EXECUTIVE RETIREMENT PLAN
As adopted on July 10, 1987
(effective February 19, 1987);
and as amended on the following
dates:
Amended and Restated March 1, 1988;
Amended and Restated April 25, 1988;
Amended and Restated May 2, 1988;
Amended September 13, 1993;
Amended November 18, 1993;
Amended February 17, 1994;
Amended September 27, 1995
This Plan Document is current as of
November 1, 1995.
NATIONAL FUEL GAS COMPANY
AND PARTICIPATING SUBSIDIARIES
EXECUTIVE RETIREMENT PLAN
<PAGE 2>
TABLE OF CONTENTS
ARTICLE PAGE NO.
- ------- --------
ARTICLE I Purpose . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II Definitions . . . . . . . . . . . . . . . . . . . 3
ARTICLE III Determination of Retirement Benefits . . . . . . 9
ARTICLE IV Vesting; Forfeiture . . . . . . . . . . . . . . . 15
ARTICLE V Form of Payment of Benefits . . . . . . . . . . . 17
ARTICLE VI Source of Payment . . . . . . . . . . . . . . . . 19
ARTICLE VII Administration of the Plan . . . . . . . . . . . 20
ARTICLE VIII Amendment and Termination . . . . . . . . . . . . 22
ARTICLE IX General Provisions. . . . . . . . . . . . . . . . 23
<PAGE 3>
ARTICLE 1
Purpose
1.1 National Fuel Gas Company established this National Fuel Gas
Company and Participating Subsidiaries Executive Retirement Plan effective as of
February 19, 1987 for the purpose of attracting and retaining executives, and
for these additional purposes: (1) to provide retirement benefits to eligible
employees in addition to basic retirement benefits provided them under the
National Fuel Gas Company Retirement Plan as it may be amended and restated; (2)
to provide retirement benefits to such employees to make up for benefit
reductions, if any, under the National Fuel Gas Company Retirement Plan caused
by participation in the National Fuel Gas Company Deferred Compensation Plan, as
it may be amended and restated; (3) to provide retirement benefits to such
employees without regard to the $200,000 limit on qualified plans' covered
compensation that became effective respecting the National Fuel Gas Company
Retirement Plan effective July 1, 1989 (and as that limit may change from time
to time); and (4) to provide to such employees benefits which would have been
payable from the tax-exempt trust under the National Fuel Gas Company Retirement
Plan but for the limitations placed by Section 415 of the Internal Revenue Code
of 1986, as it may be amended, on benefits payable and contributions made with
respect to such employees under such plans.
<PAGE 4>
1.2 The National Fuel Gas Company and Participating Subsidiaries
Executive Retirement Plan is intended to constitute an unfunded deferred
compensation plan under Section 201(2) of the Act and the Company's obligation
to pay benefits hereunder, if any, is unfunded and unsecured.
<PAGE 5>
ARTICLE 2
Definitions
When used herein, the following terms shall have the following
meanings:
2.1 Act means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
2.2 Basic Pension Plan means the National Fuel Gas Company Retirement
Plan, as amended and restated from time to time.
2.3 Beneficiary means the person or persons entitled to receive the
amount, if any, payable under the Basic Pension Plan upon the death of a member
or retired member thereof who also is a Member in the Plan.
2.4 Benefit Limitations means (i) the maximum "annual benefit" payable
under the Basic Pension Plan in accordance with Section 415 of the Code and the
implementing provisions of the Basic Pension Plan (as they operate in
conjunction with the relevant provisions of other Company employee benefit
plans), and (ii) the maximum amount of annual compensation of an employee that
may be taken into account under the Basic Pension Plan in accordance with
Section 401(a)(17) of the Code, as amended and supplemented, and the
implementing provisions of the Basic Pension Plan.
2.5 Board of Directors means the Board of Directors of National Fuel
Gas Company.
<PAGE 6>
2.6 Change in Control shall mean the happening of any of the
following:
(a) the acquisition by any party or parties of the beneficial
ownership of 30% or more of the voting shares of National Fuel
Gas Company; or
(b) the occurrence of a transaction requiring shareholders' approval
for the acquisition of National Fuel Gas Company through
purchase of stock or assets, or by merger, or otherwise; or
(c) the election during any period of 24 months, or less, of 40% or
more of the members of the Board of Directors, without the
approval of three-fourths of the members of the Board of
Directors as constituted at the beginning of the period.
