EXHIBIT 10 iii(p)
IR EXECUTIVE DEFERRED COMPENSATION PLAN
[As Amended and Restated Effective January 1, 2001]
TABLE OF CONTENTS
SECTION 1 - STATEMENT OF PURPOSE 1
SECTION 2 - DEFINITIONS
2.1 Account Balance 2
2.2 Administrative Committee 2
2.3 Base Salary 2
2.4 Beneficiary 2
2.5 Beneficiary Designation Form 2
2.6 Cash Incentive Compensation Award 2
2.7 Change in Control 2
2.8 Code 2
2.9 Compensation Committee 3
2.10 Deferral Account 3
2.11 Deferral Amount 3
2.12 Disability 3
2.13 Discretionary Company Contribution 3
2.14 Discretionary Company Contribution Account 3
2.15 Dividends on Stock Grants 3
2.16 Early Distribution 3
2.17 Elected Officer 3
2.18 Election Form 3
2.19 Eligible Employee 4
2.20 ERISA 4
2.21 Investment Option Subaccounts 4
2.22 IR Stock 4
2.23 IR Stock Account 4
2.24 Participant 4
2.25 Plan Year 4
2.26 Retirement 4
2.27 Return 4
2.28 Service 4
2.29 Supplemental Contribution 5
2.30 Supplemental Contribution Account 5
2.31 Trust 5
2.32 Unforseeable Financial Emergency 5
SECTION 3 - ADMINISTRATION OF THE PLAN 6
SECTION 4 - PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT
ELECTION
4.1 Participation and Deferral Election 7
4.2 Investment Election 7
SECTION 5 - VESTING
5.1 Deferral Amounts 9
5.2 Supplemental Contributions 9
5.3 Discretionary Contributions 9
SECTION 6 - ACCOUNTS AND VALUATIONS
6.1 Deferral Accounts 10
6.2 Supplemental Contribution Accounts 10
6.3 Discretionary Contribution Accounts 11
6.4 IR Stock Accounts 12
6.5 Changes in Capitalization 13
6.6 Accounts are Boookkeeping Entries 13
SECTION 7 - DISTRIBUTON OF ACCOUNTS
7.1 Termination with Five Years of Service, Retirement,
Disability and Death 14
7.2 Scheduled Distributions Prior to Termination of
Employment 15
7.3 Termination of Employment Prior to Completing Five
(5) Years of Service 16
7.4 Hardship Distribution 16
7.5 Early Distributions (with forfeiture) 16
7.6 Form of Payments of IR Stock 17
7.7 Taxes; Withholding 17
SECTION 8 - BENEFICIARY DESIGNATION 18
SECTION 9 - AMENDMENT AND TERMINATION OF PLAN
9.1 Amendment 19
9.2 Termination of Plan 19
SECTION 10 - MISCELLANEOUS
10.1 Unsecured General Creditor 20
10.2 Entire Agreement; Successors 20
10.3 Non-Assignability 20
10.4 No Contract of Employment 20
10.5 Authorization and Source of Shares 20
10.6 Singular and Plural 21
SECTION 10 - MISCELLANEOUS - (Continued)
10.7 Captions 21
10.8 Applicable Law 21
10.9 Severability 21
10.10 Notice 21
IR Executive Deferred Compensation Plan
As Amended and Restated Effective January 1, 2001
SECTION 1
STATEMENT OF PURPOSE
The purpose of the IR Executive Deferred Compensation Plan
(the "Plan") is to further increase the mutuality of
interest between Ingersoll-Rand Company (the "Company"), its
employees and stockholders by providing a select group of
management and highly compensated employees the opportunity
to elect to defer receipt of cash compensation. The Plan
shall be unfunded for tax purposes and for purposes of Title
I of ERISA. The Plan, originally known as the Ingersoll-
Rand Company Executive Deferred Compensation and Stock Bonus
Plan, became effective on January 1, 1997 and was amended
and restated effective January 1, 2001.
SECTION 2
DEFINITIONS
2.1 "Account Balance" means, for each Plan Year, a credit on the
records of the Company equal to the sum of the value of a
Participant's Deferral Account, Supplemental Contribution
Account, Discretionary Contribution Account and IR Stock Account
for such Plan Year. The Account Balance shall be a bookkeeping
entry only and shall be utilized solely as a device for the
measurement and determination of the amounts to be paid in cash
or IR Stock, as applicable, to a Participant, or to the
Participant's designated Beneficiary, pursuant to the Plan.
2.2 "Administrative Committee" means the committee appointed by
the Chief Executive Officer of the Company which will administer
the Plan in accordance with the duties delegated to it by the
Compensation and Nominating Committee of the Board of Directors
of the Company or as set forth herein.
2.3 "Base Salary" means a Participant's annual base salary,
excluding bonuses, commissions, incentive compensation
and all other remuneration for services rendered to the
Company and prior to reduction for any salary
contributions to a plan established pursuant to Code
Section 125 or qualified pursuant to Code Section
401(k).
2.4 "Beneficiary" means the person or persons designated as
such in accordance with Section 8.
2.5 "Beneficiary Designation Form" means the form
established from time to time by the Administrative
Committee that a Participant completes and returns to
the Administrative Committee to designate one or more
Beneficiaries.
2.6 "Cash Incentive Compensation Award" means the
Participant's annual cash incentive compensation award
(annual cash bonus award).
