Exhibit (10)(E)
OLD REPUBLIC INTERNATIONAL CORPORATION
AMENDED AND RESTATED
EXECUTIVES EXCESS BENEFITS PENSION PLAN
ARTICLE ONE
PURPOSE AND EFFECTIVE DATE
1.1 The purpose of this Executive Excess Benefits Pension Plan is to
provide key executives with retirement benefits commensurate with their current
compensation unaffected by limitations imposed by the Internal Revenue Code on
qualified retirement plans.
1.2 This Amended and Restated Plan is effective as of May 1, 1997.
ARTICLE TWO
DEFINITIONS
2.1 "Plan" shall mean this Old Republic International Corporation
Amended and Restated Executives Excess Benefits Pension Plan.
2.2 "Company" shall mean Old Republic International Corporation, a
corporation organized under the laws of the State of Delaware.
2.3 "Pension Plan" shall mean the Old Republic International Salaried
Employees Restated Retirement Plan as amended from time to time.
2.4 "Employer" shall mean the Company and each other subsidiary of the
Company which is a "Participating Employer" under the Pension Plan.
2.5 "Committee" shall mean the Pension Committee of the Board of
Directors of the Company.
2.6 "Employee" shall mean any person who is employed by an Employer.
2.7 "Eligible Employee" shall mean any Employee selected by the
Committee to participate in this Plan pursuant to Article Four hereof.
2.8 "Limiting Provision" shall mean a limitation imposed by sections
401(a)(17) or 415 of the Internal Revenue Code of 1986 or any other provision of
the Internal Revenue Code that limits the amount of benefits payable to an
individual participant in the Pension Plan.
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2.9 "Change of Control" shall have the same meaning hereunder as it has
under the Old Republic International Corporation Key Employee Performance
Recognition Plan.
ARTICLE THREE
ADMINISTRATION
3.1 The Plan shall be administered by the Pension Committee of the
Board of Directors of the Company (hereinafter the "Committee") which shall be
appointed by the Board of Directors of the Company from its own members. The
membership of the Committee may be reduced, changed, or increased from time to
time in the absolute discretion of the Board of Directors of the Company.
3.2 The Committee shall have the authority to interpret the Plan, to
establish and revise rules and regulations relating to the Plan, to designate
Eligible Employees and to make the determinations which it believes necessary or
advisable for the administration of the Plan.
ARTICLE FOUR
ELIGIBILITY
4.1 The Committee shall select the Employee or Employees who shall
participate in this Plan. The selection of Employees shall originate within the
Committee and, except as herein otherwise provided, all such selections shall be
at the sole discretion of the Committee. The Committee shall select only those
Employees who are currently "Participants" in the Pension Plan (as defined
therein), for whom the benefits which would be payable under the Pension Plan
are limited by one or more Limiting Provisions, and who meet the following
additional criteria at the time of selection by the Committee:
(a) The Employee must have attained age fifty and have been a full
time Employee of the Company, and/or a Participating Employer
and/or a subsidiary of the Company for at least fifteen years
of continuous service; and
(b) In the case of an Employee of a Participating Employer other
than the Company, the Participating Employer or subsidiary
must have been a wholly-owned subsidiary of the Company for at
least ten years.
Following action by the Committee, in the case of an Employee of a Participating
Employer, the Employee's selection must then be ratified by a majority of the
entire board of directors of the Participating Employer or, if more than one
Participating Employer, the one constituting the Employee's principal employer.
No such ratification shall be required in the case of any selected Employee who
is principally or entirely an employee of the Company.
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4.2 Once an Employee is designated as an Eligible Employee to
participate in this Plan, he shall remain an Eligible Employee, absent any
separation from service which occurs prior to attaining age fifty-five. An
Eligible Employee shall cease to be eligible and shall forfeit all rights to a
benefit payable hereunder as a result of any termination of services as a full
time Employee prior to attaining age fifty-five, other than by reason of
disability or death.