2.7 Code means the Internal Revenue Code of 1986, as amended from
time to time.
2.8 Committee means the committee appointed from time to time by the
Board of Directors to administer the Plan.
2.9 Company means National Fuel Gas Company and each of the following
subsidiaries, which participate in the Plan: National Fuel Gas Distribution
Corporation, National Fuel Gas Supply Corporation, Penn-York Energy Corporation
and Empire Exploration, Inc., each of which has adopted or has indicated that it
will adopt the Plan.
<PAGE 7>
2.10 Early Retirement Date shall be the Retirement Date selected by the
Member that is no earlier than the first day of the calendar month immediately
following or coinciding with the Member's 55th birthday, or any first of a month
thereafter, but prior to the Member's Normal Retirement Date, provided the
Member is Vested.
2.11 Employment Year is the consecutive 12-month period commencing on
the date in which the Member was hired by a Company, and each subsequent
12-month period commencing on each anniversary thereof.
2.12 Final Average Pay shall mean an amount equal to the average of the
Annual Cash Compensation payable by a Company or Companies to a Member for the
60 consecutive month period during the 120 consecutive month period immediately
preceding the date the Member retires (or in the event of a Change in Control,
terminates employment), which produces the highest average. The Member's Annual
Cash Compensation shall include the Member's base salary, whether or not the
receipt of a portion thereof has been deferred, plus the Member's compensation
(whether or not the receipt of all or a portion thereof has been deferred) under
National Fuel Gas Company's short-term annual incentive program, known as the
Annual At Risk Compensation Incentive Program (AARCIP") or any successor program
thereto, when paid or deferred. The Member's Annual Cash Compensation shall
exclude all commissions, stock, option, or SAR awards, special allowances,
supplemental compensation, and any other extra compensation or incentives or
bonuses not provided under the AARCIP.
<PAGE 8>
If an AARCIP award is paid following the Member's retirement date, that
award shall be used in determining the Member's Final Average Pay, if it is
payable in connection with employment periods included in the 60 month period
referred to above. In this event, the Member's Retirement Benefits shall be
increased, once the effect of such award is determined, and the increase shall
be made retroactive to the Member's retirement date, without interest.
Notwithstanding the above, if such a post-retirement AARCIP award is used in
determining Final Average Pay hereunder, AARCIP payments relating to no more
than five of National Fuel Gas Company's fiscal years may be used in determining
Final Average Pay."
An example of the effect of this provision is as follows. Assume that
a Member retires on October 1, 1999, and that his salary and AARCIP bonuses were
as follows for the following calendar year:
AARCIP Bonus (relating
to fiscal year ending
that September 30 but
paid in December)
Salary
1994 $480,000 $120,000
1995 $540,000 $150,000
1996 $600,000 $180,000
1997 $660,000 $210,000
1998 $780,000 $240,000
1999 $840,000 $270,000
<PAGE 9>
This Member's Final Average Pay would be $876,000, computed as follows:
[9/12 ($840,000) + 12/12 ($780,000) + 12/12 ($660,000) + 12/12 ($600,000) +
12/12 ($540,000) + 3/12 ($480,000) + $270,000 + $240,000 + $210,000 + $180,000 +
$150,000] divided by 5.
2.13 Member means any person employed by a Company who is designated as
a Member by the Chief Executive Officer of National Fuel Gas Company.
2.14 Normal Retirement Date is the first day of the month coinciding
with or immediately following the Member's 65th birthday. A Member may retire
and begin to receive a Retirement Benefit, payable commencing on his Normal
Retirement Date, equal to his Additional Benefit Base.
2.15 Plan means the National Fuel Gas Company and Participating
Subsidiaries Executive Retirement Plan as set forth herein and as amended and
restated from time to time.
2.16 Retirement Date is the date with respect to which Retirement
Benefits under the Plan commence.
2.17 Retirement Benefits means the benefits payable under this Plan.
2.18 Vesting with respect to a Member occurs on the latter of (i) the
first of the month coinciding with or immediately following his 55th birthday or
(ii) the date on which the Member has completed five Years of Service with a
Company. A "Vested" Member is a Member with respect to whom "Vesting" has
occurred.
