Participation in the Plan does not create, in favor of any Participant, any right or lien in or against any asset of the Company. Nothing contained in the Plan, and no action taken under its provisions, will create or be construed to create a trust of any kind, or a fiduciary relationship, between the Company and a Participant or any other person. The Company’s promise to pay benefits under the Plan will at all times remain unfunded as to each Participant, whose rights under the Plan are limited to those of a general and unsecured creditor of the Company.
Rights to benefits payable under the Plan are not subject in any manner to alienation, sale, transfer, assignment, pledge, or encumbrance. However, the Administrative Committee may recognize the right of an alternate payee named in a domestic relations order to receive all or part of a Participant’s benefits under the Plan, but only if (a) the domestic relations order would be a “qualified domestic relations order” within the meaning of section 414(p) of the Code (if section 414 (p) applied to the Plan), (b) the domestic relations order does not attempt to give the alternate payee any right to any asset of the Company, (c) the domestic relations order does not attempt to give the alternate payee any right to receive payments under the Plan at a time or in an amount that the Participant could not receive under the Plan, and (d) the amount of the Participant’s benefits under the Plan are reduced to reflect any payments made or due the alternate payee.
No provisions of the Plan and no action taken by the Company, the Board of Directors, the Compensation Committee, or the Administrative Committee will give any person any right to be retained in the employ of the Company, and the Company specifically reserves the right and power to dismiss or discharge any Participant for any reason or no reason and at any time.
The amount of any withholdings required to be made by any government or government agency will be deducted from benefits paid under the Plan to the extent deemed necessary by the Administrative Committee. In addition, the Participant will bear the cost of any taxes not withheld on benefits provided under the Plan, regardless of whether withholding is required, except as provided in Section 4.5 (relating to Gross-Up Payments).
SECTION 8. ADMINISTRATION, INTERPRETATION, AND MODIFICATION OF PLAN
The Administrative Committee will administer the Plan.
8.2. | Powers of the Administrator. |
The Administrative Committee powers include, but are not limited to, the power to adopt rules consistent with the Plan; the power to decide all questions relating to the interpretation of the terms and provisions of the Plan; and the power to resolve all other questions arising under the Plan (including, without limitation, the power to remedy possible ambiguities, inconsistencies, or omissions by a general rule or particular decision). The Administrative Committee has full discretionary authority to exercise each of the foregoing powers.
8.3. | Finality of Committee Determinations. |
Determinations by the Administrative Committee and any interpretation, rule, or decision adopted by the Administrative Committee under the Plan or in carrying out or administering the Plan will be final and binding for all purposes and upon all interested persons, their heirs, and their personal representatives.
If the Administrative Committee determines that any Participant entitled to benefits under the Plan is unable to care for his or her affairs because of illness or accident, any payment due (unless a duly qualified guardian or other legal representative has been appointed) may be paid for the benefit of such Participant to his or her spouse, parent, brother, sister, or other party deemed by the Administrative Committee to have incurred expenses for such Participant. If a Participant dies after having a Qualifying Termination, any payment of the Participant's Severance Benefit remaining due to the Participant will be paid to the Participant's estate at the time such payment would otherwise be paid to the Participant but no later than 90 days after the Participant's death.
8.5. | Amendment, Suspension, and Termination. |
The Board of Directors has the right by written resolution to amend, suspend, or terminate the Plan at any time, except, with respect to a Participant, as provided under the Participant’s Participation Agreement. However, no amendment, suspension, or termination that reduces the benefits to which a Participant is entitled under the Plan will apply to an employee who already is a Participant in the Plan without his or her express written consent if such amendment, suspension, or termination occurs less than one year before, or within the two-year period following, a Change in Control. Notwithstanding the foregoing, the Board of Directors may amend the Plan at any time to comply with Section 409A.
Energy Conversion Devices, Inc.
Executive Severance Plan | Page 17
September 30, 2008 |
8.6. | Power to Delegate Authority. |
The Board of Directors and the Administrative Committee may, in their sole discretion, delegate to any person or persons all or part of its authority and responsibility under the Plan, including, without limitation, the authority to amend the Plan.
The headings used in this document are for convenience of reference only and may not be given any weight in interpreting any provision of the Plan.
If an arbitrator or court of competent jurisdiction determines that any term, provision, or portion of this Plan is void, illegal, or unenforceable, the other terms, provisions, and portions of this Plan will remain in full force and effect, and the terms, provisions, and portions that are determined to be void, illegal, or unenforceable will either be limited so that they will remain in effect to the extent permissible by law, or such arbitrator or court will substitute, to the extent enforceable, provisions similar thereto or other provisions, so as to provide to the Company, to the fullest extent permitted by applicable law, the benefits intended by this Plan.
