EXHIBIT 10.(b)
FLORIDA PROGRESS CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
As Amended and Restated, effective February 20, 1997
FLORIDA PROGRESS CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
TABLE OF CONTENTS
ARTICLE 1. ESTABLISHMENT AND PURPOSE . . . . . . . . . . . . . . . . . 1
1.1 Restatement. . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Purpose. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 2. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . 2
2.1 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Gender and Number. . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE 3. PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . 8
3.1 Eligibility for Participation. . . . . . . . . . . . . . . . . 8
3.2 Date of Participation. . . . . . . . . . . . . . . . . . . . . 8
3.3 Duration . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.4 Limitation on Participation. . . . . . . . . . . . . . . . . . 8
ARTICLE 4. REGULAR BENEFITS. . . . . . . . . . . . . . . . . . . . . . 9
4.1 Normal Retirement Benefit. . . . . . . . . . . . . . . . . . . 9
4.2 Early Retirement Benefit . . . . . . . . . . . . . . . . . . . 9
4.3 Disability Retirement Benefit. . . . . . . . . . . . . . . . . 10
4.4 Vested Termination Benefit . . . . . . . . . . . . . . . . . . 12
4.5 Change in Control. . . . . . . . . . . . . . . . . . . . . . . 13
4.6 Surviving Spouse Benefit . . . . . . . . . . . . . . . . . . . 15
ARTICLE 5. SPECIAL EARLY RETIREMENT BENEFITS . . . . . . . . . . . . . 17
5.1 Special Early Retirement Benefit . . . . . . . . . . . . . . . 17
5.2 Surviving Spouse Benefit . . . . . . . . . . . . . . . . . . . 17
ARTICLE 6. SPECIAL BENEFIT PROVISIONS. . . . . . . . . . . . . . . . . 19
6.1 General Principles . . . . . . . . . . . . . . . . . . . . . . 19
6.2 Optional Lump Sum Payment. . . . . . . . . . . . . . . . . . . 19
ARTICLE 7. FINANCING . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.1 Financing. . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.2 No Trust Created . . . . . . . . . . . . . . . . . . . . . . . 21
7.3 Unsecured Interest . . . . . . . . . . . . . . . . . . . . . . 21
7.4 "Rabbi" Trust. . . . . . . . . . . . . . . . . . . . . . . . . 21
7.5 Divested Subsidiary Employee Participants. . . . . . . . . . 21
ARTICLE 8. ADMINISTRATION. . . . . . . . . . . . . . . . . . . . . . . 22
8.1 Administration . . . . . . . . . . . . . . . . . . . . . . . . 22
8.2 Liability of Committee and Board; Indemnification. . . . . . . 22
8.3 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
8.4 Tax Withholding. . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE 9. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . 23
9.1 Nontransferability . . . . . . . . . . . . . . . . . . . . . . 23
9.2 Amendment or Termination . . . . . . . . . . . . . . . . . . . 23
9.3 Impact of 1994 Amendments. . . . . . . . . . . . . . . . . . . 23
9.4 Forfeiture of Benefits . . . . . . . . . . . . . . . . . . . . 24
9.5 Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . 25
FLORIDA PROGRESS CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
(Amended and Restated, effective February 20, 1997)
ARTICLE 1. ESTABLISHMENT AND PURPOSE
1.1 Restatement. Florida Progress Corporation hereby amends and restates,
effective as of February 20, 1997, an unfunded plan of deferred compensation for
certain officers and other management personnel of the Company and its
subsidiaries and their beneficiaries as described herein, which plan shall be
known as the "Florida Progress Corporation Supplemental Executive Retirement
Plan" (the "Plan").
1.2 Purpose. The purpose of this Plan is to provide additional retirement
benefits to a select group of officers and other management personnel with the
goal of helping to attract and retain superior officers and other management
personnel.
ARTICLE 2. DEFINITIONS
2.1 Definitions. Whenever used hereinafter, the following terms shall
have the meaning set forth below.
(a) "Accrued Benefit" means, at any particular date, a Participant's
Target Amount, but calculated on the basis of the number of years
and months of Deemed Credited Service of the Participant and the
Final Average Earnings of the Participant as of such date rather
than as of his or her Normal Retirement Date.
(b) "Actuarial Equivalent" means, with respect to determining the
amount of a lump sum payment, a benefit of equivalent value to
the benefit that would otherwise have been provided to the
Participant, determined on the basis of the actuarial assumptions
in effect under the Retirement Plan as of the date such value is
computed (except that the current monthly PBGC rate shall be
used).
(c) "Board" means the Board of Directors of the Company.
(d) "Calculated under this Plan" means a calculation made as
otherwise indicated but without regard to any cost of living
adjustments occurring after retirement or other termination of
employment, and calculated as a straight life annuity without
regard to the actual form of payment under the Retirement Plan or
the Nondiscrimination Plan.
(e) A "Change in Control" means:
(1) a change in control of the Company of a nature that is
required, pursuant to the Securities Exchange Act of 1934
(the "1934 Act"), to be reported in response to (i) Item
1(a) of a Current Report on Form 8-K or (ii) Item 6(e) of
Schedule 14A, in each case as such requirements are in
effect on October 1, 1994;
(2) the adoption by the Company of a plan of dissolution or
liquidation;
(3) the closing of a sale of all or substantially all of the
assets of the Company;
(4) the closing of a merger, reorganization or similar
transaction (a "Transaction") involving the Company in
which the Company is not the surviving corporation or, if
the Company is the surviving corporation, immediately
following the closing of the Transaction, persons who were
shareholders of the Company immediately prior to the
Transaction own less than 75% of the combined voting power
of the surviving corporation's voting securities;
2
(5) the acquisition of "Beneficial Ownership" (as defined in
Rule 13d-3 under the 1934 Act) of the Company's securities
comprising 25% or more of the combined voting power of the
Company's outstanding securities by any "person" (as that
term is used in Sections 13(d) and 14(d)(2) of the 1934 Act
and the rules and regulations promulgated thereunder, but
not including any trustee or fiduciary acting in that
capacity for an employee benefit plan sponsored by the
Company) and such person's "affiliates" and "associates"
(as those terms are defined under the 1934 Act);
(6) the failure of the "Incumbent Directors" (as defined below)
to constitute at least a majority of all directors of the
Company (for these purposes, "Incumbent Directors" means
individuals who were the directors of the Company on
January 1, 1992, and, after his or her election, any
individual becoming a director subsequent to January 1,
1992, whose election, or nomination for election by the
Company's shareholders, is approved by a vote of at least
two-thirds of the directors then comprising the Incumbent
Directors, except that no individual shall be considered an
Incumbent Director whose initial assumption of office as a
director is in connection with an actual or threatened
"election contest" relating to the "election of directors"
of the Company, as such terms are used in Rule 14a-11 of
Regulation 14A under the 1934 Act); or
(7) the occurrence of a "Triggering Event," as such term is
defined in Section 1(n) of that certain Shareholder Rights
Agreement by and between the Company and Manufacturers
Hanover Trust Company dated November 21, 1991, as it may be
amended from time to time.
