Exhibit 10.2
THE EXECUTIVE NONQUALIFIED EXCESS PLAN
PLAN DOCUMENT
THE EXECUTIVE NONQUALIFIED EXCESS PLAN
Section 1. Purpose:
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By execution of the Adoption Agreement, the Employer
has adopted the Plan set forth herein, and in the Adoption
Agreement, to provide a means by which certain management
Employees or Independent Contractors of the Employer may
elect to defer receipt of current Compensation from the
Employer in order to provide retirement and other benefits
on behalf of such Employees or Independent Contractors of
the Employer, as selected in the Adoption Agreement. The
Plan is intended to be a nonqualified deferred compensation
plan that complies with the provisions of Section 409A of
the Internal Revenue Code (the "Code"). The Plan is also
intended to be an unfunded plan maintained primarily for the
purpose of providing deferred compensation benefits for a
select group of management or highly compensated employees
under Sections 201(2), 301(a)(3) and 401(a)(l) of the
Employee Retirement Income Security Act of 1974 ("ERISA")
and independent contractors. Notwithstanding any other
provision of this Plan, this Plan shall be interpreted,
operated and administered in a manner consistent with these
intentions.
Section 2. Definitions:
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As used in the Plan, including this Section 2,
references to one gender shall include the other, unless
otherwise indicated by the context:
2.1 "Active Participant" means, with respect to any
day or date, a Participant who is in Service on such day or
date; provided, that a Participant shall cease to be an
Active Participant (i) immediately upon a determination by
the Committee that the Participant has ceased to be an
Employee or Independent Contractor, or (ii) at the end of
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the Plan Year that the Committee determines the Participant
no longer meets the eligibility requirements of the Plan.
2.2 "Adoption Agreement" means the written agreement
pursuant to which the Employer adopts the Plan. The Adoption
Agreement is a part of the Plan as applied to the Employer.
2.3 "Beneficiary" means the person, persons, entity or
entities designated or determined pursuant to the provisions
of Section 13 of the Plan.
2.4 "Board" means the Board of Directors of the
Company, if the Company is a corporation. If the Company is
not a corporation, "Board" shall mean the Company.
2.5 "Change in Control Event" means an event described
in Section 409A(a)(2)(A)(v) of the Code (or any successor
provision thereto) and the regulations thereunder.
2.6 "Committee" means the persons or entity designated
in the Adoption Agreement to administer the Plan. If the
Committee designated in the Adoption Agreement is unable to
serve, the Employer shall satisfy the duties of the
Committee provided for in Section 9.
2.7 "Company" means the company designated in the
Adoption Agreement as such.
2.8 "Compensation" shall have the meaning designated
in the Adoption Agreement.
2.9 "Crediting Date" means the date designated in the
Adoption Agreement for crediting the amount of any
Participant Deferral Credits to the Deferred Compensation
Account of a Participant. Employer Credits may be credited
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to the Deferred Compensation Account of a Participant on any
day that securities are traded on a national securities
exchange.
2.10 "Deferred Compensation Account" means the account
maintained with respect to each Participant under the Plan.
The Deferred Compensation Account shall be credited with
Participant Deferral Credits and Employer Credits, credited
or debited for deemed investment gains or losses, and
adjusted for payments in accordance with the rules and
elections in effect under Section 8. The Deferred
Compensation Account of a Participant shall include any In-
Service or Education Account of the Participant, if
applicable.
2.11 "Disabled" means Disabled within the meaning of
Section 409A of the Code and the regulations thereunder.
Generally, this means that the Participant is unable to
engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which
can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, or
is, by reason of any medically determinable physical or
mental impairment which can be expected to result in death
or can be expected to last for a continuous period of not
less than 12 months, receiving income replacement benefits
for a period of not less than three months under an accident
and health plan covering Employees of the Employer.
2.12 "Education Account" is an In-Service Account
which will be used by the Participant for educational
purposes.
2.13 "Effective Date" shall be the date designated in
the Adoption Agreement.
2.14 "Employee" means an individual in the Service of
the Employer if the relationship between the individual and
the Employer is the legal relationship of employer and
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employee. An individual shall cease to be an Employee upon
the Employee's separation from Service.
2.15 "Employer" means the Company, as identified in the
Adoption Agreement, and any Participating Employer which
adopts this Plan. An Employer may be a corporation, a
limited liability company, a partnership or sole
proprietorship.
2.16 "Employer Credits" means the amounts credited to
the Participant's Deferred Compensation Account by the
Employer pursuant to the provisions of Section 4.2.
2.17 "Grandfathered Amounts" means, if applicable, the
amounts that were deferred under the Plan and were earned
and vested within the meaning of Section 409A of the Code
and regulations thereunder as of December 31, 2004.
Grandfathered Amounts shall be subject to the terms
designated in the Adoption Agreement.
2.18 "Independent Contractor" means an individual in
the Service of the Employer if the relationship between the
individual and the Employer is not the legal relationship of
employer and employee. An individual shall cease to be an
Independent Contractor upon the termination of the
Independent Contractor's Service. An Independent Contractor
shall include a director of the Employer who is not an
Employee.
2.19 "In-Service Account" means a separate account to
be kept for each Participant that has elected to take in-
service distributions as described in Section 5.4. The In-
Service Account shall be adjusted in the same manner and at
the same time as the Deferred Compensation Account under
Section 8 and in accordance with the rules and elections in
effect under Section 8.
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2.20 "Normal Retirement Age" of a Participant means the
age designated in the Adoption Agreement.
2.21 "Participant" means with respect to any Plan Year
an Employee or Independent Contractor who has been
designated by the Committee as a Participant and who has
entered the Plan or who has a Deferred Compensation Account
under the Plan; provided that if the Participant is an
Employee, the individual must be a highly compensated or
management employee of the Employer within the meaning of
Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.
