Exhibit (10)(o)* to Report
on Form 10-K for Fiscal
Year Ended June 30, 1996
by Parker-Hannifin Corporation
Parker-Hannifin Corporation Savings Restoration Plan,
as amended as of August 17, 1995
and August 15, 1996
*Numbered in accordance with Item 601 of Regulation S-K.
PARKER-HANNIFIN CORPORATION
SAVINGS RESTORATION PLAN
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PARKER-HANNIFIN CORPORATION
SAVINGS RESTORATION PLAN
Parker-Hannifin Corporation, an Ohio corporation, (the "Company"),
hereby establishes this Savings Restoration Plan (the "Plan"), effective
October 1, 1994, for the purpose of attracting high quality executives
and promoting in its executives increased efficiency and an interest in
the successful operation of the Company by restoring some of the
deferral opportunities and employer-provided benefits that are lost
under The Parker-Hannifin Employees' Savings Plus Stock Ownership Plan
due to legislative limits. The benefits provided under the Plan shall be
provided in consideration for services to be performed after the
effective date of the Plan, but prior to the executive's retirement.
ARTICLE 1
Definitions
1.1 Administrator shall mean the Company or, if applicable, the
committee appointed by the Board of Directors of the Company to
administer the Plan pursuant to Article 13 of the Plan.
1.2 Annual Deferral shall mean the amount of Compensation which
the Participant elects to defer for a Plan Year pursuant to Articles 2
and 3 of the Plan.
1.3 Beneficiary shall mean the person or persons or entity
designated as such in accordance with Article 14 of the Plan.
1.4 Change in Control means the occurrence of one of the following
events:
(i) any "person" (as such term is defined in Section 3(a)(9) of
the Securities Exchange Act of 1934 (the "Exchange Act") and as
used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or
becomes a "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of
the Company representing 20% or more of the combined
voting power of the Company's then outstanding
securities eligible to vote for the election of the
Board of Directors of the Company (the "Board") (the "Company's
Voting Securities"); provided, however, that the event described
in this paragraph shall not be deemed to be a Change in
Control by virtue of any of the following situations: (A) an
acquisition by the Company or any corporation or entity in which
the Company has a direct or indirect ownership interest of 50% or
more of the total combined voting power of the then outstanding
securities of such corporation or other entity (a "Subsidiary");
(B) an acquisition by any employee benefit plan sponsored or
maintained by the Company or any Subsidiary; (C) an acquisition
by any underwriter temporarily holding securities pursuant to an
offering of such securities; (D) a Non-Control Transaction (as
defined in paragraph (iii)); (E) as pertains to a
Participant, any acquisition by the
Participant or any group of persons (within the meaning of
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) including
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the Participant (or any entity in which the Participant or a group
of persons including the Participant, directly or indirectly,
holds a majority of the voting power of such entity's outstanding
voting interests); or (F) the acquisition of Company Voting
Securities from the Company, if a majority of the Board approves
a resolution providing expressly that the acquisition pursuant
to this clause (F) does not constitute a Change in Control
under this paragraph (i);
(ii) individuals who, at the beginning of any period of
twenty-four (24) consecutive months, constitute the Board
(the "Incumbent Board") cease for any reason to constitute
at least a majority thereof; provided, that (A) any person
becoming a director subsequent to the beginning of such
twenty-four (24) month period, whose election, or nomination
for election, by the Company's shareholders was approved by
a vote of at least two-thirds of the directors comprising the
Incumbent Board who are then on the Board (either by a specific
vote or by approval of the proxy statement of the Company in which
such person is named as a nominee for director, without objection
to such nomination) shall be, for purposes of this paragraph (ii),
considered as though such person were a member of the Incumbent
Board; provided, however, that no individual initially elected or
nominated as a director of the Company as a result of an
actual or threatened election contest with respect to directors
or any other actual or threatened solicitation of proxies or
consents by or on behalf of any person other than the Board
shall be deemed to be a member of the Incumbent Board;
(iii) the consummation of a merger, consolidation, share
exchange or similar form of corporate reorganization of the
Company or any Subsidiary that requires the approval of the
Company's stockholders, whether for such transaction or the
issuance of securities in connection with the transaction
or otherwise (a "Business Combination"), unless (A) immediately
following such Business Combination: (1) more than 50% of the
total voting power of the corporation resulting from such Business
Combination (the "Surviving Corporation") or, if applicable, the