Notwithstanding any provision above to the contrary, no Change in
Control shall be deemed to have occurred with respect to any
particular Participant by virtue of a transaction, or series of
transactions, that results in the Participant, or a group of
persons that includes the Participant, acquiring the Beneficial
Ownership of more than 25% of the combined voting power of the
Company's outstanding securities.
(f) "Code" means the Internal Revenue Code of 1986, as it may be
amended from time to time, or any successor statute. Reference to
a specific section of the Code shall include a reference to any
successor provision.
(g) "Committee" means the Compensation Committee of the Board.
(h) "Company" means Florida Progress Corporation, or any successor
entity.
(i) "Control Date" means the date on which a Change in Control
occurs.
3
(j) "Credited Service" shall have the same meaning in this Plan as
is found in the Retirement Plan; provided, that if a
Participant incurs a Disability, such Disability terminates,
the Participant returns to work with an Employer and the
Committee determines that such person shall continue as an
active Participant in this Plan upon such return to work, such
Participant's Credited Service shall be increased by the time
he or she had a Disability (but only to the extent such time
is not otherwise included in his or her Credited Service); and
provided further, that if a Participant is employed by an
Employer that is not a participating employer in the
Retirement Plan, "Credited Service" for such Participant means
the number of years and months equal to the number of years
and months of Credited Service the Participant would have had
if his or her Employer had been a participating employer in
the Retirement Plan during the entire time of the Employer's
affiliation with the Company.
(k) "Current Earnings" means, at any particular time, the sum of the
Participant's then current monthly Earnings plus 1/12th of the
Participant's last MICP Award or MICP target incentive amount
(as defined in MICP), whichever is greater.
(l) "Deemed Credited Service" means, with respect to a Participant,
the sum of the following (but not in excess of 35 years):
(1) such Participant's Credited Service; plus
(2) with respect to a person who becomes eligible to
participate under Article 4 or Article 5, the additional
years and months of credited service, if any, awarded to
the Participant by the Committee at such time.
In awarding Deemed Credited Service under the standards set
forth in this subsection (l), the Committee may establish
conditions on when the additional years shall be considered to
be earned and thus become effective (e.g., only upon the
Participant reaching a specified age or completing a specified
number of years of actual service, only on a graduated basis
pursuant to a schedule approved by the Committee, etc.); and in
any such event, for all purposes of this Plan, a Participant
shall be considered at any time only to have those years of
additional service previously awarded that then have been earned
under the conditions established by the Committee.
(m) "Disability" means the total and permanent disability of a
Participant by reason of sickness or injury to perform all of
the duties assigned to the Participant by his or her Employer,
with the existence of a Disability to be determined by the
Committee in its sole discretion.
(n) "Early Retirement Date" means the first day of the calendar
month next following the day on which the Participant has
attained age 55 and has five years of Credited Service.
4
(o) "Earnings" means a Participant's regular basic compensation (base
salary) from his or her Employer, prior to any reduction in
compensation pursuant to a plan established under the authority
of Section 125 or Section 401(k) of the Code and prior to any
reduction for amounts deferred under a deferred compensation plan
or arrangement. Any amounts deferred under a deferred
compensation plan or arrangement and thus included in Earnings
when earned shall not be included in Earnings when actually
received.
(p) "Employer" means the Company or any subsidiary thereof.
(q) "Final Average Earnings" means, on any particular date, the sum
of (1) the amount determined by dividing the sum of a
Participant's Earnings in the highest 36 consecutive months out
of the last 60 months prior to the Participant's termination of
employment or other applicable date by 36, plus (2) the amount
determined by dividing the sum of the Participant's three
highest MICP Awards paid during the last 60 months prior to the
Participant's termination of employment or other applicable
date by 36; provided, however, that in no event shall the Final
Average Earnings of a Participant decrease after such
Participant's Normal Retirement Date. Appropriate adjustments
will be made in determining Final Average Earnings for any
Participant who was not in active service for the 60 months
preceding his or her most recent termination of employment or
other applicable date, including any Participant who has less
than 36 months of service. Final Average Earnings shall then
be calculated based on Earnings and MICP Awards for all the
months during which the Participant was in active service;
Final Average Earnings shall equal the average determined by
dividing the sum of Earnings attributed to the 36 consecutive
such months that will produce the highest such average by 36,
and for a Participant with fewer than 36 months of service,
such average shall be taken over those months in which he or
she was in service.
(r) "Incentive Plan" means the Florida Progress Corporation
Management Incentive Compensation Plan and, if applicable, the
former Florida Power Corporation Management Incentive Plan, in
each case as it may be amended from time to time.
(s) "MICP Award" means an award paid to a Participant under the
Incentive Plan. For all purposes of this Plan, a MICP Award
shall be deemed to be paid at the time and in the amount as
initially provided, without regard to any deferral of payment
in whole or in part, whether the deferral is a voluntary
deferral by the Participant or is mandatory under the terms of
the applicable plan. Any portion of an award that is deferred
and thus included as part of a MICP Award as initially provided
shall not be taken into account when actually received.
(t) "Nondiscrimination Plan" means the Florida Progress Corporation
Retirement Benefit Nondiscrimination Plan for Excess Benefits,
as it may be amended from time to time.