2.22 "Participant Deferral Credits" means the amounts
credited to the Participant's Deferred Compensation Account
by the Employer pursuant to the provisions of Section 4.1.
2.23 "Participating Employer" means any trade or
business (whether or not incorporated) which adopts this
Plan with the consent of the Company identified in the
Adoption Agreement.
2.24 "Participation Agreement" means a written
agreement entered into between a Participant and the
Employer pursuant to the provisions of Section 4.1
2.25 "Performance-Based Compensation" means
compensation where the amount of, or entitlement to, the
compensation is contingent on the satisfaction of
preestablished organizational or individual performance
criteria relating to a performance period of at least twelve
months. Organizational or individual performance criteria
are considered preestablished if established in writing
within 90 days after the commencement of the period of
service to which the criteria relates, provided that the
outcome is substantially uncertain at the time the criteria
are established. Performance-based compensation may include
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payments based upon subjective performance criteria as
provided in regulations and administrative guidance
promulgated under Section 409A of the Code.
2.26 "Plan" means The Executive Nonqualified Excess
Plan, as herein set out and as set out in the Adoption
Agreement, or as duly amended. The name of the Plan as
applied to the Employer shall be designated in the Adoption
Agreement.
2.27 "Plan-Approved Domestic Relations Order" shall
mean a judgment, decree, or order (including the approval of
a settlement agreement) which is:
2.27.1 Issued pursuant to a State's domestic
relations law;
2.27.2 Relates to the provision of child support,
alimony payments or marital property rights to a Spouse,
former Spouse, child or other dependent of the Participant;
2.27.3 Creates or recognizes the right of a Spouse,
former Spouse, child or other dependent of the Participant
to receive all or a portion of the Participant's benefits
under the Plan;
2.27.4 Requires payment to such person of their
interest in the Participant's benefits in an immediate lump
payment; and
2.27.5 Meets such other requirements established by
the Committee.
2.28 "Plan Year" means the twelve-month period ending
on the last day of the month designated in the Adoption
Agreement; provided that the initial Plan Year may have
fewer than twelve months.
2.29 "Qualifying Distribution Event" means (i) the
Separation from Service of the Participant, (ii) the date
the Participant becomes Disabled, (iii) the death of the
Participant, (iv) the time specified by the Participant for
an In-Service or Education Distribution, (v) a Change in
Control Event, or (vi) an Unforeseeable Emergency, each to
the extent provided in Section 5.
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2.30 "Seniority Date" shall have the meaning designated
in the Adoption Agreement.
2.31 "Separation from Service" or "Separates from
Service" means a "separation from service" within the
meaning of Section 409A of the Code.
2.32 "Service" means employment by the Employer as an
Employee. For purposes of the Plan, the employment
relationship is treated as continuing intact while the
Employee is on military leave, sick leave, or other bona
fide leave of absence if the period of such leave does not
exceed six months, or if longer, so long as the Employee's
right to reemployment is provided either by statute or
contract. If the Participant is an Independent Contractor,
"Service" shall mean the period during which the contractual
relationship exists between the Employer and the
Participant. The contractual relationship is not terminated
if the Participant anticipates a renewal of the contract or
becomes an Employee.
2.33 "Service Bonus" means any bonus paid to a
Participant by the Employer which is not Performance-Based
Compensation.
2.34 "Specified Employee" means an employee who meets
the requirements for key employee treatment under Section
416(i)(l)(A)(i), (ii) or (iii) of the Code (applied in
accordance with the regulations thereunder and without
regard to Section 416(i)(5) of the Code) at any time during
the twelve month period ending on December 31 of each year
(the "identification date"). Unless binding corporate action
is taken to establish different rules for determining
Specified Employees for all plans of the Company and its
controlled group members that are subject to Section 409A of
the Code, the foregoing rules and the other default rules
under the regulations of Section 409A of the Code shall
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apply. If the person is a key employee as of any
identification date, the person is treated as a Specified
Employee for the twelve-month period beginning on the first
day of the fourth month following the identification date.
2.35 "Spouse" or ''Surviving Spouse" means, except as
otherwise provided in the Plan, a person who is the legally
married spouse or surviving spouse of a Participant.
2.36 "Unforeseeable Emergency" means an "unforeseeable
emergency" within the meaning of Section 409A of the Code.
2.37 "Years of Service" means each Plan Year of Service
completed by the Participant. For vesting purposes, Years of
Service shall be calculated from the date designated in the
Adoption Agreement and Service shall be based on service
with the Company and all Participating Employers.
Section 3. Participation:
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The Committee in its discretion shall designate each
Employee or Independent Contractor who is eligible to
participate in the Plan. A Participant who separates from
Service with the Employer and who later returns to Service
will not be an Active Participant under the Plan except upon
satisfaction of such terms and conditions as the Committee
shall establish upon the Participant's return to Service,
whether or not the Participant shall have a balance
remaining in the Deferred Compensation Account under the
Plan on the date of the return to Service.
Section 4. Credits to Deferred Compensation Account:
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4.1 Participant Deferral Credits. To the extent
provided in the Adoption Agreement, each Active Participant
may elect, by entering into a Participation Agreement with
the Employer, to defer the receipt of Compensation from the
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Employer by a dollar amount or percentage specified in the
Participation Agreement. The amount of Compensation the
Participant elects to defer, the Participant Deferral
Credit, shall be credited by the Employer to the Deferred
Compensation Account maintained for the Participant pursuant
to Section 8. The following special provisions shall apply
with respect to the Participant Deferral Credits of a
Participant:
4.1.1 The Employer shall credit to the
Participant's Deferred Compensation Account on each
Crediting Date an amount equal to the total Participant
Deferral Credit for the period ending on such Crediting
Date.
