Exhibit 10.5


 


CONTINUITY AGREEMENT


 


This Agreement (the “Agreement”) is dated as
of November 28, 2005 by and between Tronox Incorporated, a Delaware
corporation (the “Company”), and Roger G. Addison (the “Executive”).


 


WHEREAS, the Company’s Board of Directors
considers the continued services of key executives of the Company to be in the
best interests of the Company and its stockholders; and


 


WHEREAS, the Company’s Board of Directors
desires to assure, and has determined that it is appropriate and in the best
interests of the Company and its stockholders to reinforce and encourage the
continued attention and dedication of key executives of the Company to their
duties of employment without personal distraction or conflict of interest in
circumstances which could arise from the occurrence of a change in control of
the Company; and


 


WHEREAS, the Company’s Board of Directors has
authorized the Company to enter into continuity agreements with those key
executives of the Company and any of its respective subsidiaries (all of such
entities, together with the Company, are hereinafter referred to as an
“Employer”), such agreements to set forth the severance compensation which the
Company agrees under certain circumstances to pay such executives; and


 


WHEREAS, the Executive is a key executive of
an Employer and has been designated as an executive to be offered such a
continuity compensation agreement with the Company.


 


NOW, THEREFORE, in consideration of the
premises and the mutual covenants and agreements contained herein and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and the Executive agree as follows:


 


1.                                     Term.  This Agreement shall become
effective on the date the Company first offers shares of its Class A
common stock in an initial public offering (the “Effective Date”) and remain in
effect until the third anniversary thereof; provided, however,
that this Agreement shall automatically renew for an additional year on each
successive anniversary of the Effective Date, unless an Employer informs the
Executive, in writing, at least 180 days prior to the renewal date, that this
Agreement shall not be renewed.  The
foregoing shall constitute the “Term” of this Agreement for purposes hereof.


 


2.                                     Change in Control.  No
compensation or other benefit pursuant to Section 4 hereof shall be
payable under this Agreement unless and until either (i) a Change in
Control of the Company (as hereinafter defined) shall have occurred while the
Executive is employed by an Employer and the Executive’s employment by an
Employer thereafter shall have terminated in accordance with Section 3
hereof or (ii) the Executive’s employment by an Employer shall have
terminated in accordance with Section 3(a)(ii) hereof prior to the
occurrence of the Change in Control. 
Except as provided in Section 2(e) hereof, for purposes of
this Agreement, a “Change


 





















 


in Control” shall be deemed to have occurred if, beginning on the
Effective Date and before the end of the Term of this Agreement:


 


(a)                               any person (“Person”) as defined in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and as used
in Section 13(d) and 14(d) thereof, including a “group” as
defined in Section 13(d) of the Exchange Act but excluding the
Company and any subsidiary and any employee benefit plan sponsored or
maintained by the Company or any subsidiary (including any trustee of such plan
acting as trustee), directly or indirectly, becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), of securities of the
Company representing 25% or more of the combined voting power of the Company’s
then outstanding securities (other than indirectly as a result of the Company’s
redemption of its securities); or


 


(b)                              the consummation of any merger or other business combination of the
Company, sale of 50% or more of the Company’s assets, liquidation or
dissolution of the Company or combination of the foregoing transactions (the
“Transactions”) other than a Transaction immediately following which the
shareholders of the Company and any trustee or fiduciary of any Company
employee benefit plan immediately prior to the Transaction own at least 60% of
the voting power, directly or indirectly, of (A) the surviving corporation
in any such merger or other business combination; (B) the purchaser of or
successor to the Company’s assets; (C) both the surviving corporation and
the purchaser in the event of any combination of Transactions; or (D) the
parent company owning 100% of such surviving corporation, purchaser or both the
surviving corporation and the purchaser, as the case may be; or


 


(c)                               within any twenty-four month period, the persons who were directors
immediately before the beginning of such period (the “Incumbent Directors”)
shall cease (for any reason other than death) to constitute at least a majority
of the Board or the board of directors of a successor to the Company.  For this purpose, any director who was not a
director at the beginning of such period shall be deemed to be an Incumbent
Director if such director was elected to the Board by, or on the recommendation
of or with the approval of, at least two-thirds of the directors who then
qualified as Incumbent Directors (so long as such director was not nominated by
a person who commenced or threatened to commence an election contest or proxy
solicitation by or on behalf of a Person (other than the Board) or who has
entered into an agreement to effect a Change in Control or expressed an
intention to cause such a Change in Control); or


 


(d)                              a majority of the members of the Board of Directors in office
immediately prior to a proposed transaction determine by a written resolution
that such proposed transaction, if taken, will be deemed a Change in Control
and such proposed transaction is consummated.