2.7 "Change in Control" means a "change in control of the
Company" (as set forth in the Company's Incentive Stock
Plan of 1998) or any sale, lease, exchange or other
transfer (in one transaction or a series of related
transactions) of all, or substantially all, of the
assets of the Company, other than any sale, lease,
exchange or other transfer to any person or entity
where the Company owns, directly or indirectly, at
least 80 percent of the outstanding voting securities
of such person or entity after any such transfer,
unless a different definition is used for purposes of
any severance of employment agreement or change of
control arrangement between the Company and a
Participant, in which event such definition shall
apply.
2.8 "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
2.9 "Compensation Committee" means the Compensation and
Nominating Committee of the Board of Directors of the
Company.
2.10 "Deferral Account" means, for each Plan Year, (i) the
sum of all of a Participant's Deferral Amounts, plus
(ii) amounts credited in accordance with all the
applicable crediting provisions of the Plan that relate
to the Participant's Deferral Account, less (iii) all
distributions made to the Participant or to the
Participant's Beneficiary pursuant to the Plan that
relate to the Participant's Deferral Account.
2.11 "Deferral Amount" means the amount of a Participant's
Cash Incentive Compensation Award, Base Salary and
Dividends on Stock Grants actually deferred under the
Plan by the Participant pursuant to Section 4 for any
one Plan Year.
2.12 "Disability" means the Participant is eligible to
receive benefits under a long-term disability plan
maintained by the Company.
2.13 "Discretionary Company Contribution" means an additional
amount to be credited to a Participant's Discretionary
Contribution Account for a Plan Year.
2.14 "Discretionary Company Contribution Account" means, for each
Plan Year, (i) the sum of all of a Participant's Discretionary
Company Contributions, plus (ii) amounts credited in accordance
with all the applicable crediting provisions of the Plan that
relate to the Participant's Discretionary Company Contribution
Account, less (iii) all distributions made to the Participant or
to the Participant's Beneficiary pursuant to the Plan that relate
to the Participant's Discretionary Company Contribution Account.
2.15 "Dividends on Stock Grants" means the dividend
equivalents on deferred and/or unearned stock grants
paid or payable to a Participant pursuant to the
Ingersoll-Rand Company Incentive Stock Plan of 1998.
2.16 "Early Distribution" means an election by the
Participant, pursuant to Section 7.5, to receive a
distribution of amounts from the Participant's Deferral
Account, IR Stock Account, vested Discretionary Company
Contribution Account and vested Supplemental
Contribution Account with respect to a specific Plan
Year prior to the time at which such Participant would
otherwise be entitled to such amounts.
2.17 "Elected Officer" means an officer of the Company
elected to such position by the Board of Directors of
the Company.
2.18 "Election Form" means the form or forms established
from time to time by the Administrative Committee that
a Participant completes, signs and returns to the
Administrative Committee to make an election under the
Plan. An Election Form also includes any other method
approved by the Administrative Committee, in its sole
and absolute discretion, that a Participant may use to
make an election under the Plan. The terms and
conditions specified in the Election Form(s) are
incorporated by reference herein and form a part of the
Plan. If there is a conflict between the Election Form
and the Plan, the terms of the Plan shall control and
govern.
2.19 "Eligible Employee" means an Elected Officer or, an
individual who is among a select group of management
and highly compensated employees of the Company who has
been selected by the Administrative Committee, in its
sole and absolute discretion, to participate in the
Plan.
2.20 "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time.
2.21 "Investment Option Subaccounts" means the separate
subaccounts, each of which corresponds to an investment
option elected by the Participant or, as provided in
Section 6.3 regarding Discretionary Company
Contributions, the Administrative Committee, with
respect to a Participant's Deferral Accounts and/or
Discretionary Company Contribution Accounts, as
applicable.
2.22 "IR Stock" means the common stock of the Company.
2.23 "IR Stock Account" means, for each Plan Year, (i) the
sum of all of a Participant's Deferral Amounts and
Discretionary Company Contributions that are deemed to
be invested in IR Stock, plus (ii) amounts credited in
accordance with all the applicable crediting provisions
of the Plan that relate to the Participant's IR Stock
Account, less (iii) all distributions made to the
Participant or to the Participant's Beneficiary
pursuant to the Plan that relate to the Participant's
IR Stock Account.
2.24 "Participant" means an Eligible Employee participating
in the Plan in accordance with the provisions of
Section 4.
2.25 "Plan Year" means a calendar year.
2.26 "Retirement" means termination of employment by a
Participant after he or she has attained age 65 (62 for
Elected Officers) or termination at or after age 55
with at least five (5) years of Service.
2.27 "Return" means, for each investment option, an amount
equal to the net investment return (including changes
in value and distributions) for each such investment
option during each business day.
2.28 "Service" means periods of service with the Company as
determined by the Administrative Committee in its sole
and absolute discretion.
2.29 "Supplemental Contribution" means an additional amount
to be credited to a Participant's Supplemental
Contribution Account equal to twenty percent (20%) of
the Participant's Cash Incentive Compensation Award and
Base Salary that is deferred under the Plan for a Plan
Year and that is designated by the Participant on an
Election Form at the time of making the deferral
election to be deemed to be invested in the IR Stock
Account. Supplemental Contributions shall be available
and credited only to Participants whose job category
indicates specified ownership guidelines as determined
by the Compensation Committee in its sole and absolute
discretion.