4.1.2 An election pursuant to this Section 4.1
shall be made by the Participant by executing and delivering
a Participation Agreement to the Committee. Except as
otherwise provided in this Section 4.1, the Participation
Agreement shall become effective with respect to such
Participant as of the first day of January following the
date such Participation Agreement is received by the
Committee. A Participant's election may be changed at any
time prior to the last permissible date for making the
election as permitted in this Section 4.1, and shall
thereafter be irrevocable. The election of a Participant
shall continue in effect for subsequent years until modified
by the Participant as permitted in this Section 4.1.
4.1.3 A Participant may execute and deliver a
Participation Agreement to the Committee within 30 days
after the date the Participant first becomes eligible to
participate in the Plan to be effective as of the first
payroll period next following the date the Participation
Agreement is fully executed. Whether a Participant is
treated as newly eligible for participation under this
Section shall be determined in accordance with Section 409A
of the Code and the regulations thereunder, including (i)
rules that treat all elective deferral account balance plans
as one plan, and (ii) rules that treat a previously eligible
employee as newly eligible if his benefits had been
previously distributed or if he has been ineligible for 24
months. For Compensation that is earned based upon a
specified performance period (for example, an annual bonus),
where a deferral election is made under this Section but
after the beginning of the performance period, the election
will only apply to the portion of the Compensation equal to
the total amount of the Compensation for the service period
multiplied by the ratio of the number of days remaining in
the performance period after the election over the total
number of days in the performance period.
4.1.4 A Participant may unilaterally modify a
Participation Agreement (either to terminate, increase or
decrease the portion of his future Compensation which is
subject to deferral within the percentage limits set forth
in Section 4.1 of the Adoption Agreement) by providing a
written modification of the Participation Agreement to the
Committee. The modification shall become effective as of the
first day of January following the date such written
modification is received by the Committee.
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4.1.5 If the Participant performed services
continuously from the later of the beginning of the
performance period or the date upon which the performance
criteria are established through the date upon which the
Participant makes an initial deferral election, a
Participation Agreement relating to the deferral of
Performance-Based Compensation may be executed and delivered
to the Committee no later than the date which is 6 months
prior to the end of the performance period, provided that in
no event may an election to defer Performance-Based
Compensation be made after such Compensation has become
readily ascertainable.
4.1.6 If the Employer has a fiscal year other than
the calendar year, Compensation relating to Service in the
fiscal year of the Employer (such as a bonus based on the
fiscal year of the Employer), of which no amount is paid or
payable during the fiscal year, may be deferred at the
Participant's election if the election to defer is made not
later than the close of the Employer's fiscal year next
preceding the first fiscal year in which the Participant
performs any services for which such Compensation is
payable.
4.1.7 Compensation payable after the last day of
the Participant's taxable year solely for services provided
during the final payroll period containing the last day of
the Participant's taxable year (i.e., December 31) is
treated for purposes of this Section 4.1 as Compensation for
services performed in the subsequent taxable year.
4.1.8 The Committee may from time to time establish
policies or rules consistent with the requirements of
Section 409A of the Code to govern the manner in which
Participant Deferral Credits may be made.
4.1.9 If a Participant becomes Disabled or applies
for and is eligible for a distribution on account of an
Unforeseeable Emergency during a Plan Year, his deferral
election for such Plan Year shall be cancelled.
4.2 Employer Credits. If designated by the Employer in
the Adoption Agreement, the Employer shall cause the
Committee to credit to the Deferred Compensation Account of
each Active Participant an Employer Credit as determined in
accordance with the Adoption Agreement. A Participant must
make distribution elections with respect to any Employer
Credits credited to his Deferred Compensation Account by the
deadline that would apply under Section 4.1 for distribution
elections with respect to Participant Deferral Credits
credited at the same time, on a Participation Agreement that
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is timely executed and delivered to the Committee pursuant
to Section 4.1.
4.3 Deferred Compensation Account. All Participant
Deferral Credits and Employer Credits shall be credited to
the Deferred Compensation Account of the Participant as
provided in Section 8.
Section 5. Qualifying Distribution Events:
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5.1 Separation from Service. If the Participant
Separates from Service with the Employer, the vested balance
in the Deferred Compensation Account shall be paid to the
Participant by the Employer as provided in Section 7.
Notwithstanding the foregoing, no distribution shall be made
earlier than six months after the date of Separation from
Service (or, if earlier, the date of death) with respect to
a Participant who as of the date of Separation from Service
is a Specified Employee of a corporation the stock in which
is traded on an established securities market or otherwise.
Any payments to which such Specified Employee would be
entitled during the first six months following the date of
Separation from Service shall be accumulated and paid on the
first day of the seventh month following the date of
Separation from Service.
5.2 Disability. If the Employer designates in the
Adoption Agreement that distributions are permitted under
the Plan when a Participant becomes Disabled, and the
Participant becomes Disabled while in Service, the vested
balance in the Deferred Compensation Account shall be paid
to the Participant by the Employer as provided in Section 7.
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5.3 Death. If the Participant dies while in Service,
the Employer shall pay a benefit to the Participant's
Beneficiary in the amount designated in the Adoption
Agreement. Payment of such benefit shall be made by the
Employer as provided in Section 7.
5.4 In-Service or Education Distributions. If the
Employer designates in the Adoption Agreement that in-
service or education distributions are permitted under the
Plan, a Participant may designate in the Participation
Agreement to have a specified amount credited to the
Participant's In-Service or Education Account for in-service
or education distributions at the date specified by the
Participant. In no event may an in-service or education
distribution of an amount be made before the date that is
two years after the first day of the year in which such
amount was credited to the In-Service or Education Account.
