EXHIBIT 10.6
UNION CARBIDE CORPORATION
SUPPLEMENTAL RETIREMENT
INCOME PLAN
(Amended and Restated as of January 1, 1998)
SUPPLEMENTAL RETIREMENT INCOME PLAN
GENERAL
This is a supplemental retirement income plan for participants
in the Retirement Program Plan who receive compensation in excess of the
compensation which may be considered by the Retirement Program Plan under Code
Section 401(a)(17).
Specifically, the purpose of this Plan is to provide a retirement
benefit, equal to the excess of:
(1) the retirement benefit which would be provided by the Retirement
Program Plan determined without regard to Code Section 415 or
Code Section 401(a)(17),
OVER
(2) the retirement benefit actually provided by the Retirement
Program Plan and the Equalization Benefit Plan.
This Plan is completely separate from the Retirement Program Plan, the
Union Carbide Corporation Enhanced Retirement Income Plan and the Equalization
Benefit Plan, is unfunded for purposes of Title I of the Employee Retirement
Income Security Act of 1974, as amended and is not qualified for special tax
treatment under the Code.
ARTICLE I
ELIGIBILITY
SECTION 1. A Participant shall be eligible to participate in this Plan
if such Participant (i) participates in the Retirement Program Plan and (ii)
receives compensation in excess of the compensation which may be considered by
the Retirement Program Plan under Code Section 401(a)(17).
ARTICLE II
ADMINISTRATION
SECTION 1. (a) The Compensation Committee shall have the authority to
administer this Plan. The Compensation Committee may adopt such rules as it may
deem necessary for the proper administration of this Plan and its decision in
all matters involving the interpretation and application of the Plan shall be
final, conclusive, and binding on all parties.
(b) The Compensation Committee may, in its sole discretion, designate
any persons(s) or committee to administer this Plan. To the extent provided by
the Compensation Committee, such person(s) or committee designated to administer
this Plan shall have the same powers and responsibilities as the Compensation
Committee.
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ARTICLE III
AMOUNT OF SUPPLEMENTAL RETIREMENT INCOME
SECTION 1. (a) A Participant's monthly amount of Supplemental
Retirement Income shall be the excess, if any, of:
(i) the Participant's monthly retirement benefit, computed by using
the applicable benefit formula provided in Article V of the
Retirement Program Plan and determined without regard to the
limitations of Code Sections 401(a)(17) and 415,
OVER
(ii)the monthly amount of such Participant's retirement benefit
actually payable under the Retirement Program Plan and the
Equalization Benefit Plan.
(b) Any benefits either payable under, or which have been satisfied
through, the purchase of non-qualified annuities in connection with the
Corporation's non-qualified plans shall be deducted from the amounts payable
pursuant to subparagraph (a) above.
SECTION 2. If the Supplemental Retirement Income payable to a
Participant under this Plan commences before the grant to such Participant of
Incentive Compensation (whether or not deferred) included in the calculation of
such Participant's benefit, the monthly amount of Supplemental Retirement Income
payable hereunder shall be recalculated after such Incentive Compensation is
granted (whether or not deferred). The monthly amount of Supplemental Retirement
Income resulting from said recalculation shall be paid commencing in or before
the third calendar month after the month in which such Incentive Compensation is
awarded, provided that the first monthly payment of such recalculated
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Supplemental Retirement Income shall be increased to reflect any prior
underpayment of Supplemental Retirement Income resulting from the failure to
include such Incentive Compensation in the initial calculation of Supplemental
Retirement Income.
ARTICLE IV
VESTING
SECTION 1. A Participant shall be vested in such Participant's right
to receive Supplemental Retirement Income under this Plan in the same manner and
to the same extent as provided under the Retirement Program Plan.
ARTICLE V
PAYMENTS
SECTION 1. Supplemental Retirement Income shall be paid monthly to a
Participant or such Participant's survivor commencing with the month that such
Participant or such Participant's survivor commences benefits under the
Retirement Program Plan, and shall cease or be suspended at the same time the
Participant or such Participant's survivor ceases or suspends benefits under the
Retirement Program Plan. However, Supplemental Retirement Income shall in no
event be payable after the death of a Participant who has declined the coverage
of a survivor's benefit.