<PAGE 10>
2.19 Years of Service equals the number of Employment Years completed
by a Member. An Employment Year in which a Member completed 1,000 or more but
less than the normal number of Hours of Service (as such term is defined in the
Basic Pension Plan) for a full-time employee of the Company shall be credited as
a partial Year of Service equal to the number of Hours of Service credited in
such Employment Year divided by the normal number of Hours of Service for a
full-time employee of the Company. Years of Service shall not exceed 40. No more
than one Year of Service shall be credited in any Employment Year.
2.20 In construing the Plan, masculine pronouns shall refer to both
males and females, as appropriate.
<PAGE 11>
ARTICLE 3
Determination of Retirement Benefits
3.1 Total Benefit Base. The Total Benefit Base of a Vested Member shall
be a monthly annuity for his life, commencing at his Normal Retirement Date,
under which the annual payments shall equal an amount calculated by adding the
products of .0197 times the Member's Years of Service not in excess of 30 and
.0132 times his Years of Service, if any, in excess of 30 (but not to exceed
10), and multiplying the sum thereof by his Final Average Pay.
3.2 Social Security Benefit means the annual Primary Insurance Amount
estimated by the Committee to be payable to the Member under the Social Security
Act of 1935, as amended, at his Retirement Date, calculated on the assumption
that the Member will not receive any future wages that would be treated as such
for purposes of that act. If a Member's Retirement Date precedes his attainment
of age 62, the Primary Insurance Amount estimated to be payable to the Member at
age 62 (without assuming any cost of living increases) shall be reduced by .75%
per month for the first 24 months, and by .5% per month for the remaining
months, if any, by which the Member's Retirement Date precedes his attainment of
age 62. The Social Security Benefit, once calculated, will be frozen as of the
Member's Retirement Date.
<PAGE 12>
3.3 Additional Benefit Base for Member Retiring at Normal Retirement
Date. The Additional Benefit Base of a Vested Member who retires on a Normal
Retirement Date shall be a monthly annuity for his life, commencing at his
Normal Retirement Date, under which the annual payments shall equal the Member's
Total Benefit Base less the sum of (i) .0125 times his Years of Service times
his Social Security Benefit and (ii) the Member's Benefit Base (as reduced, if
at all, on account of Benefit Limitations) under the Basic Pension Plan. If the
remainder is negative, the Additional Benefit Base shall be zero.
3.4 Additional Benefit Base for Members Retiring on an Early Retirement
Date. The Additional Benefit Base of a Vested Member who retires on an Early
Retirement Date shall be a monthly annuity for the Member's life, commencing on
such Early Retirement Date, under which the annual payments shall equal (i) the
Member's Adjusted Basic Pension Plan Benefit Base as determined in (a) below,
plus (ii) the Early Retirement Percentage as determined in (b) below times the
remainder of his Total Benefit Base less his Adjusted Basic Pension Plan Benefit
Base, minus (iii) .0125 times his Years of Service times his Social Security
Benefit, minus (iv) the Member's Benefit Base (as reduced, if at all, on account
of Benefit Limitations) under the Basic Pension Plan.
(a) Adjusted Basic Pension Plan Benefit Base equals the Benefit Base as
determined under the Basic Pension Plan without reduction on account of Benefit
Limitations and adjusted as if deferrals
<PAGE 13>
under the National Fuel Gas Company Deferred Compensation Plan were not excluded
from the definition of Final Average Pay under the Basic Pension Plan, and
multiplied by the appropriate Early Retirement Percentage, if applicable, as
provided for in Section 4.02 of the Basic Pension Plan.
(b) The Early Retirement Percentage under the Plan is determined in
accordance with the following scale:
Retirement Age Early Retirement Percentage
-------------- ---------------------------
65 100
64 94
63 88
62 82
61 70
60 58
59 46
58 34
57 22
56 10
55 years and 2 months 0
The Early Retirement Percentage determined in accordance with the above
scale respecting ages 62, 63 and 64, shall be increased by 1/2 of 1% for each
whole calendar month by which a Member's Early Retirement Date follows the first
of the month coinciding with or immediately following his 62nd, 63rd, or 64th
birthday, as the case may be. The Early Retirement Percentage determined in
accordance with the above scale respecting ages 55 years and 2 months, 56, 57,
58, 59,
<PAGE 14>
60, and 61, shall be increased by 1% for each whole calendar month by which his
Early Retirement Date follows the first of the month coinciding with or
immediately following his 55 year and 2 month, 56th, 57th, 58th, 59th, 60th and
61st birthdays, as the case may be. Furthermore, the Early Retirement Percentage
shall be increased by .125% for each whole calendar month by which a Member's
Years of Service exceed 30; provided, however, that this shall never result in
an Early Retirement Percentage in excess of 100%. (In the event a Member desires
to retire on the earliest possible Early Retirement Date, i.e., on the first of
the month coinciding with or immediately following his 55th birthday, the
increase in percentage as a result of Years of Service in excess of 30 shall be
made from a base percentage of -2%, in computing Early Retirement Percentage.)
