EXHIBIT 10 (t)
THE DOCUMENT COMPANY
XEROX
FORM OF SALARY CONTINUANCE AGREEMENT
The following information summarizes the arrangements for your retirement from
Xerox Corporation (the Company).
Last day of active employment: To be determined by the Chief Executive Officer
Salary Continuance: 12 [24] months
Salary Continuance Amount: $xxxxxxx per month or, if greater, monthly
salary rate on last day of employment
Retirement Date: Day following end of Salary Continuance
Notwithstanding anything else contained in this letter if you engage in
Detrimental Activity as defined in the attached Exhibit the consequences set
forth therein shall apply.
Summarized below are the relevant provisions that apply to your long-term
incentive awards, profit sharing and savings accounts, pension benefits, life
insurance benefits and other benefits arrangements. In case of inconsistencies
between this summary and the relevant plan, the terms of the plan will govern.
STOCK AWARDS
Stock grants (including stock options) awarded to you prior to the commencement
of salary continuance shall continue to vest and/or remain exercisable per the
terms of the awards and the relevant plans. You will not be eligible for
additional stock awards during salary continuation.
PROFIT SHARING AND SAVINGS ACCOUNT
As you know, under relevant plan provisions, you have choices available
regarding the continued investment of your account balances and the time and
form of distribution. Please refer to You and Xerox: Wealthwise for a
description. A calculation of your account balances will be completed at the
end of your salary continuance period at which time you will have the
opportunity to elect how and when the proceeds will be distributed.
EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)
At separation, your ESOP account can be taken as cash, in stock, or rolled over
to the Xerox 401(k) savings plan. A determination of your final plan benefit
will be made at the end of salary continuance period.
PENSION BENEFITS
Effective on your retirement date, you will become a retiree of Xerox. As a
retiree, you will receive pension benefits accrued in the Retirement Income
Guarantee Plan (RIGP). In addition to your vested RIGP benefit, depending on
your age on your retirement date, you may be eligible to receive a benefit
under the Supplemental Executive Retirement Plan (SERP), which as you know,
will allow you to begin to receive retirement income benefits unreduced for
commencement prior to attainment of age 65 and will be offset by your RIGP
benefits. If you are eligible, this benefit will commence on your retirement
date, and will be paid in monthly installments reflecting your survivor
election. This benefit is unfunded and is not tax qualified. This means you
are an unsecured general creditor of the Company with respect to this benefit.
A determination of your benefit will be made at retirement. We can prepare an
estimate prior to that time if you so desire.
MEDICAL BENEFITS
As a retiree, you will receive medical coverage under Xerox Retiree Flex as it
is in effect from time to time. This program will include, among other things,
coordination of benefits if you are covered by more than one plan including
Medicare. As you get closer to your retirement date, an information package
will be sent to you from our medical insurance partner.
BONUS
You will be eligible to receive a cash bonus and/or other cash award earned for
any year in which you are actively employed. If earned, any such cash awards
will be prorated based on the number of months of active employment during the
year.
LIFE INSURANCE
Your Contributory Life Insurance coverage of $xxxxxxx will continue during your
salary continuance period. During this period, both you and the Company will
continue to share in the cost of premiums according to the original plan
agreement. In the event of your death during salary continuance, salary would
cease and your beneficiaries will, subject to applicable plan provisions,
receive the proceeds of your life insurance coverage. Upon termination, the
Company will recover its cumulative premiums paid into the Contributory Life
Insurance Plan, plus an amount for administrative expenses as stated in the
Plan Agreement. At that time you will become sole owner of the policy along
with any remaining cash value, with the option to continue the coverage at your
own expense.
OTHER ARRANGEMENTS
You will relinquish your position as a Director and Officer of Xerox
Corporation and as a director and officer of any subsidiary company when your
active employment ends.
You will be paid for any accrued and unused vacation upon commencement of
salary continuance. You will not accrue any further vacation during salary
continuance.
Your company financial counseling and tax preparation programs will be
continued through the end of the year in which your active employment ends.
You will not be entitled to any future Executive Expense Allowance payments
while on salary continuance.
You will not be eligible to receive long-term incentive awards while on salary
continuation. You will be eligible for your physical under the Executive
Physical program for any year during which you are actively employed.
INDEMNITY
You will be entitled to be indemnified with respect to all periods of your
service as a director or officer of the Company or any of its subsidiaries in
accordance with 1) the provisions of Sections 721 through 725 of the Business
Corporation Law of the State of New York and provisions of California Labor
Code Section 2802 2) Section 2 of Article VIII of the by-laws of the Company as
in effect on the date of commencement of salary continuance and 3) the Company
directors and officers liability insurance policies with Federal Insurance
Company, National Union Fire Insurance Company of Pittsburgh P.A., Reliance
Insurance Company, Chubb Atlantic Ltd., Gulf Insurance Company and A.C.E.
