EXHIBIT 10.31
REYNOLDS METALS COMPANY
SALARY DEFERRAL PLAN FOR EXECUTIVES
Effective June 1, 1994
ARTICLE I
PURPOSE OF THE PLAN
The purpose of the Plan is to assist the Company in attracting
and retaining key employees by providing an opportunity for deferred
taxation and capital accumulation.
ARTICLE II
DEFINITIONS
2.01 "Adjusted Deferred Salary" shall have the meaning specified
in Section 3.02.
2.02 "Beneficiary" shall mean the individual or entity designated
by the Participant to receive any amounts remaining in the Plan upon the
Participant's death. If no such designation is made, or if the designated
individual predeceases the Participant or the entity no longer exists, then
the Beneficiary shall be the Participant's estate.
2.03 "Company" shall mean Reynolds Metals Company, a Delaware
corporation.
2.04 "Deferred Salary" shall mean that portion of a Participant's
Salary which the Participant elects to defer in the manner provided for
herein, until the time or times selected for payment in accordance with
Section 4.01 at the time the Participant first elects to participate in the
Plan.
2.05 "Deferral Termination Date" shall mean the December 31st of
(a) the year in which the Participant's employment with the Company and any
subsidiary terminates, or (b) any of the three years following the year of
termination, as elected by the Participant in accordance with Section 4.01
at the time the Participant first elects to participate in the Plan.
2.06 "Effective Date" shall mean June 1, 1994.
2.07 "Eligible Employee" shall mean for any year any officer or
employee of the Company or a subsidiary (a) who is eligible to participate
in the Savings and Investment Plan on December 1 of the preceding year and
(b) whose annual rate of Salary in effect on December 1 of the preceding
year exceeds the limitation imposed as of such December 1 on the amount of
annual compensation that can be taken into account in computing
contributions or benefits under a qualified plan pursuant to Section
401(a)(17) of the Internal Revenue Code.
2.08 "Internal Revenue Code" shall mean the Internal Revenue Code
of 1986, as amended. Any reference to a specific section of the Internal
Revenue Code shall include that section and any comparable section or
sections of future legislation amending, modifying, supplementing, or
superseding the referenced section.
2.09 "Participant" shall mean an Eligible Employee who submits a
written request pursuant to the terms of this Plan for deferral of Salary.
2.10 "Phantom Investment Alternative" shall mean any of the
investment funds available from time to time under the Savings and
Investment Plan.
2.11 "Plan" shall mean this Reynolds Metals Company Salary
Deferral Plan for Executives.
2.12 "Plan Committee" shall mean the committee appointed by the
Board of Directors of the Company to administer the Plan.
2.13 "Salary" shall mean the base salary payable to an Eligible
Employee by the Company or a subsidiary.
2.14 "Savings and Investment Plan" shall mean the Reynolds Metals
Company Savings and Investment Plan for Salaried Employees, as in effect
from time to time.
ARTICLE III
ELECTIONS TO DEFER SALARY
3.01 Each year during the term of the Plan, each Eligible
Employee, whether or not then a Participant, shall have the right to elect
to defer the receipt of Salary in accordance with and subject to the
following terms and conditions:
(a) Elections with respect to a year shall apply only to
Salary otherwise payable during such year to the Eligible
Employee in excess of the annual compensation limitation imposed
for that year under Section 401(a)(17) of the Internal Revenue
Code. Eligible Employees may elect to defer receipt of not less
than 5% nor more than 90% of Salary in excess of this limit, in
multiples of 5%.
(b) For Salary earned in 1995 and future years, an election
to defer Salary must be made between December 1 and December 31
of the year immediately preceding the year in which the Salary is
earned.
(c) For Salary earned in 1994, an election to defer must be
made between June 1 and June 30, 1994, and such election will
apply only to Salary earned between July 1 and December 31, 1994.
Solely for purposes of this initial election period in June of
1994, the definition of "Eligible Employee" in Section 2.07 shall
be applied as if the date "June 1, 1994" were substituted for
"December 1 of the preceding year" and "December 1".
(d) Elections shall be irrevocable as to the Salary to which
such elections apply, except as otherwise provided herein.
