EXHIBIT 10.2
DEFERRED COMPENSATION PLAN OF THE COMPANY
MID AM, INC.
NON-QUALIFIED RETIREMENT PLAN
The Mid Am, Inc. Non-Qualified Retirement Plan (the "Plan") is
adopted effective as of January 1, 1998, for the Directors and
Eligible Employees of Mid Am, Inc. (the "Company") and its
affiliates. The Plan is an amendment and restatement of the Mid
Am, Inc. Pension Make-Up Plan established by the Company and the
Letters of Agreement Deferring Officers Compensation made
available by the Company. The Plan is designed to ensure that
the benefits provided to Directors and Eligible Employees enhance
the overall effectiveness of the Mid Am, Inc. executive
compensation program and attract, retain and motivate such
individuals.
Accordingly, Mid Am, Inc. hereby adopts the Plan pursuant to the
terms and provisions set forth below:
ARTICLE I
DEFINITIONS
Whenever used herein the following terms shall have the meanings
hereinafter set forth:
1.1 "Account" means the account maintained under the Plan in a
Participant's name to which all Plan contributions, and earnings
and losses thereon, are credited. A Participant's Account
consists of the following subaccount:
(a) for Directors who are Participants, a Compensation Deferral
Account, a Discretionary Company Contributions Account, a Stock
Option Deferral Account and a Rollover Contributions Account; and
(b) for Eligible Employees who are Participants, a Compensation
Deferral Account, a Supplemental Matching Contributions Account,
a Supplemental Profit Sharing Contributions Account, a
Supplemental Pension Contributions Account, a Discretionary
Company Contributions Account, a Stock Option Deferral Account
and a Rollover Contributions Account.
1.2. "Affiliated Company" means a business entity, or
predecessor of such entity, if any, that is a member of a
controlled group of corporations of which the company is also a
member. The Eligible Employees and Directors of each Affiliated
Company will be covered by the Plan upon approval by the
Committee.
1.3. "Board" means the Board of Directors of Company.
1.4. "Bonus" means the additional cash remuneration payable to a
Participant annually pursuant to an Employer's performance
compensation program or any other plan, program or arrangement
under which an Employer pays an amount of cash remuneration to a
Participant above such Participant's Salary, prior to any
Deferral Contributions under this Plan.
1.5. "Change in Control" means any one or more of the following
events:
(a) the merger or consolidation of the company with or into any
other corporation and the Company is not the surviving
corporation;
(b) in excess of 24.99% of the outstanding common stock of the
Company is owned, held or controlled by an entity, person or
group acting in concert with the power to control the Company as
that term is defined in Rule 405 of the Securities Act of 1933;
(c) the sale exchange of in excess of 24.99% of the assets of
the Company to any entity, person, or group acting in concert;
(d) the recapitalization, reclassification of securities or
reorganization of the Company which has the effect of either
subparagraph (b) or (c) above;
(e) the issuance by the Company of securities in an amount in
excess of 24.99% of the outstanding common stock of the Company
to any entity, person, or group acting in concert and intending
to exercise control of the Company, or
(f) the removal, termination or retirement of more than 49% of
the members of the Board.
1.6. "Code" means the Internal Revenue Code of 1986, as amended
from time to time, and any regulations relating thereto.
1.7. "Committee" means the Mid Am, Inc. Non-Qualified Plan
Committee that is responsible for the administration of the Plan.
1.8. "Company" means Mid Am, Inc., an Ohio corporation, or, to
the extent provided in Section 9.9 below, any successor
corporation or other entity resulting from a merger or
consolidation into or with the Company or a transfer or sale of
substantially all of the assets of the Company.
1.9. "Company Stock Fund" means the Investment Fund maintained
under the trust that is invested solely in shares of the
Company's common stock.
1.10. "Compensation" means a Participant's Salary, Bonus,
Director's Fees or Director's Retainer payable in any calendar
year. Except as required by applicable law, Compensation
deferrals elected under this Plan shall not affect the
determination of Compensation or earnings for purposes of any
other plan, policy or program maintained by the Company or an
Affiliated Company.
1.11. "Compensation Deferral Account" means the account
established for a Participant under the Plan that is credited
with Deferral Contributions under Sections 3.1 and 3.2 of the
Plan.
1.12. "Deferral Agreement" means the written deferral agreement
entered into by a Participant with the Company pursuant to the
terms of Sections 3.1 or 3.2 of the Plan.
1.13. "Deferral Contribution" means the elective deferral
contribution credited to a Participant's Account under the Plan
by the Company.
1.14. "Deferral" means an individual who is a member of the
Board or a member of the board of directors of an Affiliated
Company. Neither "Advisory board members" nor employees of an
Employer shall be considered Directors under the Plan.
1.15. "Director's Fees" means the Board meeting and Board
committee meeting fees paid to a Director by the Employer.