4.3 As a condition to continued eligibility and the receipt of a
benefit hereunder, an Eligible Employee shall not for a period of three years
after his termination of employment with an Employer, either as an individual on
his own account, as a partner, joint venturer, employee, agent, salesman for any
person, as an officer, director or stockholder (other than a beneficial holder
of not more than one percent of the outstanding voting stock of a company having
at least five hundred holders of voting stock) of a corporation, or otherwise,
directly or indirectly,
(i) enter into or engage in any business competitive with that carried
on by the Company or his Participating Employer or subsidiary of the
Company within any area of the United States in which the Company or
the Participating Employer or the subsidiary is then doing business; or
(ii) solicit or attempt to solicit any of the Participating Employer's,
subsidiary, or the Company's customers with whom the Employee has had
contact as an Employee in the exercise of his duties and
responsibilities with the intent or purpose to perform for such
customer the same or similar services or to sell to such customer the
same or similar products or policies which the Employee performed for
or sold to such customer during the term of his employment.
If the Committee determines that an Eligible Employee has violated either of the
foregoing covenants, the Committee may, by written notice to such Employee,
cause his benefit to be immediately suspended for the duration of such
continuing violation or if payment of a benefit has not yet commenced, notify
the Employee that such continued conduct will cause a forfeiture of such
benefit. If after the sending of such notice the Committee finds that the
Employee has violated either or both of the foregoing covenants for a period of
thirty days following such notice, the Committee may permanently cancel the
Employee's benefit hereunder, and thereupon all rights of such Employee under
this Plan shall terminate. The foregoing forfeiture provisions shall be
inoperative in the event a Change of Control occurs.
ARTICLE FIVE
BENEFITS
5.1 The benefit payable hereunder to an Eligible Employee shall be the
difference between (a) the normal, early, postponed, deferred vested or
disability benefit that would be payable under the Pension Plan in a single life
annuity not taking into consideration the limitations imposed by Limiting
Provisions and (b) the actual normal, early, postponed, deferred vested or
disability benefit payable to the Eligible Employee under the Pension Plan in a
single life annuity. For the purposes hereof, the benefit calculations referred
to in items (a) and (b) above shall be made in
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accordance with the terms and conditions of the Pension Plan in effect as of the
date the Employee is to begin receiving benefits. Once made, the calculation of
benefits payable hereunder shall not be changed or affected in any manner by any
subsequent amendment or termination of the Pension Plan, even if retroactive in
effect.
5.2 An Eligible Employee shall begin to receive his benefit under this
Plan when he begins to receive his benefit under the Pension Plan, except that
benefits hereunder shall in all cases be paid on the first regular business day
of the calendar year quarters beginning in January, April, July and October,
respectively.
5.3 The benefit payable to an Eligible Employee under this Plan shall
be paid in the same form as the benefit payable from the Pension Plan. If the
Eligible Employee has selected an optional form of benefit under the Pension
Plan, the benefit payable under this Plan shall be calculated by using the same
actuarial methods and factors that are applied to calculate his optional benefit
under the Pension Plan.
5.4 If an Eligible Employee dies before beginning to receive a benefit
hereunder and the Eligible Employee is survived by a spouse entitled to receive
a spouse's annuity under the Pension Plan, the spouse shall be paid a survivor's
benefit under this Plan equal to 50% of the difference between (a) the Eligible
Employee's accrued benefit under the Pension Plan if the Limiting Provisions
were not taken into account and (b) the accrued benefit under the Pension Plan
which was used in calculating the spouse's benefit under Paragraph 6.02 of the
Pension Plan. The survivor's benefit shall be payable at the same time and in
the same manner as the spouse's benefit under the Pension Plan, except that such
benefit payments shall continue for at least twenty quarters. If the surviving
spouse dies before a total of twenty quarterly benefit payments have been made,
the remainder of the twenty payments under the survivor's benefit shall be made
to the Eligible Employee's designated beneficiary, if any, otherwise to his
estate. Such remainder shall be calculated in the same manner as provided above
for a survivor's benefit. If there is no surviving eligible spouse at the date
of the Employee's death, a survivor's benefit shall nevertheless be calculated
as if there was a surviving eligible spouse and shall be payable in twenty
quarterly payments to the Employee's designated beneficiary, if any, otherwise
to the estate.
5.5 If an Eligible Employee dies after his benefit hereunder has
commenced, the payment of the survivor's benefit will be governed by the form of
benefit which the Eligible Employee was receiving at the time of his death,
except that if the form of benefit elected under the Pension Plan and the date
of the Eligible Employee's death would result in the Employee and his surviving
eligible spouse, if any, receiving less than twenty total quarterly benefit
payments hereunder, benefit payments hereunder shall continue until a total of
twenty quarterly payments have been made. If there is no surviving eligible
spouse upon the Employee's death, then the balance of the twenty total quarterly
benefit payments shall be paid to the Employee's designated beneficiary, if any,
otherwise to his estate.