(c) The benefit a Member will receive through the Plan if he retires
early consists of two parts. The first part will make him whole for any
reduction in the regular pension he receives under the Basic Pension Plan
resulting from Internal Revenue Code limitations and his participation in the
National Fuel Gas Company Deferred Compensation Plan. This is frequently called
a "tophat." The second part is a benefit equal to a percentage of the Plan
benefit normally paid at age 65. This normal Plan benefit is calculated by
subtracting the amount received under the Basic Pension Plan and the "tophat"
from the Total Benefit Base. The percentages are set forth in Section 3.4(b) on
page 10. The benefit payable under this second part but not the "tophat" will be
<PAGE 15>
reduced by a lesser Social Security offset. The offset is .0125 times Years of
Service times Social Security Benefit (as defined in 3.2).
For example, if an employee had 30 Years of Service under this Plan (29
under the Basic Pension Plan) and a Final Average Salary of $100,000; if he
desired to retire at age 58 (10% reduction under the Basic Pension Plan); if the
applicable limits under Section 415 of the Code capped the Basic Pension Plan
annual benefits expressed as a Benefit Base equivalent, at $85,000; and if his
Social Security Benefit as determined hereunder were $10,000; the formula would
work as follows:
(i) Adjusted Basic Pension Benefit Base = [(.0125) ($7,800) + (.015)
($92,200)] (29) (.90) = $38,641.05
(ii) Early Retirement Percentage times [Total Benefit Base minus
(i)] = (.34) [(.591) ($100,000) - $38,641.05] = $6,956.04
(iii) Additional Benefit Base = $38,641.05 + $6,956.04 - [(.0125)
(30) ($10,000)] - $38,641.05 = $3,206.04
(d) If, respecting any Member, his Early Retirement Percentage times
the remainder of Total Benefit Base less Adjusted Basic Pension Plan Benefit
Base, results in a figure which is less than or equal to .0125 times his Years
of Service times his Social Security Benefit, Additional Benefit Base shall
equal Adjusted Basic Pension Plan Benefit Base less the Member's Benefit Base
(as reduced, if at all, on account of Benefit Limitations) under the Basic
Pension Plan. This provides that, if the bonus for Early Retirement under the
Plan is less valuable than the Social Security offset provided hereunder, the
<PAGE 16>
Member will not be prejudiced thereby; i.e., will not lose any portion of the
benefits provided for under the Plan to undo the impact of Benefit Limitations.
3.5 Late Retirement. A Member's Years of Service shall be credited if
they extend beyond his Normal Retirement Date, (but shall not exceed 40 in
total), and the Final Average Pay determination shall reflect such Years of
Service. However, there shall be no actuarial adjustment to his Additional
Benefit Base on account of a Member's retirement after Normal Retirement Date;
for such purpose Additional Benefit Base hereunder shall be computed as if his
late retirement date were his Normal Retirement Date.
3.6 Adjustment of Retirement Benefit. The amount of Retirement Benefits
payable to or in respect of a Member shall be reduced by the amount of any
increases in the benefits payable under the Basic Pension Plan to or in respect
of such Member (whether due to increases in the Benefit Limitations or
otherwise) subsequent to the Member's Retirement Date, and shall be increased by
the amount of any such decrease subsequent to the Member's Retirement Date, as
the case may be. Notwithstanding the above, (i) any increase in benefits payable
under the Basic Pension Plan due to a full or partial cost of living adjustment
or (ii) any increase in Basic Pension Plan benefits due to a change in benefit
formula thereunder shall not cause a reduction in Retirement Benefits. Moreover,
any such increase in (i) or (ii) above, if and to the extent ineffective
respecting a Member due to Benefit Limitations, shall be provided through this
Plan.
<PAGE 17>
ARTICLE 4
Vesting; Forfeiture
4.1 Time of Vesting. No Retirement Benefits will be payable to or in
respect of any Member unless (i) that Member remains employed by the Company
until he is Vested under this Plan; or (ii) Section 4.4 applies.