2.30 "Supplemental Contribution Account" means, for each
Plan Year, (i) the sum of all of a Participant's
Supplemental Contributions, plus (ii) amounts credited
in accordance with all the applicable crediting
provisions of the Plan that relate to the Participant's
Supplemental Contribution Account, less (iii) all
distributions made to the Participant or to the
Participant's Beneficiary pursuant to the Plan that
relate to the Participant's Supplemental Contribution
Account.
2.31 "Trust" means the Ingersoll-Rand Company Deferred
Compensation Trust Agreement, dated as of January 1,
2001 between the Company and the trustee named therein,
as amended from time to time.
2.32 "Unforeseeable Financial Emergency" means severe
financial hardship to the Participant resulting from a
sudden and unexpected illness or accident of the
Participant or a dependent of the Participant, loss of
the Participant's property due to casualty or other
similar or extraordinary and unforeseeable
circumstances arising as a result of events beyond the
control of the Participant. The circumstances that
would constitute an unforeseeable financial emergency
will depend upon the facts of each case, but, in any
case, a hardship benefit may not be made to the extent
that such hardship is or may be relieved (i) through
reimbursement or compensation by insurance or
otherwise, (ii) by liquidation of the Participant's
assets, to the extent the liquidation of assets would
not itself cause severe financial hardship, or (iii) by
cessation of Deferral Amounts under the Plan.
SECTION 3
ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Compensation Committee
(or any successor committee). The Compensation Committee
has delegated authority to the Administrative Committee to
administer the Plan in accordance with the provisions of
this Section. Notwithstanding the previous sentence, the
Compensation Committee shall retain authority for
determining (i) a Participant's eligibility to receive
Supplemental Contributions, and (ii) eligibility for, and
the amount of, Discretionary Company Contributions with
respect to Participants whose job category indicate
specified ownership guidelines as determined by the
Compensation Committee.
The primary responsibility of the Administrative Committee
is to administer the Plan for the exclusive benefit of
Participants and their Beneficiaries, subject to the
specific terms of the Plan. The Administrative Committee
shall administer the Plan in accordance with its terms to
the extent consistent with applicable law, and shall have
the power to determine all questions arising in connection
with the administration, interpretation, and application of
the Plan. Any such determination by the Administrative
Committee shall be conclusive and binding upon all affected
parties. Any denial by the Administrative Committee of a
claim for benefits under the Plan by a Participant or
Beneficiary shall be stated in writing by the Administrative
Committee and delivered or mailed to the Participant or
Beneficiary. Such notice shall set forth the specific
reasons for the Administrative Committee's decision. In
addition, the Administrative Committee shall afford a
reasonable opportunity to any Participant or Beneficiary
whose claim for benefits has been denied for a review of the
decision denying this claim.
SECTION 4
PARTICIPATION, DEFERRAL ELECTION AND INVESTMENT ELECTION.
4.1 Participation and Deferral Election. Any Eligible
Employee may elect to participate in the Plan for a
given Plan Year by filing a completed Election Form for
the Plan Year in the manner prescribed by the
Administrative Committee. The Election Form must
specify the percentage or dollar amount of any Deferral
Amount otherwise payable during such Plan Year that
will be deferred under the Plan. Notwithstanding the
previous sentence, an election to defer Dividends on
Stock Grants shall be equal to one hundred percent
(100%) of the Dividends on Stock Grants. The minimum
total dollar amount of a Participant's Deferral Amount
that a Participant may defer under the Plan for any
Plan Year is $5,000. Any election to defer a Deferral
Amount is irrevocable upon the filing of the Election
Form, and must be properly completed and filed no later
than the November 30 immediately preceding such Plan
Year, or such other date as the Administrative
Committee may specify. An Eligible Employee who fails
to file a properly completed Election Form by such date
will be ineligible to defer a Deferral Amount under the
Plan for the following Plan Year. In addition, the
Administrative Committee, in its sole and absolute
discretion, may establish from time to time such other
enrollment requirements as it determines are necessary
or proper.
Notwithstanding anything to the contrary, the
Administrative Committee, in its sole and absolute
discretion, shall determine from time to time the
percentage of Base Salary that may be deferred by
Participants under the Plan in any Plan Year. Once
such a determination is made the percentage shall
remain in effect until changed by the Administrative
Committee.
If the Administrative Committee determines in good
faith that a Participant no longer qualifies as a
member of a select group of management or highly
compensated employees, as membership in such group is
determined in accordance with ERISA Sections 201(2),
301(a)(3) and 401(a)(1), the Administrative Committee
shall have the right, in its sole and absolute
discretion, to (i) terminate any deferral election the
Participant has made for the remainder of the Plan Year
in which the Participant's membership status changes,
(ii) prevent the Participant from making future
deferral elections and/or (iii) immediately distribute
the Participant's then vested Account Balances and
terminate the Participant's participation in the Plan.
4.2 Investment Election. In accordance with procedures
established by the Administrative Committee in its sole
and absolute discretion, prior to the time a Participant's
Deferral Amounts are credited to a Participant's Deferral
Account pursuant to Section 6.1, the Participant shall
designate, on an Election Form, the types of investment
options in which the Participant's Deferral Amounts will
be deemed to be invested for purposes of determining the
amount of earnings to be credited to the Participant's
Deferral Account and, with respect to Deferral Amounts
that are designated by the Participant to be deemed to be
invested in IR Stock, the IR Stock Account.
