Exhibit 10.08
POLICY TO GRANT SUPPLEMENTAL
DEFERRED COMPENSATION BENEFITS IN
SELECTED INSTANCES TO
A SELECT GROUP OF
MANAGEMENT OR HIGHLY COMPENSATED EMPLOYEES
As Amended and Restated
Through August l, 1989
I. Effective Date:
1.1 The effective date of this Policy (sometimes referred
to as "the Plan") is January 1, 1984.
1.2 Capitalized terms not defined herein shall have the
meaning given to such terms in the Retirement Plan
for Non-Union Employees of Equitable Resources, Inc.,
Equitable Gas-Energy, Equitable Resources Energy
Company, Eastern Kentucky Production Company and PECO
Resources, Inc., as amended and restated effective
January 1, 1984 (Plan A).
II. Authorization:
2.1 Authority is hereby granted to the Chief Executive
Officer of the Company to grant supplemental benefits
to a select group of management or highly compensated
employees who will retire from the Company, or a
related Company, with a benefit based upon less than
thirty (30) years of continuous service.
III. Implementation:
3.1 The decision to implement a benefit under this policy
will be made by means of a Contract entered into
between the designated employee ("Member") and the
Company.
IV. Amount of Benefit:
4.1 The benefit will be in a monthly amount specified in
such Contract, the same having been established by
the Chief Executive Officer of the Company, but in no
event will the amount payable be more than the
benefit to which the employee would be entitled under
the Company's Qualified Defined Benefit Plan if the
employee were to retire at age sixty-five (65) with a
benefit based upon thirty (30) years of service, and
reduced by (a) and (b) below:
(a) The amount of the employee's benefit under the
Company's Defined Benefit Plan, plus
(b) The amount of deferred vested benefit, if any, to
which the employee is entitled on account of his
service with other employers preceding his
employment with the Company.
V. Form of Payment of Benefits:
5.1 Normal Form: The normal form of retirement benefit
payment shall be a single life annuity, payable
monthly, for the life of the Member.
5.2 Qualified Joint and Survivor Annuity: If a Member is
married on the later of his applicable Retirement
Date or the date of his retirement benefit payments
commence under the Plan, his retirement benefit
payment shall be in the form of a Qualified Joint and
Survivor Annuity which is the Actuarial Equivalent of
the normal form of retirement benefit payment. A
Member who would receive the Qualified Joint Survivor
Annuity as provided herein may elect as provided in
Section 5.5 herein to receive his retirement benefit
in the normal form or in one of the following
survivorship optional forms and any such election
shall be an affirmative election not to receive his
benefit in the Qualified Joint and Survivor Annuity
form; provided, however, that any such election shall
be made prior to the commencement of a Member's
services with the Company for which benefits are to
be provided under this Plan; and provided, that any
such election (other than an election to make the
spouse a Joint Annuitant pursuant to Section 5.3 to
receive a monthly benefit after the death of the
Member equal to 75 percent or 100 percent of the
pension paid to the Member) made after December 31,
1984 shall be effective only if the Member obtains
his spouse's consent thereto as provided in Section
5.5(c) herein.
5.3 Survivorship Options: A Member may elect in the
manner hereinafter provided to have the value of this
retirement benefit payment apply to the payment of a
reduced pension to him during this life, and after
his death to his designated surviving Joint Annuitant
in an amount equal to 100 percent of, or 75 percent
of, or 50 percent of, or 25 percent of such reduced
pension. The reduced pensions to be paid to the
Member and to the surviving Joint Annuitant shall be
determined on the basis of actuarial values selected
by the Committee according to the ages of the Member
and of the member's designated Joint Annuitant at the
time the Member retires.
In order for an effective election of an optional
form of benefit to be made hereunder, the following
requirements must be met. The election must be made
before the commencement of the service to be
performed. The present value of benefit payments to
be made to the Member determined as of the date
benefit payments will commence must exceed fifty
percent (50 percent) of the present value of all
payments to be made under the option, except where
the designated Joint Annuitant is the Member's
spouse. The Member must furnish all information
requested by the Committee at the times and in the
form and manner required by it, including specific
designation of the percentage of the benefit payable
to the member under the option which is to be paid to
the Joint Annuitant. A Member may designate only one
Joint Annuitant with respect to his election of an
option. Except as otherwise provided in Section 5.2
all elections hereunder are subject to the provisions
of Section 5.5 relating to election periods and
spousal consents; provided, however, that any such
election shall be made prior to the commencement of a
Member's services with the Company for which benefits
are to be provided under this Plan.
5.4 Pre-retirement Spouse's Benefit:
(a) Death On or After Age Fifty-five: If a Member who
is married on the date of his death and who has
attained age fifty-five dies while actively
employed by the Company, his spouse shall receive
the survivor portion of the Qualified Joint and
Survivor Annuity determined as if the Member had
retired upon the first day of the calendar month
in which he died and elected the immediate
commencement of his benefit payments.
(b) Death On or After Age Fifty-five or Completion of
Twenty-five Years: Effective on and after March
1, 1985, if a Member who is married on the date
of this death and who has attained age fifty-five
or completed twenty-five years of Continuous
Service dies while actively employed by the
Company, his spouse shall receive a benefit,
payable in the form of a single life annuity, in
an amount equal to fifty percent (50 percent) of
the Member's Accrued Benefit determined as of the
first day of the calendar month in which he died
but without reduction for age due to benefit
commencement prior to the date such Member would
have attained age sixty-five, if applicable.