3.02 At the same time a deferral election is made under Section
3.01 with regard to Salary to be earned in a specified year, the
Participant shall also elect the Phantom Investment Alternative(s) that the
Participant wishes to have apply to any Salary deferred in accordance with
such deferral election. At any point in time, a Participant's Adjusted
Deferred Salary under this Plan shall equal the value the Participant would
have had under the Savings and Investment Plan if all amounts deferred
under this Plan had actually been contributed to the Savings and Investment
Plan and invested in the designated investment fund(s) under the Savings
and Investment Plan from the time the Deferred Salary would have been paid
to the Participant but for the deferral. All elections made under this
Section 3.02 shall be in accordance with and subject to the following terms
and conditions:
(a) A Participant may elect any Phantom Investment
Alternative available for current contributions under the terms
of the Savings and Investment Plan at the time the deferral
election is being made. To the extent necessary to administer
this Plan, any election of Phantom Investment Alternative(s)
under this Section 3.02 will be required to comply with
administrative rules in effect from time to time under the
Savings and Investment Plan; this means, for example, that
Participants may be required to elect Phantom Investment
Alternatives in multiples of 5% or 10%.
(b) If an investment fund under the Savings and Investment
Plan is eliminated after a Participant in this Plan has made an
election under this Section 3.02, any Deferred Salary the value
of which is dependent on such eliminated investment fund shall,
as of the date the investment fund is eliminated, be treated for
purposes of this Section 3.02 as if the Adjusted Deferred Salary
became invested in whatever investment fund would automatically
be chosen under the terms of the Savings and Investment Plan if a
participant in that plan did not elect a new investment fund.
(c) Except as otherwise specifically provided herein, any
election of Phantom Investment Alternative(s) shall be
irrevocable as to the Deferred Salary to which such election
applies, and such election shall continue to apply to the
Deferred Salary until it is paid out in accordance with Article
IV.
ARTICLE IV
PAYMENT OF DEFERRED COMPENSATION
4.01 The first time an Eligible Employee elects to defer Salary
in accordance with Section 3.01, the Eligible Employee shall also elect at
the same time a Deferral Termination Date and a payment schedule in
accordance with the provisions of this Section 4.01:
(a) The Deferral Termination Date must be the December 31st
of either (i) the year in which the Participant's employment with
the Company and any subsidiary terminates, or (ii) any of the
three years following the year of termination, as elected by the
Participant.
(b) Payments shall be made to the Participant (i) in a
single lump sum payment or (ii) in annual installments over a
period of five (5) years, as elected by the Participant,
following the applicable Deferral Termination Date.
(c) A Participant's election of a Deferral Termination Date
and of a schedule of payments pursuant to this Section 4.01 shall
be irrevocable and shall apply to all Salary deferred under this
Plan by such Participant, both in the first year and in
succeeding years, except as specifically provided herein.
4.02 A Participant's Adjusted Deferred Salary shall be paid in
cash following the applicable Deferral Termination Date in accordance with
the provisions of this Section 4.02.
(a) Lump sum payments shall be paid as soon as
administratively feasible in the January following the year in
which the Deferral Termination Date occurs. The amount of any
lump sum payment shall equal the value of the Participant's
Adjusted Deferred Salary on the December 31st immediately
preceding the date of payment.
(b) Annual installments shall be paid as soon as
administratively feasible in the January of each of the five
calendar years following the year in which the Deferral
Termination Date occurs. The amount of the first installment
shall equal one-fifth of the value of the Participant's Adjusted
Deferred Salary on the December 31st immediately preceding the
date of payment. The amount of the second installment shall
equal one-fourth of the value of the Participant's Adjusted
Deferred Salary on the December 31st immediately preceding the
date of payment of the second installment. In similar manner,
the amounts of the third and fourth installments shall be one-
third and one-half, respectively, of the value of the
Participant's Adjusted Deferred Salary on the December 31st
immediately preceding the date of the respective payment. The
fifth installment shall equal the entire value of the Adjusted
Deferred Salary remaining on the December 31st immediately
preceding the date of payment.
4.03 If a Participant dies, any remaining unpaid portion of such
Participant's Adjusted Deferred Salary shall be accelerated and paid to the
Participant's Beneficiary in cash in a single lump sum as soon as
administratively feasible in the January following the year in which the
Participant's death occurs. The amount of the payment shall equal the
value of the Participant's Adjusted Deferred Salary remaining on the
December 31st immediately preceding the date of payment.