ultimate parent corporation which directly or indirectly has
beneficial ownership of 100% of the voting securities eligible
to elect directors of the Surviving Corporation (the
"Parent Corporation"), is represented by Company Voting
Securities that were outstanding immediately prior to the
Business Combination (or, if applicable, shares into which
such Company Voting Securities were converted pursuant to
such Business Combination), and such voting power among the
holders thereof is in substantially the same proportion as the
voting power of such Company Voting Securities among the holders
thereof immediately prior to the Business Combination, (2) no
person (other than any employee benefit plan sponsored or
maintained by the Surviving Corporation or the Parent
Corporation) is or becomes the beneficial owner, directly or
indirectly, of 20% or more of the total voting power of the
outstanding voting securities eligible to elect
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directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation), and (3) at least a
majority of the members of the board of directors of the
Parent Corporation (or, if there is no Parent Corporation,
the Surviving Corporation), following the Business Combination,
were members of the Incumbent Board at the time of the Board's
approval of the execution of the initial agreement providing for
such Business Combination (a "Non-Control Transaction") or
(B) the Business Combination is effected by means of the
acquisition of Company Voting Securities from the Company, and
a majority of the Board approves a resolution providing expressly
that such Business Combination does not constitute a Change in
Control under this paragraph (iii); or
(iv) the stockholders of the Company approve a plan of
complete liquidation or dissolution of the Company or the sale
or other disposition of all or substantially all of the assets
of the Company and its Subsidiaries.
Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur solely because any person acquires beneficial ownership of more than 20%
of the Company Voting Securities as a result of the acquisition of Company
Voting Securities by the Company which, by reducing the number of Company
Voting Securities outstanding, increases the percentage of shares beneficially
owned by such person; provided, that if a Change in Control would occur as a
result of such an acquisition by the Company (if not for the operation of this
sentence), and after the Company's acquisition such person becomes the
beneficial owner of additional Company Voting Securities that increases the
percentage of outstanding Company Voting Securities beneficially owned by such
person, a Change in Control shall then occur.
Notwithstanding anything in this Plan to the contrary, if the
Participant's employment is terminated prior to a Change in Control, and the
Participant reasonably demonstrates that such termination was at the request
of a third party who has indicated an intention or taken steps reasonably
calculated to effect a Change in Control, (a "Third Party"), then for all
purposes of this Plan, the date immediately prior to the date of such
termination of employment shall be deemed to be the date of a Change in
Control for such Participant.
1.5 Compensation shall mean the sum of the Participant's base
salary and anticipated regular bonuses (including profit-sharing, RONA,
and executive compensation, but excluding payments under any long term
incentive plan, volume incentive plan, or other extraordinary bonus or
incentive plan) for a Plan Year before reductions for deferrals under
the Plan, or the Executive Deferral Plan, or the Savings Plan, or the
Benefits Plus Program.
1.6 Crediting Rate shall mean: (i) the amount described in
Section 1.6.1 to the extent the Restoration Account Balance represents
either Annual Deferrals under Article 3 or earnings previously credited
on such deferrals under Section 5.2; or (ii) the amount described in
Section 1.6.2 to the extent the Restoration Account balance represents
either
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Matching Credits under Article 4 or interest previously credited on such
Matching Credits under Section 5.2:
1.6.1 Crediting Rate for Annual Deferrals shall mean any
notional gains or losses equal to those generated as if the Restoration
Account balance attributable to Annual Deferrals under Article 3 had
been invested in one or more of the investment portfolios sponsored by
The Prudential Series Fund, Inc. and designated as available by the
Administrator, less separate account fees and less applicable
administrative charges determined annually by the Administrator.
The allocation of the Restoration Account shall be
determined by the Participant among one or more of the available
portfolios. The gains or losses shall be credited based upon the daily
unit values for the portfolio(s) selected by the Participant. The rules
and procedures for allocating the Restoration Account balance among the
portfolios shall be determined by the Administrator. The Participant's
allocation is solely for the purpose of calculating the Crediting Rate.
Notwithstanding the method of calculating the Crediting Rate, the
Company shall be under no obligation to purchase any investments
designated by the Participant.