5
(u) "Normal Retirement Date" means the first day of the calendar
month next following the day on which the Participant attains age
65.
(v) "Participant" means any officer or other management employee of
an Employer who meets the eligibility requirements of the Plan,
as set forth in Article 3, to be and become a Participant, and
who continues to meet such requirements.
(w) "Plan" means the Florida Progress Corporation Supplemental
Executive Retirement Plan, as it is set forth herein and as it
may be amended from time to time.
(x) "Prospective Target Amount" means, at any particular date, a
Participant's Target Amount calculated using the Participant's
Final Average Earnings as of that date and the years and months
of Deemed Credited Service that the Participant would have at his
or her Normal Retirement Date if he or she continued to work
until such Normal Retirement Date.
(y) "Reorganization" means any change in personnel that is initiated
voluntarily by an Employer to accommodate or facilitate
enhancement of the operations or organization of the Employer.
(z) "Retirement Plan" means the Employees' Retirement Plan of Florida
Progress Corporation, as it may be amended from time to time.
(aa) "Social Security" means estimated Social Security benefits; if
the Participant's termination of employment occurs before the
Participant attains age 55, the Participant's future earnings are
assumed to continue until his or her Normal Retirement Date at
the same rate as they were immediately prior to the termination,
and if the Participant's termination of employment occurs at or
after the time the Participant attains age 55, the Participant's
future earnings are assumed to be zero.
(bb) "Special Early Retirement" means, for purposes of Article 5, the
retirement of a Participant from service with his or her Employer
in connection with a Reorganization and pursuant to an
opportunity provided by the Committee, at any time after the
Participant has at least 15 years of Credited Service, but before
the Participant has attained age 65.
(cc) "Spouse" means a person to whom a Participant was married both at
the time of the termination of his or her employment and at the
time of his or her death.
(dd) "Target Amount" means the monthly normal retirement income
payable to a Participant under Section 4.01(a) of the Retirement
Plan and Article IV of the Nondiscrimination Plan, but Calculated
under this Plan, and further calculated on the basis of the
number of years and months of Deemed Credited
6
Service (without regard to the actual number of years and months
of Credited Service) of the Participant and the Final Average
Earnings (as defined in this Plan and not as defined in the
Retirement Plan) of the Participant as of his or her Normal
Retirement Date.
2.2 Gender and Number. Except when otherwise indicated by the context, any
masculine terminology when used in the Plan shall also include the feminine
gender, and the definition of any term herein in the singular shall also include
the plural.
7
ARTICLE 3. PARTICIPATION
3.1 Eligibility for Participation. The Committee shall have the exclusive
right to designate which officers or other management employees of an Employer
shall be eligible to participate in this Plan. Participation shall be limited to
a select group of management or highly compensated employees and is subject to
change by the Committee from time to time.
3.2 Date of Participation. Each retired or active officer or other
management employee who was a Participant in this Plan on October 1, 1994 shall
remain as a Participant. Thereafter, each officer or other management employee
who becomes eligible to participate in this Plan under Section 3.1 shall become
a Participant on such date as may be designated by the Committee.
3.3 Duration. An officer or other management employee who becomes a
Participant shall continue to be a Participant until the earlier of (a) the date
he or she is no longer employed by an Employer or (b) the effective date of a
determination by the Committee that he or she shall not accrue additional
benefits under this Plan; provided, in either case, that if a Participant is
then vested in benefits under the Plan, he or she shall continue as a
Participant (even though not accruing additional benefits) for the purpose of
receiving his or her then accrued vested benefits pursuant to the provisions of
this Plan. In addition, a person eligible to receive a benefit under Section 4.5
shall cease to be a Participant as of the applicable Control Date (subject to
the right to receive benefits under such Section 4.5).
3.4 Limitation on Participation. A Participant shall be entitled to receive
benefits either under Article 4 or under Article 5, but not both. To implement
this provision, the Committee shall provide, with respect to each Participant,
whether such person shall be eligible to receive the regular benefits under
Article 4 or the Special Early Retirement benefits under Article 5. Accordingly,
the term "Participant" as used in Article 4 shall only refer to a Participant
who has been designated to receive benefits under such Article 4, and the term
"Participant" as used in Article 5 shall only refer to a Participant who has
been designated to receive benefits under such Article 5. Notwithstanding the
foregoing, a Participant under Article 4 may become eligible for the Special
Early Retirement Benefits under Article 5 provided that such person first waives
to the satisfaction of the Committee any and all rights to benefits under
Article 4.
8
ARTICLE 4. REGULAR BENEFITS
4.1 Normal Retirement Benefit.
(a) Eligibility. A Participant whose employment with his or her
Employer terminates at or after (1) attaining age 65 and (2)
completing five years of participation in this Plan shall be
eligible for a normal retirement benefit under this Section 4.1.
(b) Amount. A Participant who is eligible for a benefit under
subsection (a) above shall be entitled to receive a monthly
normal retirement benefit for his or her life equal to the amount
by which (1) below exceeds (2) below:
(1) This amount equals the Participant's Accrued Benefit as of
the date of his or her retirement, with no increase for
payment beginning after the Participant's Normal Retirement
Date.
(2) This amount equals the sum of (i) the monthly normal
retirement income payable to the Participant under the
Retirement Plan and the Nondiscrimination Plan (adjusted as
provided for in Section 6.1(c)), without regard to any
post-retirement increases in such benefit, plus (ii) the
monthly amount payable to the Participant as his or her
full primary Social Security benefit, without regard to any
subsequent increases in such benefit.
(c) Commencement and Form of Payment. Monthly normal retirement
benefit payments shall commence at the same time as the
Participant's normal retirement benefits under the Retirement
Plan and shall continue to be paid for the life of the
Participant.
4.2 Early Retirement Benefit.
(a) Eligibility. A Participant whose employment with his or her
Employer terminates (for reasons other than normal retirement,
death or Disability) at or after (1) attaining his or her Early
Retirement Date and (2) completing five years of participation
in this Plan shall be eligible for an early retirement benefit
under this Section 4.2; provided, however, that a Participant
shall not be entitled to an early retirement benefit unless (1)
if the Participant has fewer than 15 years of Credited Service,
the Participant first obtains the express, written consent of
the Committee or (2) if the Participant has 15 or more years of
Credited Service, the Participant provides the Committee with
at least six months prior written notice of such proposed
retirement.