 


(e)                               The following events shall not constitute a Change in Control under this
Agreement and shall not be considered in determining whether a Change in
Control has occurred:


 


(i)                                 the sale or purchase of the Company’s Class A
common stock in connection with the initial public offering of such stock;


 


(ii)                              the distribution to Kerr-McGee shareholders of the shares of the Company’s
Class B common stock that Kerr-McGee owns subsequent to the Effective
Date;


 


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(iii)                           Kerr-McGee Corporation exchanging shares of the Company’s Class B
common stock that it owns subsequent to the completion of the initial public
offering of such stock with its shareholders in return for shares of Kerr-McGee
Corporation;


 


(iv)                          any event that qualifies as a “change in control” under the terms of any
agreement providing for continuity compensation under similar terms and
conditions as this Agreement if such agreement was entered into by the
Executive and Kerr-McGee Corporation before the Effective Date of this
Agreement and remains in effect on the date of the qualifying event; or


 


(v)                             if the Executive is not a party to an agreement described in Section 2(e)(iv),
above, any event that would qualify as a “change in control” under the terms of
this Agreement if the term “Kerr-McGee Corporation” were substituted for the
term “Company” in Section 2 hereof and this Section 2(e) were
disregarded.


 


3.                                     Termination of Employment; Definitions.


 


(a)                               Termination without Cause by the Company or for
Good Reason by the Executive.


 


(i)  The Executive shall be entitled to
the compensation provided for in Section 4 hereof, if within two years
after a Change in Control, the Executive’s employment by an Employer shall be
terminated (A) by an Employer for any reason other than (I) the Executive’s
Disability or Retirement, (II) the Executive’s death or (III) for Cause, or (B) by
the Executive with Good Reason (all terms are as hereinafter defined), unless
such termination occurs with the Executive’s prior written consent expressly
waiving the rights provided hereunder.


 


(ii)  In addition, the Executive shall
be entitled to the compensation provided for in Section 4 hereof if, (A) in
the event that an agreement is signed which, if consummated, would result in a
Change of Control and, within 12 months thereafter, the Executive is terminated
without Cause by the Company (other than on account of Executive’s Death or
Disability) or terminates employment with Good Reason prior to the Change in
Control, (B) such termination is at the request or instigation of the
acquiror or merger partner or otherwise in connection with the anticipated
Change in Control, and (C) within said 12 month period, such Change in
Control actually occurs.


 


(b)                              Disability.  For purposes of this Agreement,
“Disability” shall mean the Executive’s absence from the full-time performance
of the Executive’s duties (as such duties existed immediately prior to such
absence) for 180 consecutive business days, when the Executive is disabled as a
result of incapacity due to physical or mental illness.


 


(c)                               Retirement.  For purposes of this Agreement,
“Retirement” shall mean the Executive’s voluntary termination of employment
pursuant to late, normal or early retirement under a pension plan sponsored by
an Employer, as defined in such plan, but only if such retirement occurs prior
to a termination by an Employer without Cause or by the Executive for Good
Reason.


 


(d)                              Cause.  For purposes of this Agreement,
“Cause” shall mean:


 


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(i)                                 the willful and continued failure of the
Executive to perform substantially all of his or her duties with an Employer
(other than any such failure resulting from incapacity due to physical or
mental illness), after a written demand for substantial performance is
delivered to such Executive by the Board of Directors (the “Board”) of the
Company which specifically identifies the manner in which the Board believes
that the Executive has not substantially performed his or her duties;


 


(ii)                              the willful engaging by the Executive in gross misconduct which is
materially and demonstrably injurious to the Company or any Employer; or


 


(iii)                           the conviction of, or plea of guilty or nolo  contendere
to, a felony.


 


Termination of the Executive for Cause shall
be made by delivery to the Executive of a copy of a resolution duly adopted by
the affirmative vote of not less than a three-fourths majority of the
non-employee Directors of the Company or of the ultimate parent of the entity
which caused the Change in Control (if the Company has become a subsidiary) at
a meeting of such Directors called and held for such purpose, after 30 days
prior written notice to the Executive specifying the basis for such termination
and the particulars thereof and a reasonable opportunity for the Executive to
cure or otherwise resolve the behavior in question prior to such meeting,
finding that in the reasonable judgment of such Directors, the conduct or event
set forth in any of clauses (i) through (iii) above has occurred and
that such occurrence warrants the Executive’s termination.