4.2 Misconduct. Notwithstanding Section 4.1 hereof, no Retirement
Benefits will be payable to or in respect of a Member whose employment is
terminated by the Company for serious, willful misconduct in respect of his
obligations to the Company, including but not limited to the commission of a
felony or a perpetration of a common law fraud which has damaged, or is likely
to result in damage to, the Company.
4.3 Competition. If and so long as a Member or retired Member shall be
employed by any corporation, entity or individual which is then engaged in a
business competitive with the Company, or shall be engaged in any such business,
or shall aid, advise or assist or attempt to aid, advise or assist any
corporation, individual or entity in engaging in any such business, or shall
endeavor, directly or indirectly, to interfere with the relations between the
Company and any customer or engage in any activity that would be deemed by the
Committee in its sole discretion to be detrimental to the Company's best
interests, the rights of such Member or retired Member to Retirement Benefits,
including the rights of any Beneficiary, shall be forfeited with the same
<PAGE 18>
full force and effect as though the Retirement Benefits had not been granted
under any of the provisions of the Plan, unless the Committee determines that
such activity is not detrimental to the best interests of the Company;
provided that from and after 60 days following cessation by the Member or
retired Member of such activity and written notice by him to the Committee, his
right to receive Retirement Benefits hereunder shall be restored, unless the
Committee, in its sole discretion, determines that the prior activity has
caused substantial damage to the Company.
No action under the Section shall be taken upon or after the occurrence
of a Change in Control.
4.4 In the Event of a Change in Control. If a Change in Control occurs,
and a Member hereof at that time or within three years thereafter shall no
longer be an officer of, or employed by, a Company, his Retirement Benefit shall
vest at the time of his cessation of employment with a Company, and shall be
payable to him or for his benefit in the form of a lump sum, based upon his
accrued Additional Benefit Base at Normal Retirement Date and discounting same
by using the interest assumption(s) then used by the Pension Benefit Guaranty
Corporation for computing the value of immediate annuities upon the termination
of a tax-qualified defined benefit plan such as the Basic Pension Plan.
<PAGE 19>
ARTICLE 5
Form of Payment of Benefits
5.1 Coordination with Basic Pension Plan. Retirement Benefits shall be
payable to or in respect of a Member eligible therefor at the same time, in the
same manner and form, and subject to the same terms and conditions as stated in
Sections 5.02 to 5.06 of the Basic Pension Plan, except that there shall be no
disability benefit under this Plan. If Retirement Benefits are to be paid after
the Member's or retired Member's death to his Beneficiary, Retirement Benefits
shall be payable to such Beneficiary in the same time, manner and form as
payments under the Basic Pension Plan.
5.2 Right to Adjust. The Committee shall have the right to adjust
Retirement Benefits payable under this Plan to correct errors, and/or to provide
uniform treatment of Members, retired Members or Beneficiaries.
5.3 Spouse's Benefit. In the event of a Vested Member's death, his
spouse shall receive Retirement Benefits hereunder equal to the greater of (i)
or (ii):
(i) .50 times the Member's Additional Benefit Base computed under
Section 3.3, except that if the Member's surviving spouse is more than five
years younger than the Member, the .50 multiplier described in this clause shall
be reduced by .00125 for each month in excess of 60 that the surviving spouse's
age is less than that of the Member. Thus, for example, the multiplier declines
to .30 if the surviving spouse is 220 months younger than the Member.
<PAGE 20>
(ii) 50% of the Retirement Benefit which the Member would have received
had payment thereof commenced on the day before the date of his death in the
form of the Automatic Joint and Survivor Annuity (as defined and described in
the Basic Pension Plan).
5.4 Lump Sum Payment Option. There shall be one exception to Section
5.1: A Member may elect to receive Retirement Benefits in the form of a lump sum
payment even if he does not or may not select such option under the Basic
Pension Plan. Such election may only be made by means of an irrevocable election
executed in the calendar year prior to the year in which the Member's Retirement
Date occurs. The most recently published mortality table that is generally
accepted by American actuaries and reasonably applicable to the Plan, and a 6
percent annual interest rate or discount rate, shall be used to convert the
Member's Additional Benefit Base to a lump sum equivalent. (However, with
respect to other forms of benefit available under the Plan, the mortality table
used in the Basic Pension Plan and described in Section 1.01 thereof, or a
successor section, shall continue to be used.) If the Member's Additional
Benefit Base, had it been paid in the form of an annuity, would otherwise have
been expected to increase or decrease subsequent to the Member's Retirement
Date, (for example, due to cost of living increases that effectively raise the
maximum amounts that may be paid from the Basic Pension Plan as a result of the
operation of Code Section 415 limits, or due to expected post-retirement AARCIP
awards), the Company may adjust such lump sum payment accordingly and shall
later true it up either by paying an additional sum to the Member or by
receiving a refund of any excess from the Member.