(b) Amount. A Participant who is eligible for a benefit under
subsection (a) above shall be entitled to receive a monthly early
retirement benefit for his or her life equal to the amount by
which (1) below exceeds (2) below:
9
(1) This amount equals the Participant's Accrued Benefit as of
the date of his or her early retirement, reduced for early
payment as provided in Section 4.2(c).
(2) This amount equals the sum of (i) the monthly early
retirement income payable to the Participant under the
Retirement Plan and the Nondiscrimination Plan (adjusted as
provided for in Section 6.1(c)), without regard to any
post-retirement increases in such benefit, plus (ii) the
monthly amount payable to the Participant as his or her
full primary Social Security benefit, assuming such
payments begin at age 62 or, if later, the date of the
Participant's early retirement (without regard to any
subsequent increases in such benefit); provided, however,
that the Social Security offset under this subsection
(b)(2)(ii) shall not be applied until the Participant
attains age 62.
(c) Reduction for Early Payment. The amount of the Participant's
Accrued Benefit determined under Section 4.2(b)(1) shall be
reduced to the extent payment of the Participant's early
retirement benefit begins before the Participant's Normal
Retirement Date. Such reduced amount shall be computed by
multiplying the Participant's Accrued Benefit as so determined by
the factor set forth below based on the Participant's age at the
time payment begins:
Age When Payment Begins Factor
64 1.00
63 1.00
62 1.00
61 .95
60 .90
59 .85
58 .80
57 .75
56 .70
55 .65
(d) Commencement and Form of Payment. Monthly early retirement
benefit payments shall commence on the first day of the calendar
month following the date of the Participant's early retirement
under this Plan.
4.3 Disability Retirement Benefit.
(a) Eligibility. A Participant whose employment with his or her
Employer terminates due to a Disability prior to his or her
Normal Retirement Date shall be eligible for a disability
retirement benefit under this Section 4.3; provided, however,
that a Participant shall not be entitled to receive and/or to
continue receiving any Disability benefits under this Plan
unless the Committee has
10
determined in its sole discretion that a Disability exists and
continues. To this end, the Committee may require the
Participant to submit to a medical examination or a series of
medical examinations at any time and from time to time to
determine his or her eligibility and/or continued eligibility
for a disability benefit. The failure of the Participant to
submit to any such examination shall be sufficient grounds for
the denial of a disability benefit and/or the continuation
thereof.
(b) Amount. A Participant who is eligible for a benefit under
subsection (a) above shall be entitled to receive a monthly
disability retirement benefit for his or her life (or if his or
her Disability terminates prior to the Participant's Normal
Retirement Date, until his or her Disability terminates) equal to
the amount by which (1) below exceeds (2) below:
(1) This amount equals the Participant's Accrued Benefit as of
the date of the termination of his or her employment by
reason of Disability, with no reduction for early payment.
(2) This amount equals the sum of (i) the monthly income
payable to the Participant under the Retirement Plan and
the Nondiscrimination Plan (adjusted as provided for in
Section 6.1(c)), without regard to any post-termination
increases in such benefit, plus (ii) the monthly amount
that would be payable to the Participant under any
long-term disability plan sponsored by his or her Employer
if the Participant had elected the maximum benefit option
thereunder available to the Participant, without regard to
the actual election, if any, made by the Participant, plus
(iii) the monthly amount payable to the Participant as his
or her Social Security disability benefit if he or she is
then eligible for such a benefit, or if he or she is not
then eligible for a Social Security disability benefit, his
or her full primary Social Security benefit, assuming such
payments begin at age 62 or, if later, the date of the
Participant's termination of employment by reason of
Disability (without regard to any subsequent increases in
such benefit); provided, however, that if the Participant
is not eligible for a Social Security disability benefit,
any Social Security offset under this subsection
(b)(2)(iii) shall not be applied until the Participant
attains age 62. For purposes of (ii) above, the maximum
benefit option available to a Participant is the maximum
benefit option that may be elected by a Participant (as of
October 1, 1994, the 70% option) in the absence of an
adverse determination by the insurance carrier; or, in the
case of such an adverse determination, is the maximum
benefit allowed by the insurance carrier.
(c) Commencement and Form of Payment. Monthly disability retirement
benefit payments shall commence on the first day of the calendar
month following the date of the termination of the Participant's
employment by reason of Disability and shall continue to be paid
for the life of the Participant
11
or, if his or her Disability terminates prior to his or her
Normal Retirement Date, until the Participant's Disability
terminates.
(d) Termination of Disability. If the Participant's Disability
terminates before his or her Normal Retirement Date and either
the Participant does not return to work for an Employer, or the
Participant returns to work for an Employer but the Committee
does not determine that such person shall continue as an active
Participant in the Plan upon such return to work, the
Participant shall be entitled to receive an early retirement
benefit under Section 4.2 (if he or she was eligible for such a
benefit on the date his or her employment terminated by reason
of Disability) or a vested termination benefit under Section
4.4; and in any such case, the benefit shall be calculated as
of the date the Participant's employment terminated by reason
of Disability. Any early retirement benefit referred to in the
first sentence of this subsection (d) shall begin on the first
day of the calendar month immediately following the termination
of the Disability, and any vested termination benefit referred
to in the first sentence of this subsection (d) shall begin on
the first day of the calendar month next following the day the
Participant attains age 62 or, if the termination of the
Disability occurs thereafter, on the first day of the calendar
month next following the date of such termination.
4.4 Vested Termination Benefit.
(a) Eligibility. A Participant whose employment with his or her
Employer terminates at or after the time he or she has a vested
Accrued Benefit under this Article 4, but who is not otherwise
entitled to a benefit under this Article 4, shall be eligible
for a vested termination benefit under this Section 4.4.
Except as provided in Section 9.3 with respect to Participants
in the Plan on October 1, 1994, a Participant shall not have a
vested Accrued Benefit under this Article 4 unless and until he
or she satisfies the provisions of Section 4.4(d).