Notwithstanding the foregoing, if a Participant incurs a
Qualifying Distribution Event prior to the date on which the
entire balance in the In-Service or Education Account has
been distributed, then the balance in the In-Service or
Education Account on the date of the Qualifying Distribution
Event shall be paid as provided under Section 7.1 for
payments on such Qualifying Distribution Event.
5.5 Change in Control Event. If the Employer
designates in the Adoption Agreement that distributions are
permitted under the Plan upon the occurrence of a Change in
Control Event, the Participant may designate in the
Participation Agreement to have the vested balance in the
Deferred Compensation Account paid to the Participant upon a
Change in Control Event by the Employer as provided in
Section 7.
5.6 Unforeseeable Emergency. If the Employer
designates in the Adoption Agreement that distributions are
permitted under the Plan upon the occurrence of an
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Unforeseeable Emergency event, a distribution from the
Deferred Compensation Account may be made to a Participant
in the event of an Unforeseeable Emergency, subject to the
following provisions:
5.6.1 A Participant may, at any time prior to his
Separation from Service for any reason, make application to
the Committee to receive a distribution in a lump sum of all
or a portion of the vested balance in the Deferred
Compensation Account (determined as of the date the
distribution, if any, is made under this Section 5.6)
because of an Unforeseeable Emergency. A distribution
because of an Unforeseeable Emergency shall not exceed the
amount required to satisfy the Unforeseeable Emergency plus
amounts necessary to pay taxes reasonably anticipated as a
result of such distribution, after taking into account the
extent to which the Unforeseeable Emergency may be relieved
through reimbursement or compensation by insurance or
otherwise or by liquidation of the Participant's assets (to
the extent the liquidation of such assets would not itself
cause severe financial hardship) or by stopping current
deferrals under the Plan pursuant to Section 4.1.9.
5.6.2 The Participant's request for a distribution
on account of Unforeseeable Emergency must be made in
writing to the Committee. The request must specify the
nature of the financial hardship, the total amount requested
to be distributed from the Deferred Compensation Account,
and the total amount of the actual expense incurred or to be
incurred on account of the Unforeseeable Emergency.
5.6.3 If a distribution under this Section 5.6 is
approved by the Committee, such distribution will be made as
soon as practicable following the date it is approved. The
processing of the request shall be completed as soon as
practicable from the date on which the Committee receives
the properly completed written request for a distribution on
account of an Unforeseeable Emergency. If a Participant's
Separation from Service occurs after a request is approved
in accordance with this Section 5.6.3, but prior to
distribution of the full amount approved, the approval of
the request shall be automatically null and void and the
benefits which the Participant is entitled to receive under
the Plan shall be distributed in accordance with the
applicable distribution provisions of the Plan.
5.6.4 The Committee may from time to time adopt
additional policies or rules consistent with the
requirements of Section 409A of the Code to govern the
manner in which such distributions may be made so that the
Plan may be conveniently administered.
Section 6. Vesting:
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A Participant shall be fully vested in the portion of
his Deferred Compensation Account attributable to Participant
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Deferral Credits, and all income, gains and losses attributable
thereto. A Participant shall become fully vested in the portion
of his Deferred Compensation Account attributable to Employer
Credits, and income, gains and losses attributable thereto,
in accordance with the vesting schedule and provisions
designated by the Employer in the Adoption Agreement. If a
Participant's Deferred Compensation Account is not fully
vested upon Separation from Service, the portion of the
Deferred Compensation Account that is not fully vested shall
thereupon be forfeited.
Section 7. Distribution Rules:
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7.1 Payment Options. The Employer shall designate in
the Adoption Agreement the payment options which may be
elected by the Participant (lump sum, annual installments,
or a combination of both). Different payment options may be
made available for each Qualifying Distribution Event, and
different payment options may be available for different
types of Separations from Service, all as designated in the
Adoption Agreement. The Participant shall elect in the
Participation Agreement the method under which the vested
balance in the Deferred Compensation Account will be
distributed from among the designated payment options. The
Participant may at such time elect a different method of
payment for each Qualifying Distribution Event as specified
in the Adoption Agreement. If the Participant is permitted
by the Employer in the Adoption Agreement to elect different
payment options and does not make a valid election, the
vested balance in the Deferred Compensation Account will be
distributed as a lump sum.
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Notwithstanding the foregoing, if certain Qualifying
Distribution Events occur prior to the date on which the
vested balance of a Participant's Deferred Compensation
Account is completely paid pursuant to this Section 7.1
following the occurrence of certain initial Qualifying
Distribution Events, the following rules apply:
7.1.1 If the initial Qualifying Distribution Event
is a Separation from Service or Disability, and the
Participant subsequently dies, the remaining unpaid vested
balance of a Participant's Deferred Compensation Account
shall be paid as a lump sum.
7.1.2 If the initial Qualifying Distribution Event
is a Change in Control Event, and any subsequent Qualifying
Distribution Event occurs (except an In-Service or Education
Distribution described in Section 2.29(iv)), the remaining
unpaid vested balance of a Participant's Deferred
Compensation Account shall be paid as provided under Section
7.1 for payments on such subsequent Qualifying Distribution
Event.
7.2 Timing of Payments. Payment shall be made in the
manner elected by the Participant and shall commence as soon
as practicable after (but no later than 60 days after) the
distribution date elected for the Qualifying Distribution
Event. In the event the Participant fails to make a valid
election of the payment method, the distribution will be
made in a single lump sum payment as soon as practicable
after (but no later than 60 days after) the Qualifying
Distribution Event. A payment may be further delayed to the
extent permitted in accordance with regulations and guidance
under Section 409A of the Code.