SECTION 2. Unless otherwise elected, Supplemental Retirement Income
payable under this Plan shall include the coverage of a survivor's benefit. A
survivor's benefit payable from this Plan shall be paid to that person
designated to receive a survivor's benefit under the Retirement Program Plan.
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SECTION 3. Supplemental Retirement Income shall be distributed to the
Participant in the same form, and with the same actuarial adjustments, as such
Participant's distributions from the Retirement Program Plan.
SECTION 4. Notwithstanding the provisions of Sections 1 and 3 of this
Article V, Participants may elect, in the calendar year in which the last
amounts included in average monthly Compensation are determined, that their
payments under the Plan shall be made either (i) in a lump sum as of January 1
of the calendar year following such election, or (ii) in substantially equal
installments over a period of at least 2 but not more than 10 years commencing
as of such date. The lump sum payment or installment payments described in the
preceding sentence shall be calculated using (A) a discount rate equal to the
average of 10 and 20 year Aaa municipal bonds as published by Moody's or a
similar rating service for the third month prior to the month payments commence,
and (B) a mortality table determined by the Compensation Committee or its
designee. The Compensation Committee or its designee shall determine the
procedures for such elections and the time and method of payment for payments in
accordance with this Section 4. For Participants who make the election described
in this Section 4, the provisions of Sections 1 and 3 of this Article V shall
not apply.
SECTION 5. The Corporation may withhold the Participant's portion of
the FICA taxes due on the Participant's Supplemental Retirement Income benefit
from the payment of such benefit.
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ARTICLE VI
MISCELLANEOUS
SECTION 1. Unless otherwise defined in this Plan, all defined terms
shall have the same meaning as set forth in the Retirement Program Plan.
(a) "Code" means the Internal Revenue Code of 1986, as amended.
(b) "Compensation Committee" means the Compensation and
Management Development Committee of the Board of Directors of the Corporation.
(c) "Corporation" means Union Carbide Corporation and any
subsidiary of the Corporation which is participating in the Retirement Program
Plan.
(d) "Equalization Benefit Plan" means the Union Carbide
Corporation Equalization Benefit Plan, as amended and restated January 1, 1998.
(e) "Incentive Compensation" means those incentive compensation
awards which are made: (i) under any cash award plan and (ii) under any other
variable compensation plans (whether or not deferred) designated by the Board of
Directors; provided, however, that with respect to the EPS Plan, "Incentive
Compensation" shall include variable compensation that would have been paid but
participation in the EPS Plan, and shall not include any payouts under the EPS
Plan.
(f) "Participant" means an employee of the Corporation who is
eligible to participate in the Plan pursuant to Article I.
(g) "Plan" means this Union Carbide Corporation Supplemental
Retirement Income Plan, as amended and restated as of January 1, 1998.
(h) "Retirement Program Plan" as used in this Plan means the
Retirement Program Plan for Employees of Union Carbide Corporation and its
Participating Subsidiary Companies.
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(i) "Supplemental Retirement Income" as used in this Plan means
the benefit payable to a Participant pursuant to Article III of this Plan.
SECTION 2. The Corporation may amend or terminate this Plan at any
time, but any such amendment or termination shall not adversely affect the
rights of any Participant of any Participant then receiving benefits under this
Plan, or the vested rights of any Participant.
SECTION 3. Except to the extent required by law, no assignment of the
rights and interests of a Participant under this Plan shall be permitted nor
shall such rights be subject to attachment or other legal processes for debts.
Notwithstanding the foregoing, the Corporation will honor the terms of a QDRO,
as defined in Code ss. 414(p).
SECTION 4. This Plan is intended to be unfunded for purposes of Title
I of the Employee Retirement Income Security Act of 1974, as amended and the
rights of a Participant shall be no greater than the right of an unsecured
general creditor of the Corporation.
SECTION 5. The Corporation may satisfy all or any part of its
obligation to provide benefits under this Plan by purchasing, and distributing
to a Participant, an annuity from an insurance carrier to provide such benefits.
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SECTION 6. Participation in this Plan shall not affect the
Corporation's right to discharge any Participant.
UNION CARBIDE CORPORATION
By: /s/ M.A. Kessinger
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Vice-President, Human Resources
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