(b) Amount. A Participant who is eligible for a benefit under
subsection (a) above shall be entitled to receive a monthly
vested termination benefit for his or her life equal to the
amount by which (1) below exceeds (2) below:
(1) This amount equals the Participant's Accrued Benefit as of
the date of the termination of his or her employment, with
no reduction for early payment.
(2) This amount equals the sum of (i) the monthly income
payable to the Participant under the Retirement Plan and
the Nondiscrimination Plan (adjusted as provided for in
Section 6.1(c)), without regard to any post-termination
increases in such benefit, plus (ii) the monthly amount
payable to the Participant as his or her full primary
Social Security benefit, assuming such payments begin at
age 62 or, if later, the date
12
of the Participant's termination of employment (without
regard to any subsequent increases in such benefit).
(c) Commencement and Form of Payment. Monthly vested termination
benefit payments shall commence on the first day of the calendar
month next following the day the Participant attains age 62 or,
if the termination of employment occurs thereafter, on the first
day of the calendar month next following the date of such
termination of employment, and shall continue to be paid for the
life of the Participant.
(d) Vesting. A Participant shall become 100% vested in his or her
Accrued Benefit when he or she has satisfied both of the
following conditions:
(1) the Participant has been a Participant for at least five
years; and
(2) one of the following has occurred:
(i) the Participant has attained age 55 and has at
least five years of Credited Service; or
(ii) the sum of the Participant's age and Credited
Service (in each case counting full months
thereof) equals or exceeds 65.
A Participant shall also become 100% vested in his or her Accrued
Benefit, even if the foregoing tests have not been satisfied, at
the time of the Participant's termination of employment by reason
of Disability or death; the occurrence of a Change in Control; or
the termination of this Plan.
4.5 Change in Control.
(a) Eligibility. Upon the occurrence of a Change in Control, any
Participant employed by an Employer on the day immediately
prior to a Control Date shall be entitled to receive a benefit
calculated and paid as provided in this Section 4.5.
Notwithstanding any other provision of this Plan to the
contrary, upon the occurrence of a Change in Control, the
benefit provided by this Section 4.5 shall be the exclusive
benefit provided under this Plan to the Participants who are
eligible to receive such benefit (and to their spouses) and
accordingly each such person shall not be entitled to any other
benefits under this Plan without regard to the age of the
Participant, the vested status of the Participant or any other
factor; and upon receipt of his or her benefit under this
Section 4.5, a person shall cease being a Participant in this
Plan.
(b) Amount and Form of Payment. A Participant who is eligible for a
benefit under subsection (a) above shall receive his or her
benefit in a lump sum, paid on or as soon as practicable after
the Control Date, but no more than five days after such date,
equal to the sum of the following:
13
(1) This amount equals the product of the Participant's Current
Earnings on the day immediately prior to the Control Date
and the number of months by which the Control Date precedes
the Participant's Normal Retirement Date (up to a maximum
of 24 months).
(2) This amount equals the "adjusted present value" (as defined
below) of a monthly benefit for the Participant's life in
an amount equal to the amount by which (i) below exceeds
(ii) below, plus (but only if the Participant is married as
of the Control Date) the "adjusted present value" (as
defined below) of a 50% surviving spouse's benefit for the
life of the surviving spouse:
(i) This amount equals the Participant's Prospective
Target Amount determined as of the Control Date, with
no reduction for early payment.
(ii) This amount equals the monthly deferred retirement
income that would be payable to the Participant under
the Retirement Plan and the Nondiscrimination Plan
beginning as of the Participant's Normal Retirement
Date (adjusted as provided for in Section 6.1(c)) if
the Participant's employment terminated as of the
Control Date. For these purposes, no pre-retirement
survivorship charges or early retirement reductions
shall be applied.
For purposes of this Section 4.5(b)(2), the "adjusted
present value" shall be calculated by determining the
Actuarial Equivalent of the stated benefit as if it were to
be paid in a lump sum on the Participant's Normal
Retirement Date and as if the equivalent monthly benefit
for the Participant's and (if applicable) the surviving
spouse's lives were to begin at the Participant's Normal
Retirement Date; no reduction shall be made for payment of
the lump sum prior to the Participant's Normal Retirement
Date.
(c) Additional Payment. A Participant who is eligible for a
benefit under subsection (a) above also shall be entitled to
receive the amount described below to the extent applicable:
In the event any payment under this Section 4.5 or under
another plan or agreement (collectively, the "Payments") are
subject to the excise tax imposed by Section 4999 of the Code
(the "Excise Tax"), the Participant's Employer shall pay the
Participant an amount (the "Gross Up") such that the net amount
retained by the Participant after deduction of any Excise Tax
on the Payments and the federal income tax on any payments
under this Section 4.5(c) shall be equal to the Payments. For
purposes of determining the Gross Up, the Participant shall be
deemed to pay the federal income tax at the highest marginal
rate of taxation (currently 39.5%) in the calendar year in
which the payment under Section 4.5 is to be made. The
determination of whether such Excise Tax is payable and the
14
amount thereof shall be made upon the opinion of tax counsel
selected by the Employer and reasonably acceptable to the
Participant. The Gross Up, if any, that is due as a result of
such determination shall be paid to the Participant in cash in
a lump sum within thirty (30) days of such computation. If
such opinion is not finally accepted by the Internal Revenue
Service upon audit or otherwise, then appropriate adjustments
shall be computed (without interest but with Gross Up, if
applicable) by such tax counsel based upon the final amount of
the Excise Tax so determined; any additional amount due the
Participant as a result of such adjustment shall be paid to the
Participant by his or her Employer in cash in a lump sum within
thirty (30) days of such computation, or any amount due the
Participant's Employer as a result of such adjustment shall be
paid to the Employer by the Participant in cash in a lump sum
within thirty (30) days of such computation.