1.6.2 Crediting Rate for Matching Credits shall mean any
notional gains or losses equal to those generated as if the Restoration
Account balance attributable to Matching Credits under Article 4 had
been invested in the Common Stock of the Company, including reinvestment
of dividends. The rules and procedures for determining the value of the
Common Stock of the Company shall be determined by the Administrator.
The rules and procedures for re-allocating the Restoration Account
balance attributable to the Matching Credits among the other portfolios
offered under the Plan shall be determined by the Administrator.
1.7 Disability shall mean any long term disability as defined
under the Company's long term disability plan. The Administrator, in
its complete and sole discretion, shall determine a Participant's
Disability. The Administrator may require that the Participant submit
to an examination on an annual basis, at the expense of the Company, by
a competent physician or medical clinic selected by the Administrator to
confirm Disability. On the basis of such medical evidence, the
determination of the Administrator as to whether or not a condition of
Disability exists or continues shall be conclusive.
1.8 Early Retirement Date shall mean age 55 with ten or more
years of employment with the Company.
1.9 Eligible Executive shall mean a key employee of the Company
or any of its subsidiaries who: (i) participates in the Savings Plan
and makes the maximum permissible pre-tax contributions of compensation;
(ii) is designated by the Administrator as eligible to participate in
the Plan (subject to the restriction in Sections 10.2 and 12.2 of the
Plan); and (iii) qualifies as a member of the "select group of
management or highly compensated employees" under ERISA.
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1.10 ERISA shall mean the Employee Retirement Income Security Act
of 1974, as amended.
1.11 Executive Deferral Plan shall mean the Parker-Hannifin
Corporation Executive Deferral Plan as it currently exists and as it may
subsequently be amended.
1.12 Financial Hardship shall mean an unexpected need for cash
arising from an illness, casualty loss, sudden financial reversal, or
other such unforeseeable occurrence as determined by the Administrator.
Cash needs arising from foreseeable events such as the purchase of a
residence or education expenses for children shall not, alone, be
considered a Financial Hardship.
1.13 Fixed Crediting Rate shall mean an effective annual yield
equal to ninety percent (90%) of the sixty (60) month rolling average of
the Ten-Year United States Treasury Note as determined by the
Administrator on September 30 of the preceding year. Notwithstanding
the preceding sentence, with respect to the first Plan Year, the Fixed
Crediting Rate shall be determined as of September 30, 1994. The Fixed
Crediting Rate in effect as of the Participant's Termination of
Employment or death shall be held constant for the remainder of the
period for which benefits are paid.
1.14 Matching Credit shall mean the Company's credit to the
Participant's Restoration Account under Article 4.
1.15 Normal Retirement Date shall mean the date on which a
Participant attains age 65.
1.16 Participant shall mean an Eligible Executive who has elected
to participate and has completed a Participation Agreement pursuant to
Article 2 of the Plan.
1.17 Participation Agreement shall mean the Participant's written
election to participate in the Plan.
1.18 Plan Year shall mean the calendar year, except that the
first Plan Year shall be the year commencing October 1, 1994 and ending
December 31, 1994.
1.19 Restoration Account shall mean the notional account
established for record keeping purposes for a Participant pursuant to
Article 5 of the Plan.
1.20 Retirement shall mean a termination of employment following
Normal or Early Retirement Date.
1.21 Savings Plan shall mean The Parker-Hannifin Employees'
Savings Plus Stock Ownership Plan as it currently exists and as it may
subsequently be amended.
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1.22 Statutory Limit shall mean any statutory or regulatory limit
on salary reduction contributions to savings plans, or on compensation
taken into account in calculating employer or employee contributions to
savings plans with the exception of Internal Revenue Code Section
415(c), as adjusted for inflation, which shall be deemed to apply to the
combination of both employer and employee contributions made in
combination to the Plan and the Savings Plan. The impact of such limits
on the Participants shall be determined by the Company prior to the
beginning of each Plan Year based upon its best estimates and according
to procedures determined by the Administrator. Once the Company has
determined the impact of the Statutory Limits, no adjustment shall be
made to increase deferrals or matching credits under this Plan
notwithstanding any adjustments ultimately required under the Savings
Plan due to actual employee contributions or other factors.
1.23 Termination of Employment shall mean the Participant's
employment with the Company ceases for any reason whatsoever, whether
voluntary or involuntary, other than Retirement or death.
