Exhibit No. (10)
KIMBERLY-CLARK CORPORATION
RETIREMENT CONTRIBUTION EXCESS BENEFIT PROGRAM
Amended and Restated effective January 6, 2003
In recognition of the valuable services provided to Kimberly-Clark
Corporation (the "Corporation"), and its subsidiaries, by its employees, the
Board of Directors of the Corporation (the "Board") wishes to provide additional
retirement benefits to those individuals whose benefits under the Kimberly-Clark
Corporation Retirement Contribution Plan (the "RCP") are restricted by the
operation of the provisions of the Internal Revenue Code of 1986, as amended. It
is the intent of the Corporation to provide these benefits under the terms and
conditions hereinafter set forth. This Program is intended to encompass two
plans, (i) an "excess benefit plan" within the meaning of Section 3(36) of
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and, as
such, to be exempt from all of the provisions of ERISA pursuant to Section
4(b)(5) thereof and (ii) a non-qualified supplemental retirement plan which is
unfunded and maintained primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees of
the Corporation, pursuant to Sections 201, 301 and 401 of ERISA and, as such,
exempt from the provisions of Parts II, III and IV of Title I of ERISA.
ARTICLE 1
Definitions
Each term which is used in this Program and also used in the RCP shall have the
same meaning herein as the RCP.
Notwithstanding the above, for purposes of this Program, where the following
words and phrases appear in this Program they shall have the respective meanings
set forth below unless the context clearly indicates otherwise:
1.1 "Beneficiary" means the person or persons who under this Program becomes
entitled to receive a Participant's interest in the event of the Participant's
death. The Beneficiary need not be the same as the beneficiary under the RCP.
1.2 A "Change of Control" of the Corporation shall be deemed to have taken
place if: (i) a third person, including a "group" as defined in Section 13(d)(3)
of the Securities Exchange Act of 1934, as amended, acquires shares of the
Corporation having 20% or more of the total number of votes that may be cast for
the election of Directors of the Corporation; or (ii) as the result of any cash
tender or exchange offer, merger or other business combination, sale of assets
or contested election, or any combination of the foregoing transactions (a
"Transaction"), the persons who were directors of the Corporation before the
Transaction shall cease to constitute a majority of the Board of Directors of
the Corporation or any successor to the Corporation.
1.3 "Code" means the Internal Revenue Code for 1986, as amended and any
lawful regulations or other pronouncements promulgated thereunder.
1.4 "Committee" means the Incentive Investment Plan Committee named under the
Kimberly-Clark Corporation Salaried Employees Incentive Investment Plan.
1.5 "Earnings" means remuneration when paid, or would have been paid but for
an Employee's deferral election, to a Participant from a Participating Unit for
personal services rendered to such Participating Unit (before any withholding
required by law or authorized by the person to whom such remuneration is
payable), including overtime, bonuses, incentive compensation, vacation pay,
deducted military pay, state disability payments received, workers compensation
payments received and, to the extent such deductions decrease the individual's
base pay, Before-Tax deferrals under the Kimberly-Clark Corporation Salaried
Employee Incentive Investment Plan, contributions under the Kimberly-Clark
Corporation Flexible Benefits Plan or any other plan described under Section 125
of the Code, and deferrals under the Kimberly-Clark Corporation Deferred
Compensation Plan. Earnings shall exclude any severance payments (except as
provided in Section 4.3 of the RCP), payments made under the Kimberly-Clark
Corporation Equity Participation Plans, pay in lieu of vacation, compensation
paid in a form other than cash (such as goods, services and, except as otherwise
provided herein, contributions to employee benefit programs), service or
suggestion awards, and all other special or unusual compensation of any kind;
provided, however that the limitations on Earnings provided for pursuant to Code
Sections 401(a)(17) shall not apply under this Program. Notwithstanding the
foregoing, Earnings shall not include any remuneration paid to a Participant
after payment of such individual's Individual Account commences in accordance
with Section 4.9 following the Participant's Termination of Service.
1.6 "Effective Date" means January 1, 1997.
1.7 "Excess Plan" means the plan established as part of the Program for
Participants whose Retirement Contributions to the RCP are limited solely by
Code Section 415.
1.8 "Individual Account" means the account established pursuant to Section 3.
1.9 "Investment Funds" means the phantom investment funds established under
this Program which will accrue earnings as if the Participant's Individual
Account held actual assets which were invested in the appropriate Investment
Fund as defined under the RCP.