 


(e)                               Good Reason.  For purposes of this Agreement,
“Good Reason” shall mean the occurrence, within the Term of this Agreement, of
any of the following without the Executive’s written consent expressly waiving
the rights provided hereunder:


 


(i)                                 any material and adverse diminution in the
Executive’s duties or responsibilities with the Company (or any affiliate
thereof) from those in effect immediately prior to the Change in Control;


 


(ii)                              any reduction in the Executive’s annual base salary or any adverse
change in bonus opportunity or participation in cash bonus programs in effect
immediately prior to the Change in Control;


 


(iii)                           any requirement that Executive be based at a location more than 35 miles
from the location at which the Executive was based immediately prior to the
Change in Control (or a substantial increase in the amount of travel Executive
is required to do because of a relocation of the executive offices);


 


(iv)                          any failure by the Company to obtain from any successor to the Company
an agreement reasonably satisfactory to the Executive to assume and perform
this Agreement, as contemplated by Section 10(a) hereof; or


 


(v)                             any amendment, reduction or termination of any benefit plan, program or
arrangement, which has the effect of causing the Executive to have benefits
which are not substantially similar, in the aggregate, to those benefits
provided to the Executive immediately prior to the Change in Control.


 


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Notwithstanding the foregoing, in the event
Executive provides the Company with a Notice of Termination (as defined below)
referencing this Section 3(e), the Company shall have 30 days thereafter
in which to cure or resolve the behavior otherwise constituting Good
Reason.  Any good faith determination by
Executive that Good Reason exists shall be presumed correct and shall be
binding upon the Company.


 


(f)                                 Notice of Termination.  Any
purported termination of the Executive’s employment (other than on account of
Executive’s death) with an Employer, if such termination occurs after the
occurrence of a Change in Control or under circumstances specified under Section 3(a)(ii) above,
shall be communicated by a Notice of Termination to the Executive, if such
termination is by an Employer, or to an Employer, if such termination is by the
Executive.  For purposes of this
Agreement, “Notice of Termination” shall mean a written notice which shall indicate
the specific termination provision in this Agreement relied upon and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive’s employment under the provisions so
indicated. 
For purposes of this Agreement, no purported termination of
Executive’s employment with an Employer shall be effective without such a
Notice of Termination having been given.


 


4.                                     Compensation Upon Termination After a Change in
Control.


 


Subject to Section 9 hereof, if within
two years of a Change in Control, the Executive’s employment by an Employer
shall be terminated in accordance with Section 3(a) (the
“Termination”), the Executive shall be entitled to the following payments and
benefits:


 


(a)                               Severance.  The Company shall pay or cause
to be paid to the Executive a cash severance amount equal to (i) three (3) times
the sum of (A) the Executive’s annual base salary on the date of the
Change in Control (or, if higher, the annual base salary in effect immediately
prior to the giving of the Notice of Termination) and (B) the higher
of:  (x) the average of the actual
bonuses earned by the Executive in respect of the three years prior to the year
in which the Change in Control occurs under the Company’s incentive award
program, or (y) the Executive’s target bonus for the year of Termination, plus (ii) in
lieu of continuation of any of the Executive’s perquisites as provided to the
Executive prior to the Change in Control (or, if greater, at the time of
Termination), a cash payment equal to 7 percent of the Executive’s annual base
salary as in effect on the date of the Change in Control for each of the three (3) years
following the date of Termination.  This
cash severance amount shall be payable in a lump sum.


 


(b)                              Additional Payments and Benefits.  The
Executive shall also be entitled to:


 


(i)                                 a lump sum cash payment equal to the sum of (A) the
Executive’s accrued but unpaid annual base salary through the date of
Termination, (B) the unpaid portion, if any, of bonuses previously earned
by the Executive pursuant to the Company’s Executive incentive award program,
plus the pro rata portion of the bonus to be paid for the year in which the
date of Termination occurs (calculated through the date of Termination), (C) an
amount, if any, equal to compensation previously deferred (excluding any
qualified plan deferral) and any accrued vacation pay, in each case, in full
satisfaction of Executive’s rights thereto, and (D) an amount, if any,
equal to the value of the number of performance units that the Executive would
have earned if the performance period for such performance units had ended on
the date of the Change in Control or, if greater, the target number of
performance units under the award.


 


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(ii)                              a lump sum cash payment equal to the aggregate sum of (A) additional
pension contributions in an amount equal to the Company’s contributions under
the Company’s 401(k) plan, profit sharing or other savings pension plans (or
such other qualified and nonqualified defined contribution pension plans as
then in effect) for the three (3) year period following the date of
Termination (the “Separation Period”) (based on assumed rates of Executive’s
contributions at the level of participation in effect as of the last date
Executive was permitted to participate); and (B) the difference between
the discounted present value (i.e., lump sum value) of the annuity benefit the
Executive is entitled to receive under the Company’s qualified and nonqualified
defined benefit retirement programs in which the Executive is a participant
calculated through the date of Termination and the discounted present value
(i.e., lump sum value) of the annuity benefit the Executive would be entitled
to receive under such retirement programs calculated after adding an additional
five years of credit to age and service up to a maximum of age 65 as if the
executive had been paid at the rate used to calculate the payments under Section 4(a),
provided that the additional credits added with respect to each retirement
program shall not exceed five years when added to any additional credits
already provided by the terms of the such programs in respect of the
Termination covered hereby.