Subject to the right of the Administrative Committee to
direct the types of investment options in which a
Participant's Discretionary Company Contributions will
be deemed to be invested as described in Section 6.3,
in the event a Participant receives a Discretionary
Company Contribution, the Participant shall, at the
time designated by the Administrative Committee, in its
sole and absolute discretion, designate, on an Election
Form, the types of investment options in which the
Participant's Discretionary Company Contributions will
be deemed to be invested for purposes of determining
the amount of earnings to be credited to the
Participant's Discretionary Company Contribution
Account and, with respect to Discretionary Company
Contributions that are designated by the Participant to
be deemed to be invested in IR Stock, the IR Stock
Account.
Subject to Section 6.4, in making the designations
pursuant to this Section, the Participant may specify
that all or any portion of the Participant's Deferral
Amount and, subject to Section 6.3, Discretionary
Company Contributions be deemed to be invested, in
whole percentage increments, in one or more of the
types of investment options provided under the Plan as
communicated from time to time by the Administrative
Committee. A Participant may change the designation
made under this Section with respect to prior and/or
future Deferral Amounts and/or, subject to Section 6.3,
prior and/or future Discretionary Company Contributions
by filing an Election Form no later than the time
specified by the Administrative Committee, in its sole
and absolute discretion, to be effective as of the
first business day of the following month. Except for
Discretionary Company Contributions that the
Administrative Committee, pursuant to Section 6.3, has
directed the investment options in which a
Participant's Discretionary Company Contributions shall
be deemed to be invested, if a Participant fails to
elect a type of investment option under this Section,
he or she shall be deemed to have elected the
investment option designated by the Administrative
Committee as the default investment option.
SECTION 5
VESTING
5.1. Deferral Amounts. A Participant shall be fully vested
in his or her Deferral Account.
5.2. Supplemental Contributions. A Participant shall vest in his
or her Supplemental Contribution Account on the earliest of: (i)
the fifth anniversary of the date the Supplemental Contribution
is credited to the Participant's Supplemental Contribution
Account; (ii) the date of the Participant's Retirement; (iii) the
Participant's Disability, (iv) the Participant's death; (v) a
Change in Control; or (vi) a termination of the Plan pursuant to
Section 9.2.
5.3 Discretionary Contributions. A Participant shall vest
in his or her Discretionary Company Contribution
Account on the earliest of (i) the date determined by
the Administrative Committee; (ii) the date of the
Participant's Disability; (iii) the date of the
Participant's death; (iv) a Change in Control or (v) a
termination of the Plan pursuant to Section 9.2.
SECTION 6
ACCOUNTS AND VALUATIONS
6.1 Deferral Accounts. The Administrative Committee shall
establish and maintain a separate Deferral Account for each
Participant for each Plan Year. All Deferral Amounts, other than
Deferral Amounts that are deemed, at the Participant's election,
to be invested in IR Stock shall be credited to the Participant's
Deferral Account on the date when the Deferral Amount would
otherwise be paid to the Participant. All Deferral Amounts that
are deemed, at the Participant's election, to be invested in IR
Stock shall be credited to the Participant's IR Stock Account as
described in Section 6.4.
Each Participant's Deferral Accounts shall be divided
into Investment Option Subaccounts. A Participant's
Deferral Accounts shall be credited as follows:
(a) On the day a Deferral Amount is credited to a Participant's
Deferral Account, the Administrative Committee shall credit
the Investment Option Subaccounts of the Participant's
Deferral Account with an amount equal to the Participant's
Deferral Amount in accordance with the Participant's
Election Form; that is, the portion of the Participant's
Deferral Amount that the Participant has elected to be
deemed to be invested in a certain type of investment
option shall be credited to the Investment Option
Subaccount corresponding to that investment option, and
(b) Each business day, each Investment Option
Subaccount of a Participant's Deferral Account
shall be adjusted for earnings or losses in an
amount equal to that determined by multiplying the
balance credited to such Investment Option
Subaccount as of the prior day plus contributions
credited that day to the Investment Option
Subaccount by the Return for the corresponding
investment option.
6.2 Supplemental Contribution Accounts. The Administrative
Committee shall establish and maintain a separate
Supplemental Contribution Account for each Plan Year
for each Participant who receives a Supplemental
Contribution for such Plan Year. All Supplemental
Contributions shall be credited to the Participant's
Supplemental Contribution Account on the same date that
the Participant's Deferral Amount applicable to Base
Salary or a Cash Incentive Compensation Award for which
the Supplemental Contribution is being made is credited
to the Participant's Deferral Account pursuant to
Section 6.1. Notwithstanding anything to the contrary,
a Participant may not designate the investment of
Supplemental Contributions and all of a Participant's
Supplemental Contributions shall be deemed to be
invested in, and shall remain deemed to be invested in,
IR Stock in the Participant's Supplemental Contribution
Account until distributed from the Plan.
All Supplemental Contributions shall be credited to a
Participant's Supplemental Contribution Account in
units or fractional units. The value of each unit
shall be determined each business day and shall equal
the closing price of one share of IR Stock on the New
York Stock Exchange-Composite Tape. On each date that
Supplemental Contributions are credited to a
Participant's Supplemental Contribution Account, the
number of units to be credited shall be determined by
dividing the amount of such Supplemental Contributions
by the value of a unit on such date.