7.3 Installment Payments. If the Participant elects to
receive installment payments upon a Qualifying Distribution
Event, the payment of each annual installment shall be made
on the anniversary of the date of the first installment
payment, and the amount of the annual installment shall be
adjusted on such anniversary for credits or debits to the
Participant's account pursuant to Section 8 of the Plan.
Such adjustment shall be made by dividing the balance in the
Deferred Compensation Account on such date by the number of
annual installments remaining to be paid hereunder; provided
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that the last annual installment due under the Plan shall be
the entire amount credited to the Participant's account on
the date of payment.
7.4 De Minimis Amounts. Notwithstanding any payment
election made by the Participant, if the Employer designates
a pre-determined de minimis amount in the Adoption
Agreement, the vested balance in the Deferred Compensation
Account of the Participant will be distributed in a single
lump sum payment if at the time of a permitted Qualifying
Distribution Event the vested balance does not exceed such
pre-determined de minimis amount; provided, however, that
such distribution will be made only where the Qualifying
Distribution Event is a Separation from Service, death,
Disability (if applicable) or Change in Control Event (if
applicable). Such payment shall be made on or before the
later of (i) December 31 of the calendar year in which the
Qualifying Distribution Event occurs, or (ii) the date that
is 2-1/2 months after the Qualifying Distribution Event
occurs. In addition, the Employer may distribute a
Participant's vested balance at any time if the balance does
not exceed the limit in Section 402(g)(1)(B) of the Code and
results in the termination of the Participant's entire
interest in the Plan as provided under Section 409A of the
Code.
7.5 Subsequent Elections. With the consent of the
Committee, a Participant may delay or change the method of
payment of the Deferred Compensation Account subject to the
following requirements:
7.5.1 The new election may not take effect until at
least 12 months after the date on which the new election is
made.
7.5.2 If the new election relates to a payment for
a Qualifying Distribution Event other than the death of the
Participant, the Participant becoming Disabled, or an
Unforeseeable Emergency, the new election must provide for
the deferral of the payment for a period of at least five
years from the date such payment would otherwise have been
made.
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7.5.3 If the new election relates to a payment from
the In-Service or Education Account, the new election must
be made at least 12 months prior to the date of the first
scheduled payment from such account.
For purposes of this Section 7.5 and Section 7.6, a payment
is each separately identified amount to which the
Participant is entitled under the Plan; provided, that
entitlement to a series of installment payments is treated
as the entitlement to a single payment.
7.6 Acceleration Prohibited. The acceleration of the
time or schedule of any payment due under the Plan is
prohibited except as expressly provided in regulations and
administrative guidance promulgated under Section 409A of
the Code (such as accelerations for domestic relations
orders and employment taxes). It is not an acceleration of
the time or schedule of payment if the Employer waives or
accelerates the vesting requirements applicable to a benefit
under the Plan.
Section 8. Accounts; Deemed Investment; Adjustments
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to Account:
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8.1 Accounts. The Committee shall establish a book
reserve account, entitled the "Deferred Compensation
Account," on behalf of each Participant. The Committee shall
also establish an In-Service or Education Account as a part
of the Deferred Compensation Account of each Participant, if
applicable. The amount credited to the Deferred Compensation
Account shall be adjusted pursuant to the provisions of
Section 8.3.
8.2 Deemed Investments. The Deferred Compensation
Account of a Participant shall be credited with an
investment return determined as if the account were invested
in one or more investment funds made available by the
Committee. The Participant shall elect the investment funds
in which his Deferred Compensation Account shall be deemed
to be invested. Such election shall be made in the manner
prescribed by the Committee and shall take effect upon the
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entry of the Participant into the Plan. The investment
election of the Participant shall remain in effect until a
new election is made by the Participant. In the event the
Participant fails for any reason to make an effective
election of the investment return to be credited to his
account, the investment return shall be determined by the
Committee.
8.3 Adjustments to Deferred Compensation Account. With
respect to each Participant who has a Deferred Compensation
Account under the Plan, the amount credited to such account
shall be adjusted by the following debits and credits, at
the times and in the order stated:
8.3.1 The Deferred Compensation Account shall be
debited each business day with the total amount of any
payments made from such account since the last preceding
business day to him or for his benefit.
8.3.2 The Deferred Compensation Account shall be
credited on each Crediting Date with the total amount of any
Participant Deferral Credits and Employer Credits to such
account since the last preceding Crediting Date.
8.3.3 The Deferred Compensation Account shall be
credited or debited on each day securities are traded on a
national stock exchange with the amount of deemed investment
gain or loss resulting from the performance of the
investment funds elected by the Participant in accordance
with Section 8.2. The amount of such deemed investment gain
or loss shall be determined by the Committee and such
determination shall be final and conclusive upon all
concerned.
Section 9. Administration by Committee:
--------- ---------------------------
9.1 Membership of Committee. If the Committee consists
of individuals appointed by the Board, they will serve at
the pleasure of the Board. Any member of the Committee may
resign, and his successor, if any, shall be appointed by the
Board.
9.2 General Administration. The Committee shall be
responsible for the operation and administration of the Plan
and for carrying out its provisions. The Committee shall
have the full authority and discretion to make, amend,
18
interpret, and enforce all appropriate rules and regulations
for the administration of this Plan and decide or resolve
any and all questions, including interpretations of this
Plan, as may arise in connection with this Plan. Any such
action taken by the Committee shall be final and conclusive
on any party. To the extent the Committee has been granted
discretionary authority under the Plan, the Committee's
prior exercise of such authority shall not obligate it to
exercise its authority in a like fashion thereafter. The
Committee shall be entitled to rely conclusively upon all
tables, valuations, certificates, opinions and reports
furnished by any actuary, accountant, controller, counsel or
other person employed or engaged by the Employer with
respect to the Plan. The Committee may, from time to time,
employ agents and delegate to such agents, including
employees of the Employer, such administrative or other
duties as it sees fit.