 


(iii)                           continued medical, dental, vision, and life insurance coverage
(excluding accident, death, and disability insurance) for the Executive and the
Executive’s eligible dependents or, to the extent such coverage is not
commercially available, such other arrangements reasonably acceptable to the
Executive, on the same basis as in effect prior to the Change in Control or the
Executive’s Termination, whichever is deemed to provide for more substantial
benefits, for a period ending on the earlier of (A) the end of the
Separation Period or (B) the commencement of comparable coverage by the Executive
with a subsequent employer;


 


(iv)                          unless it would adversely affect the Company’s ability to use pooling of
interest accounting in a Change in Control transaction in which such accounting
is intended to be used, immediate 100% vesting of all outstanding stock
options, stock appreciation rights and restricted stock granted or issued by
any Employer to the extent not previously vested on or following the Change of
Control; and


 


(v)                             all other accrued or vested benefits in accordance with the terms of the
applicable plan (with an offset for any amounts paid under Section 4(b)(i)(C),
above).


 


All lump sum payments under this Section 4
shall be paid within 15 business days after Executive’s date of Termination, provided,
however, that such payment shall be made 30 days after Termination in
the event that the Company requires the Executive to sign a release at the time
of Termination.  Discounted present value
(i.e., lump sum value) for purposes of subsection (ii) above shall be
calculated using a discount factor equal to one percentage point below the rate
of interest, per annum, publicly announced by The Chase Manhattan Bank, N.A. as
its prime rate in effect at its principal office in New York City, and using
the actuarial factors set forth in the defined benefit retirement program.


 


(c)                               Outplacement.  If so requested by the
Executive, outplacement services shall be provided by a professional
outplacement provider selected by Executive; provided, however,
that such outplacement services shall be provided the Executive at an aggregate
total cost to the Company of not more than ten (10) percent of such
Executive’s annual base salary.


 


(d)                              Withholding.  Payments and benefits provided
pursuant to this Section 4 shall be subject to any applicable payroll and
other taxes required to be withheld.


 


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5.                                     Compensation Upon Termination for Death,
Disability or Retirement.


 


If an Executive’s employment is terminated by
reason of Death, Disability or Retirement prior to any other termination,
Executive will receive:


 


(a)                               the sum of (i) Executive’s accrued but unpaid salary through the
date of Termination, (ii) the pro rata portion of the Executive’s target
bonus for the year of Executive’s Death or Disability (calculated through the
date of Termination), and (iii) an amount equal to any compensation
previously deferred and any accrued vacation pay; and


 


(b)                              other accrued or vested benefits in accordance with the terms of the
applicable plan (with an offset for any amounts paid under item (a)(iii),
above).


 


6.                                     Excess Parachute Payments.


 


(a) (i) If it is determined (as
hereafter provided) that any payment or distribution by the Company or any
Employer to or for the benefit of the Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise pursuant to or by reason of any other agreement, policy, plan,
program or arrangement, including without limitation any stock option, stock
appreciation right or similar right, or the lapse or termination of any
restriction on or the vesting or exercisability of any of the foregoing (a
“Severance Payment”), would be subject to the excise tax imposed by Section 4999
of the Code (or any successor provision thereto) by reason of being “contingent
on a change in ownership or control” of the Company, within the meaning of Section 280G
of the Code (or any successor provision thereto) or to any similar tax imposed
by state or local law, or any interest or penalties with respect to such excise
tax (such tax or taxes, together with any such interest and penalties, are
hereafter collectively referred to as the “Excise Tax”), then the Executive
shall be entitled to receive an additional payment or payments (a “Gross-Up
Payment”) in an amount such that, after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including any Excise Tax, imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Severance Payments.


