right to amend or terminate this Agreement for whatever reasons it may deem
appropriate as of the first day of the month following the delivery to the
Executive of written notice of such amendment or termination; however, no such
amendment shall impair, reduce or void the Executive's (or his Spouse's) rights
with respect to the continued health benefits provided by Section 1.5 or the
retirement (or death) benefits (whether or not in pay status) accrued under this
Agreement as of the date of such amendment and further, any termination of this
Agreement by the Company shall, notwithstanding anything herein to the contrary,
entitle the Executive (or his Spouse, as the case may be) to immediately receive
from the Company the lump sum present value of the accrued retirement (or death)
benefits as calculated in accordance with Section 1.4.
3. ADMINISTRATION
3.1 BOARD DECISION. The Board's decision whether or not to waive the
reduction in the amount of benefits payable in the event of the Executive's
Qualified Termination prior to reaching age 65, as provided in Section 1.2(a),
shall be totally discretionary with the Board and need not be based upon any
standard nor be consistent with any past practices and shall be conclusive on
all parties.
3.2 BENEFITS UNFUNDED. This Agreement is completely separate from and is
not a part of any other plan, qualified or nonqualified, of the Company and its
subsidiaries. The benefits payable hereunder, if any, are in addition to those
that may be provided to the Executive under any other plan, arrangement or
agreement. Further, the benefits payable hereunder are completely unfunded and
shall be payable by the Company solely out of its general assets and the
Executive and his spouse shall be unsecured, general creditors of the Company
with respect to such benefits; provided, however, the Company, in its
discretion, may establish a grantor or rabbi trust to pay all or part of the
benefits it may be required to pay under this Agreement, in which event this
Agreement shall be deemed to be a part of such trust agreement and the Executive
hereby waives, with respect to the assets of such rabbi trust, any preference he
may have under state law with respect to such assets and acknowledges that he
shall be a general, unsecured creditor of the Company with respect to the same.
4. MISCELLANEOUS
4.1 NO EMPLOYMENT RIGHTS. Nothing contained in this Agreement shall be
construed as a contract of employment between the Company and the Executive, or
as a right of the Executive to be continued in the employment of the Company or
as a limitation of the right of the Company to discharge the Executive at any
time, with or without Cause.
4.2 ASSIGNMENT. The benefits payable under this Agreement may not be
assigned, alienated, pledged, transferred, sold, encumbered or hypothecated in
any manner by the Executive or his spouse. Any attempted sale, conveyance,
transfer, assignment, pledge or encumbrance of this Agreement or of such rights,
interest and benefits or the levy of any attachment or similar process thereupon
shall be null and void and without effect.
4.3 BINDING EFFECT. 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, by agreement in
form and substance reasonably satisfactory to the Executive, expressly to assume
and agree to perform this Agreement in the same manner and to the same extent as
the Company would have been required if no such succession had taken place.
Notwithstanding anything herein to the contrary, failure of the Company to
obtain such agreement prior to the effectiveness of any such succession shall
constitute a termination of this Agreement pursuant to Section 2.1 and entitle
the Executive (or Spouse) as the case may be, to immediate payment thereunder.
As used in this Agreement, "Company" shall mean the Company as hereinbefore
defined and any successor to its business and/or assets as aforesaid that
executes and delivers the agreement provided for in this Section 4.3 or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law.
4.4 MISCELLANEOUS. No provision of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing and signed by the Executive and by the President or other authorized
officer of the Company. No waiver by either party hereto at any time of any
breach by the other party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provision or conditions at the same or at any
prior or subsequent time.
4.5 PAYMENTS. The Company may make any payments required by this Agreement,
when in the judgment of the Company the recipient is incapacitated by reasons of
physical or mental illness or infirmity, to the recipient directly, or to the
legal guardian of the recipient.
4.6 TAXES. The Company shall have the right to deduct from all payments
made under this Agreement, any taxes required by law to be withheld with respect
to such payments.
4.7 VALIDITY. The interpretation, construction and performance of this
Agreement shall be governed by and construed and enforced in accordance with the
laws of the State of Texas without regard to the principle of conflicts of laws.
The invalidity or unenforceability of any provisions of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
each of which shall remain in full force and effect.
4.8 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
4.9 EMPLOYMENT WITH SUBSIDIARIES. Employment with the Company for purposes
of this Agreement includes employment with any corporation in which the Company
has a direct or indirect ownership interest of 50% or more of the total combined
voting power of all classes of stock (a "Subsidiary").
4.10 ARBITRATION. Any dispute or controversy arising out of or in
connection with this Agreement as to whether the Executive (or his spouse) is
entitled to a retirement (or survivor's) benefit, the amount thereof or other
matter shall be submitted to arbitration pursuant to the following procedure:
(a) Either party may demand such arbitration in writing after the
controversy arises, which demand shall include the name of the arbitrator
appointed by the party demanding arbitration, together with a statement of
the matter in controversy.
(b) Within 15 days after such demand, the other party shall name an
arbitrator, or in default thereof, such arbitrator shall be named by the
Arbitration Committee of the American Arbitration Association, and the two
arbitrators so selected shall name a third arbitrator within 15 days or, in
lieu of such agreement on a third arbitrator by the two arbitrators so
appointed a third arbitrator shall be appointed by the Arbitration
Committee of the American Arbitration Association.
(c) The Company shall bear all arbitration costs and expenses, including
without limitation any legal fees and expenses incurred by the Executive
(or his Spouse) in connection with such arbitration procedure.
(d) The arbitration hearing shall be held at a site in Houston, Texas, to
be agreed to by a majority of the arbitrators on ten days' written notice
to the parties. (e) The arbitration hearing shall be concluded within ten
days unless otherwise ordered by a majority of the arbitrators, and the
award thereon shall be made within ten days after the close of the
submission of evidence. An award rendered by a majority of the arbitrators
appointed pursuant to this Agreement shall be final and binding on all
parties to the proceeding, and judgment on such award may be entered by
either party in the highest court, state or federal, having jurisdiction.
The parties stipulate that the provisions hereof shall be a complete
defense to any suit, action, or proceeding instituted in any federal, state, or
local court or before any administrative tribunal with respect to any
controversy or dispute arising under this Agreement, and which is arbitrable as
herein set forth. The arbitration provisions hereof shall, with respect to such
controversy or dispute, survive the termination of this Agreement.
IN WITNESS WHEREOF the Company has caused this Agreement to be
executed by its duly authorized officer, and the Executive has executed this
Agreement effective for all purposes as of the date first written above.
TECH-SYM CORPORATION
DATED: JANUARY 7, 1998 /S/XXXXXXX X. XXXXX
XXXXXXX X. XXXXX
CHAIRMAN AND PRESIDENT
EXECUTIVE
DATED: JANUARY 7, 1998 /S/XXXX X. XXXX
XXXX X. XXXX