1.24 Unscheduled Withdrawal shall mean a distribution of all or a
portion of the entire amount credited to the Participant's Restoration
Account requested by the Participant pursuant to the provisions of
Article 11 of the Plan.
1.25 Valuation Date shall mean the end of the month in which
Retirement, Termination of Employment, or death occurs, except in the
event of an election to delay retirement benefits under Article 6, in
which case the Valuation Date shall mean the November 30 of the year
preceding commencement of benefit payments.
ARTICLE 2
Participation
2.1 Participation Agreement / Annual Deferral. An Eligible
Executive shall become a Participant in the Plan on the first day of the
Plan Year coincident with or next following the later of the date the
individual becomes an Eligible Executive and the date the individual
begins to participate in the Savings Plan, provided such Eligible
Executive has submitted to the Administrator a Participation Agreement.
To be effective, the Eligible Executive must submit the Participation
Agreement to the Administrator during the enrollment period designated
by the Administrator. In the Participation Agreement, and subject to
the restrictions in Article 3, the Eligible Executive shall designate
the Annual Deferral for the covered Plan Year.
2.2 Continuation of Participation. An Eligible Executive who
has elected to participate in the Plan by making an Annual Deferral
shall continue as a Participant in the Plan for purposes of such Annual
Deferral even though such executive ceases to be an Eligible Executive.
However, a Participant shall not be eligible to elect a new Annual
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Deferral unless the Participant is an Eligible Executive for the Plan
Year for which the election is made.
ARTICLE 3
Executive Deferrals
3.1 Deferral Election. A Participant who has elected to
contribute under the Savings Plan, but whose pre-tax contributions to
the Savings Plan are limited by the Statutory Limit, may elect an Annual
Deferral under this Plan to defer all or a portion of the Compensation
that he or she cannot defer under the Savings Plan due to the Statutory
Limit. Such election shall designate a specified percentage of
Compensation to be deferred. Such percentage shall include anticipated
contributions to the Savings Plan as well as to this Plan. Annual
Deferrals under this Plan shall be irrevocable.
3.2 Maximum Annual Deferral. The Annual Deferral for a Plan
Year, when combined with the amount the Participant has elected to
contribute to the Savings Plan on a pre-tax basis, may not exceed the
stated percentage of Compensation that could be deferred in the Savings
Plan but for the Statutory Limits. In addition, the Administrator
shall, in its sole discretion and prior to the first day of the Plan
Year, decrease the deferral as needed to allow the Participant to
receive the optimal Matching Credit within the Statutory Limits as
defined for purpose of the Plan.
3.3 Discontinuation of Deferral. In the event that a
Participant elects to make after-tax contributions of Compensation to
the Savings Plan, deferrals under this Plan shall cease for the
remainder of the Plan Year.
3.4 Vesting. The Participant's right to receive Compensation
deferred (and gains or losses thereon) under this Article 3 shall be
100% vested at all times.
ARTICLE 4
Company Matching Credits
4.1 Amount. The Company's Matching Credit in each Plan Year
shall equal one hundred percent (100%) of the first three percent (3%)
of Compensation deferred and twenty-five percent (25%) of the next two
(2%) of Compensation deferred, reduced by the matching contributions
credited to the Participant's account under the Savings Plan.
4.2 Discontinuation of Matching Credits. Notwithstanding the
foregoing, if the Participant decreases or ceases pre-tax contributions
and/or makes after-tax contributions to the Savings Plan in any Plan
Year, additional Matching Credits shall not be credited to the
Participant's Restoration Account for the remainder of that Plan Year.
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4.3 Vesting. Subject to Section 12.4, the Participant's right
to receive Matching Credits (and gains or losses thereon) credited to
the Participant's Restoration Account shall be one hundred percent
(100%) vested.
ARTICLE 5
Restoration Accounts
5.1 Restoration Accounts. Solely for record keeping purposes,
the Company shall maintain a Restoration Account for each Participant.
5.2 Timing of Credits -- Pre-Termination. The Company shall
credit to the Restoration Account the Annual Deferrals under Article 3
at the time the deferrals would otherwise have been paid to the
Participant but for the deferral election. Matching Credits under
Article 4 shall be credited to the Restoration Account quarterly as of
the first day of the following quarter. The Company shall also credit
gains or losses to the Restoration Account each calendar quarter, or as
of the Valuation Date, using the Crediting Rate in effect.