 


(ii)                              Subject to the provisions of Section 6(a)(i) hereof, all
determinations required to be made under this Section 6, including whether
an Excise Tax is payable by the Executive and the amount of such Excise Tax and
whether a Gross-Up Payment is required and the amount of such Gross-Up Payment,
shall be made by the nationally recognized firm of certified public accountants
(the “Accounting Firm”) used by the Company prior to the Change in Control (or,
if such Accounting Firm declines to serve, the Accounting Firm shall be a
nationally recognized firm of certified public accountants selected by the
Executive).  The Accounting Firm shall be
directed by the Company or the Executive to submit its preliminary determination
and detailed supporting calculations to both the Company and the Executive
within 15 calendar days after the Termination Date, if applicable, and any
other such time or times as may be requested by the Company or the Executive.  If the Accounting Firm determines that any
Excise Tax is payable by the Executive, the Company shall pay the required
Gross-Up Payment to, or for the benefit of, the Executive within five business
days after receipt of such determination and calculations.  If the Accounting Firm determines that no
Excise Tax is payable by the Executive, it shall, at the same time as it makes
such determination, furnish the Executive with an opinion that he has
substantial authority not to report any Excise Tax on


 


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his/her federal, state, local income or other tax return.  Any determination by the Accounting Firm as
to the amount of the Gross-Up Payment shall be binding upon the Company and the
Executive absent a contrary determination by the Internal Revenue Services or a
court of competent jurisdiction; provided, however, that no such
determination shall eliminate or reduce the Company’s obligation to provide any
Gross-Up Payment that shall be due as a result of such contrary
determination.  As a result of the
uncertainty in the application of Section 4999 of the Code (or any
successor provision thereto) and the possibility of similar uncertainty
regarding state or local tax law at the time of any determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments that will not
have been made by the Company should have been made (an “Underpayment”),
consistent with the calculations required to be made hereunder.  In the event that the Company exhausts or
fails to pursue its remedies pursuant to Section 6(a) hereof and the
Executive thereafter is required to make a payment of any Excise Tax, the
Executive shall direct the Accounting Firm to determine the amount of the
Underpayment that has occurred and to submit its determination and detailed
supporting calculations to both the Company and the Executive as promptly as
possible.  Any such Underpayment shall be
promptly paid by the Company to, or for the benefit of, the Executive within
five business days after receipt of such determination and calculations.


 


(iii)                           The federal, state and local income or other tax returns filed by the
Executive (or any filing made by a consolidated tax group which includes the
Company) shall be prepared and filed on a consistent basis with the determination
of the Accounting Firm with respect to the Excise Tax payable by the
Executive.  The Executive shall make
proper payment of the amount of any Excise Tax, and at the request of the
Company, provide to the Company true and correct copies (with any amendments)
of his/her federal income tax return as filed with the Internal Revenue Service
and corresponding state and local tax returns, if relevant, as filed with the
applicable taxing authority, and such other documents reasonably requested by
the Company, evidencing such payment.  If
prior to the filing of the Executive’s federal income tax return, or
corresponding state or local tax return, if relevant, the Accounting Firm
determines that the amount of the Gross-Up Payment should be reduced, the
Executive shall within five business days pay to the Company the amount of such
reduction.


 


(iv)                          The Company and the Executive shall each provide the Accounting Firm
access to and copies of any books, records and documents in the possession of
the Company or the Executive, as the case may be, reasonably requested by the
Accounting Firm, and otherwise cooperate with the Accounting Firm in connection
with the preparation and issuance of the determination contemplated by Section 6(a) hereof.


 


(v)                             The fees and expenses of the Accounting Firm for its services in
connection with the determinations and calculations contemplated by Sections
6(a)(ii) and (iv) hereof shall be borne by the Company.  If such fees and expenses are initially
advanced by the Executive, the Company shall reimburse the Executive the full
amount of such fees and expenses within five business days after receipt from
the Executive of a statement therefor and reasonable evidence of his/her
payment thereof.


 


(b)                              In the event that the Internal Revenue Service claims that any payment
or benefit received under this Agreement constitutes an “excess parachute
payment,” within the meaning of Section 280G(b)(1) of the Code, the
Executive shall notify the Company in writing of such claim.  Such notification shall be given as soon as
practicable but no later than 10 business days after the Executive is informed
in writing of such claim and shall apprise the Company of the nature of such
claim and the date on which such claim is requested to be paid.


 


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The Executive shall not pay such claim prior to the expiration of the
30 day period following the date on which the Executive gives such notice to
the Company (or such shorter period ending on the date that any payment of taxes
with respect to such claim is due).  If
the Company notifies the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive shall (i) give
the Company any information reasonably requested by the Company relating to
such claim; (ii) take such action in connection with contesting such claim
as the Company shall reasonably request in writing from time to time, including
without limitation, accepting legal representation with respect to such claim
by an attorney reasonably selected by the Company and reasonably satisfactory
to the Executive; (iii) cooperate with the Company in good faith in order
to effectively contest such claim; and (iv) permit the Company to
participate in any proceedings relating to such claim; provided, however,
that the Company shall bear and pay directly all costs and expenses (including,
but not limited to, additional interest and penalties and related legal,
consulting or other similar fees) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an after-tax basis, for and
against any Excise Tax or other tax (including interest and penalties with
respect thereto) imposed as a result of such representation and payment of
costs and expenses.