1.16. "Director's Retainer" means the annual retainer paid to a
Director by the Employer.
1.17. "Disability" means a Participant is under the regular care
of a doctor and prevented by a medically determinable physical or
mental impairment from performing each of the material duties of
his or her regular occupation. Determinations of Disability are
made by the Committee in its sole discretion.
1.18. "Discretionary Company Contribution" means a discretionary
company contribution made by the Company on behalf of one or more
Participants under the terms of the Plan.
1.19. "Discretionary Company Contributions Account" means the
account established for a Participant under the Plan that is
credited with Discretionary Company Contributions under Section
2.7 of the Plan.
1.20. "Eligible Employee" means each employee of an Employer who
is: (i) classified as a senior vice-president or higher; (ii) a
commissioned salesperson whom the Committee expects to earn at
least $100,000 in commissions per year; or (iii) a management or
highly compensated employees designated by the Board as an
Eligible Employee.
1.21. "Employer" means the Company and any Affiliated Company
that is approved by the Committee.
1.22. "Employment Termination" means the dated of (i) an
Eligible Employee's termination of employment with the Employer,
or (ii) a Director's termination of service as a Director, and
shall include such termination for any reason, unless expressly
indicated otherwise.
1.23. "Investment Funds" means the various investment funds
established and maintained under the Trust.
1.24. "Participant" means a Director or an Eligible Employee who
is eligible for participation and who has completed all necessary
election and enrollment forms provided by the Committee.
1.25. "Plan" means the Mid Am, Inc. Non-Qualified Retirement
Plan, as set forth herein and as hereinafter amended from time to
time.
1.26. "Plan Year" means the 12-month period beginning on January
1 and ending on the following December 31 of each year.
1.27. "Qualified Pension Plan" means the Mid Am, Inc. Employee
Stock Ownership Pension Plan, as amended from time to time, and
any successor or replacement plan.
1.28. "Qualified Plans" means the Qualified Savings Plan and the
Qualified Pension Plan. Except as otherwise provided in this
Article I, all defined terms used in the Plan that are defined in
the Qualified Plans shall have the same meaning in the Plan as is
set forth in the Qualified Plans.
1.29. "Qualified Plan Compensation Deferral Contribution" means
the elective salary reduction contribution made by the Company
for the benefit of a Participant under the terms of the Qualified
Savings Plan in any Plan year.
1.30. "Qualified Plan Pension Contribution" means the employer
contribution credit by the Company for the benefit of a
Participant under the terms of the Qualified Pension Plan.
1.31. "Qualified Plan Matching Contribution" means the matching
contribution made by the Company for the benefit of a Participant
under the terms of the Qualified Pension Plan.
1.32. "Qualified Plan Profit Sharing Contribution" means the
profit sharing contribution made by the Company for the benefit
of a Participant under the terms of the Qualified Savings Plan.
1.33. "Qualified Savings Plan" means the Mid Am, Inc. Employee
Stock Ownership and Savings Plan, and any successor or
replacement plan.
1.34. "Rollover Contributions Account" means the account
established for a Participant under the Plan that is credited
with Rollover Contributions under Section 2.8 of the Plan.
1.35. "Salary" means a Participant's annual base salary rate for
the Plan year, as specified by the Employer, prior to any
Deferral Contributions under this Plan.
1.36. "Stock Option Plan" means each of the Mid Am, Inc. 1992
Stock Option Plan, the 1997 Mid Am, Inc. Stock Option Plan, and
such other stock plans as may be adopted by the Company, each as
amended from time to time.
1.37. "Stock Option Deferral Account" means the account
established for a Participant under the Plan that is credited
with Stock Option Deferral Amounts under Section 3.1 of the Plan.
1.38. "Supplemental Matching Contribution" means the matching
contribution credited by the Company for the benefit of a
Participant under the terms of the Plan.
1.39. "Supplemental Matching Contributions Account" means the
account established for a Participant under the Plan that is
credited with Supplemental Matching Contributions under Section
2.4 of the Plan.
1.40. "Supplemental Pension Contributions Account" means the
account established for a Participant under the Plan that is
credited with Supplemental Pension Contributions under Section
2.6 of the Plan.
1.41. "Supplemental Profit Sharing Contribution" means the
profit sharing contribution credited by the Company for the
benefit of a Participant under the terms of the Plan in any Plan
Year.
1.42. "Supplemental Profit Sharing Contributions Account" means
the account established for a Participant under the Plan that is
credited with Supplemental Profit Sharing Contributions under
Section 2.5 of the Plan.
1.43. "Trust" means a trust agreement entered into by the
Company under which the Company made contributions for the
purpose of accumulating assets to assist the Employers in
fulfilling their obligations to Participants hereunder.
1.44. "Year of Service" means each 12-consecutive month period
of an Eligible Employee's continuous employment, or a Director's
continuous service, with an Employer.