4.6 Surviving Spouse Benefit.
(a) Eligibility. If at the time of the death of a Participant, (1)
(i) the employment of a Participant with his or her Employer
had previously terminated and the Participant was receiving or
was entitled to receive benefits under this Article 4 or (ii)
the Participant was still employed by his or her Employer and
had unpaid Accrued Benefits under this Article 4 (whether or
not vested at the time of death) and (2) the Participant is
survived by a Spouse, such Spouse shall be eligible for a
surviving spouse benefit under this Section 4.6. In no other
circumstances shall the Spouse of a Participant or any other
beneficiary of a Participant under the Retirement Plan or
otherwise be entitled to any benefit under this Article 4 in
the event of the death of a Participant hereunder, even if
survivor benefits are otherwise payable under the Retirement
Plan. Also, without limitation on the foregoing, and
notwithstanding anything to the contrary contained in this
Section 4.6, no benefit shall be payable to a Spouse of a
deceased Participant or former Participant who received during
his or her lifetime or who was entitled to receive at the time
of death a benefit under Section 4.5, or who received during
his or her lifetime or who was entitled to receive at the time
of death a benefit under any provision of this Article 4 in the
optional lump sum form in accordance with Section 6.2.
(b) Amount. A Spouse who is eligible for a benefit under subsection
(a) above shall be entitled to receive a monthly surviving
spouse benefit for his or her life in an amount equal to the
amount by which (1) below exceeds (2) below:
(1) In the case of a Participant whose employment with his or
her Employer terminated prior to death, this amount equals
fifty percent (50%) of the monthly amount the Participant
was eligible to receive (even if only on a deferred basis)
or was receiving at the time of death under Section
4.1(b)(1), 4.2(b)(1), 4.3(b)(1) or 4.4(b)(1), as the case
may be, prior to the application of any applicable
set-off, with no reduction for early payment. In the
case of a Participant who was still
15
in the employment of his or her Employer at the time of
death, this amount equals fifty percent (50%) of the
Participant's Accrued Benefit as of the date of death,
with no reduction for early payment.
(2) This amount equals the aggregate monthly income, if any,
payable to the Spouse and to any other beneficiary of the
Participant under the Retirement Plan and the
Nondiscrimination Plan as a result of the death of the
Participant (adjusted as provided for in Section 6.1(c)).
(c) Commencement and Form of Payment. Monthly surviving spouse
benefit payments shall be payable to the Spouse for the life of
the Spouse and shall commence as soon as practicable following
the Participant's death.
16
ARTICLE 5. SPECIAL EARLY RETIREMENT BENEFITS
5.1 Special Early Retirement Benefit.
(a) Eligibility. A Participant whose employment with his or her
Employer terminates by reason of Special Early Retirement shall
be entitled to a retirement benefit under this Section 5.1.
(b) Amount. A Participant who is eligible for a benefit under
subsection (a) above shall be entitled to receive a monthly
retirement benefit for his or her life equal to the amount by
which (1) below exceeds (2) below:
(1) This amount equals the amount determined by the Committee,
but not in excess of the Participant's Prospective Target
Amount determined as of the date of the termination of the
Participant's employment by reason of Special Early
Retirement, with no reduction for early payment.
(2) This amount equals the sum of (i) the monthly income
payable to the Participant under the Retirement Plan and
the Nondiscrimination Plan (adjusted as provided for in
Section 6.1(c)), without regard to any post-retirement
increases in such benefit, plus (ii) the monthly amount
payable to the Participant as his or her full primary
Social Security benefit, assuming such payments begin at
age 62 or, if later, the date of the Participant's early
retirement (without regard to any subsequent increases in
such benefit); provided, however, that the Social Security
offset under this subsection (b)(2)(ii) shall not be
applied until the Participant attains age 62.
(c) Commencement and Form of Payment. Monthly Special Early
Retirement benefit payments under this Section 5.1 shall
commence on the first day of the calendar month next following
the day of the Participant's termination of employment with his
or her Employer by reason of Special Early Retirement and shall
continue to be paid for the life of the Participant, or shall
be paid in such other form as may be determined in the sole
discretion of the Committee. Any such alternative benefit
shall be in an amount that is the Actuarial Equivalent of such
monthly benefit for life.
5.2 Surviving Spouse Benefit.
(a) Eligibility. If a Participant dies while eligible for a
benefit under Section 5.1 (i.e., his or her employment has
terminated by reason of Special Early Retirement) and is
survived by a Spouse, such Spouse shall be eligible for a
surviving spouse benefit under this Section 5.2. In no other
circumstances shall the Spouse of a Participant or any other
beneficiary of a Participant under the Retirement Plan or
otherwise be entitled to any benefit under this Article 5 in
the event of the death of a Participant hereunder, even if
survivor
17
benefits are otherwise payable under the Retirement
Plan. Also, without limitation on the foregoing, and
notwithstanding anything to the contrary contained in this
Section 5.2, no benefit shall be payable to a Spouse of a
deceased Participant who received during his or her lifetime or
who was entitled to receive at the time of his or her death a
benefit under Section 5.1 in the optional lump sum form in
accordance with Section 6.2.
(b) Amount. A Spouse who is eligible for a benefit under subsection
(a) above shall be entitled to receive a monthly surviving
spouse benefit for his or her life equal to the amount by which
(1) below exceeds (2) below:
(1) This amount equals fifty percent (50%) of the monthly
amount the Participant was eligible to receive or was
receiving at the time of death under Section 5.1(b)(1),
prior to the application of any applicable set-off, with
no reduction for early payment.
(2) This amount equals the aggregate monthly income, if any,
payable to the Spouse and to any other beneficiary of the
Participant under the Retirement Plan and the
Nondiscrimination Plan as a result of the death of the
Participant (adjusted as provided for in Section 6.1(c)).
(c) Commencement and Form of Payment. Monthly surviving spouse
benefit payments shall be payable to the Spouse for the life of
the Spouse and shall commence as soon as practicable following
the Participant's death.