 


(c)  The Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and sue for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company
directs the Executive to pay such claim and sue for a refund, the Company shall
advance the amount of such payment to the Executive on an interest-free basis,
and shall indemnify and hold the Executive harmless, on an after-tax basis,
from any Excise Tax or other tax (including interest and penalties with respect
thereto) imposed with respect to such advance or with respect to any imputed
income with respect to such advance; and provided, further, that
if the Executive is required to extend the statute of limitations to enable the
Company to contest such claim, the Executive may limit this extension solely to
such contested amount.  The Company’s
control of the contest shall be limited to issues with respect to which a
corporate deduction would be disallowed pursuant to Section 280G of the
Code and the Executive shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other taxing
authority.  In addition, no position may
be taken nor any final resolution be agreed to by the Company without the
Executive’s consent if such position or resolution could reasonably be expected
to adversely affect the Executive (including any other tax position of the
Executive unrelated to matters covered hereby).


 


(d)  If, after the receipt by the
Executive of an amount advanced by the Company in connection with the contest
of the Excise Tax claim, the Executive becomes entitled to receive any refund
with respect to such claim, the Executive shall promptly pay to the Company the
amount of such refund (together with any interest paid or credited thereon
after taxes applicable thereto); provided, however, if the amount
of that refund exceeds the amount advanced by the Company or it is otherwise
determined for any reason that additional amounts could be paid to the Named
Executive without incurring any Excise Tax, any such amount will be promptly
paid by the Company to the named Executive (or shall be applied to reduce any
amount that Executive would otherwise be required to pay the Company).  If, after the receipt by the Executive of an
amount advanced by the Company in connection with an Excise Tax claim, a
determination is made that the Executive shall not be entitled to any refund
with respect to such


 


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claim and the Company does not notify the Executive in writing of its
intent to contest the denial of such refund prior to the expiration of 30 days
after such determination, such advance shall be forgiven and shall not be
required to be repaid and shall be deemed to be in consideration for services
rendered after the date of the Termination.


 


7.                                     Expenses.  In addition to all other
amounts payable to the Executive under this Agreement, the Company shall pay or
reimburse the Executive for reasonable legal fees (including without
limitation, any and all court costs and reasonable attorneys’ fees and
expenses) incurred by the Executive in connection with or as a result of any
claim, action or proceeding brought by the Company or the Executive with
respect to or arising out of this Agreement or any provision hereof; provided,
however, that the Company shall have no obligation to pay any such legal
fees, if (i) in the case of an action brought by the Executive, the
Company is successful in establishing with the court that the Executive’s
action was frivolous or otherwise without any reasonable legal or factual
basis; or (ii) in connection with any such claim, action or proceeding
arising out of Section 12 of this Agreement.


 


8.                                     Obligations Absolute; Non-Exclusivity of
Rights; Joint Several Liability.


 


(a)                               The obligations of the Company to make the payments to the Executive,
and to make the arrangements, provided for herein shall be absolute and
unconditional and shall not be reduced by any circumstances, including without
limitation any set-off, counterclaim, recoupment, defense or other right which
the Company may have against the Executive or any third party at any time.


 


(b)                              Nothing in this Agreement shall prevent or limit the Executive’s
continuing or future participation in any benefit, bonus, incentive or other
plan or program provided by the Company or any other Employer and for which the
Executive may qualify, nor shall anything herein limit or reduce such rights as
the Executive may have under any agreements with the Company or any other
Employer.


 


(c)                               Each entity included in the definition of “Employer” and any successors
or assigns shall be joint and severally liable with the Company under this
Agreement.


 


9.                                     Not an Employment Agreement; Effect On Other
Rights.


 


(a)                               This Agreement is not, and nothing herein shall be deemed to create, a
contract of employment between the Executive and the Company. The Company may
terminate the employment of the Executive by the Company at any time, subject
to the terms of this Agreement and/or any employment agreement or arrangement
between the Company and the Executive that may then be in effect.


 


(b)                              This Agreement supersedes all prior agreements covering change in
control or any other subject matter covered by this Agreement and Executive
hereby represents that the Executive has no other oral or written
representations, understandings or agreements with the Company or any of its
officers, directors or representatives covering any such subject matter and
agrees that any and all prior written agreements relating to such subject
matter shall be terminated effective as of the date of execution of this
Agreement and shall be of no further force or effect.


 


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10.                               Successors; Binding Agreement, Assignment.