ARTICLE II
CONTRIBUTIONS
2.1. Director's Deferral Contributions. A Participant who is a
Director may elect to defer a who percentage (up to 100 percent)
of the Director's Fees otherwise payable to him or her by the
Employer for a Plan Year. A Participant who is Director also may
elect to defer a whole percentage (up to 100 percent) of the
Director's Retainer otherwise payable to him or her by the
Employer for a Plan Year. The amount deferred pursuant to this
Section shall be a Director's Deferral Contribution credited to
the Director's Compensation Deferral Account.
2.2. Eligible Employee's Compensation Deferral Contributions. A
Participant who is an Eligible Employee may elect to defer a
whole percentage (up to 100 percent) of the Bonus otherwise
payable to him or her by the Employer for a Plan Year. A
Participant who is an Eligible Employee also may elect to defer a
who percentage (up to 50 percent) of the Salary otherwise payable
to him or her by the Employer for a Plan year. The amount
deferred pursuant to this Section shall be credited to the
Participant's Compensation Deferral Account.
2.3. Deferral Agreements. As a condition to the Company's
obligation to credit any Deferral Contribution for the benefit of
a Participant pursuant to Sections 3.1 or 3.2, the Participant
must execute a Compensation Deferral Agreement. Except as
provided below, a Participant's Deferral Agreement for any Plan
year must be in writing, signed by the Participant, and delivered
to the Committee prior to January 1 of that Plan Year. A
Participant's Deferral Agreement will remain in full force and
effect for subsequent Plan Years unless and until revoked by a
Participant by written instrument delivered to the Committee
prior to the beginning of the Plan Year in which such revocation
is to be effective.
Neither Eligible Employees nor Directors are required to elect
Deferral Contributions in any Plan Year. However, the minimum
amount of Deferral Contribution for any Plan Year for which a
Deferral Agreement is executed is $1,000.
2.4. Supplemental Matching Contributions. Each Plan Year, the
Company will credit a Supplemental Matching Contribution to the
Plan on behalf of each Participant in an amount equal to the
difference between (a) and (b) below:
(a) the Qualified Plan Matching Contribution that would have
been made on behalf of the Participant for the Plan Year in which
an amount is deferred by the Participant pursuant to Section 3.2,
based on the Participant's Compensation prior to any Deferral
Contributions under this Plan, and without giving effect to any
reductions required by the limitations imposed by the Code on
the Qualified Savings Plan; and
(b) the amount of the Qualified Plan Matching Contribution
actually made on behalf of the Participant for the Plan Year.
All Supplemental Matching Contributions shall be credited to the
Supplemental Matching Contributions Account maintained for the
Participant.
2.5. Supplemental Profit Sharing Contributions. Each Plan Year,
the Company will credit a Supplemental Profit Sharing
Contribution to the Plan on behalf of each Participant in an
amount equal to the difference between (a) and (b) below:
(a) The Qualified Plan Profit Sharing Contribution that would
have been made on behalf of the Participant for the Plan Year,
based on the Participant's Compensation prior to any Deferral
Contributions under this Plan, and without giving effect to any
reductions required by the limitations imposed by the Code on
the Qualified Savings Plan; and
(b) The amount of the Qualified Plan Profit Sharing contribution
actually made on behalf of the Participant for the Plan Year.
All Supplemental Profit Sharing Contributions shall be credited
to the Supplemental Profit Sharing Contributions Account
maintained for the Participant.
2.6. Supplemental Pension Contributions. Each Plan Year, the
Company will credit a Supplemental Pension Contribution to the
Plan on behalf of each Participant in an amount equal to the
difference between (a) and (b) below:
(a) The Qualified Plan Pension Contribution that would have been
made on behalf of the Participant for the Plan Year, based on the
Participant's Compensation prior to any Deferral Contributions
under this Plan, and without giving effect to any reductions
required by the limitations imposed by the Code on the Qualified
Pension Plan; and
(b) The amount of the Qualified Plan Pension Contribution
actually made on behalf of the Participant for the Plan Year.
All Supplemental Pension Contributions shall be credit to the
Supplemental Pension Contributions Account maintained for the
Participant.
2.7. Discretionary Company Contributions. The Company may in
its sole discretion contribute to the Account of a Participant an
amount that it may from time to time deem advisable. Such
discretionary contributions shall be credited to the
Discretionary Company Contributions Account maintained for the
Participant.
2.8. Rollover Contributions. The Committee may, in its sole
discretion, accept transfers on behalf of a Participant from any
non-qualified plan or arrangement in which such Participant
participated. The committee shall not accept such transfer to
the extent that any amount is subject to current income taxation.
Transferred amounts shall be credited to the Rollover
Contributions Account maintained for the Participant.