1.10 "Participant" means any Employee who satisfies the eligibility
requirements set forth in Section 2. In the event of the death or incompetency
of a Participant, the term shall mean the Participant's personal representative
or guardian.
1.11 "Program" means the Kimberly-Clark Corporation Retirement Contribution
Excess Benefit Program as set forth herein and as the same may be amended from
time to time; provided, however, that the term "Excess Plan" or "SRP" may be
used to refer to only one of the two plans encompassed within the Program.
1.12 "Retirement Date" means the date of Termination of Service of the
Participant on or after he attains age 55 and has 5 Years of Service with the
Corporation.
1.13 "RCP" means the Kimberly-Clark Corporation Retirement Contribution Plan,
as in effect from time to time.
1.14 "SRP" means the plan established as part of the Program for Participants
whose Retirement Contributions to the RCP are limited by the application of the
rules, or regulations, of Code Section 401(a)(4) or the limitations of Code
Section 401(a)(17), in either case alone or in conjunction with the limitations
of Code Section 415 or whose Earnings are not fully taken into account in
determining the Employee's Retirement Contributions to the RCP.
1.15 "Termination of Service" means the Participant's cessation of his service
with the Corporation for any reason whatsoever, whether voluntarily or
involuntarily, including by reasons of retirement or death.
ARTICLE 2
Eligibility
2.1 Any Employee who is a Participant in the RCP on or after the Effective
Date and whose Retirement Contributions to the RCP are limited solely by Code
Section 415 shall participate in the Excess Plan. Any other Employee who is a
Participant in the RCP on or after the Effective Date and whose Retirement
Contributions to the RCP are limited by the application of the rules, or
regulations, of Code Section 401(a)(4) or the limitations of Code Section
401(a)(17), in either case alone or in conjunction with the limitations of Code
Section 415 or whose Earnings are not fully taken into account in determining
the Employee's Retirement Contributions to the RCP shall participate in the SRP;
provided, however, that no Employee shall become a Participant in the SRP unless
such Employee is a member of a select group of management or highly compensated
Employees of the Corporation so that the SRP is maintained as a plan described
in Section 201(2) of ERISA.
2.2 Notwithstanding any of the foregoing provisions of Article 2 to the
contrary, any Employee who on the Effective Date is both an active employee of
the Corporation or its subsidiaries and is a Participant in the Kimberly-Clark
Tissue Company Defined Contribution Excess Benefit Program (the "KCTC Plan")
must elect to participate in this Program and shall, pursuant to this election,
as of the Effective Date, have the amount credited to the Participant's
Individual Account under the KCTC Plan transferred to this Program. "Active
employee" shall not include employees who are in transition assignments or who
are on Limited Service as defined under the Scott Paper Company Termination Pay
Plan for Salaried Employees.
ARTICLE 3
Individual Account
3.1 The Corporation shall create and maintain an unfunded Individual Account
under the Excess Plan or the SRP, as applicable, for each Participant to which
it shall credit the amounts described in this Article 3. Participants entitled
to receive Retirement Contributions under the RCP shall receive Retirement
Contributions under the Excess Plan in an amount as would have been contributed
for such Participant under the RCP without regard to the limitation on benefits
imposed by Section 415 of the Code, and calculated using Earnings as defined in
this Program, but only to the extent that such amount exceeds such limitations.
In addition, each Participant shall receive Retirement Contributions under the
SRP as would have been contributed for such Participant under the RCP without
regard to the limitations on benefits imposed by Sections 401(a)(17) and
401(a)(4) of the Code, and calculated using Earnings as defined in this Program,
but only to the extent that such amount exceeds the Retirement Contributions
under the RCP. Such Retirement Contributions shall be made for each Participant
on the same terms and conditions, at the same times, and pursuant to the same
elections made by the Participant as they would have been if paid under the RCP,
were not for such limitations on benefits or Earnings.
3.2 For the period prior to July 1, 1997, as of the last day of each calendar
month, the Corporation shall credit each Participant's Individual Account with
deemed interest with respect to the then balance of the Participant's Individual
Account equal to 1% plus the rate shown for U.S. Treasury Notes with a remaining
maturity closest to, but not exceeded, 7 years, in the "representative
mid-afternoon over the counter quotations supplied by the Federal Reserve Bank
of New York City, based on transactions of $1 million or more," as reported in
The Wall Street Journal published on the last business day of each calendar
month; provided, however, the Committee may change this crediting rating at any
time for deemed interest not yet credited to an Individual Account.