 


(a)                               The Company shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of
the business of the Company, by agreement to expressly, absolutely and
unconditionally assume and 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. Failure of the Company to obtain such
agreement prior to the effectiveness of any such succession shall be a material
breach of this Agreement and shall entitle the Executive to terminate the
Executive’s employment with the Company or such successor for Good Reason
immediately prior to or at any time after such succession. As used in this
Agreement, “Company” shall mean (i) the Company as hereinbefore defined,
and (ii) any successor to all the stock of the Company or to all or
substantially all of the Company’s business or assets which executes and
delivers an agreement provided for in this Section 10(a) or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law, including any parent or subsidiary of such a successor.


 


(b)                              This Agreement shall inure to the benefit of and be enforceable by the
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive should
die while any amount would be payable to the Executive hereunder if the
Executive had continued to live, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to the
Executive’s estate or designated beneficiary. 
Neither this Agreement nor any right arising hereunder may be assigned
or pledged by the Executive.


 


11.                               Notice.  For purpose of this Agreement,
notices and all other communications provided for in this Agreement or
contemplated hereby shall be in writing and shall be deemed to have been duly
given when personally delivered, delivered by a nationally recognized overnight
delivery service or when mailed United States certified or registered mail,
return receipt requested, postage prepaid, and addressed, in the case of the
Company, to the Company at:


 


Tronox Incorporated


123 Robert S. Kerr Avenue


P.O. Box 268859


Oklahoma City, Oklahoma 73126-8859


Attention: 
Chief Executive Officer


(with a copy to General Counsel)


 


and in the case of the Executive, to the Executive at the address set
forth on the execution page at the end hereof.


 


Either party may designate a different
address by giving notice of change of address in the manner provided above,
except that notices of change of address shall be effective only upon receipt.


 


12.  Confidentiality.


 


(a)                               The Executive shall retain in confidence any and all confidential
information concerning the Company and its respective business which is now
known or hereafter becomes known to the Executive, except as otherwise required
by law and except information (i) ascertainable or obtained from public
information, (ii) received by the Executive


 


11





















 


at any time after the Executive’s employment by the Company shall have
terminated, from a third party not employed by or otherwise affiliated with the
Company or (iii) which is or becomes known to the public by any means
other than a breach of this Section 12. 
Upon the Termination of employment, the Executive will not take or keep
any proprietary or confidential information or documentation belonging to the
Company.


 


(b)                              The Executive acknowledges and agrees that the Company’s remedies at law
for a breach or threatened breach of any of the provisions of this Section 12
would be inadequate and, in recognition of this fact, Executive agrees that, in
the event of such a breach or threatened breach, in addition to any remedies at
law, the Company, without posting any bond, shall be entitled to cease making
any payments or providing any benefit otherwise required by this Agreement
during the pendency of any dispute involving such Section and to obtain
equitable relief in the form of specific performance, temporary restraining
order, temporary or permanent injunction or any other equitable remedy which
may then be available.  Upon the
resolution of such dispute, any payments or benefits required by this Agreement
which were suspended during the pendency of the dispute shall be paid or
provided to the Executive if it is determined that no breach of this Section 12
occurred.


 


This paragraph 12 shall survive this
Agreement.


 


13.                               Release. In the event that the Company requests a release from the Executive,
in the form attached hereto as Exhibit A, then as a condition to providing
any payments or benefits under this Agreement, the Executive shall deliver such
release.


 


14.                               Miscellaneous.  No provision of this Agreement
may be amended, altered, modified, waived or discharged unless such amendment,
alteration, modification, waiver or discharge is agreed to in writing signed by
the Executive and such officer of the Company as shall be specifically
designated by the Committee or by the Board of Directors of the Company.  No waiver by either party, at any time, of
any breach by the other party of, or of compliance by the other party with, any
condition or provision of this Agreement to be performed or complied with by
such other party shall be deemed a waiver of any similar or dissimilar
provision or condition of this Agreement or any other breach of or failure to
comply with the same condition or provision at the same time or at any prior or
subsequent time.  No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly
set forth in this Agreement.


 


15.                               Severability.  If any one or more of the
provisions of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions of this Agreement shall not be affected thereby. To the extent
permitted by applicable law, each party hereto waives any provision of law
which renders any provision of this Agreement invalid, illegal or unenforceable
in any respect.


 


16.                               Governing Law; Venue.  The
validity, interpretation, construction and performance of this Agreement shall
be governed exclusively by the laws of the State of Delaware without giving effect to its conflict of laws
rules.  For purposes of jurisdiction and
venue, the Company and each Employer hereby consents to jurisdiction and venue
in any suit, action or proceeding with respect to this Agreement in any court
of competent jurisdiction in the state in which Executive resides at the
commencement of such suit, action or proceeding and waives any objection,
challenge or dispute as to such jurisdiction or venue being proper.