ARTICLE III
DEFERRAL OF STOCK OPTION INCOME
3.1. Stock Option Deferral Elections. To the extent permitted
under the terms of the Stock Option Plan, a Participant who has
been granted a non-qualified stock option (an "Option") under the
Stock Option Plan may elect to defer all or a portion of any
income or gain that would otherwise be recognized upon the
exercised of the Option. If a Participant elects such a
deferral, the Company will credit the Stock Option Deferral
Account of such Participant with a number of Stock Units (as
defined below) that were the subject of the deferral election
made by the Participant.
3.2. Crediting of Stock Units. The number of Stock Units to be
credited to a Participant's Stock Option Deferral Account shall
be equal to the fair market value, on the date of exercise of the
applicable Option, of the excess of: (i) the number of shares of
common stock of the Company to be purchased pursuant to the
exercised of such Option, over (ii) a number of shares of such
common stock with a fair market value equal to the option price
of such Option. Each such Stock Unit, as of any given date,
shall have a value equal to the fair market value of a share of
common stock of the Company on such date. For purposed of this
Section, fair market value of common stock of the Company shall
be defined as the closing price of such common stock on the
National Market System's NASDAQ Quotation Service on the trading
day immediately preceding the date as of which fair market value
is determined.
Additional credits shall be made to a Participant's Stock Option
Deferral Account in dollar amounts equal to the cash value (or
the fair market value of dividends paid in property other than
common stock of the Company) that the Optionee would have
received had he been the owner on each record date of a number of
shares of common stock equal to the number of Stock Units
credited to his Stock Option Deferral Account on such date. In
the case of a dividend in common stock of the Company, additional
credits will be made to the Stock Option Deferral Account of the
Participant of a number of Stock Units equal to the number of
shares of common stock that the Participant would have received
had he been the owner on each record date of a number of shares
of such common stock equal to the number of Stock Units credited
to his Stock Option Deferral Account. Any cash dividends (or the
value of dividends paid in property other than common stock of
the Company) shall be converted into Stock Units based upon the
fair market value of common stock of the Company on the record
date for payment of any such dividend.
3.3. "Stock Units" means units based upon the fair market value
of the common stock of the Company and credited to a Stock Option
Deferral Account pursuant to Section 3.1 above.
ARTICLE IV
VESTING OF PARTICIPANTS' ACCOUNTS
4.1. Fully Vested Accounts. A Participant shall be fully vested
in the amount in his or her Compensation Deferral Account,
Supplemental Matching Contributions Account, Rollover
Contributions Account and Stock Option Deferral Account at all
times.
4.2. Supplemental Profit Sharing and Pension Contributions
Accounts. A Participant shall be vested in his or her
Supplemental Profit Sharing and Pension Contributions Accounts
after he or she completes five Years of Service, as illustrated
by the following schedule:
Years of Service Vested Percentage
Less than 5 years 0%
5 or more years 100%
4.3. Discretionary Company Contributions Account. Except as
provided in the following sentence, a Participant shall be vested
in his or her Discretionary Company Contributions Account at a
rate of twenty percent (20%) per Year of Service, as illustrated
by the following schedule:
Years of Service Vested Percentage
Less than 1 year 0%
1 full year 20%
2 full years 40%
3 full years 60%
4 full years 80%
5 or more full years 100%
Notwithstanding the foregoing, the Committee, in its sole
discretion, may specify in writing, a different vesting schedule
applicable to any Participant or group of Participants, and/or
any particular Discretionary Company Contributions Account.
4.4. Forfeiture Due to Competition or Breach of Confidentiality.
A Participant may not, except with the express prior written
consent of the Company, for a period of two (2) years after the
Participant's Employment Termination (the "Restrictive period"),
directly or indirectly compete with the business of the
Employers, including, but not by way of limitation, by directly
or indirectly owning, managing, operating, controlling,
financing, or by directly or indirectly serving as an employee,
officer or director of or consultant to, or by soliciting or
inducing, or attempting to solicit or induce, any employee or
agent of an Employer to terminate employment with the Employer
and become employed by any person, firm, partnership,
corporation, trust or other entity that owns or operates, a bank,
savings and loan association, credit union or similar financial
institution (a "Financial Institution") within a twenty-five (25)
miles radius of (i) an Employer's main office or (ii) the office
of any Employer's Affiliated Companies (the "Restrictive
Covenant"). The foregoing Restrictive Covenant shall not
prohibit a Participant from owning directly or indirectly capital
stock or similar securities which are listed on a securities
exchange or quoted on the National Association of Securities
Dealers Automated Quotation system which do not represent more
than one percent (1%) of the outstanding capital stock of any
Financial Institution.
If a Participant violates the Restrictive Covenant or the
Company's Code of Professional Responsibility, all amounts in the
Participant's Discretionary Company Contributions Account and
Supplemental Matching, Profit Sharing, and Pension Contributions
Accounts shall be forfeited; except that this Section 4.4 shall
become ineffective upon a Change in Control of the Company.