9.3 Indemnification. To the extent not covered by
insurance, the Employer shall indemnify the Committee, each
employee, officer, director, and agent of the Employer, and
all persons formerly serving in such capacities, against any
and all liabilities or expenses, including all legal fees
relating thereto, arising in connection with the exercise of
their duties and responsibilities with respect to the Plan,
provided however that the Employer shall not indemnify any
person for liabilities or expenses due to that person's own
gross negligence or willful misconduct
Section 10. Contractual Liability:
---------- ---------------------
10.1 Contractual Liability. Unless otherwise elected in the
Adoption Agreement, the Company shall be obligated to make
all payments hereunder. This obligation shall constitute a
contractual liability of the Company to the Participants,
and such payments shall be made from the general funds of
the Company. The Company shall not be required to establish
19
or maintain any special or separate fund, or otherwise to
segregate assets to assure that such payments shall be made,
and the Participants shall not have any interest in any
particular assets of the Company by reason of its
obligations hereunder. To the extent that any person
acquires a right to receive payment from the Company, such
right shall be no greater than the right of an unsecured
creditor of the Company.
10.2 Trust. The Employer may establish a trust to assist
it in meeting its obligations under the Plan. Any such trust
shall conform to the requirements of a grantor trust under
Revenue Procedures 92-64 and 92-65 and at all times during
the continuance of the trust the principal and income of the
trust shall be subject to claims of general creditors of the
Employer under federal and state law. The establishment of
such a trust would not be intended to cause Participants to
realize current income on amounts contributed thereto, and
the trust would be so interpreted and administered.
Section 11. Allocation of Responsibilities:
---------- ------------------------------
The persons responsible for the Plan and the duties and
responsibilities allocated to each are as follows:
11.1 Board.
(i) To amend the Plan;
(ii) To appoint and remove members of the Committee; and
(iii) To terminate the Plan as permitted in Section 14
11.2 Committee.
(i) To designate Participants;
(ii) To interpret the provisions of the Plan and to
determine the rights of the Participants under the
Plan, except to the extent otherwise provided in
Section 16 relating to claims procedure;
20
(iii) To administer the Plan in accordance with its
terms, except to the extent powers to administer
the Plan are specifically delegated to another
person or persons as provided in the Plan;
(iv) To account for the amount credited to the Deferred
Compensation Account of a Participant;
(v) To direct the Employer in the payment of benefits;
(vi) To file such reports as may be required with the United
States Department of Labor, the Internal Revenue Service and
any other government agency to which reports may be required
to be submitted from time to time; and
(vii) To administer the claims procedure to the
extent provided in Section 16.
Section 12. Benefits Not Assignable; Facility of Payments:
---------- ---------------------------------------------
12.1 Benefits Not Assignable. No portion of any benefit
credited or paid under the Plan with respect to any
Participant shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance
or charge, and any attempt so to anticipate, alienate, sell,
transfer, assign, pledge, encumber or charge the same shall
be void, nor shall any portion of such benefit be in any
manner payable to any assignee, receiver or any one trustee,
or be liable for his debts, contracts, liabilities,
engagements or torts. Notwithstanding the foregoing, in the
event that all or any portion of the benefit of a
Participant is transferred to the former Spouse of the
Participant incident to a divorce, the Committee shall
maintain such amount for the benefit of the former Spouse
until distributed in the manner required by an order of any
court having jurisdiction over the divorce, and the former
Spouse shall be entitled to the same rights as the
Participant with respect to such benefit.
12.2 Plan-Approved Domestic Relations Orders. The
Committee shall establish procedures for determining whether
an order directed to the Plan is a Plan-Approved Domestic
Relations Order. If the Committee determines that an order
21
is a Plan-Approved Domestic Relations Order, the Committee
shall cause the payment of amounts pursuant to or segregate
a separate account as provided by (and to prevent any
payment or act which might be inconsistent with) the Plan-
Approved Domestic Relations Order.
12.3 Payments to Minors and Others. If any individual
entitled to receive a payment under the Plan shall be
physically, mentally or legally incapable of receiving or
acknowledging receipt of such payment, the Committee, upon
the receipt of satisfactory evidence of his incapacity and
satisfactory evidence that another person or institution is
maintaining him and that no guardian or committee has been
appointed for him, may cause any payment otherwise payable
to him to be made to such person or institution so
maintaining him. Payment to such person or institution shall
be in full satisfaction of all claims by or through the
Participant to the extent of the amount thereof.
Section 13. Beneficiary:
---------- -----------
The Participant's beneficiary shall be the person,
persons, entity or entities designated by the Participant on
the beneficiary designation form provided by and filed with
the Committee or its designee. If the Participant does not
designate a beneficiary, the beneficiary shall be his
Surviving Spouse. If the Participant does not designate a
beneficiary and has no Surviving Spouse, the beneficiary
shall be the Participant's estate. The designation of a
beneficiary may be changed or revoked only by filing a new
beneficiary designation form with the Committee or its
designee. If a beneficiary (the "primary beneficiary") is
receiving or is entitled to receive payments under the Plan
and dies before receiving all of the payments due him, the
balance to which he is entitled shall be paid to the
contingent beneficiary, if any, named in the Participant's
22
current beneficiary designation form. If there is no
contingent beneficiary, the balance shall be paid to the
estate of the primary beneficiary. Any beneficiary may
disclaim all or any part of any benefit to which such
beneficiary shall be entitled hereunder by filing a written
disclaimer with the Committee before payment of such benefit
is to be made. Such a disclaimer shall be made in a form
satisfactory to the Committee and shall be irrevocable when
filed. Any benefit disclaimed shall be payable from the Plan
in the same manner as if the beneficiary who filed the
disclaimer had predeceased the Participant.