Dividends paid on IR Stock shall be reflected in a
Participant's Supplemental Contribution Account by the
crediting of additional units or fractional units.
Such additional units or fractional units shall equal
the value of the dividends based upon the closing price
of one share of IR Stock on the New York Stock Exchange-
Composite Tape on the date such dividends are paid.
6.3 Discretionary Company Contribution Accounts. The
Administrative Committee shall establish and maintain a
separate Discretionary Company Contribution Account for
each Plan Year for each Participant who receives a
Discretionary Company Contribution for such Plan Year.
All Discretionary Company Contributions, other than
those that are deemed, at the Participant's election or
as directed by the Administrative Committee pursuant to
the following paragraph, to be invested in IR Stock
shall be credited to the Participant's Discretionary
Company Contribution Account on the date determined by
the Administrative Committee in its sole and absolute
discretion. All Discretionary Company Contributions
that are deemed, at the Participant's election or as
directed by the Administrative Committee, to be
invested in IR Stock shall be credited to the
Participant's IR Stock Account as described in Section
6.4.
Each Participant's Discretionary Company Contribution
Accounts shall be divided into Investment Option
Subaccounts. Notwithstanding the previous sentence,
the Administrative Committee may, in its sole and
absolute discretion, at the time a Discretionary
Company Contribution is made, direct that a
Participant's Discretionary Company Contribution be
invested in any one or more of the Investment Option
Subaccounts (including the IR Stock Account) and that
such Discretionary Company Contribution remain invested
in such Investment Option Subaccounts until at least
such time as the Administrative Committee, in its sole
and absolute discretion, determines that such
Discretionary Company Contribution, or portion thereof,
may be invested in Investment Option Subaccounts
elected by the Participant. A Participant's
Discretionary Company Contribution Accounts shall be
credited as follows:
(a) On the day a Discretionary Company Contribution is
credited to a Participant's Discretionary Company
Contribution Account, the Administrative Committee
shall credit the Investment Option Subaccounts of
the Participant's Discretionary Company
Contribution Account with an amount equal to the
Participant's Discretionary Company Contribution
in accordance with the Participant's Election Form
or as directed by the Administrative Committee;
that is, the portion of the Participant's
Discretionary Company Contribution that the
Participant has elected, or that the
Administrative Committee has directed, to be
deemed to be invested in a certain type of
investment option shall be credited to the
Investment Option Subaccount corresponding to that
investment option.
(b) Each business day, each Investment Option
Subaccount of a Participant's Discretionary
Company Contribution Account shall be adjusted for
earnings or losses in an amount equal to that
determined by multiplying the balance credited to
such Investment Option Subaccount as of the prior
day plus contributions credited that day to the
Investment Option Subaccount by the Return for the
corresponding investment option.
6.4 IR Stock Accounts. The Administrative Committee shall
establish and maintain a separate IR Stock Account for
each Plan Year for each Participant who (i) elects to
have all or a portion of his of her Deferral Amounts
and/or Discretionary Company Contributions for such
Plan Year invested in IR Stock or, (ii) receives a
Discretionary Company Contribution which is directed,
pursuant to Section 6.3, by the Administrative
Committee to be deemed to be invested in IR Stock. All
Deferral Amounts that are deemed, at the Participant's
election, to be invested in IR Stock shall be credited
to the Participant's IR Stock Account on the date when
the Deferral Amount would otherwise be paid to the
Participant. All Discretionary Company Contributions
that are deemed, whether at the Participant's election
or as directed by the Administrative Committee, to be
invested in IR Stock shall be credited to the
Participant's IR Stock Account on the date determined
by the Administrative Committee in its sole and
absolute discretion. Notwithstanding anything to the
contrary, IR Stock credited to a Participant's IR Stock
Account may not be designated by the Participant to be
deemed to be invested in any other investment option
and shall remain invested in IR Stock in such IR Stock
Account until distributed from the Plan or until at
least such time as the Administrative Committee, in its
sole and absolute discretion determines, with respect
to Discretionary Company Contributions that it directed
be invested in IR Stock, that such Discretionary
Company Contributions may be invested, at the
Participant election, in other investment options
available under the Plan. A Participant's IR Stock
Accounts shall be credited as follows:
(a) On the day a Deferral Amount or Discretionary
Company Contribution is credited to a
Participant's IR Stock Account, the Administrative
Committee shall credit the IR Stock Account with
an amount equal to the Participant's Deferral
Amount and/or Discretionary Company Contribution.
(b) All Deferral Amounts and Discretionary Company
Contributions deemed to be invested in IR Stock in
accordance with the Participant's Election Form
or, with respect to Discretionary Company
Contributions as directed by the Administrative
Committee, shall be credited to a Participant's IR
Stock Account in units or fractional units. The
value of each unit shall be determined each
business day and shall equal the closing price of
one share of IR Stock on the New York Stock
Exchange-Composite Tape. On each date that
Deferral Amounts and/or Discretionary Company
Contributions are credited to the Participant's IR
Stock Account, the number of units to be credited
shall be determined by dividing the amount of such
Deferral Amounts and/or Discretionary Company
Contributions by the value of a unit on such date.