4.5. Full Vesting Provisions. Notwithstanding the foregoing, a
Participant shall be full vested in his or her entire Account
upon: (i) the date of the Participant's Employment Termination on
account of death or Disability; or (ii) a Change in Control of
the Company.
4.6. Forfeiture. A Participant whose Employment Termination
occurs prior to the full vesting of his or her Account will
forfeit the portion of his or her Account that is not vested.
ARTICLE V
INVESTMENT OF CONTRIBUTIONS
5.1. Investment of Participants' Accounts. All Participant and
Company Contributions shall be contributed by the Company to, and
held and invested in the Investment Funds maintained under the
Trust. A Participant's Supplemental Profit Sharing and Pension
Contributions Accounts and Discretionary Company Contributions
Account will be deemed to be invested in the Company Stock Fund.
The Participant will be consulted with respect to the investment
of his or her Compensation Deferral and Supplemental Matching
Contributions Accounts. However, the Committee reserves the
right to invest all Participants' Accounts as it deems best.
Each Participant's Account shall be credited or debited with that
Participant's proportionate share of any gains or losses
resulting from the Investment Funds.
Any amount in a participant's Account that is forfeited according
to Article IV shall be applied toward administrative expenses
incurred in connection with the Plan or used to reduce future
Company contributions in the sole discretion of the Committee.
The company shall provide each Participant with written statement
of his Accounts at least semi-annually.
5.2. Adjustment For Investment Earnings. The amounts credited
to a Participant's Account shall be adjusted from time to time in
accordance with uniform procedures established by the Committee
to reflect the value of an investment equal to the Participant's
Account balance in the Investment Funds. The Investment Funds
available may be revised from time to time by the Committee with
approval of the Trustee of the Trust described in Section 9.2.
The Committee, with the approval of the Trustee, may eliminate
any Investment Funds available at any time; provided, however,
that the Committee may not retroactively eliminate any Investment
Fund.
A Participant shall designated the applicable Investment Fund to
be used with respect to his or her Compensation Deferral and
Supplemental Matching Contributions Accounts in increments of at
least 10%, pursuant to a written investment election form
delivered to the Committee on the date he or she commences
participation in the Plan. The Participant may change his or her
Investment Fund designation with respect to future contributions
credited to his or her Compensation Deferral and Supplemental
Matching Contributions Accounts, and/or with respect to amounts
previously credited to such Accounts, by notifying the Committee
or its designed. A revised investment direction may be made by a
Participant in writing on a quarterly basis and shall be
effective as of the beginning of the calendar quarter immediately
following such written submission; provided, however, that the
Committee or its designed shall have the discretion to delay the
effective date of any revised investment direction to the
beginning of the second calendar quarter following receipt of
such direction if the Committee or its designed receives such
direction fewer than 15 days prior to the beginning of a calendar
quarter.
5.3. Investment of Prior Deferrals. Prior to the effective date
of this Plan, certain officers entered in Letters of Agreement
Deferring Officer's Compensation (the "Agreements"). Under the
Agreements, amounts in a [Deferred Officer's Compensation
Account] (as defined in the Agreements) could be invested in a
life insurance contract to be owned by the Company. A
Participant who previously had directed that all or any portion
of his Deferred Officer's Compensation Account be invested in
life insurance contracts may continue to direct that all or any
portion of his or her [Compensation Deferral Contribution] be
invested in an existing life insurance contract held under the
Trust.
ARTICLE VI
DISTRIBUTIONS
6.1. Distribution of Participants' Accounts. A Participant's
Accounts will be distributed to him or her in accordance with the
provisions of this Article VI. A Participant's Accounts will be
distributed in cash, except that, a Participant's Accounts that
are deemed to be invested in the Company Stock Fund as of the
date that distribution of the Participant's Accounts is to be
made can be distributed in shares of Company common stock, at the
Participant's election.
6.2. Form of Distribution. Each Participant shall elect the
manner of payment of his or her Account, generally at the time of
any Deferral Agreement. No such election shall be effective if
made or modified within 12 months of the date distribution is
made or commences. A Participant may elect to have his or her
Account distributed in any form of distribution permitted by the
Qualified Savings Plan. If a Participant does not make a valid
distribution election, then the manner of payment and date for
commencement of payment of the Participant's Account shall be
selected by the Company in its sole discretion.
Notwithstanding the foregoing, if the value of the Participants'
Accounts is less than $5,000 at any time after the Participant's
Employment Termination, such Accounts shall be distributed to the
Participant in a single lump sum distribution, as soon as
practicable. If the Participant fails to elect a form or period
of distribution, the Participant's Accounts will be paid in a
manner selected by the Committee or its designed. The
Participant also may elect, at the time of his or her election of
Compensation Deferral Contributions, to have distributions
commence as soon as practicable after his Disability.