3.3 After June 30, 1997 and prior to June 29, 2000, each Participant's
Retirement Contributions under this Program shall be considered allocated to the
Investment Funds in the same proportion as the Participant has elected under the
RCP pursuant to Section 6.1 thereof. Effective June 29, 2000, each Participant's
Retirement Contributions under this Program shall be considered allocated to the
Investment Funds according to the Participant's elections under this Program,
independent of the Participant's elections under the RCP, provided that (i) such
Participant's elections under this Program shall be made in the same or similar
manner prescribed by the Committee for the RCP, and (ii) such Participant's
elections under the RCP as of June 29, 2000 shall be carried over to this
Program until such time as the Participant changes them hereunder.
3.4 After June 30, 1997 and prior to June 29, 2000, reallocations between
Investment Funds shall be considered made at the same time, in the same
proportionate amount, and to and from the same Investment Funds under this
Program as those made by the Participant under Section 6.3 of the RCP; provided,
however, that if such Participant has no account balance under the RCP, the
Participant may make separate reallocation elections hereunder in a manner
prescribed by the Committee. Effective June 29, 2000, reallocations between
Investment Funds shall be considered made according to the Participant's
elections under this Program, independent of the Participant's elections under
the RCP, provided that (i) such Participant's elections under this Program shall
be made in the same or similar manner prescribed by the Committee for the RCP,
and (ii) such Participant's elections under the RCP as of June 29, 2000 shall be
carried over to this Program until such time as the Participant changes them
hereunder.
3.5 After June 30, 1997 and before June 29, 2000, the Corporation shall
credit each Participant's Individual Account with earnings, gains and losses as
if such accounts held actual assets and such assets were invested among such
Investment Funds, in the same proportion as the Participant has invested in the
RCP; provided, however, that if such Participant has no account balance under
the RCP, the Participant may make separate investment elections hereunder in the
manner prescribed by the Committee. Effective June 29, 2000, the Corporation
shall credit each Participant's Individual Account with earnings, gains and
losses as if such accounts were invested among the Investment Funds according to
the Participant's elections under this Program, independent of the Participant's
elections under the RCP, provided that (i) such Participant's elections under
this Program shall be made in the same or similar manner prescribed by the
Committee for the RCP, and (ii) such Participant's elections under the RCP as of
June 29, 2000 shall be carried over to this Program until such time as the
Participant changes them hereunder.
ARTICLE 4
Distributions of Benefit Supplement
4.1 Retirement Benefit. Subject to Section 4.5 below, upon a Participant's
Retirement Date, he shall be entitled to receive the amount of his Individual
Account. The form of benefit payment, and the time of commencement of such
benefit, shall be as provided in Section 4.4.
4.2 Termination Benefit. Upon the Termination of Service of a Participant
prior to his Retirement Date, for reasons other than death, the Corporation
shall pay to the Participant, a benefit equal to his Individual Account.
Unless otherwise directed by the Committee, the termination benefit shall be
payable in a lump sum as set forth in Section 4.9 following the Participant's
Termination of Service. Upon payment following a Termination of Service, the
Participant shall immediately cease to be eligible for any other benefit
provided under this Program.
4.3 Death Benefits. Upon the death of a Participant or a retired Participant,
the Beneficiary of such Participant shall receive the Participant's remaining
Individual Account. Payment of a Participant's remaining Individual Account
shall be made in accordance with Section 4.4.
4.4 Form of Benefit Payment. Upon the happening of an event described in
Sections 4.1, 4.2 or 4.3, the Corporation shall pay to the Participant the
amount specified therein in a lump sum.
4.5 Limitations on the Annual Amount Paid to a Participant. Notwithstanding
any other provisions of this Program to the contrary, in the event that a
portion of the payments due a Participant pursuant to Sections 4.1, 4.2, 4.3 or
4.4 would not be deductible by the Corporation pursuant to Section 162(m) of the
Code, the Corporation, at its discretion, may postpone payment of such amounts
to the Participant until such time that the payments would be deductible by the
Corporation; provided, however, that no payment postponed pursuant to this
Section 4.5 shall be postponed beyond the first anniversary of such
Participant's Termination of Service.
4.6 Change of Control and Lump Sum Payments
(a) If there is a Change of Control, notwithstanding any other
provision of this Program, any Participant who has an Individual
Account hereunder may, at any time during a twenty-four (24) month
period immediately following a Change of Control, elect to receive an
immediate lump sum payment of the balance of his Individual Account,
reduced by a penalty equal to ten percent (10%) of the Participant's
Individual Account as of the last business day of the month preceding
the date of the election. The ten percent (10%) penalty shall be
permanently forfeited and shall not be paid to, or in respect of, the
Participant.