<PAGE 21>
ARTICLE 6
Source of Payment
6.1 All payments provided for under the Plan shall be paid in cash from
the general funds of the Company; provided, however, that such payments shall be
reduced by the amount of any payments made to or in respect of a Member from any
trust or special or separate fund established by the Company to assure such
payments. The Company shall not be required to establish a special or separate
fund or other segregation of assets to assure such payments, and, if the Company
shall make any investments to aid it in meeting its obligations hereunder, the
Member and his Beneficiary shall have no right, title, or interest whatever in
or to any such investments except as may otherwise be expressly provided in a
separate written instrument relating to such investments. Nothing contained in
this Plan, and no action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind between the Company and any Member or
Beneficiary. To the extent that any Member or Beneficiary acquires a right to
receive payments from the Company hereunder, such right shall be no greater than
the right of an unsecured creditor of the Company.
<PAGE 22>
ARTICLE 7
Administration of the Plan
7.1 Committee to Administer. The Plan shall be administered by the
Committee which shall have full power and authority to interpret, construe and
administer the Plan, and review claims for benefits under the Plan, and the
Committee's interpretations and constructions of the Plan and actions thereunder
shall be binding and conclusive on all persons and for all purposes.
7.2 Agents. For purposes of the Act, the members of the Committee shall
be the named fiduciaries of the Plan for administration of the Plan (including
but not limited to complying with reporting and disclosure requirements and
establishing and maintaining Plan records), and shall engage such certified
public accountants, who may be accountants for the Company, as it shall require
or may deem advisable for purposes of the Plan. The Committee may arrange for
the engagement of such legal counsel, who may be counsel for the Company, and
make use of such agents and clerical or other personnel as they each shall
require or may deem advisable for purposes of the Plan. The Committee may rely
upon the written opinion of such counsel and the accountants engaged by the
Committee and may delegate to any agent, who may be a Company employee, or to
any sub-committee or member of the Committee, its authority to perform any act
hereunder, including without limitation those matters involving the exercise of
discretion, provided that such delegation shall be subject to revocation at any
time at the discretion of the Committee.
<PAGE 23>
7.3 Liability; Indemnity. To the maximum extent permitted by the Act,
no member of the Committee, nor any of their agents, including Company officers
or employees, shall be personally liable by reason of any contract or other
instrument executed by any of them in their capacity as members of the Committee
or otherwise, nor for any mistake of judgment made in good faith, and the
Company shall indemnify and hold harmless, directly from its own assets, each
member of the Committee and each other officer, employee, or director of the
Company to whom any duty or power relating to the administration or
interpretation of the Plan or to the management or control of the assets of the
Plan may be delegated or allocated, against any cost or expense (including
counsel fees) or liability (including any sum paid in settlement of a claim with
the approval of the Company) arising out of any act or omission to act in
connection with the Plan unless arising out of such person's own fraud or bad
faith. Said persons shall be entitled to rely conclusively upon, and shall be
fully protected in any action taken by them or any of them in good faith in
reliance upon, any table, valuation, certificate, opinion or report which shall
be furnished to them or any of them by an actuary, accountant, counsel or other
expert who shall be employed or engaged by them.
7.4 Binding Effect of Decisions. The decision or action of this
Committee with respect to any question arising out of or in connection with the
administration, interpretation and application of the Plan and the rules and
regulations promulgated hereunder shall be final, conclusive and binding upon
all persons having any interest in the Plan.