6.3. Timing of Distribution. The balance of a Participant's
Accounts shall be distributed to or with respect to the
participant only: (i) upon Employment Termination, (ii) upon a
Participant's 5, 10, 15, 20, 25 or 30-year anniversary of service
with the Employer, as elected by the Participant at least
12-months prior to the date of such anniversary, (iii) because of
hardship in accordance with Section 6.5, or (iv) to the extent a
Participant's Account balance becomes subject to immediate income
taxation. Notwithstanding clause (i) through (iii) in the
preceding sentence, the balance of a Participant's Stock Option
Deferral Account may not be distributed to or with respect to the
Participant until a date that is at lease 12 months from the date
of exercise of the applicable Option.
6.4. Distributions Upon Death. If a Participant dies before
full distribution of his or her Account, any remaining amounts
shall be distributed to the beneficiary, and in the method,
designated by the Participant in a writing delivered most
recently to the Committee prior to death. If a Participant has
not designated a beneficiary, or method of distribution, or if no
designated beneficiary is living on the date of distribution,
such amounts shall be distributed to those persons entitled to
receive distributions of the Participant's accounts under the
Qualified Savings Plan and in the same method as distribution is
made under the Qualified Savings Plan. If the Participant has no
account under the Qualified Savings Plan, such amounts shall be
distributed to those persons entitled to receive distributions of
the Participant's accounts under the Qualified Pension Plan and
in the same method as distribution is made under the Qualified
Pension Plan. If the Participant has no accounts under the
Qualified Plans, distributions of the Participant's Account shall
be made to the Participants' estate.
6.5. Hardship Distributions. In the discretion of the
Committee, and at the written request of a Participant, an amount
up to 100 percent of his or her vested Account may be distributed
to a Participant in the case of an "unforeseeable emergency,"
subject to the limitations set forth below. For purposes of this
Section 6.5, an "unforeseeable emergency" is a severe financial
hardship to the Participant resulting from a sudden and
unexpected illness or accident of the Participant or of a
dependent (as defined in Code Section 152(a)) of the Participant,
loss of the Participant's property due to casualty, or other
similar extraordinary and unforeseeable circumstances arising as
a result of events beyond the control of the Participant. The
circumstances that will constitute an unforeseeable emergency
will depend upon the facts of each case, but, in any case,
payment may not be made to the extent that such hardship is or
may be relieved:
(a) through reimbursement or compensation by insurance or
otherwise;
(b) by liquidation of the Participant's assets, to the extent
the liquidation of such assets would not itself cause severe
financial hardship; or
(c) by cessation of Deferral Contributions under the Plan.
Only one hardship distribution shall be permitted during a Plan
Year. A Participant's request for a hardship distribution must
be accompanied or supplemented by such evidence that the hardship
is necessary as the Committee or its designed may reasonable
require. Withdrawals of amounts because of a unforeseeable
emergency shall be permitted only to the extent reasonable needed
to satisfy the unforeseeable emergency need.
Any Participant who receives a hardship distribution shall cease
Deferral Contributions for a period of one year following the
date of such hardship distribution. Reentry into the Plan will
be according to the Deferral Agreement procedures described in
Section 2.3.
6.6. Tax-Savings Clause. Notwithstanding anything to the
contrary contained herein, if (i) the Internal Revenue Service
(IRS) prevails in its claim that all or a portion of the amounts
contributed to the Plan, and/or earnings thereon, constitute
taxable income to a Participant or beneficiary for any taxable
year that is prior to the taxable year in which such
contributions and/or earnings are actually distributed to such
Participant or beneficiary, (ii) the U.S. Department of Labor
(DOL) prevails in its claim that the Trust prevents the Plan from
meeting the "unfunded" criterion of the exceptions to various
requirement of Title I of the Employee Retirement Income Security
Act of 1974 (ERISA) for plans that are unfunded and maintained
primarily for the purpose of providing deferred compensation for
a select group of management or highly compensated employees, or
(iii) legal counsel selected by the Committee advises the
Committee that the IRS or DOL would likely prevail in such claim,
the applicable Account balance shall be immediately distributed
to the Participant or beneficiary. For purposes of this Section,
the IRS or DOL shall be deemed to have prevailed in a claim if
such claim is upheld by a court of final jurisdiction, or if the
Committee, based upon the advice of legal counsel selected by the
Committee, fails to appeal a decision of the IRS or DOL, or a
court of applicable jurisdiction, with respect to such claim, to
an appropriate IRS or DOL appeals authority or to a court of
higher jurisdiction within the appropriate time period.
ARTICLE VII
ADMINISTRATION OF THE PLAN
7.1. Administration by the Committee. The Committee shall be
responsible for the general operation and administration of the
Plan and for carrying out the provisions thereof.
7.2. Power and Duties of Committee. The Committee shall
administer the Plan in accordance with its terms and shall have
all powers necessary to carry out the provisions of the Plan.