(b) If there is a Change of Control, notwithstanding any other
provision of this Program, any retired Participant, or Beneficiary, who
has an Individual Account hereunder may, at any time during a
twenty-four (24) month period immediately following a Change of
Control, elect to receive an immediate lump sum payment of the balance
of his Individual Account, reduced by a penalty equal to five percent
(5%) of the Participant's Individual Account as of the last business
day of the month preceding the date of the election. The five percent
(5%) penalty of the retired Participant's or Beneficiary's Individual
Account shall be permanently forfeited and shall not be paid to, or in
respect of, the retired Participant or Beneficiary.
(c) In the event no such request is made by a Participant, a retired
Participant or Beneficiary, the Program shall remain in full force and
effect.
4.7 Change in Credit Rating and Lump Sum Payments.
In the event the Corporation's financial rating falls below Investment Grade, a
Participant, retired Participant, or Beneficiary may at any time during a six
(6) month period following the reduction in the Corporation's financial rating,
elect to receive an immediate lump sum payment of the balance of his Individual
Account reduced by a penalty equal to ten percent (10%) of the Participant's
Individual Account or five percent (5%) of the retired Participant's or
Beneficiary's Individual Account as of the last business day of the month
preceding the election. The penalties accrued hereunder shall be permanently
forfeited and shall not be paid to, or in respect of, the Participant, retired
Participant or Beneficiary.
In the event no such request is made by a Participant, retired Participant or
Beneficiary, the Program shall remain in full force and effect.
4.8 Tax Withholding. To the extent required by law, the Corporation shall
withhold any taxes required to be withheld by any Federal, State or local
government.
4.9 Commencement of Payments. Unless otherwise provided, commencement of
payments under Section 4.6 or 4.7 of this Program shall be as soon as
administratively feasible on or after the last business day of the month
following receipt of notice and approval by the Committee of an event which
entitles a Participant or a Beneficiary to payments under this Program. Unless
otherwise provided, commencement of payments under Section 4.1, 4.2 or 4.3 of
this Program shall be payable in the first calendar quarter of the year
following the Plan year in which the Participant terminates employment from the
Corporation for any reason; provided, however, that such a termination shall not
be deemed to occur until immediately following the receipt of all payments due
to the Employee under the Scott Paper Company Termination Pay Plan for Salaried
Employees.
4.10 Recipients of Payments; Designation of Beneficiary. All payments to be
made by the Corporation under the Program shall be made to the Participant
during his lifetime, provided that if the Participant dies prior to the
completion of such payments, then all subsequent payments under the Program
shall be made by the Corporation to the Beneficiary determined in accordance
with this Section. The Participant may designate a Beneficiary by filing a
written notice of such designation with the Committee in such form as the
Committee requires and may include contingent Beneficiaries. The Participant may
from time-to-time change the designated Beneficiary by filing a new designation
in writing with the Committee. If a married Participant designates a Beneficiary
or Beneficiaries other than his spouse at the time of such designation, such
designation shall not be effective (and the Participant's spouse shall be the
Beneficiary) unless:
(a) the spouse consents in writing to such designation;
(b) the spouse's consent acknowledges the effect of such designation, which
consent shall be irrevocable; and
(c) the spouse executes the consent in the presence of either a Plan
representative designated by the Committee or a notary public.
Notwithstanding the foregoing, such consent shall not be required if the
Participant establishes to the satisfaction of the Committee that such consent
cannot be obtained because (i) there is no spouse; (ii) the spouse cannot be
located after reasonable efforts have been made; or (iii) other circumstances
exist to excuse spousal consent as determined by the Committee. If no
designation is in effect at the time when any benefits payable under this Plan
shall become due, the Beneficiary shall be the spouse of the Participant, or if
no spouse is then living, the representatives of the Participant's estate.
ARTICLE 5
Vesting
5.1 The balance of a Participant's Individual Account shall be 100% vested at
the same time as if the amounts had been credited to the Participant's Account
under the RCP.