Section 14. Amendment and Termination of Plan:
---------- ---------------------------------
The Company may amend any provision of the Plan or
terminate the Plan at any time; provided, that in no event
shall such amendment or termination reduce the balance in
any Participant's Deferred Compensation Account as of the
date of such amendment or termination, nor shall any such
amendment affect the terms of the Plan relating to the
payment of such Deferred Compensation Account.
Notwithstanding the foregoing, the following special
provisions shall apply:
14.1 Termination in the Discretion of the Employer.
Except as otherwise provided in Sections 14.2, the Company
in its discretion may terminate the Plan and distribute
benefits to Participants subject to the following
requirements and any others specified under Section 409A of
the Code:
14.1.1 All arrangements sponsored by the Employer
that would be aggregated with the Plan under Section 1.409A-
l(c) of the Treasury Regulations are terminated.
14.1.2 No payments other than payments that would be
payable under the terms of the Plan if the termination had
not occurred are made within 12 months of the termination
date.
14.1.3 All benefits under the Plan are paid within 24
months of the termination date.
23
14.1.4 The Employer does not adopt a new arrangement
that would be aggregated with the Plan under Section 1.409A-
1(c) of the Treasury Regulations providing for the deferral
of compensation at any time within 3 years following the
date of termination of the Plan.
14.1.5 The termination does not occur proximate to a
downturn in the financial health of the Employer.
14.2 Termination Upon Change in Control Event. If the
Company terminates the Plan within thirty days preceding or
twelve months following a Change in Control Event, the
Deferred Compensation Account of each Participant shall
become fully vested and payable to the Participant in a lump
sum within twelve months following the date of termination,
subject to the requirements of Section 409A of the Code.
Section 15. Communication to Participants:
---------- -----------------------------
The Employer shall make a copy of the Plan available
for inspection by Participants and their beneficiaries
during reasonable hours at the principal office of the
Employer.
Section 16. Claims Procedure:
---------- ----------------
The following claims procedure shall apply with respect
to the Plan:
16.1 Filing of a Claim for Benefits. If a Participant
or Beneficiary (the "claimant") believes that he is entitled
to benefits under the Plan which are not being paid to him
or which are not being accrued for his benefit, he shall
file a written claim therefore with the Committee.
16.2 Notification to Claimant of Decision. Within 90
days after receipt of a claim by the Committee (or within
180 days if special circumstances require an extension of
time), the Committee shall notify the claimant of the
decision with regard to the claim. In the event of such
special circumstances requiring an extension of time, there
24
shall be furnished to the claimant prior to expiration of
the initial 90-day period written notice of the extension,
which notice shall set forth the special circumstances and
the date by which the decision shall be furnished. If such
claim shall be wholly or partially denied, notice thereof
shall be in writing and worded in a manner calculated to be
understood by the claimant, and shall set forth: (i) the
specific reason or reasons for the denial; (ii) specific
reference to pertinent provisions of the Plan on which the
denial is based; (iii) a description of any additional
material or information necessary for the claimant to
perfect the claim and an explanation of why such material or
information is necessary; and (iv) an explanation of the
procedure for review of the denial and the time limits
applicable to such procedures, including a statement of the
claimant's right to bring a civil action under ERISA
following an adverse benefit determination on review.
Notwithstanding the foregoing, if the claim relates to a
disability determination, the Committee shall notify the
claimant of the decision within 45 days (which may be
extended for an additional 30 days if required by special
circumstances).
16.3 Procedure for Review. Within 60 days following
receipt by the claimant of notice denying his claim, in
whole or in part, or, if such notice shall not be given,
within 60 days following the latest date on which such
notice could have been timely given, the claimant may appeal
denial of the claim by filing a written application for
review with the Committee. Following such request for
review, the Committee shall fully and fairly review the
decision denying the claim. Prior to the decision of the
Committee, the claimant shall be given an opportunity to
review pertinent documents and to submit issues and comments
in writing.
25
16.4 Decision on Review. The decision on review of a
claim denied in whole or in part by the Committee shall be
made in the following manner:
16.4.1 Within 60 days following receipt by the
Committee of the request for review (or within 120 days if
special circumstances require an extension of time), the
Committee shall notify the claimant in writing of its
decision with regard to the claim. In the event of such
special circumstances requiring an extension of time,
written notice of the extension shall be furnished to the
claimant prior to the commencement of the extension.
Notwithstanding the foregoing, if the claim relates to a
disability determination, the Committee shall notify the
claimant of the decision within 45 days (which may be
extended for an additional 45 days if required by special
circumstances).
16.4.2 With respect to a claim that is denied in
whole or in part, the decision on review shall set forth
specific reasons for the decision, shall be written in a
manner calculated to be understood by the claimant, and
shall set forth:
(i) the specific reason or reasons for the
adverse determination;
(ii) specific reference to pertinent Plan
provisions on which the adverse
determination is based;
(iii) a statement that the claimant is
entitled to receive, upon request and
free of charge, reasonable access to,
and copies of, all documents, records,
and other information relevant to the
claimant's claim for benefits; and
(iv) a statement describing any
voluntary appeal procedures offered by
the Plan and the claimant's right to
obtain the information about such
procedures, as well as a statement of
the claimant's right to bring an action
under ERISA section 502(a).