The Committee shall interpret the Plan and shall determine all
questions arising in the administration, interpretation, and
application of the Plan, including but not limited to, questions
of eligibility and the status and rights of employees,
Participants and other person. Any such determination by the
Committee shall presumptively be conclusive and binding on all
persons. The regularly kept records of the Company shall be
conclusive and binding upon all persons with respect to a
Participant's date and length of service, amount of Compensation
and the manner of payment thereof, type and length of any absence
from work and all other matters contained therein relating
applied to all persons in similar circumstances. To the extent
not inconsistent with this Plan, all provisions set forth in the
Qualified Plans with respect to the administrative powers and
duties of the Committee, expense of administration, and
procedures for filing claims, also shall be applicable with
respect to this Plan.
ARTICLE VIII
AMENDMENT OR TERMINATION
8.1. Amendment of Termination. The Company intends the Plan to
be permanent but reserves the right to amend or terminate the
Plan at any time. Any such amendment or termination shall be
made pursuant to a resolution of the Board and shall be effective
as of the date of such resolution.
8.2. Effect of Amendment or Termination. No amendment or
termination of the Plan shall directly or indirectly reduce the
balance of any Account held hereunder as of the effective date of
such amendment or termination. Upon termination of the Plan,
distribution of amounts in a Participant's Account shall be made
to the Participant or his or her beneficiary in the manner and at
the time described in Article VI of the Plan. No additional
contributions shall be made to the Account of a Participant after
termination of the Plan, but the Company shall continue to credit
gains and losses to participants' Accounts pursuant to Article V,
until the balance of such Accounts have been fully distributed to
each Participant or beneficiary, as applicable.
ARTICLE IX
GENERAL PROVISIONS
9.1. Participant's Rights Unsecured. Except as otherwise set
forth in Section 9.2, the Plan at all times shall be entirely
unfunded and no provision shall at any time be made with respect
to segregating any assets of the Company or its Affiliates for
payment of any distributions hereunder. The right of a
Participant or beneficiary to receive a distribution hereunder
shall be an unsecured claim against the general assets of the
Company or its Affiliates, and neither the Participant nor any
beneficiary shall have any rights in or against any specific
assets of the Company or its Affiliates. All amounts credited to
the Accounts of Participants shall constitute general assets of
the Company and may be disposed of by the Company at such time
and for such purposes as it may deem appropriate.
9.2. Trust Agreement. All rights under this Plan shall at all
times be entirely unfunded, and no provision shall at any time be
made with respect to segregating any assets of the Company or any
Employer for payment of any amounts due hereunder. No
Participant or beneficiary under the Plan shall have any interest
in or rights against any specific assets of the Company or any
Employer, and all Participants and beneficiaries shall have only
the rights of general unsecured creditors of the Company and the
applicable Employer. Notwithstanding the preceding provisions of
the Section, the Company, in its discretion shall have the right,
at any time and from time to time, to cause amounts payable to
any Participant or beneficiary hereunder to be paid to the
trustee of a Trust established by the Company for the benefit of
Participants or their beneficiaries. Such Trust shall contain
terms and conditions to insure that the trust assets will be
subject to creditors of the Company, but will otherwise be
available only to pay benefits to Participants and beneficiaries
pursuant to the terms of the Plan, and will contain such other
provisions as are necessary to assure the transfers to the trust,
and earnings on trust assets, will not constitute taxable income
to any Participant or beneficiary pursuant to applicable
provisions of the Code.
9.3. General Conditions. Except as otherwise expressly provided
herein, all terms and conditions of the Qualified Plans
applicable to a Qualified Plan Compensation Deferral, Qualified
Plan Matching, Qualified Plan Pension, or Qualified Plan Profit
Sharing Contribution will also be applicable to an Eligible
Employee's Deferral, Supplemental Matching, Supplemental Pension,
or a Supplemental Profit Sharing Contribution, to be made
hereunder. Any Qualified Plan Compensation deferral, Qualified
Plan Matching, Qualified Plan Pension, or Qualified Plan Profit
Sharing Contribution, or any other contributions to be under the
Qualified Plans, shall be made solely in accordance with the
terms and conditions of the Qualified Plans, and nothing in the
Plan shall operate or be construed in any way to modify, amend or
affect the terms and provisions of the Qualified Plans.
9.4. No Guaranty of Benefits. Nothing contained in the Plan
shall constitute a guaranty by the Company or any Affiliate or
any other person or entity that the assets of the Company or any
Affiliate will be sufficient to pay any benefit hereunder.
9.5. No Enlargement of Employee Rights. No Participant shall
have any right to receive a distribution of contributions made
under the Plan except in accordance with the terms of the Plan.
Establishment of the Plan shall not be construed to give
Participant the right to be retained in the service of the
Company or any Affiliate Company.