18
ARTICLE 6. SPECIAL BENEFIT PROVISIONS
6.1 General Principles.
(a) General Rule for Offset. The amount of any offset under
Section 4.1(b)(2), 4.2(b)(2), 4.3(b)(2), 4.4(b)(2), 4.6(b)(2),
5.1(b)(2), or 5.2(b)(2), as the case may be, shall be
determined by using the amount payable to a Participant or
other named person during the month in question under the
Retirement Plan, the Nondiscrimination Plan and (if applicable)
any long-term disability plan, taking into account in general
applicable adjustments, if any, including without limitation
those for deferred payment or early payment, and pre-retirement
survivorship charges, but any such determination shall be
subject to the provisions of Section 6.1(c); provided, that no
adjustments shall be made for any cost-of-living or similar
changes in a Participant's benefits after the date that
benefits begin to be paid to the Participant. Furthermore, as
provided under Sections 4.2(b)(2), 4.3(b)(2) and 5.1(b)(2), a
Social Security offset may not be applicable prior to the time
the Participant attains age 62; and a benefit may not be
payable under the Retirement Plan, the Nondiscrimination Plan,
and/or any long-term disability plan for all months a benefit
is to be payable under this Plan. Thus, the amount of the
offset may vary from month to month.
(b) Qualified Domestic Relations Order. If a Participant's spouse
or former spouse has received or is entitled to receive a
benefit under the Retirement Plan or the Nondiscrimination Plan
as a result of a Qualified Domestic Relations Order, the amount
of the offset applicable to the Participant shall include the
amount that is so paid or is payable to the spouse.
(c) Special Adjustment. In determining the amount payable during
the month in question under the Retirement Plan and the
Nondiscrimination Plan, the benefit, in the case of a
Participant who is not married for purposes of the Retirement
Plan, shall be calculated as a straight life annuity and the
benefit, in the case of a Participant who is married for
purposes of the Retirement Plan, shall be calculated as a 50%
joint and survivor annuity, without regard in each case to the
actual form of payment under the Retirement Plan or the
Nondiscrimination Plan.
6.2 Optional Lump Sum Payment.
(a) Right To Receive. The benefit of a Participant under Section
4.1 (Normal Retirement), Section 4.2 (Early Retirement) and
Section 4.4 (Vested Termination) shall be paid in a lump sum if
payment in such form is elected by the Participant; provided,
however, that to be effective, such election must be made in
accordance with such rules and procedures as may be
established by the Committee from time to time and must be
approved by the Committee. Any lump sum benefit shall be in an
amount that is the Actuarial Equivalent of such monthly benefit
for life.
19
(b) Limitation. Notwithstanding the foregoing provisions of this
Section 6.2, a Participant's election of a lump sum payment
shall be effective only if an irrevocable election is made by
the Participant and submitted to the Committee no later than
the last day of the calendar year that is at least two calendar
years prior to the calendar year of retirement or other
termination of employment or unless the benefit is reduced by
five percent (5%).
(c) Payment. A validly elected lump sum shall be paid to a
Participant as soon as practicable following the date monthly
benefits would have begun to be paid to the Participant;
provided, however, that in the event, if payment were made at
such time, the Company would not be able to deduct for federal
income tax purposes the entire amount to be paid to the
Participant under this Plan because of the limits under Section
162(m) of the Code, full payment shall be delayed, with payment
to be made as soon as possible in one or more installments to
the extent and at such time or times as a deduction may be
obtained without limit under Section 162(m).
20
ARTICLE 7. FINANCING
7.1 Financing. The benefits under this Plan shall be paid out of the
general assets of the Company or other Employer.
7.2 No Trust Created. Nothing contained in this Plan, and no action taken
pursuant to the provisions of this Plan, shall create or be construed to create
a trust of any kind or a fiduciary relationship between any Employer and any
Participant, his or her spouse or any other person.
7.3 Unsecured Interest. No Participant hereunder shall have any interest
whatsoever in any specific asset of the Company or any other Employer. To the
extent that any person acquires a right to receive payments under this Plan,
such right shall be no greater than the right of any unsecured general creditor
of the Company or other Employer.
7.4 "Rabbi" Trust. Notwithstanding the foregoing provisions of this Article
7, the Company and the other Employers reserve the right to create and
contribute funds to a "Rabbi" trust for the purpose of paying some or all of the
benefits provided under this Plan, but the existence of any such trust shall not
in any way alter the relationship among the Company, any other Employer and a
Participant as described in this Article 7.
7.5 Divested Subsidiary Employee Participants. The liability for benefits
under this Plan for any Participant, who is an employee of an Employer that is
divested ("Divested Subsidiary Employee Participant") is and shall remain solely
the obligation of that divested Employer. Any Divested Subsidiary Employee
Participant will have no future claim to benefits under this Plan, or against
assets of any related trust, if assets sufficient to fund that Divested
Subsidiary Employee Participant's benefits are transferred to a plan or trust to
be sponsored by the divested Employer, or if the Divested Subsidiary Employee
Participant is compensated for any benefits accrued under this Plan.
21
ARTICLE 8. ADMINISTRATION
8.1 Administration. The Committee shall have complete control over the
administration of the Plan, with all powers necessary to enable it to carry out
its duties in that respect. In connection with its administration of the Plan,
the Committee shall be empowered to exercise discretion, including with respect
to the interpretation of the terms of the Plan and in the determination of
eligibility for benefits and the amounts thereof; such discretionary
determinations and interpretations shall be binding upon all Participants and
others hereunder. Without limitation on the foregoing, the Committee shall be
authorized to construe and interpret all of the provisions of the Plan, to adopt
rules and practices concerning the administration of the same, and to make any
determination necessary hereunder, all of which shall be binding and conclusive
on all parties.
8.2 Liability of Committee and Board; Indemnification. To the extent
permitted by law, no member of the Committee or of the Board shall be liable to
any person for any action taken or omitted in connection with the interpretation
and administration of this Plan unless attributable to his or her own gross
negligence, fraud or bad faith. The Company shall indemnify the members of the
Committee and of the Board against any and all claims, losses, damages and
expenses, including counsel fees, incurred by them, and any liability, including
any amounts paid in settlement with their approval, arising from their action or
failure to act, except when the same is determined to be attributable to their
gross negligence, fraud or bad faith. The provisions of this Section 8.2 are not
intended to be exclusive, and nothing contained in this Section 8.2 shall in any
way limit indemnification provided members of the Committee and/or members of
the Board under the by-laws of the Company, by contract, by statute or
otherwise.
8.3 Expenses. The cost of payment from this Plan and the expenses of
administering the Plan shall be borne by the Company and the other Employers.