Dividends paid on IR Stock shall be reflected in
a Participant's IR Stock Account by the crediting of
additional units or fractional units. Such additional
units or fractional units shall equal the value of the
dividends based upon the closing price of one share of
IR Stock on the New York Stock Exchange-Composite Tape
on the date such dividends are paid.
6.5 Changes in Capitalization. If there is any change in
the number or class of shares of IR Stock through the
declaration of a stock dividend or other extraordinary
dividends, or recapitalization resulting in stock
splits, or combinations or exchanges of such shares or
in the event of similar corporate transactions, the
units in each Participant's IR Stock Account and
Supplemental Contribution Account shall be equitably
adjusted to reflect any such change in the number or
class of issued shares of IR Stock or to reflect such
similar corporate transaction.
6.6 Accounts are Bookkeeping Entries. Notwithstanding any
other provision of the Plan that may be interpreted to
the contrary, the investment options, including IR
Stock, are to be used for measurement purposes only,
and a Participant's election of any such investment
option, the allocation to his or her Account Balances
thereto, the calculation of additional amounts and the
crediting or debiting of such amounts to a
Participant's Account Balances shall not be considered
or construed in any manner as an actual investment of
his or her Account Balances in any such investment
option. In the event that the Company or the trustee
of the Trust, in its own discretion, decides to invest
funds in any or all of the investment options, no
Participant shall have any rights in or to such
investments themselves. Without limiting the
foregoing, a Participant's Account Balances shall at
all times be a bookkeeping entry only and shall not
represent any investment made on the Participant's
behalf by the Company or the Trust. The Participant
shall at all times remain an unsecured creditor of the
Company.
SECTION 7
DISTRIBUTION OF ACCOUNTS
7.1 Termination with Five Years of Service, Retirement,
Disability and Death. A Participant who terminates
employment after completing at least five (5) years of
Service, reaches Retirement, incurs a Disability, or
dies shall be paid his or her vested Account Balances
(and after his or her death to his or her Beneficiary)
in annual installments over ten (10) years beginning as
soon as administratively practicable in the year
following the Participant's termination, Retirement,
Disability or death unless an optional form of benefit
payment is elected in accordance with the next
sentence. For each Plan Year's Account Balance the
Participant may elect an optional form of benefit
payment in the manner prescribed by the Administrative
Committee, in its sole and absolute discretion, from
among the following:
(1) A lump sum distribution to be paid as soon as
administratively practicable in the year following
the Participant's termination, Retirement,
Disability or death;
(2) Annual installments over five (5) years commencing
as soon as administratively practicable in the year
following the Participant's termination, Retirement,
Disability or death;
(3) Annual installments over fifteen (15) years commencing
as soon as administratively practicable in the year
following the Participant's termination, Retirement,
Disability or death; and
(4) A lump sum distribution which shall be paid as soon as
administratively practicable in the year specified by
the Participant on the Election Form. Such specified
time shall be no less than one (1) year and no more than
five (5) years following termination, Retirement,
Disability or death.
A Participant may elect, on an Election Form, to change
the form and/or extend the timing of a distribution
under this Section that he or she has previously
elected to any other form of distribution or time
permitted under this Section, provided that no such
election shall be effective unless it is made at least
one (1) year before the Participant's termination,
Retirement, Disability or death, as applicable.
In the event of the Participant's termination of
employment with the Company with five (5) years of
Service, Retirement, Disability or death prior to the
elected date for one or more scheduled distributions
prior to termination of employment under Section 7.2,
the portion of the Participant's Account Balance
associated with such distribution(s) shall be paid to
the Participant (and after his or her death to his or
her Beneficiary) in the same form as elected by the
Participant under this Section.
Notwithstanding any provision of the Plan to the
contrary, if a Participant terminates employment after
completing five (5) years of Service, has reached
Retirement, incurs a Disability or dies while receiving
annual installments prior to termination of employment
pursuant to Section 7.2, such annual installments shall
continue to be paid to the Participant (and after his
or her death to his or her Beneficiary) in the same
manner as if the Participant had not terminated
employment, reached Retirement, incurred a Disability
or died.
All distributions under this Section shall be made on a
pro rata basis from the Participant's Account Balances.
7.2 Scheduled Distributions Prior to Termination of
Employment. A Participant may elect, on an Election
Form, to receive a distribution of all or a portion of
his or her Deferral Account, IR Stock Account and
vested Discretionary Company Contribution Account with
respect to a Plan Year(s) while still employed by the
Company. A Participant's election for a distribution
under this Section shall be permitted only if the date
specified on the Election Form by the Participant for
such distribution (in the event of a lump sum) or the
commencement of such distribution (in the event of
annual installments) is no earlier than two (2) years
from the last day of the Plan Year for which the
portion of the Deferral Account, IR Stock Account and
vested Discretionary Company Contribution Account to be
distributed is actually deferred. A Participant may
elect, on an Election Form, to extend the date for any
distribution under this Section with respect to any
Plan Year, provided such election occurs at least one
year before the date of distribution most recently
elected for that Plan Year by the Participant and the
extension is for a period of not less than two (2)
years after the date of distribution most recently
elected for that Plan Year by the Participant. The
Participant shall have the right to extend the date for
any distribution under this Section for a Plan Year
twice.