5.3 Mid-Year Terminations. If a Participant's Termination of
Employment occurs other than at the end of a Plan Year, the Company
shall credit gains or losses to the Restoration Account from the first
day of such Plan Year to the Valuation Date.
5.4 Statement of Accounts. The Administrator shall provide
periodically to each Participant a statement setting forth the balance
of the Restoration Account maintained for such Participant.
ARTICLE 6
Retirement Benefits
6.1 Amount. Upon Retirement, the Company shall pay to the
Participant a retirement benefit in the form provided in Section 6.2 of
the Plan, based on the balance of the Restoration Account as of the
Valuation Date. If paid as a lump sum, the retirement benefit shall be
equal to such balance. If paid in installments, the installments shall
be paid in amounts that will annually amortize such balance with
earnings and losses credited at the Crediting Rate over the period of
time benefits are to be paid.
6.2 Form of Retirement Benefits. The retirement benefit shall
be paid monthly over a period of one hundred eighty (180) months or
the number of months required to result in a monthly benefit of one
thousand dollars ($1,000.00), if less. Notwithstanding anything herein
to the contrary, the Participant may elect in the Participation
Agreement to
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have the retirement benefit paid in a lump sum or in installments paid
monthly over a period of sixty (60) or one hundred twenty (120) months.
Payments shall be made or shall begin as of the first day of the
calendar quarter next following the date sixty (60) days after the
Participant's Retirement unless the Participant elects in the
Participation Agreement for payments to begin on January l of a later
year. However, in all events payments shall commence on or before the
earlier of the date the retired Participant attains age seventy (70) or
the January 1 five years after Retirement. Except as provided under
Section 10.2, Participants may elect an alternative form of payout as
available under this Section 6.2 by written election filed with the
Administrator; provided, however, that if the Participant files the
election less than thirteen (13) months prior to the date benefit
payments are to commence, the Participant's Restoration Account shall be
reduced by ten percent (10%).
6.3 Small Benefit Exception. Notwithstanding any of the
foregoing, if the sum of all benefits payable to the Participant is less
than or equal to five thousand dollars ($5,000.00), the Company may, in
its sole discretion, elect to pay such benefits in a single lump sum.
ARTICLE 7
Termination Benefits
7.1 Amount. As of the first day of the calendar quarter
beginning at least sixty (60) days after Termination of Employment, the
Company shall pay to the Participant a termination benefit equal to the
balance of the Restoration Account as of the Valuation Date.
7.2 Form of Termination Benefits. The Company shall pay the
termination benefits in a single lump sum; provided, however, that
except following a Change in Control the Company may, in its sole
discretion, elect to pay the termination benefits over a period of three
(3) years in monthly installments, in which event the Company shall
credit interest on the unpaid balance of the Restoration Account after
the Valuation Date at the Fixed Crediting Rate in effect at the time of
Termination of Employment.
ARTICLE 8
Survivor Benefits
8.1 Pre-Commencement Survivor Benefit. If the Participant dies
prior to the time installment payments have commenced, the Company
shall pay to the Participant's Beneficiary within ninety (90) days after
the Participant's death a benefit equal to the balance of the
Participant's Restoration Account as of the Valuation Date.
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8.2 Post-Commencement Survivor Benefit. If the Participant dies
after the time installment payments have commenced, the Company shall
pay to the Participant's Beneficiary an amount equal to the remaining
benefits payable to the Participant under the Plan over the same period
such benefits would have been paid to the Participant, in which event
the Company shall credit interest on the unpaid balance of the
Restoration Account at the Fixed Crediting Rate in effect at the date of
the Participant's death.
8.3 Small Benefit Payment. Notwithstanding any of the
foregoing, in the event the sum of all benefits payable to the
Beneficiary is less than or equal to five thousand dollars ($5,000.00),
the Company may, in its sole discretion, elect to pay such benefits in a
single lump sum.
ARTICLE 9
Disability
If a Participant suffers a Disability, the Company shall pay the
benefit described in Article 6 to the Participant as if the date of the
Participant's Termination of Employment for Disability were the
Participant's Normal Retirement Date.
ARTICLE 10
Change in Control
10.1 Election. At the time the Participant is completing his
initial Participation Agreement, the Participant may elect that, if a
Change in Control occurs, the Participant (or after the Participant's
death the Participant's Beneficiary) shall receive a lump sum payment of
the balance of the Restoration Account within thirty (30) days after the
Change of Control. Such balance shall be determined as of end of the
month sixty (60) days prior to the month in which the Change of Control
occurs.