Insurance, Ltd., or any replacement or substitute thereof or any addition
thereto.
RELEASE
This salary continuance payments provided for in this letter shall not
become effective until you execute and deliver to the Company the release in
the form attached immediately prior to the scheduled commencement thereof.
COOPERATION IN LITIGATION
You will cooperate fully with the Company and its counsel in any litigation
that arises out of or is related to your service with the Company or any of
its subsidiaries, or in which you are named as a party. That cooperation
includes making yourself available for reasonable periods of time upon
reasonable notice for consultation with the Company's counsel in any such
litigation and to testify in such litigation.
At the appropriate time, a representative of Xerox Corporation will contact
you regarding your resignation as a Corporate Officer.
Sincerely,
________________________
[Chief Executive Officer]
AGREED AND ACCEPTED
_________________________
[Employee Name]
Date:
Exhibit to Letter Agreement
Engagement in Detrimental Activity
Definition of Detrimental Activity
"Detrimental Activity" shall mean:
(1) Employment as an employee of, or services provided as a consultant to,
another firm or corporation (other than the Company or an affiliate) that is a
direct competitor of the Company in any business in which the Company is
presently engaged or in which the Company as of the date of the letter to which
this Exhibit is attached ("Letter Agreement") may reasonably be expected to
engage in the future, or is or may become such a competitor indirectly through
a partnership, joint venture or other business arrangement with, or as a
supplier or consultant to, such a direct competitor ("Competitor"), unless
the Company has previously advised in writing that in its reasonable judgment
such other firm or corporation is not a Competitor (the Company will provide
notice upon request as to the competitive nature of a prospective employer); or
(2) Disclosure of confidential or proprietary business information of the
Company;
(3) The making of any derogatory or disparaging statements about the
Company, its management or its business;
(4) Violation of any rules, policies, procedures or guidelines of the
Company, including but not limited to the Company's Business Ethics Policy;
(5) Any attempt directly or indirectly to induce any employee of the Company
to be employed or perform services elsewhere or any attempt directly or
indirectly to solicit the trade or business of any current or prospective
customer, supplier or partner of the Company;
(6) Conviction of, or entry of a guilty plea with respect to, a crime,
whether or not connected with the Company; or
(7) Engagement in any other conduct or act determined by the Company to be
injurious, detrimental or prejudicial to any interest of the Company and,
therefore, to constitute an act of disloyalty towards the Company.
Consequences of Engagement in Detrimental Activity
If the executive who is a party to the Letter Agreement engages in any
Detrimental Activity any salary continuance provided for therein shall not
become payable or shall immediately terminate if payments have started,
employment with the Company will terminate and any benefits described in the
Letter Agreement, or otherwise, that are dependent upon continued employment,
including without limitation, continued vesting of benefits and determination
of years of service will also terminate.
If the executive who is a party to the Letter Agreement engages in Detrimental
Activity, that in the Company's sole discretion constitutes an act of
disloyalty towards the Company either before becoming entitled to salary
continuance or after commencement of salary continuance payments, as the case
may be, in accordance with the Letter Agreement, the following additional
consequences shall apply:
(a) Any outstanding award under the 1991 Long-term Incentive Plan (including
LEEP awards), the 1998 Employee Stock Option Plan, or pursuant to any bonus
or retention plans or programs ("Awards") shall be cancelled and be of no
further force or effect;
(b) Any payment of salary continuance or exercise, payment or delivery of
an Award within six months prior to such Detrimental Activity may be rescinded
at the sole discretion of the Company. In the event of any such rescission,
the executive shall pay to the Company the amount of any gain realized or
payment received as a result of the rescinded exercise, payment or delivery,
in such manner and on such terms and conditions as may be required amount
owed to you by the Company; and
(c) Any unfunded retirement benefits including, without limitation, under the
Unfunded Retirement Income Guarantee Plan and the Supplementary Executive
Retirement Plan, shall be forfeited.