4.04 (a) Upon receipt of a written request from a Participant (or
if the Participant is not competent to manage his affairs, from a
Participant's legal representative), the Plan Committee may direct that all
or any part of the Participant's Adjusted Deferred Salary be accelerated
and paid in a lump sum if it finds, in its sole discretion, that the
Participant has incurred a substantial unforeseen hardship. For purposes
of this Section 4.04(a), a substantial unforeseen hardship is a severe
financial hardship resulting from extraordinary and unforeseeable
circumstances arising as a result of one or more recent events beyond the
control of the Participant. In no event, however, may accelerated payments
be made to the extent such hardship is or may be relieved (i) through
reimbursement or compensation by insurance or otherwise, (ii) by
liquidation of the Participant's assets, to the extent the liquidation of
such assets would not itself cause severe hardship, or (iii) by cessation
of deferrals under the Plan. Acceleration of payments because of a
substantial unforeseen hardship may only be permitted to the extent
reasonably necessary to satisfy the hardship.
(b) The Plan Committee may direct that all unpaid Adjusted
Deferred Salary be accelerated and paid to all Participants in a lump sum
if it finds, in its sole discretion, that a major challenge to the control
of the Company exists or if, in conjunction with the termination of the
Plan, the Plan Committee finds, in its sole discretion, that other
extraordinary circumstances make such acceleration of payments in the best
interest of the Company.
(c) Subsections (a) and (b) above shall apply both to Salary
deferred in previous years and to Salary being deferred during the year in
which the acceleration of payments is approved, except that no Deferred
Salary shall be paid out prior to the date such Deferred Salary would be
payable if it were current Salary.
(d) Anything herein to the contrary notwithstanding, the Plan
Committee shall not accelerate any payment of Deferred Salary with respect
to which the Participant has elected an investment measured by the
performance of the Company's Common Stock unless the Plan Committee
determines that such accelerated payments comply with Rule 16a-1(c)(3)
under Section 16 of the Securities Exchange Act of 1934.
ARTICLE V
ADMINISTRATION
The Plan Committee shall have full responsibility and authority
to interpret and administer the Plan, including the power to promulgate
rules of Plan administration, the power to settle any disputes as to rights
or benefits arising from the Plan, the power to appoint agents and delegate
its duties, and the power to make such decisions or take such actions as
the Plan Committee, in its sole discretion, deems necessary or advisable to
aid in the proper administration of the Plan. Actions and determinations
by the Plan Committee shall be final, binding and conclusive for all
purposes of the Plan.
ARTICLE VI
AMENDMENT, SUSPENSION AND TERMINATION OF THE PLAN
The Board of Directors of the Company may from time to time
amend, suspend or terminate the Plan, in whole or in part, except that no
such amendment, suspension or termination shall materially adversely affect
the rights of any Participant in respect of Deferred Salary previously
earned by such Participant and not yet paid.
ARTICLE VII
FUNDING
No promises under this Plan shall be secured by any specific
assets of the Company, nor shall any assets of the Company be designated as
attributable or allocated to the satisfaction of such promises. Benefit
payments shall be made from the Company's general assets.
ARTICLE VIII
GENERAL PROVISIONS
8.01 All elections by a Participant hereunder shall be made in
writing by the completion and delivery to the Company of forms prescribed
for such purpose within the time limits established with respect to such
election.
8.02 Neither the establishment of the Plan nor the payment of any
benefits hereunder nor any action of the Company, including its Board of
Directors, in connection therewith shall be held or construed to confer
upon any individual any legal right to remain an officer or an employee of
the Company.
8.03 No benefit under the Plan shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance
or charge, except by will or the laws of descent and distribution, and any
attempt thereat shall be void. No such benefit shall, prior to receipt
thereof, be in any manner liable for or subject to the recipient's debts,
contracts, liabilities, engagements, or torts.
8.04 This Plan shall inure to the benefit of, and be binding
upon, the Company and each Participant, and upon the successors and assigns
of the Company and of each Participant.
8.05 The Company shall deduct from the amount of any payments
hereunder all taxes required to be withheld by applicable laws.
8.06 This Plan shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Virginia.
Executed and adopted this 31st day of May, 1994, pursuant to
action taken by the Board of Directors of Reynolds Metals Company at its
meeting on May 20, 1994.
REYNOLDS METALS COMPANY
By: Donald T. Cowles
Title: Executive Vice President,
Human Resources and External Affairs