EXHIBIT 10.25
SUPPLEMENTAL PENSION AGREEMENT
AGREEMENT, dated as of this 30th day of April, 1997 (the "Effective Date"),
by and between AMBAC Inc., a Delaware corporation (the "Company"), and DAVID L.
BOYLE (the "Executive").
WHEREAS, the Company and the Executive have agreed that the Executive shall
be employed by the Company commencing on March 31, 1997; and
WHEREAS, the Company and the Executive have agreed that, as part of the
incentive for the Executive's employment with the Company, the Company shall
provide the Executive with enhanced pension benefits according to the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto hereby agree as follows:
1. Supplemental Pension. (i) Subject to the provisions included herein, the
Executive shall earn a supplemental monthly pension (the "Pension") payable in
the same manner as the Executive elects with respect to his retirement benefits
under the Pension Plan of AMBAC Inc. (the "Retirement Plan") commencing with the
month following the month in which the Executive attains age 65. The amount of
the Pension shall be determined in accordance with the benefit formula and
actuarial factors and assumptions set forth in the Retirement Plan, as in effect
on the Effective Date, except that, for purposes of calculating the amount of
the Pension, the following shall apply: (A) the Pension shall be calculated
without giving effect to the limitations provided for in Sections 401(a)(17) and
415 of the Internal Revenue Code of 1986, as amended (the "Code"), or any
successor provisions thereto; and (B) for purposes of calculating the amount of
his retirement benefits, including the Pension, the Executive shall be credited
with years of accrual service equal to the number of whole months elapsed from
March 31, 1997 to the date of the Executive's termination of employment with the
Company, up to a maximum of 120 months, excluding any leave of absence, divided
by six; (C) the Executive shall be fully vested in the Pension on the date the
Executive completes 60 months of employment with the Company (excluding any
periods spent on leave of absence); (D) the amount of the Pension shall be paid
in the form of a 50% qualified joint and survivor annuity, unless the Executive
shall elect in writing prior to his termination of employment to have the
Pension paid in another form of payment that may be elected under the Retirement
Plan; provided, however, that the Company shall have the right at any time
following the Executive's termination of employment to pay the entire amount of
the remaining Pension to the Executive (or his surviving spouse, if applicable)
in a lump sum (regardless of the amount of such lump sum) calculated in
accordance with the actuarial factors specified in the Retirement Plan
applicable to involuntary cashouts; (E) the amount of the Pension shall be
reduced by the amount of the retirement benefits payable to the Executive (or
his spouse) under the Retirement Plan, the AMBAC Inc. Supplemental Pension Plan
and the AMBAC Inc. Excess Benefits Pension Plan; and (F) the monthly payments of
the Pension shall not commence until the latest to occur of (I) the date the
Executive attains the earliest retirement age under the Retirement Plan and (II)
the date of the Executive's termination of employment. If the payment of the
Pension should commence prior to the time that the Executive
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for David L. Boyle
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attains age 65, the amount of the Pension shall be reduced in accordance with
the reduction factors set forth in the Retirement Plan. The Pension to the
Executive shall terminate in the month in which the Executive dies. Any death
benefits payable to his surviving spouse, if any, and any disability benefits
shall be determined in accordance with the same terms as apply to the Retirement
Plan.
(ii) The Executive shall forfeit all right to the Pension if his
employment with the Company ends, for any reason, prior to the
completion of 60 months of employment with the Company.
2. General Provisions.
(a) Notices. Any notice hereunder by either party to the other shall
be given in writing by personal delivery, telex, telecopy or certified
mail, return receipt requested, to the applicable address set forth below:
(i) To the Company: AMBAC Inc.
One State Street Plaza
New York, NY 10004
Attention: General Counsel
(ii) To the Executive: David Boyle
440 Riversville Road
Greenwich, CT 06831
or to such other person or other address as either party may specify to the
other in writing.
(b) Limited Waiver. The waiver by the Company or the Executive of a
violation of any of the provisions of this Agreement, whether express or
implied, shall not operate or be construed as a waiver of any subsequent
violation of any such provision.
(c) Assignment. No right, benefit or interest hereunder shall be
subject to assignment, encumbrance, charge, pledge, hypothecation or set
off by the Executive in respect of any claim, debt, obligation or similar
process. The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business or assets or the Company to assume
expressly and to agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession had taken place.
(d) Amendment. This Agreement may not be amended, modified or canceled
except by written agreement of the Executive and the Company.
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(e) Severability. If any term or provision hereof is determined to be
invalid or unenforceable in a final court or arbitration proceeding, (i)
the remaining terms and provisions hereof shall be unimpaired and (ii) the
invalid or unenforceable term or provision shall be deemed replaced by a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision.
(f) Unsecured Promise. No benefit or promise hereunder shall be
secured by any specific assets of the Company. Unless otherwise stated
herein, the Executive shall have only the rights of an unsecured general
creditor of the Company in seeking satisfaction of such benefits or
promises.
(g) Governing Law. This Agreement has been made in and shall be
governed by and construed in accordance with the laws of the State of
Delaware.
(h) Headings. The headings and captions of the Sections of this
Agreement are included solely for convenience of reference and shall not
control the meaning or interpretation of any provisions of this Agreement.
(i) Counterparts. This Agreement may be executed by the parties hereto
in counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same document.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the day and year first written above.
AMBAC INC.
By /s/: Janice Reals Ellig
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Name: Janice Reals Ellig
Title: Senior Vice President
THE EXECUTIVE
/s/ David L. Boyle
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David L. Boyle