9.6. Spendthrift Provision. No interest of any person or entity
in, or right to receive a distribution under, the Plan shall be
subject in any manner to sale, transfer, assignment, pledge,
attachment, garnishment, or other alienation or encumbrance of
any kind; nor may such interest or right to receive a
distribution be taken, either voluntarily or involuntarily for
the satisfaction of the debts of, or other obligations or claims
against, such person or entity, including claims for alimony,
support, separate maintenance and claims in bankruptcy
proceedings.
9.7. Applicable Law. To the extent the laws of the United
States do not apply, the Plan shall be construed and administered
under the laws of the State of Ohio, other than its laws
respecting choice of law.
9.8. Incapacity of Recipient. If any person entitle to a
distribution under the Plan is deemed by the Company or its
designed to be incapable of personally receiving and giving a
valid receipt for such payment, then, unless and until claim
therefor shall have been made by a duly appointed guardian or
other legal representative of such person, the Company or its
designed may provide for such payment or any part thereof to be
made to any other person or institution then contributing toward
or providing for the care and maintenance of such person. Any
such payment shall be a payment for the account of such person
and a complete discharge of any liability of the Company, its
designed and the Plan therefor.
9.9. Corporate Successors. The Plan shall not be automatically
terminated by a transfer or sale of assets of the Company, or by
the merger or consolidation of the Company into or with any other
corporation or other entity, but the Plan shall be continued
after such sale, merger or consolidation only if and to the
extent that the transferee, purchaser or successor entity agrees
to continue the Plan. If the Plan is not continued by the
transferee, purchaser or successor entity, then the Plan shall
terminate subject to the provisions of Section 8.2.
9.10. Unclaimed Benefit. In the event that all, or any portion,
of the distribution payable to a Participant or beneficiary
hereunder shall, at the expiration of five years after it shall
become payable, remain unpaid solely by the reason of the
inability of the Company or its designed, after sending a
registered letter, return receipt requested, to the last known
address, and after further diligent effort, to ascertain the
whereabouts of such Participant or beneficiary, the amount so
distributable shall be treated as a forfeiture and shall be
retained by the Company as part of its general assets.
9.11. Limitations on Liability. Notwithstanding any of the
preceding provisions of the Plan, neither the Company nor any
individual acting as employee or agent of the Company shall be
liable to any Participant, former Participant, beneficiary or
other person for any claim, loss, liability or expense incurred
in connection with the Plan.
9.12. Claims Procedure. A claim for a Plan benefit shall be
deemed filed when a written communication is made by a
participant or Beneficiary, or the authorized representative of
either, which is reasonably calculated to bring the claim to the
attention of the Committee. If a claim is wholly or partially
denied, notice of such decision shall be furnished to the
claimant in writing within 90 days after receipt of the claim by
the Committee. Such notice shall set forth, in a manner
calculated to be understood by the claimant: (i) the specific
reason or reasons for the denial; (ii) specific reference to
pertinent Plan provisions on which the denial is based; (iii) a
description of any additional material or information is
necessary; and (iv) an explanation of the Plan's claims review
procedure. If no such notice is furnished to the claimant within
90 days after receipt of a claim by the Committee, such claim
shall be deemed wholly denied.
Within 90 days from the receipt of the note of denial, a claimant
may appeal such denial to the Committee for a full and fair
review. The review shall be instituted by the filing of a
written request for review by the claimant or his or her
authorized representative within the 90-day period stated above.
A request for review shall be deemed filed as of the date of
receipt of such written request by the Committee. The claimant
or his or her authorized representative shall have the right to
review all pertinent documents, may submit issues and comments in
writing and may do such other appropriate things as the Committee
may allow. The decision of the Committee shall be made not later
than 60 days after the receipt of the request for review, unless
special circumstances, such as the need to hold a hearing,
required an extension of time, in which case, a decision shall be
rendered not later than 120 days after the receipt of a request
for review. Such decision shall be final and binding on the
claimant.
9.13. Gender and Number. Words in the masculine gender shall
include the feminine and the singular shall include the plural,
and vice versa, unless qualified by the context. Any headings
used herein are included for reference only, and are not to be
construed so as to alter the terms hereof.
9.14. Indemnification. The Company and each Employer shall
indemnify and hold harmless each member of the Committee, or any
employee of the Company or an Employer, or any individual acting
as an employee or agent of either of them (to the extent not
indemnified or saved harmless under any liability insurance or
any other indemnification arrangement) from any and all claims,
losses, liabilities, costs and expenses (including attorneys'
fees) arising out of any actual or alleged act or failure to act
made in good faith pursuant to the provisions of the Plan or the
Trust, including expenses reasonable incurred in the defense of
any claim relating thereto with respect to the administration of
the Plan or the trust, except that no indemnification or defense
shall be provided to any person with respect to any conduct that
has been judicially determined, or agreed by the parties, to have
constituted willful misconduct on the part of such person, or to
have resulted in his or her receipt of personal profit or
advantage to which he or she is not entitled.