The Plan will be construed, administered, and regulated in accordance with the laws of Michigan (excluding any conflicts or choice of law rule or principle), except to the extent that those laws are preempted by federal law.
8.10. | Complete Statement of Plan. |
This Plan contains a complete statement of its terms. The Plan may be amended, suspended, or terminated only in writing and then only as provided in Section 8.5 or 8.6. A Participant’s right to any benefit of a type provided under the Plan will be determined solely in accordance with the terms of the Plan. No other evidence, whether written or oral, will be taken into account in interpreting the provisions of the Plan. Notwithstanding the preceding provisions of this Section 8.10, for purposes of determining benefits with respect to a Participant, this Plan will be deemed to include (a) the provisions of any Participation Agreement executed in accordance with Section 3.2, and (b) the provisions of any other written agreement between the Company and the Participant to the extent such other agreement explicitly provides for the incorporation of some or all of its terms into this Plan.
Energy Conversion Devices, Inc.
Executive Severance Plan | Page 18
September 30, 2008 |
SECTION 9. CLAIMS AND APPEALS
9.1. | Application of Claims and Appeals Procedures. |
| (a) | The provisions of this Section 9 will apply to any claim for a benefit under the Plan, regardless of the basis asserted for the claim and regardless of when the act or omission upon which the claim is based occurred. |
| (b) | No claim for non-payment or underpayment of benefits allegedly owed under the Plan may be filed in court until the claimant has exhausted the claims review procedures established in accordance with this Section 9. |
| (a) | Any claim for benefits will be in writing (which may be electronic if permitted by the Administrative Committee) and will be delivered to a claims administrator designated in writing by the Administrative Committee |
| (b) | Each claim for benefits will be decided by the claims administrator or the Administrative Committee (as determined by the Administrative Committee) within a reasonable period of time, but not later than 90 days after such claim is received by the claims administrator (without regard to whether the claim submission includes sufficient information to make a determination), unless the claims administrator or the Administrative Committee determines that special circumstances require an extension of time for processing the claim. If the claims administrator or the Administrative Committee determines that an extension of time for processing is required, the claims administrator or the Administrative Committee will notify the claimant in writing before the end of the initial 90-day period of the circumstances requiring an extension of time and the date by which a decision is expected. |
| (c) | If any claim is denied in whole or in part, the claims administrator or the Administrative Committee will provide to the claimant a written decision, issued by the end of the period prescribed by subsection (b), above, that includes the following information: |
| (1) | The specific reason or reasons for denial of the claim; |
(2) References to the specific Plan provisions upon which such denial is based;
(3) A description of any additional material or information necessary to perfect the claim, and an explanation of why such material or information is necessary;
(4) An explanation of the appeal procedures Plan’s and the applicable time limits; and
(5) A statement of the claimant’s right to bring a civil action under section 502(a) of ERISA, if his or her claim is denied upon review.
Energy Conversion Devices, Inc.
Executive Severance Plan | Page 19
September 30, 2008 |
| (a) | If a claim for benefits is denied in whole or in part, the claimant may appeal the denial to the Administrative Committee. Such appeal will be in writing (which may be electronic, if permitted by the Administrative Committee), may include any written comments, documents, records, or other information relating to the claim for benefits, and will be delivered to the Administrative Committee within 60 days after the claimant receives written notice that his or her claim has been denied. |
| (b) | The Administrative Committee will decide each appeal within a reasonable period of time, but not later than 60 days after such claim is received by the Administrative Committee, unless the Administrative Committee determines that special circumstances require an extension of time for processing the appeal. |
(1) If the Administrative Committee determines that an extension of time for processing is required, the Administrative Committee will notify the claimant in writing before the end of the initial 60-day period of the circumstances requiring an extension of time and the date by which the claims administrator expects to render a decision.
(2) If an extension of time pursuant to paragraph (1), above, is due to a claimant’s failure to submit information necessary to decide the appeal, the period for deciding the appeal will be tolled from the date on which the notification of extension is sent to the claimant until the date on which the claimant responds to the request for additional information.
| (c) | In connection with any appeal, a claimant will be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to his or her claim for benefits. A document, record, or other information will be considered relevant to a claim for benefits if such document, record, or other information: |
| (1) | Was relied upon in making the benefit determination; |
(2) Was submitted, considered, or generated in the course of making the benefit determination, without regard to whether such document, record, or other information was relied upon in making the benefit determination; or
(3) Demonstrates compliance with processes and safeguards designed to ensure and to verify that the benefit determination was made in accordance with the terms of the Plan and that such terms of the Plan have been applied consistently with respect to similarly situated claimants.
| (d) | The Administrative Committee review on appeal will take into account all comments, documents, records and other information submitted by the claimant, without regard to whether such information was considered in the initial benefit determination. |
Energy Conversion Devices, Inc.