10.2 Benefit Reduction on Withdrawal. If a Participant has not
made the election described in Section 10.1 above and, within thirty
(30) days after a Change of Control, the Participant (or Beneficiary)
elects to receive a distribution of the balance of the Restoration
Account (determined as described in Section 10.1 herein), the lump sum
payment shall be reduced by an amount equal to five percent (5%) of the
total balance of the Restoration Account (instead of the ten percent
(10%) reduction otherwise provided for in Section 11.2). If a
Participant elects such a withdrawal, any on-going Annual Deferral shall
cease, and the Participant may not again be designated as an Eligible
Executive until one entire Plan Year following the Plan Year in which
such withdrawal was made has elapsed.
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ARTICLE 11
Unscheduled Withdrawals
11.1 Election. A Participant (or Beneficiary if the Participant
is deceased) may request an Unscheduled Withdrawal of all or a portion
of the entire amount credited to the Participant's Restoration Account,
which shall be paid in a single lump sum; provided, however, (i) that
the minimum withdrawal shall be twenty-five percent (25%) of the
Restoration Account balance, and (ii) that an election to withdraw
seventy-five percent (75%) or more of the balance shall be deemed to be
an election to withdraw the entire balance.
11.2 Withdrawal Penalty. There shall be a penalty deducted from
the Restoration Account prior to an Unscheduled Withdrawal equal to ten
percent (10%) of the Unscheduled Withdrawal. If a Participant elects
such a withdrawal, any on-going Annual Deferral shall cease, and the
Participant may not again be designated as an Eligible Executive until
one entire Plan Year following the Plan Year in which such withdrawal
was made has elapsed.
11.3 Small Benefit Exception. Notwithstanding any of the
foregoing, if the sum of all benefits payable to the Participant or
Beneficiary who has requested the Unscheduled Withdrawal is less than or
equal to five thousand dollars ($5,000.00), the Company may, in its sole
discretion, elect to pay out the entire Restoration Account balance
(reduced by the ten percent (10%) penalty) in a single lump sum.
ARTICLE 12
Conditions Related to Benefits
12.1 Nonassignability. The benefits provided under the Plan may
not be alienated, assigned, transferred, pledged or hypothecated by or
to any person or entity, at any time or any manner whatsoever. These
benefits shall be exempt from the claims of creditors of any Participant
or other claimants and from all orders, decrees, levies, garnishment or
executions against any Participant to the fullest extent allowed by law.
12.2 Financial Hardship Distribution. Upon a finding that the
Participant or the Beneficiary has suffered a Financial Hardship, the
Administrator may in its sole discretion, permit the Participant to
cease any on-going deferrals and accelerate distributions of benefits
under the Plan in the amount reasonably necessary to alleviate such
Financial Hardship. If a distribution is to be made to a Participant on
account of Financial Hardship, the Participant may not make deferrals
under the Plan until one entire Plan Year following the Plan Year in
which a distribution based on Financial Hardship was made has elapsed.
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12.3 No Right to Company Assets. The benefits paid under the
Plan shall be paid from the general funds of the Company, and the
Participant and any Beneficiary shall be no more than unsecured general
creditors of the Company with no special or prior right to any assets of
the Company for payment of any obligations hereunder.
12.4 Protective Provisions. The Participant shall cooperate with
the Company by furnishing any and all information requested by the
Administrator, in order to facilitate the payment of benefits hereunder,
taking such physical examinations as the Administrator may deem
necessary and taking such other actions as may be requested by the
Administrator. If the Participant refuses to cooperate, the Company
shall have no further obligation to the Participant under the Plan. In
the event of a Participant's suicide during the first two (2) years of
participation in the Plan, or if the Participant makes any material
misstatement of information or nondisclosure of medical history, then no
benefits shall be payable to the Participant or the Participant's
Beneficiary or estate under the Plan beyond the sum of the Participant's
Annual Deferrals.
12.5 Withholding. The Participant or the Beneficiary shall make
appropriate arrangements with the Company for satisfaction of any
federal, state or local income tax withholding requirements and Social
Security or other employee tax requirements applicable to the payment of
benefits under the Plan. If no other arrangements are made, the Company
may provide, at its discretion, for such withholding and tax payments as
may be required.