<PAGE 24>
ARTICLE 8
Amendment and Termination
8.1 Subject to the application of Article 4 in the situations therein
enumerated, the Plan may be amended, suspended or terminated, in whole or in
part, by the Board of Directors, and Members may be adversely affected thereby
provided that such actions may not deprive Vested Members of Retirement Benefits
accrued until the date of such actions. However, any amendment that changes the
interest rate described in Section 5.4 or otherwise changes the methods for
computing lump sum equivalents thereunder, or that otherwise reduces or
eliminates the lump sum payment option or any other form of benefit payment
option under the Plan, shall not be considered to be a deprivation of the
accrued Retirement Benefits of Vested Members. In addition, prior to a Change in
Control, the rights of Vested Members may be affected if failing to make changes
would be administratively burdensome and if the Member voluntarily consents to
such change in writing, or if changes are required by law.
<PAGE 25>
ARTICLE 9
General Provisions
9.1 Effect of Corporate Reorganization. This Plan shall be binding upon
and inure to the benefit of the Company and its successors and assigns and the
Member, and his designees, Beneficiaries, legal representatives and estate.
Nothing in this Plan shall preclude the Company from consolidating or merging
into or with, or transferring all or substantially all of its assets to, another
corporation which assumes this Plan and all obligations of the Company
hereunder. Upon such a consolidation, merger or transfer of assets, and
assumption of the Plan, the term "Company" shall refer to such other corporation
and this Plan shall continue in full force and effect.
9.2 Right to Discharge Member. Neither the Plan nor any action taken
hereunder shall be construed as giving to a Member the right to be retained in
the employ of the Company or as affecting the right of the Company to discharge
any Member, at any time without regard to the effect such discharge would have
upon his eligibility for or receipt of benefits under the Plan.
9.3 Withholding. The Company may withhold from any benefits payable
under this Plan all federal, state, city or other taxes as shall be required (as
determined by the Company) pursuant to any law or governmental regulation or
ruling.
9.4 Assignability. No right to any amount payable at any time under
the Plan may be assigned, transferred, pledged, or encumbered, either
voluntarily or by operation of law, except as provided expressly herein as to
<PAGE 26>
payments to a Beneficiary or as may otherwise be required by law. If, by reason
of any attempted assignment, transfer, pledge, or encumbrance, or any bankruptcy
or other event happening at any time, any amount payable under the Plan would be
made subject to the debts or liabilities of the Member or his Beneficiary or
would otherwise not be enjoyed by him, then the Committee, if it so elects,
may terminate such person's interest in any such payment and direct that the
same be held and applied to or for the benefit of the Member, his Beneficiary,
or any other person deemed to be the natural objects of his bounty, taking
into account the expressed wishes of the Member (or, in the event of his death,
his Beneficiary).
<PAGE 27>
9.5 Inability to Utilize Benefits. If the Committee shall find that any
person to whom any amount is or was payable hereunder is unable to care for his
affairs because of illness or accident or other reasons, or has died, then the
Committee, if it so elects, may direct that any payment or any part thereof due
such person shall be paid to his estate (unless a prior claim therefor has been
made by a duly appointed legal representative) or be paid or applied for the
benefit of such person or to or for the benefit of his spouse, children or other
dependents, an institution maintaining or having custody of such person, any
other person deemed by the Committee to be a proper recipient on behalf of such
person otherwise entitled to payment, or any of them, in such manner and
proportion as the Committee may deem proper. Any such payment shall be in
complete discharge of the liability therefor of the Company, the Plan or the
Committee or any member, officer or employee thereof. The Committee may withhold
the payment of any amount that shall be payable in accordance with the
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provisions of the Plan to a person under legal disability until a representative
of such person competent to receive such payment on his behalf shall have been
properly appointed.
9.6 Actuarial Equivalents. Except as otherwise set forth in Section
5.4, whenever, under this Plan, it is necessary to determine whether one benefit
is less than, equal to, or larger than another, or whether one benefit is the
actuarial equivalent of another whether or not such benefits are provided under
this Plan, such determination shall be made using mortality, interest and any
other assumptions used at the time in determining actuarial equivalents under
the Basic Pension Plan.
9.7 Health Information. The Member shall provide to the Company, if so
requested and as a precondition for remaining a Member, all health information
and other information as the Company may require should it decide to purchase
life insurance policies or annuity contracts.
9.8 Additional Benefit. The benefits payable under this Plan shall be
in addition to all other benefits provided for Employees of the Company, except
as otherwise provided in this Plan.
9.9 Headings. The captions preceding the sections and articles hereof
have been inserted solely as a matter of convenience and in no way define or
limit the scope or intent of any provisions of the Plan.
9.10 Governing Law. This Plan shall be governed by the laws of the
State of New York as from time to time in effect.