8.4 Tax Withholding. An Employer may withhold, or require the withholding
of, from any payment which it is required to make, any federal, state or local
taxes required by law to be withheld with respect to such payment and such sum
as the Employer may reasonably estimate as necessary to cover any taxes for
which the Employer may be liable and which may be assessed with regard to such
payment. Upon discharge or settlement of such tax liability, the Employer shall
distribute the balance of such sum, if any, to the Participant from whose
payment it was withheld, or if such Participant is then deceased, to the
beneficiary of such Participant. Prior to making any payment hereunder, the
Employer may require such documents from any taxing authority, or may require
such indemnities or surety bond, as the Employer shall reasonably deem necessary
for its protection.
22
ARTICLE 9. MISCELLANEOUS
9.1 Nontransferability. In no event shall the Company or any Employer make
any payment under this Plan to any assignee or creditor of a Participant or of a
beneficiary. Prior to the time of a payment hereunder, a Participant or a
beneficiary shall have no rights by way of anticipation or otherwise to assign
(including without limitation in connection with a divorce) or otherwise dispose
of any interest under this Plan nor shall rights be assigned or transferred by
operation of law.
9.2 Amendment or Termination.
(a) Amendments; Termination. The Plan may be amended or terminated at
any time by the Committee, and, except as provided to the
contrary in subsection (b) below, no Participant or beneficiary
of a deceased Participant shall have a right to receive benefits
under the Plan at any time. Notice of any such amendment or
termination shall be given in writing to each Participant and
beneficiary of a deceased Participant having an interest in the
Plan.
(b) Effect on Benefits. No amendment or termination of the Plan may
adversely affect the benefits then payable or that may be payable
in the future with respect to any Participant (without giving
effect to such Plan amendment or termination) to the extent
described below:
(1) for a Participant whose employment with his or her Employer
has terminated prior to such Plan amendment or termination,
the benefits then payable or to be payable to the
Participant and his or her spouse shall not be altered;
(2) for a Participant under Article 4 whose employment with
his or her Employer has not terminated prior to such Plan
amendment or termination, the amount of the benefits
accrued as of the date of the Plan amendment or
termination shall not be decreased;
(3) for a Participant under Article 5 whose employment with
his or her Employer has not terminated prior to such Plan
amendment or termination, the benefits that would be
payable to the Participant and his or her spouse (without
giving effect to such Plan amendment or termination) upon
the termination of his or her employment by reason of
Special Early Retirement shall not be altered; and
(4) once there has been a Change in Control, any benefits
payable or that could be payable under Section 4.5 as a
result of such Change in Control shall not be altered.
9.3 Impact of 1994 Amendments. Notwithstanding the provisions of Section
9.2, the following provisions shall govern the impact of the amendment and
restatement of this Plan as of October 1, 1994 on persons who were Participants
on October 1, 1994:
23
(a) a Participant in this Plan on October 1, 1994 who was then
receiving benefits shall not be affected by the amendment and
restatement and shall be governed in all respects by the
provisions of the Plan as in effect immediately prior to such
Participant's termination of employment; and
(b) a Participant in this Plan on October 1, 1994 who was not then
receiving benefits shall be entitled to receive as a benefit
under Section 4.1, 4.2, 4.3, 4.4, 4.5 or 5.1, as the case may
be, and assuming the Participant is otherwise eligible for such
benefit at some time (either then or in the future), an amount
equal to the greater of the benefit calculated under the
provisions of the Plan as in effect immediately prior to such
amendment and restatement or the benefit calculated under the
provisions of the Plan as so amended and restated. The benefits
payable to a Participant's surviving spouse under Section 4.6
or 5.2, as the case may be (taking into account, in calculating
the benefit payable to a Participant's surviving spouse, the
benefit available to the Participant under the preceding
sentence) and all other provisions relating to the payment of
benefits under the Plan (including, without limitation, the
ability to receive a lump sum payment) shall be governed by the
provisions of the Plan as so amended and restated.
Notwithstanding any provisions of Sections 4.1(a) or 4.2(a) to the contrary, the
requirement that a Participant have at least five years of participation in this
Plan in order to receive a benefit under such provisions shall be deemed to be
satisfied (without regard to the actual number of years of such participation)
with respect to each Participant in this Plan on October 1, 1994. Moreover, each
Participant in this Plan on October 1, 1994 shall be deemed to be 100% vested in
his or her Accrued Benefit (as it may be from time to time), without regard to
his or her number of years of participation in the Plan, number of years of
Credited Service, age or any other requirement of Section 4.4(d).
9.4 Forfeiture of Benefits. As a condition of receiving benefits under this
Plan, a Participant shall not, directly or indirectly, after the termination of
his or her employment with an Employer:
(a) use or disclose any financial or business information of the
Company and/or its subsidiaries obtained by the Participant
during the course of his or her employment, other than
information that has been previously made available to the
public through normal, authorized business channels, in a
manner that would be prejudicial to the interests of the
Company and its subsidiaries. Notwithstanding the preceding
requirements of this subsection (a), a Participant may disclose
information if required by legal process or if the disclosure
is protected by the Florida Whistle-blower's Act of 1986, or
any similar applicable federal or state statute; or
(b) render any services of an advisory nature or become employed by
or participate or engage in any business in competition with
the Company or any of its subsidiaries, without the prior
written consent of his or her Employer. A Participant shall be
considered as engaging in a business if he or she is a
shareholder or other owner, or partner, director, officer, or
employee of, or
24
consultant to, the business; provided, that a Participant shall
not be prohibited from owning securities of a competitor if (1)
the securities owned constitute less that 2% of the
competitor's total outstanding securities of the same class and
(2) the Participant does not have the power to control, direct
or substantially influence the competitor's management or
policies.
Any breach of any of the foregoing conditions will result in complete forfeiture
of any further benefits under the Plan for both the Participant and any
surviving spouse of the Participant. The immediately preceding sentence shall
not require the forfeiture or the return of any benefit received or due prior to
the breach of any of the specific conditions.
9.5 Applicable Law. This instrument shall be construed in accordance with
and governed by the laws of the State of Florida, to the extent not superseded
by the laws of the United States.
25