ARTICLE 13
Administration of Plan
The Company shall administer the Plan, provided, however, that the
Company may elect by action of its Board of Directors to appoint a
committee of three (3) or more individuals to administer the Plan. All
references to the Administrator herein shall refer to the Company or, if
such committee has been appointed, the committee.
The Administrator shall administer the Plan and interpret,
construe and apply its provisions in accordance with its terms. The
Administrator shall further establish, adopt or revise such rules and
regulations as it may deem necessary or advisable for the administration
of the Plan. All decisions of the Administrator shall be final and
binding. The individuals serving on the committee shall, except as
prohibited by law, be indemnified and held harmless by the Company from
any and all liabilities, costs, and expenses (including legal fees), to
the extent not covered by liability insurance arising out of any action
taken by any member of the committee with respect to the Plan, unless
such liability arises from the individual's own gross negligence or
willful misconduct.
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ARTICLE 14
Beneficiary Designation
The Participant shall have the right, at any time, to designate
any person or persons as Beneficiary (both primary and contingent) to
whom payment under the Plan shall be made in the event of the
Participant's death. The Beneficiary designation shall be effective
when it is submitted in writing to the Administrator during the
Participant's lifetime on a form prescribed by the Administrator.
The submission of a new Beneficiary designation shall cancel all
prior Beneficiary designations. Any finalized divorce or marriage of a
Participant subsequent to the date of a Beneficiary designation shall
revoke such designation, unless in the case of divorce the previous
spouse was not designated as Beneficiary and unless in the case of
marriage the Participant's new spouse has previously been designated as
Beneficiary. The spouse of a married Participant shall consent to any
designation of a Beneficiary other than the spouse, and the spouse's
consent shall be witnessed by a notary public.
If a Participant fails to designate a Beneficiary as provided
above, or if the Beneficiary designation is revoked by marriage,
divorce, or otherwise without execution of a new designation, or if
every person designated as Beneficiary predeceases the Participant or
dies prior to complete distribution of the Participant's benefits, then
the Administrator shall direct the distribution of such benefits to the
Participant's estate.
ARTICLE 15
Amendment and Termination of Plan
15.1 Amendment of Plan. Except as provided in Section 15.3, the
Company may at any time amend the Plan in whole or in part, provided,
however, that such amendment: (i) shall not decrease the balance of the
Participant's Restoration Account at the time of such amendment; and
(ii) shall not retroactively decrease the applicable Crediting Rate of
the Plan prior to the time of such amendment. The Company may amend the
Crediting Rate or Fixed Crediting Rate of the Plan prospectively, in
which case the Company shall notify the Participant of such amendment in
writing within thirty (30) days after such amendment.
15.2 Termination of Plan. Except as provided in Section 15.3,
the Company may at any time terminate the Plan. If the Company
terminates the Plan, the date of such termination shall be treated as
the date of Retirement or Termination of Employment for the purpose of
calculating Plan benefits, and the Company shall pay to the Participant
the benefits the Participant is entitled to receive under the Plan in
monthly installments over a thirty-six (36) month period. Interest at
the Fixed Crediting Rate will be credited to the
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Participant's Restoration Account commencing as of the date of the
Plan's termination and continuing until distribution under this Section
is completed.
15.3 Amendment or Termination After Change in Control.
Notwithstanding the foregoing, the Company shall not amend or terminate
the Plan without the prior written consent of affected Participants for
a period of two calendar years following a Change in Control and shall
not thereafter amend or terminate the Plan in any manner which affects
any Participant (or Beneficiary of a deceased Participant) who commences
receiving payment of benefits under the Plan prior to the end of such
two year period following a Change in Control.
15.4 Company Action. Except as provided in Section 15.3 or 15.5,
the Company's power to amend or terminate the Plan shall be exercisable
by the Company's Board of Directors or by the committee or individual
authorized by the Company's Board of Directors to exercise such powers.
15.5 Constructive Receipt Termination. In the event the
Administrator determines that amounts deferred under the Plan have been
constructively received by Participants and must be recognized as income
for federal income tax purposes, the Plan shall terminate and
distributions shall be made to Participants in accordance with the
Provisions of Section 15.2 or as may be determined by the Administrator.