 


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17.                               Counterparts.  This Agreement may be executed
in two or more counterparts, each of which shall be an original and all of
which shall be deemed to constitute one and the same instrument.


 


IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the date first above written.


 


	
   

  	
  TRONOX INCORPORATED.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert M. Wohleber

  	
   

  
	
   

  	
   

  	
  Robert M. Wohleber

  	
   

  
	
   

  	
   

  	
  Chairman of the Board

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Roger G. Addison

  	
   

  
	
   

  	
   

  	
  Roger G. Addison

  	
   

  



 


13





















 


Exhibit A


 


RELEASE


 


[                      ]
(“Executive”), for and in consideration of the payments and benefits that
Executive shall receive under this Agreement, hereby executes the following
General Release (“Release”) and agrees as follows:


 


1.                                     Executive, on behalf of Executive, Executive’s
agents, assignees, attorneys, successors, assigns, heirs and executors, to, and
Executive does hereby fully and completely forever release the Company and its
affiliates, predecessors and successors and all of their respective past and/or
present officers, directors, partners, members, managing members, managers,
Executives, agents, representatives, administrators, attorneys, insurers and
fiduciaries in their individual and/or representative capacities (hereinafter
collectively referred to as the “Releasees”), from any and all causes of
action, suits, agreements, promises, damages, disputes, controversies,
contentions, differences, judgments, claims, debts, dues, sums of money,
accounts, reckonings, bonds, bills, specialties, covenants, contracts,
variances, trespasses, extents, executions and demands of any kind whatsoever,
which Executive or Executive’s heirs, executors, administrators, successors and
assigns ever had, now have or may have against the Releasees or any of them, in
law, admiralty or equity, whether known or unknown to Executive, for, upon, or
by reason of, any matter, action, omission, course or thing whatsoever
occurring up to the date this Release is signed by Executive, including,
without limitation, in connection with or in relationship to Executive’s
employment or other service relationship with the Company or its affiliates,
the termination of any such employment or service relationship and any
applicable employment, compensatory or equity arrangement with the Company or
its respective affiliates; provided that such released claims shall not include
any claims to enforce Executive’s rights under, or with respect to, this
Release (such released claims are collectively referred to herein as the
“Released Claims”).


 


2.                                     Notwithstanding the generality of clause (1) above,
the Released Claims include, without limitation, (a) any and all claims
under Title VII of the Civil Rights Act of 1964, the Age Discrimination in
Employment Act of 1967, the Civil Rights Act of 1971, the Civil Rights Act of
1991, the Fair Labor Standards Act, the Executive Retirement Income Security
Act of 1974, the Americans with Disabilities Act, the Family and Medical Leave
Act of 1993, and any and all other federal, state or local laws, statutes, rules and
regulations pertaining to employment or otherwise, and (b) any claims for
wrongful discharge, breach of contract, fraud, misrepresentation or any
compensation claims, or any other claims under any statute, rule, regulation or
under the common law, including compensatory damages, punitive damages,
attorney’s fees, costs, expenses and all claims for any other type of damage or
relief.


 


3.                                     This means that, by signing this Release, the
Executive shall have waived any right to which the Executive may have had to
bring a lawsuit or make any claim against the Releasees based on any acts or
omissions of the releasees up to the date of the signing of this Release.


 


4.                                     Executive represents that he has read carefully
and fully understands the terms of this Release, and that Executive has been
advised to consult with an attorney and have had the opportunity to consult
with an attorney prior to signing this Release. 
Executive acknowledges that he is executing this Release voluntarily and
knowingly and that he has not relied on any representations, promises or
agreements of any kind made to Executive in connection with


 


14





















 


Executive’s decision to accept the terms of this Release, other than
those set forth in this Release. 
Executive acknowledges that Executive has been given at least twenty-one
(21) days to consider whether Executive wants to sign this Release and that the
Age Discrimination in Employment Act gives Executive the right to revoke this
Release within seven (7) days after it is signed, and Executive
understands that he will not receive any payments due him under this Release
until such seven (7) day revocation period (the “Revocation Period”) has
passed and then, only if Executive has not revoked this Release.  To the extent Executive has executed this
Release within less than twenty-one (21) days after its delivery to Executive,
Executive hereby acknowledges that his decision to execute this Release prior
to the expiration of such twenty-one (21) day period was entirely voluntary.


 


 


	
   

  	
   

  	
  TRONOX INCORPORATED

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Executive

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  



 


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