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ARTICLE SIX
IRREVOCABLE TRUST
The Company shall establish an irrevocable grantor trust substantially in the
form attached hereto and marked as Appendix A in order to provide itself with a
source of funds to assist it in meeting its liabilities hereunder.
Notwithstanding such trust, this Plan shall remain an unfunded plan maintained
for the purpose of providing deferred compensation for a select group of
management or highly compensated Employees. Upon establishing such trust, the
Company shall deposit in it funds in an amount equal to the Company's current
accrued deferred compensation liabilities under the Plan. Such funds shall be in
the form of cash or securities. Any securities shall be valued for such purpose
at their current market value and shall not include any securities issued by the
Company or any Participating Employer. Each year thereafter, the Company shall
separately calculate or cause to be calculated the current accrued deferred
compensation liabilities with respect to each Eligible Employee participating in
the Plan. The difference between such liabilities and the value of the assets on
deposit in the Trust with respect to each Eligible Employee, taking into account
any benefit payments anticipated during the year, as well as an assumed rate of
return or interest on the investment of such sums, shall be the indicated
additional funding required. The Company shall provide the Employer of each
Eligible Employee with a copy of such calculation, and the Employer shall be
responsible for the indicated additional funding. In the event the currently
available funds exceed accrued liabilities, taking into account the anticipated
payouts and investment earnings, such excess shall be carried forward as a
credit with respect to the succeeding year's calculation. As benefits become
due, the Company shall instruct the trustee and the trustee shall make payments
directly to each Eligible Employee or other intended recipient thereof. Any
balance remaining upon termination of this Plan shall be returned by the trustee
to the Company.
ARTICLE SEVEN
AMENDMENT AND TERMINATION
7.1 The Company shall have the power at any time and from time to time,
to amend this Plan by resolution of its Board of Directors provided, however,
that no amendment shall be adopted the effect of which would be to deprive any
Eligible Employee of the benefit that is accrued under this Plan. The accrued
benefit under this Plan is a benefit equal to the difference between (a) the
accrued benefit under the Pension Plan if the Limiting Provisions were not taken
into account and (b) the accrued benefit under the Pension Plan.
7.2 The Company reserves the right to terminate this Plan by resolution
of its Board of Directors. Upon termination of this Plan Eligible Employees
shall be fully vested in their accrued benefits. The accrued benefit of an
Eligible Employee shall be payable at the same time and in the same manner as
his accrued benefit under the Pension Plan.
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ARTICLE EIGHT
MISCELLANEOUS
8.1 This Plan shall be an unfunded deferred compensation plan. The
Company and each Participating Employer shall set up reserves on their books of
account evidencing the liability under this Plan.
8.2 Nothing in the Plan shall be construed to:
(a) give any Employee any right to participate in the Plan except
in accordance with the provisions of the Plan;
(b) limit in any way the right of an Employer to terminate an
Employee's employment; or
(c) be evidence of any agreement, understanding or commitment,
express or implied, that an Employer will continue to employ
an Eligible Employee or will employ an Eligible Employee in
any particular position or at any particular rate of
remuneration.
8.3 No benefits under this Plan shall be pledged, assigned,
transferred, sold, or in any manner whatsoever anticipated, charged, or
encumbered by an Eligible Employee, former Eligible Employee, or their
beneficiaries, or in any manner be liable for the debts, contracts, obligations
or engagements of any person having a possible interest in the Plan, voluntary
or involuntary, or for any claims, legal or equitable, against any such person,
including claims for alimony or the support of any spouse.
8.4 This Plan shall be construed in accordance with the laws of the
State of Illinois in every respect, including without limitation, validity,
interpretation and performance.
8.5 Article headings herein are included for conveninece of reference
only, and this Plan is to be construed without any reference thereto. Should
there be any conflict between such headings and the text hereof, the text shall
control.
8.6 Wherever appropriate, words used in this Plan in the singular
include the plural, and the masculine include the feminine.
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IN WITNESS HEREOF, the Company has caused this Amended and Restated
Plan to be signed by its duly qualified officers and caused its corporate seal
to be hereunto affixed on this 27th day of February, 1997.
OLD REPUBLIC INTERNATIONAL CORPORATION
By: /s/ A.C. Zucaro
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President
Attest:
/s/ Spencer LeRoy III
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Secretary
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