5.5 Commencement and Termination of Benefit: Retirement
benefits shall commence on the Member's Retirement
Date. The survivor annuity payable to a spouse and
the survivor annuity payable to the Member's
designated Joint Annuitant should commence on the
first day of the month next succeeding the month in
which the Member's death occurs. The pre-retirement
spouse's benefit payable under Section 5.4 above
shall commence on the first day of the month next
succeeding the month in which the Member would have
attained age fifty-five (55) or the month which he
died, whichever is the later to occur. All benefit
payments shall cease with payment due immediately
preceding the date of death of the last person
entitled to benefits under the form of benefit
payment being made. Notwithstanding the foregoing, in
the event no effective election of a date for
commencement of benefits is made by a Member, the
payment of benefits hereunder shall commence within
thirty (30) days after the close of the Plan Year in
which occurs the latest of:
(a) attainment of the Member's Normal Retirement Date
or if the Member is not an employee his
sixty-fifth (65) birthday; or
(b) the Member's termination of employment with the
Company; provided, however, the retirement
benefit payments under the Plan shall commence no
later than the April 1 of the calendar year
following the calendar year in which the Member
retires.
At the first day of the month succeeding the month in
which such Member's sixty-fifth (65) birthday
occurred, in the event the whereabouts of a Member
whose only entitlement is to a Deferred Vested
Benefit are not known, a reasonable effort will be
made by the Committee to locate such Member. In the
event the Member cannot be located, the Member's
benefit payments shall commence and shall be held by
the Plan until the earlier of the time the
whereabouts of the Member are made known to the
Committee by the Member or his lawful agent or seven
(7) years subsequent to his Normal Retirement Date,
after which such Member shall be presumed dead and
any other benefit which becomes payable by reason of
such death under the rules of the Plan relating to
form of benefit payment shall be paid thereafter.
5.6 Payments in the Event of Incapacity: In the event it
is determined that a Member, retired Member or other
person entitled to benefits under the Plan, in the
judgement of the Committee, is unable to care for his
affairs because of illness, accident, or incapacity
(either mental or physical), or for any other reason,
the Committee shall cause any payment of a benefit or
refund of contributions to be paid in the form of a
life annuity, payable monthly to a duly appointed
guardian, committee, or other legal representative of
such person, or, if there is no such legal
representative, to his spouse or child or such other
object of natural bounty as the Committee may
determine, or to such person, persons or institutions
as, in the judgement of the Committee, are then
maintaining or have custody of such Member, retired
Member of other person entitled to benefits.
5.7 Nonforfeitability of Benefits: Except as provided by
the Plan, all Member retirement benefits in pay
status and all benefits after attainment of the
Normal Retirement Age shall be nonforfeitable except
in the event of death which shall result in a
forfeiture of all such Member's benefits. These
provisions shall have no application to any
survivorship annuities including the Qualified Joint
and Survivor Annuity which may be payable by reason
of the operation of the rules of this Plan, which
benefits shall terminate by reason of the death of
the survivor annuitant. All benefits provided by the
Plan are personal in nature and shall be payable only
to and during the life of the applicable recipient
and no other person shall inure to any right therein.
For purposes of this Section, "Normal Retirement Age"
shall mean the date on which the Member attains age
sixty-five (65).
5.8 Special Rule for Small Payments: If a benefit
otherwise payable under this Plan is ten dollars
($10.00) or less per month, it shall be paid annually
in a lump sum equal to its commuted value.
Effective on or after January 1, 1985, where the
present value of any benefit otherwise payable under
the Plan, including without limiting the foregoing,
any pre-retirement surviving spouse's benefit, does
not exceed $3,500 (and payment of the benefit has not
commenced) the Committee shall direct the Trustee to
distribute the entire present value in one lump sum
payment.
As used herein, "present value" shall mean the value
of a benefit determined as of the date of
distribution utilizing an interest rate not greater
than the interest rate which would be used (as of the
date of the distribution) by the Pension Benefit
Guaranty Corporation for purposes of determining the
present value of a lump sum distribution on plan
termination.
VI. Death Benefits:
6.1 In the event of the death, after age fifty-five (55)
but prior to retirement, of an employee to whom a
benefit has been granted under this Policy, the
amount payable under the Contract to the employee's
surviving spouse, if any, would be calculated as
under the provisions of the Company's Qualified
Pension Plan, but based upon the benefit provided
under this Policy.
VII. Termination:
7.1 In the event that an employee who has been granted a
benefit under this Policy leaves the employ of the
Company prior to age sixty-two 62 for any reason
other than death or disability, the benefits
described in this employee's Contract may be
forfeited at the discretion of the Chief Executive
Officer of the Company.
VIII. Costs of the Policy:
8.1 The entire cost of benefits and administrative
expenses for benefits granted under this Policy shall
be paid for by the Company as incurred.
IX. Administration:
9.1 Contracts granted under this Policy shall be
administered by the Administrator appointed under the
Qualified Plan. In addition, the terms of the
Qualified Plan shall govern in situations not
specifically provided for herein, but only to the
extent such terms are not inconsistent with the
provisions and intent of the employee's Contract.
X. General Provisions:
10.1 This Policy is intended to provide supplemental
benefits for "a select group of management or highly
compensated employees" as that term is used in
Section 201(2) of ERISA.
10.2 These Contracts are purely voluntary on the part of
the Company. The Company expects and intends to
continue each Contract for life, but necessarily
reserves the right to amend, alter, suspend or
terminate any or all Contracts, in whole or in part,
at any time.
10.3 All rights of a Participant of a Beneficiary under
this Plan shall be mere unsecured creditors' rights
against the Company, with no rights to the assets of
the Company (or any trust in which assets are held
for purposes of this Plan) superior to that of any
other general unsecured creditor.
10.4 Participant's rights payable under the Plan are not
subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge or encumbrance.
Such rights may not be subject to the debts,
contracts, liabilities engagements or torts of the
participants or the participant's beneficiaries.