The determination of the Administrator under this Section 15.4 shall be
binding and conclusive.
ARTICLE 16
Miscellaneous
16.1 Successors of the Company. The rights and obligations of
the Company under the Plan shall inure to the benefit of, and shall be
binding upon, the successors and assigns of the Company.
16.2 ERISA Plan. The Plan is intended to be an unfunded plan
maintained primarily to provide deferred compensation benefits for "a
select group of management or highly compensated employees" within the
meaning of Sections 201, 301 and 401 of ERISA and therefore to be exempt
from Parts 2, 3 and 4 of Title I of ERISA.
16.3 Trust. The Company shall be responsible for the payment of
all benefits under the Plan. At its discretion, the Company may
establish one or more grantor trusts for the purpose of providing for
payment of benefits under the Plan. Such trust or trusts may be
irrevocable, but the assets thereof shall be subject to the claims of
the Company's creditors. Benefits paid to the Participant from any such
trust shall be considered paid by the Company for purposes of meeting
the obligations of the Company under the Plan.
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16.4 Employment Not Guaranteed. Nothing contained in the Plan
nor any action taken hereunder shall be construed as a contract of
employment or as giving any Participant any right to continued
employment with the Company.
16.5 Gender, Singular and Plural. All pronouns and variations
thereof shall be deemed to refer to the masculine, feminine, or neuter,
as the identity of the person or persons may require. As the context
may require, the singular may be read as the plural and the plural as
the singular.
16.6 Captions. The captions of the articles and sections of the
Plan are for convenience only and shall not control or affect the
meaning or construction of any of its provisions.
16.7 Validity. If any provision of the Plan is held invalid,
void or unenforceable, the same shall not affect, in any respect
whatsoever, the validity of any other provisions of the Plan.
16.8 Waiver of Breach. The waiver by the Company of any breach
of any provision of the Plan by the Participant shall not operate or be
construed as a waiver of any subsequent breach by the Participant.
16.9 Applicable Law. The Plan shall be governed and construed in
accordance with the laws of Ohio except where the laws of Ohio are
preempted by ERISA.
16.10 Notice. Any notice or filing required or permitted to be
given to the Company under the Plan shall be sufficient if in writing
and hand-delivered, or sent by first class mail to the principal office
of the Company, directed to the attention of the Administrator. 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.
ARTICLE 17
Claims and Review Procedures
17.1 Claims Procedure. The Company shall notify a Participant in
writing, within ninety (90) days after his or her written application
for benefits, of his or her eligibility or noneligibility for benefits
under the Plan. If the Company determines that a Participant is not
eligible for benefits or full benefits, the notice shall set forth: (i)
the specific reasons for such denial; (ii) a specific reference to the
provisions of the Plan on which the denial is based; (iii) a description
of any additional information or material necessary for the claimant to
perfect his or her claim, and a description of why it is needed; and
(iv) an explanation of the Plan's claims review procedure and other
appropriate information as to the steps to be taken if the Participant
wishes to have
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the claim reviewed. If the Company determines that there are special
circumstances requiring additional time to make a decision, the Company
shall notify the Participant of the special circumstances and the date
by which a decision is expected to be made, and may extend the time for
up to an additional ninety-day period.
17.2 Review Procedure. If a Participant is determined by the
Company not to be eligible for benefits, or if the Participant believes
that he or she is entitled to greater or different benefits, the
Participant shall have the opportunity to have such claim reviewed by
the Company by filing a petition for review with the Company within
sixty (60) days after receipt of the notice issued by the Company. Said
petition shall state the specific reasons which the Participant believes
entitle him or her to benefits or to greater or different benefits.
Within sixty (60) days after receipt by the Company of the petition, the
Company shall afford the Participant (and counsel, if any) an
opportunity to present his or her position to the Company orally or in
writing, and the Participant (or counsel) shall have the right to review
the pertinent documents. The Company shall notify the Participant of
its decision in writing within the sixty-day period, stating
specifically the basis of its decision, written in a manner calculated
to be understood by the Participant and the specific provisions of the
Plan on which the decision is based. If, because of the need for a
hearing, the sixty-day period is not sufficient, the decision may be
deferred for up to another sixty-day period at the election of the
Company, but notice of this deferral shall be given to the Participant.
In the event of the death of the Participant, the same procedures shall
apply to the Participant's beneficiaries.
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