THE DOCUMENT COMPANY
XEROX
GENERAL RELEASE
(1) In consideration of Xerox's agreement to provide salary continuance and
other benefits as set forth in the letter agreement dated June 13, 2001,
attached hereto and incorporated herein, and other good and valuable
consideration the adequacy and receipt of which are hereby acknowledged, I,
[Employee Name] release Xerox and its employees, directors, officers, agents,
stockholders, subsidiaries, affiliates, successors and assigns, and the Xerox
employee benefits plans in which I am now or have been a participant and their
trustees, administrators, successors, assigns, agents and, employees (the
"Releasees"), from any and all claims of any kind, known or unknown, which I
now have or may have against the Releasees by reason of facts which have
occurred prior to the date of this Release. Such released claims include,
without limitation, any and all claims of age discrimination under the Age
Discrimination in Employment Act of 1967, the Older Workers' Benefits
Protection Act of 1990, any claims under Title VII of the Civil Rights Act of
1964, the Civil Rights Acts of 1866, 1870, 1871 and 1991, the Americans with
Disabilities Act of 1990, the Rehabilitation Act of 1973, the Family and
Medical Leave Act of 1993, the Equal Pay Act of 1963, the Fair Labor Standards
Act of 1938, the Employee Retirement Income Security Act of 1974, the Worker
Adjustment and Retraining Notification Act of 1989, the Uniformed Services
Reemployment Rights Act of 1994, and the Vietnam Era Veteran's Readjustment
Assistance Act of 1974 (all as amended), and the laws of the state(s) where I
am employed and reside, including by example and not limitation the state fair
employment practices law(s) or any other federal, state or local statute or
regulation regarding employment or discrimination in employment, as well as any
and all claims arising out of, based upon or relating to the hire, offer of
employment by Releasees, employment contract, if any, between myself and
Releasees, any representations or commitments made by the Releasees regarding
future employment, remuneration, promotion, discipline, termination from
employment, or benefits payable by Releasees to me including but not limited to
any and all claims under State contract or tort law such as breach of the
implied covenant of good faith and fair dealing, negligent or intentional
infliction of emotional distress and defamation, all claims for punitive or
compensatory damages, costs or attorneys fees, and any and all claims I have,
against Xerox based upon its employee relocation policy.
(2) I acknowledge and agree that the consideration set forth in this Release is
in addition to anything of value to which I am otherwise entitled by law and
Xerox policy.
(3) I understand and agree that this Release and Releasees' agreement to
provide consideration as set forth above are not intended and should not be
construed, in any way, as an admission by Releasees of wrongdoing or liability.
(4) I agree that I will not file or pursue any charge, claim or action with any
government agency or any court against the Releasees based upon any event or
occurrence which took place prior to the date of this Release. However, I
understand that nothing set forth in this Release shall be construed as a
condition precedent, penalty or other limitation of my right to file a charge
or complaint with, or participate in an investigation or proceeding conducted
by, the EEOC or any comparable state agency.
(5) I agree that if I act contrary to the representations and obligations set
forth in this Release, I shall repay to Xerox upon demand any and all moneys
paid to me by Xerox in consideration of this release. Moreover, if I act
contrary to paragraph 4 of this Release, I agree to pay all costs and expenses
of defending the charge, claim or action incurred by Releasees, including
reasonable attorneys fees.
(6) Should any provision of this Release, with the exception of paragraph I, be
declared or be determined by any court to be illegal or invalid, the validity
of the remaining parts, terms or provisions shall not be affected thereby and
said illegal or invalid part, term, or provision shall be deemed not to be a
part of this Agreement. Should paragraph I be declared or be determined by any
court to be illegal or invalid, the purpose of this entire Agreement shall be
deemed to have failed and I shall return all consideration paid by Xerox
hereunder.
(7) I agree to treat the existence and substance of this Release as
Confidential and shall not disclose it to other persons within or outside the
Releasees except as required by law.
(8) I understand and acknowledge that for a period of one year following my
separation from service with Xerox, I will not be eligible for rehire as an
employee, or retention as a contract worker or consultant.
(9) The undersigned and the Company agree that this release shall not release
the payments, benefits and other provisions contained in the attached letter
agreement between the undersigned and the Company.
(10) I acknowledge that I have been advised by Xerox as follows:
- -- TO CONSULT WITH AN ATTORNEY OF MY CHOOSING TO COUNSEL ME AS TO MY RIGHTS
BEFORE I SIGN THIS RELEASE;
- -- TO TAKE SUFFICIENT TIME TO DECIDE WHETHER TO SIGN THIS RELEASE. I HAVE
21 DAYS FROM THE DATE THIS RELEASE IS PROVIDED TO ME TO CONSIDER IT
BEFORE I SIGN AND RETURN IT TO XEROX;
- -- THAT EVEN AFTER I SIGN AND RETURN THIS RELEASE TO XEROX, I WILL HAVE
7 DAYS THEREAFTER TO CHANGE MY MIND AND REVOKE MY RELEASE BY ASKING
XEROX FOR ITS RETURN.
(11) I understand and agree that this release waives all claims I may have at
the time I sign it, including claims I do not then know about or suspect. I
further understand and acknowledge that California Civil Code, Section 1542
provides: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR." I hereby expressly waive any rights I may have under that Code
section, if applicable, or any other similar state or federal statute or
common law principle of similar effect.
Date release provided to employee:
Date Signed and Returned to Xerox: ____________________, _____
(To be filled in by employee)
By: _______________________
(Employee Signature)
XEROX CORPORATION
By: ____________________
[Title]