At the time an election for a distribution under this
Section is made, the Participant shall also elect, on
the Election Form, the form of payment of the
distribution. The Participant shall elect either (i) a
lump sum payment to be paid as soon as soon as
administratively practicable in the year specified by
the Participant on the Election Form or (ii) annual
installments over two (2), three (3), four (4) or five
(5) years beginning as soon as administratively
practicable in the year specified by the Participant on
the Election Form.
A Participant may elect, on an Election Form, to change
the form of payment for any distribution under this
Section for any Plan Year to any other form of payment
permitted under this Section, provided such election
occurs at least one (1) year before the date of
distribution previously elected by the Participant.
All distributions under this Section shall be made on a
pro rata basis from the Participant's Deferral
Account(s), IR Stock Account(s) and vested
Discretionary Company Contribution Account(s), as
applicable.
7.3 Termination of Employment Prior to Completing Five (5)
Years of Service. If a Participant's employment with
the Company terminates prior to his or her completing
five (5) years of Service, the vested portion of the
Participant's Account Balances, if any, shall be
distributed in a lump sum as soon as practicable in the
year following the Participant's termination of
employment. If a Participant's employment with the
Company terminates prior to his or her completing five
(5) years of Service while receiving annual
installments prior to termination of employment
pursuant to Section 7.2, such annual installments shall
continue to be paid to the Participant (and after his
or her death to his or her Beneficiary) in the same
manner as if the Participant had not terminated
employment prior to completing five (5) years of
Service. For purposes of Section 7.3, Disability,
death and Retirement shall be deemed not to be a
termination of employment.
7.4 Hardship Distribution. In the event that the
Administrative Committee, upon written petition of the
Participant (or the Participant's Beneficiary) on an
Election Form filed with the Administrative Committee
specifying the Plan Year(s), from which payment shall
be made, determines in its sole and absolute
discretion, that the Participant (or the Participant's
Beneficiary) has suffered an Unforeseeable Financial
Emergency, the Company may pay to the Participant (or
the Participant's Beneficiary) in a single cash lump
sum from the Participant's Deferral Account(s), IR
Stock Account(s), vested portion of the Discretionary
Contribution Account(s) and the vested portion of the
Supplemental Contribution Account(s) with respect to
the specified Plan Year(s), as soon as practicable
following such determination, an amount appropriate
under the circumstances. All distributions under this
Section shall be made on a pro rata basis from the
Participant's Deferral Account(s), IR Stock Account(s),
vested Discretionary Company Contribution Account(s)
and vested Supplementary Contribution Account(s), as
applicable.
7.5 Early Distributions (with forfeiture). A Participant
shall be permitted to elect, on an Election Form, to
receive an Early Distribution in whole percentages of
up to 100% of his or her Deferral Account(s), IR Stock
Account(s) and vested Discretionary Company
Contribution Account(s) with respect to a specified
Plan Year(s), subject to the following restrictions:
(1) 10% of the amount elected by the Participant to be
distributed as an Early Distribution shall be
permanently forfeited and such forfeited amount shall
be deducted from the amount to be distributed to the
Participant.
(2) If a Participant receives an Early Distribution, the
Participant will be ineligible to participate in the
Plan for the balance of the Plan Year in which the Early
Distribution is received and for the following Plan Year.
All Early Distributions shall be made on a pro rata basis
from the Participant's Deferral Account(s), IR Stock
Account(s) and vested Discretionary Company Contribution
Account(s).
(3) The Early Distribution shall be paid in a single cash
lump sum as soon as administratively practicable after
the Early Distribution election is made.
7.6 Form of Payments of IR Stock. Except as provided in
Sections 7.4, all amounts in a Participant's IR Stock
Account and Supplemental Contribution Account payable
to a Participant or Beneficiary under the Plan shall be
paid in IR Stock, with one share distributed for each
unit. All fractional shares shall be payable in cash.
All distributions from the Plan that are to be paid in
a specified number of annual installments shall be paid
so that the amount of each annual installment is
determined by dividing the total remaining number of
units in the Participant's Account Balance to be paid
in annual installments, by the number of years of
annual installments remaining.
7.7 Taxes; Withholding. To the extent required by law, the
Company, or the trustee of the Trust, shall withhold
from payments made hereunder an amount equal to at
least the minimum taxes required to be withheld by the
federal or any state or local government. The amount
to be withheld and the manner in which amounts shall be
withheld shall be determined in the sole discretion of
the Company or the trustee of the Trust.
SECTION 8
BENEFICIARY DESIGNATION
A Participant shall have the right to designate a
Beneficiary(ies) to receive the Participant's Account
Balances in the event the Participant dies prior to
receiving all of his or her Account Balances. A Beneficiary
designation shall be made, and may be amended at any time,
by the Participant by filing a written designation with the
Administrative Committee, on such form and in accordance
with such procedures as the Administrative Committee shall
establish from time to time. A Participant may change the
designated Beneficiary under the Plan at any time by
providing such designation in writing to the Administrative
Committee.
If a Participant fails to designate a Beneficiary(ies), or
if all designated Beneficiaries predecease the Participant,
the Participant's Beneficiary(ies) shall be deemed to be the
Participant's estate. If the Company is unable to determine
a Participant's Beneficiary or if any dispute arises
concerning a Participant's Beneficiary, the Company may pay
benefits to the Participant's estate. Upon such payment,
the Company shall have no further liability hereunder.
If any distribution to a Beneficiary is to be made in annual
installments, and the Beneficiary dies before receiving all
such installments, the value of the remaining installments,
if any, shall be paid to the estate of the Beneficiary in a
lump sum.