Executive Severance Plan | Page 20
September 30, 2008 |
| (e) | If any appeal is denied in whole or in part, the Administrative Committee will provide to the claimant a written decision, issued by the end of the period prescribed by subsection (b), above, that includes the following information: |
| (1) | The specific reason or reasons for the decision; |
(2) References to the specific Plan provisions upon which the decision is based;
(3) An explanation of the claimant’s right to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to his or her claim for benefits (as determined pursuant to subsection (c), above); and
(4) A statement of the claimant’s right to bring a civil action under section 502(a) of ERISA.
9.4. | Other Rules and Rights Regarding Claims and Appeals. |
| (a) | A claimant may authorize a representative to pursue any claim or appeal on his or her behalf. The Administrative Committee may establish reasonable procedures for verifying that any representative has in fact been authorized to act on his or her behalf. |
| (b) | Notwithstanding the deadlines prescribed by this 9.4, the Administrative Committee and any claimant may agree to a longer period for deciding a claim or appeal or for filing an appeal, provided that the Administrative Committee will not extend any deadline for filing an appeal unless imposition of the deadline prescribed by Section 9.3(a) would be unreasonable under the applicable circumstances. |
The provisions of this Section 9 are intended to comply with section 503 of ERISA and will be administered and interpreted in a manner consistent with such intent.
Energy Conversion Devices, Inc.
Executive Severance Plan | Page 21
September 30, 2008 |
EXHIBIT A
DRAFT RELEASE
In consideration of the benefits I am entitled to receive under the Energy Conversion Devices, Inc. Executive Severance Plan (the “Plan”), I, [employee name], on behalf of myself, and on behalf of my heirs, successors and assigns, hereby agree to release Energy Conversion Devices, Inc. (the “Company”), all of its past, present and future subsidiaries, affiliates, directors, officers, employees; and all of its and their respective heirs, successors, and assigns (the “Released Parties”) from any and all claims, demands, actions, and liabilities that I might otherwise have asserted arising out of my employment with the Company, including the termination of that employment.
I also promise not to sue the Company or any of the Released Parties based, in whole or in part, on any claims relating to my employment with the Company or the termination of that employment. However, I am not releasing my rights, if any, under the Plan or any qualified employee retirement plan, nor am I releasing any rights or claims that may arise after the date on which I sign this Release. Those rights, and only those rights, survive unaffected by this Release.
I understand that as a consequence of my signing this Release I am giving up, with respect to my employment and the termination of that employment, any and all rights I might otherwise have under (1) the Age Discrimination in Employment Act of 1967, as amended; (2) and all other federal, state or municipal laws prohibiting discrimination in employment on the basis of sex, race, national origin, religion, age, handicap or other invidious factor; and (3) any and all theories of contract or tort law, whether based on common law or otherwise.
I acknowledge and agree that:
1. | The benefits I am receiving under the Plan constitute consideration over and above any benefits that I might be entitled to receive without executing this Release. |
2. | The Company advised me in writing to consult with an attorney prior to executing a copy of the Plan document and the Release. |
3. | I was given a period of at least 21 days within which to consider the Plan and the Release. |
4. | The Company has advised me of my statutory right to revoke my acceptance of the terms of the Plan and this Release at any time within seven (7) days of my signing of this Release. |
5. | I remain subject to and will continue to comply with the restrictive covenants set forth in Section 5 of the Plan. |
6. | I warrant and represent that my decision to accept the Plan (including this Release) was (a) entirely voluntary on my part; (b) not made in reliance on any inducement, promise or representation, whether express or implied, other than the inducements, representations and promises expressly set forth in the Plan or in the Release; and (c) did not result from any threats or other coercive activities to induce acceptance of the Plan or Release. |
Energy Conversion Devices, Inc.
Executive Severance Plan | Page A-1
September 30, 2008 |
In the event I decide to exercise my right to revoke within seven (7) days of my acceptance of this Release, I warrant and represent that I will do the following: (1) notify the Company in writing of my intent to revoke my agreement, and (2) simultaneously return in full the consideration received from the Company under the Plan. I acknowledge that, if I revoke this Release during the revocation period, I will not be entitled to the benefits under the Plan.
I further warrant and represent that I fully understand and appreciate the consequence of my signing this Release.
IN WITNESS WHEREOF, I hereby acknowledge receipt of consideration and execute the foregoing agreement at ___, this ____ day of ____________, 20__.
_______________________________
[name of employee]
Witnessed by _______________ on this _____ day of ____________, 20_.
_______________________________
WITNESS
Energy Conversion Devices, Inc.
Executive Severance Plan | Page A-2
September 30, 2008 |