5.2 K-C Aviation Benefit. Notwithstanding any other provision of the Plan, a
Participant shall be fully vested in his Individual Account as of the date on
which he ceases to be an Eligible Employee under the Program, if such
Participant meets all of the following conditions:
(a) immediately prior to the Closing Date, as defined in the
Agreement of Purchase and Sale dated as of July 23, 1998 by
and between the Corporation and Gulfstream Aerospace
Corporation (the "Agreement"), he must have been an Employee
employed by the Corporation or K-C Aviation Inc.; and
(b) as of the Closing Date, as defined in the Agreement, he must
have ceased to be an Eligible Employee solely on account of
the sale of the stock of K-C Aviation Inc. pursuant to the
Agreement, and he must either (i) be employed by the Buyer, as
defined in the Agreement, immediately after he ceases to be an
Eligible Employee hereunder, or (ii) have been on a long-term
disability leave of absence from K-C Aviation Inc. as of the
Closing Date, as defined in the Agreement.
ARTICLE 6
Funding
6.1 The Board may, but shall not be required to, authorize the establishment
of a trust by the Corporation to serve as the funding vehicle for the benefits
described herein. In any event, the Corporation's obligations hereunder shall
constitute a general, unsecured obligation, payable solely out of its general
assets, and no Participant shall have any right to any specific assets of the
Corporation.
ARTICLE 7
Administration
7.1 The Committee shall administer this Program and shall have the same
powers and duties, and shall be subject to the same limitations as are set forth
in the Kimberly-Clark Corporation Salaried Employees Incentive Investment Plan.
ARTICLE 8
Amendment and Termination
8.1 The Corporation, by action of the Board, or the Compensation Committee as
designated by the Board, shall have the right at any time to amend this Program
in any respect, or to terminate this Program; provided, however, that no such
amendment or termination shall operate to reduce the benefit that has accrued
for any Participant who is participating in the Program nor the payment due to a
terminated Participant at the time the amendment or termination is adopted.
Continuance of the Program is completely voluntary and is not assumed as a
contractual obligation of the Corporation. Notwithstanding the foregoing, this
Program shall terminate when the RCP terminates.
Any action permitted to be taken by the Board, or the Compensation Committee as
designated by the Board, under the foregoing provision regarding the
modification, alteration or amendment of the Program may be taken by the
Committee, using its prescribed procedures, if such action
(a) is required by law, or
(b) is estimated not to increase the annual cost of the Program by more
than $1,000,000.
Any action taken by the Board, the Compensation Committee as designated by the
Board, or Committee shall be made by or pursuant to a resolution duly adopted by
the Board, the Compensation Committee as designated by the Board, or Committee
and shall be evidenced by such resolution or by a written instrument executed by
such persons as the Board, the Compensation Committee as designated by the
Board, or Committee shall authorize for such purpose.
The Committee shall report to the Chief Executive Officer of the Corporation
before January 31 of each year all action taken by it hereunder during the
preceding calendar year.
ARTICLE 9
Miscellaneous
9.1 Nothing contained herein (a) shall be deemed to exclude a Participant
from any compensation, bonus, pension, insurance, termination pay or other
benefit to which he otherwise is or might become entitled to as an Employee or
(b) shall be construed as conferring upon an Employee the right to continue in
the employ of the Corporation as an executive or in any other capacity;
provided, however, that if, at the time payments are to be made hereunder, the
Participant or the Beneficiary are indebted or obligated to the Corporation,
then the payments remaining to be made to the Participant or the Beneficiary
may, at the discretion of the Corporation, be reduced by the amount of such
indebtedness or obligation, provided, however, that an election by the
Corporation not to reduce any such payment or payments shall not constitute a
waiver of its claim for such indebtedness or obligation.
9.2 Any amounts payable by the Corporation hereunder shall not be deemed
salary or other compensation to a Participant for the purposes of computing
benefits to which the Participant may be entitled under any other arrangement
established by the Corporation for the benefit of its Employees.
9.3 The rights and obligations created hereunder shall be binding on a
Participant's heirs, executors and administrators and on the successors and
assigns of the Corporation.
9.4 The Program shall be construed and governed by the laws of the State of
Wisconsin.
9.5 The rights of any Participant under this Program are personal and may not
be assigned, transferred, pledged or encumbered. Any attempt to do so shall be
void.
9.6 Neither the Corporation, its Employees, agents, any member of the Board,
the Plan Administrator nor the Committee shall be responsible or liable in any
manner to any Participant, Beneficiary, or any person claiming through them for
any benefit or action taken or omitted in connection with the granting of
benefits, the continuation of benefits or the interpretation and administration
of this Program.
9.7 An application or claim for a benefit under the RCP shall constitute a
claim for a benefit under this Program.
9.8 The Corporation is the plan sponsor. All actions shall be taken by the
Corporation in its sole discretion, not as a fiduciary, and need not be applied
uniformly to similarly situated individuals.