SECTION 9
AMENDMENT AND TERMINATION OF PLAN
9.1 Amendment. The Plan may, at any time and from time to
time, be amended without the consent of any Participant
or Beneficiary, (a) by the Board of Directors of the
Company, (b) by the Administrative Committee in the
case of amendments which do not materially modify the
provisions hereof (any amendment permitted be made by
the Compensation Committee pursuant to (c) below shall
be deemed to materially modify the provisions hereof),
or (c) by the Compensation Committee in the case of an
amendment to the amount to be credited to a
Participant's Supplemental Contribution Account
pursuant to Section 2.29; provided, however, that no
amendment shall reduce any benefits accrued under the
terms of the Plan prior to the date of amendment.
9.2 Termination of Plan
a. Company's Right to Terminate. The Board of
Directors of the Company may terminate the Plan at
any time and for any reason.
b. Payments Upon Termination. Upon any termination
of the Plan under this Section, Base Salary, Cash
Incentive Compensation Awards, Dividends on Stock
Grants, Discretionary Company Contributions and
Supplemental Contributions shall prospectively
cease to be deferred and, with respect to all such
amounts previously deferred, the Company shall pay
to the Participant, in a lump sum, as soon as
administratively practicable, the value of the
Participant's Account Balances.
SECTION 10
MISCELLANEOUS
10.1 Unsecured General Creditor. Benefits under the Plan
shall be payable by the Company out of its general
funds. The Company shall have the right to establish a
reserve or make any investment for the purposes of
satisfying its obligations hereunder for payment of
benefits at its discretion, provided, however, that no
Participant or Beneficiary shall have any interest in
such investment or reserve. To the extent that any
person acquires a right to receive benefits under the
Plan, such rights shall be no greater than the right of
any unsecured general creditor of the Company. No
Participant shall have any of the rights or privileges
of a stockholder of the Company under the Plan,
including as a result of the crediting of units to a
Participant's IR Stock Account or Supplemental
Contribution Account, except at such time as
distribution is actually made from the Participant's IR
Stock Account or Supplemental Contribution Account, as
applicable.
10.2 Entire Agreement; Successors. The Plan, including the
Election Form and any subsequently adopted amendments
to the Plan or Election Form, shall constitute the
entire agreement or contract between the Company and
any Participant regarding the Plan. There are no
convenants, promises, agreements, conditions or
understandings, either oral or written, between the
Company and any Participant relating to the subject,
matter hereof, other than those set forth herein. The
Plan and any amendment hereof shall be binding on the
Company and the Participants and, their respective
heirs, administrators, trustees, successors and
assigns, including but not limited to, any successors
of the Company by merger, consolidation or otherwise by
operation of law, and on all designated Beneficiaries
of the Employee.
10.3 Non-Assignability. To the extent permitted by law, the
right of any Participant or any Beneficiary in any
benefit hereunder shall not be subject to attachment or
any other legal process for the debts of such
Participant or Beneficiary; nor shall any such benefit
be subject to anticipation, alienation, sale, transfer,
assignment or encumbrance.
10.4 No Contract of Employment. The establishment of the
Plan or any modification hereof shall not give any
Participant or other person the right to remain in the
service of the Company or any of its subsidiaries, and
all Participants and other persons shall remain subject
to discharge to the same extent as if the Plan had
never been adopted.
10.5 Authorization and Source of Shares. Shares of IR Stock
necessary to meet the obligations of the Plan have been
reserved and authorized pursuant to resolutions adopted
by the Board of Directors of the Company on December 4,
1996, and additional shares of IR Stock shall be
reserved and authorized for delivery under the Plan
from time to time. These shares of IR Stock may be
provided from newly-issued or treasury shares.
10.6 Singular and Plural. As the context may require, the
singular may be read as the plural and the plural as
the singular.
10.7 Captions. The captions to the articles, sections, and
paragraphs of the Plan are for convenience only and
shall not control or affect the meaning or construction
of any of its provisions.
10.8 Applicable Law. The Plan shall be governed and
construed in accordance with the laws of the State of
New Jersey.
10.9 Severability. If any provisions of the Plan shall, to
any extent, be invalid or unenforceable, the remainder
of the Plan shall not be affected thereby, and each
provision of the Plan shall be valid and enforceable to
the fullest extent permitted by law.
10.10 Notice. Any notice or filing required or permitted to
be given to the Administrative Committee shall be sufficient if
in writing and hand delivered, or sent by registered or certified
mail, to the principal office of the Company at 200 Chestnut
Ridge Road, Woodcliff Lake, NJ 07677, directed to the attention
of the Senior Vice President, Human Resources. Such notice shall
be deemed given as of the date of delivery or, if delivery is
made by mail, as of the date shown on the postmark on the receipt
for registration or certification. Any notice to the Participant
shall be addressed to the Participant at the Participant's
residence address as maintained in the Company's records. Any
party may change the address for such party here set forth by
giving notice of such change to the other parties pursuant to
this Section.
IN WITNESS WHEREOF, the Company has caused this amendment and
restatement to be executed by its duly authorized representative
as of January 1, 2001.
INGERSOLL-RAND COMPANY
By: /s/ Donald H. Rice
Donald H. Rice
Senior Vice President
Global Business Services and Human
Resources