16.4.3 The decision of the Committee shall be final and
conclusive.
16.5 Action by Authorized Representative of Claimant.
All actions set forth in this Section 16 to be taken by the
claimant may likewise be taken by a representative of the
claimant duly authorized by him to act in his behalf on such
matters. The Committee may require such evidence as either
may reasonably deem necessary or advisable of the authority
to act of any such representative.
Section 17. Miscellaneous Provisions:
---------- ------------------------
26
17.1 Set off. Notwithstanding any other provision of
this Plan, the Employer may reduce the amount of any payment
otherwise payable to or on behalf of a Participant hereunder
(net of any required withholdings) at the time payment is
due by the amount of any loan, cash advance, extension of
credit or other obligation of the Participant to the
Employer that is then due and payable, and the Participant
shall be deemed to have consented to such reduction. In
addition, the Employer may at any time offset a
Participant's Deferral Compensation Account by an amount up
to $5,000 to collect any such amount in accordance with the
requirements of Section 409A of the Code.
17.2 Notices. Each Participant who is not in Service
and each Beneficiary shall be responsible for furnishing the
Committee or its designee with his current address for the
mailing of notices and benefit payments. Any notice required
or permitted to be given to such Participant or Beneficiary
shall be deemed given if directed to such address and mailed
by regular United States mail, first class, postage prepaid.
If any check mailed to such address is returned as
undeliverable to the addressee, mailing of checks will be
suspended until the Participant or Beneficiary furnishes the
proper address. This provision shall not be construed as
requiring the mailing of any notice or notification
otherwise permitted to be given by posting or by other
publication.
17.3 Lost Distributees. A benefit shall be deemed
forfeited if the Committee is unable to locate the
Participant or Beneficiary to whom payment is due on or
before the fifth anniversary of the date payment is to be
made or commence; provided, that the deemed investment rate
of return pursuant to Section 8.2 shall cease to be applied
to the Participant's account following the first anniversary
of such date; provided further, however, that such benefit
27
shall be reinstated if a valid claim is made by or on behalf
of the Participant or Beneficiary for all or part of the
forfeited benefit.
17.4 Reliance on Data. The Employer and the Committee
shall have the right to rely on any data provided by the
Participant or by any Beneficiary. Representations of such
data shall be binding upon any party seeking to claim a
benefit through a Participant, and the Employer and the
Committee shall have no obligation to inquire into the
accuracy of any representation made at any time by a
Participant or Beneficiary.
17.5 Receipt and Release for Payments. Subject to the
provisions of Section 17.1, any payment made from the Plan
to or with respect to any Participant or Beneficiary, or
pursuant to a disclaimer by a Beneficiary, shall, to the
extent thereof, be in full satisfaction of all claims
hereunder against the Plan and the Employer with respect to
the Plan. The recipient of any payment from the Plan may be
required by the Committee, as a condition precedent to such
payment, to execute a receipt and release with respect
thereto in such form as shall be acceptable to the
Committee.
17.6 Headings. The headings and subheadings of the Plan
have been inserted for convenience of reference and are to
be ignored in any construction of the provisions hereof.
17.7 Continuation of Employment. The establishment of
the Plan shall not be construed as conferring any legal or
other rights upon any Employee or any persons for
continuation of employment, nor shall it interfere with the
right of the Employer to discharge any Employee or to deal
with him without regard to the effect thereof under the
Plan.
28
17.8 Merger or Consolidation; Assumption of Plan. No
Employer shall consolidate or merge into or with another
corporation or entity, or transfer all or substantially all
of its assets to another corporation, partnership, trust or
other entity (a "Successor Entity") unless such Successor
Entity shall assume the rights, obligations and liabilities
of the Employer under the Plan and upon such assumption, the
Successor Entity shall become obligated to perform the terms
and conditions of the Plan. Nothing herein shall prohibit
the assumption of the obligations and liabilities of the
Employer under the Plan by any Successor Entity.
17.9 Construction. The Employer shall designate in the
Adoption Agreement the state according to whose laws the
provisions of the Plan shall be construed and enforced,
except to the extent that such laws are superseded by ERISA
and the applicable requirements of the Code.
17.10 Taxes. The Employer or other payor may
withhold a benefit payment under the Plan or a Participant's
wages, or the Employer may reduce a Participant's Account
balance, in order to meet any federal, state, or local or
employment tax withholding obligations with respect to Plan
benefits, as permitted under Section 409A of the Code. The
Employer or other payor shall report Plan payments and other
Plan-related information to the appropriate governmental
agencies as required under applicable laws.
Section 18. Transition Rules:
---------- ----------------
This Section 18 does not apply to plans newly established on
or after January 1, 2009.
18.1 2005 Election Termination. Notwithstanding
Section 4.1.4, at any time during 2005, a Participant may
terminate a Participation Agreement, or modify a
Participation Agreement to reduce the amount of Compensation
subject to the deferral election, so long as the
Compensation subject to the terminated or modified
Participation Agreement is includible in the income of the
29
Participant in 2005 or, if later, in the taxable year in
which the amounts are earned and vested.
18.2 2005 Deferral Election. The requirements of
Section 4.1.2 relating to the timing of the Participation
Agreement shall not apply to any deferral elections made on
or before March 15, 2005, provided that (a) the amounts to
which the deferral election relate have not been paid or
become payable at the time of the election, (b) the Plan was
in existence on or before December 31, 2004, (c) the
election to defer compensation is made in accordance with
the terms of the Plan as in effect on December 31, 2005
(other than a requirement to make a deferral election after
March 15, 2005), and (d) the Plan is otherwise operated in
accordance with the requirements of Section 409A of the
Code.
18.3 2005 Termination of Participation; Distribution.
Notwithstanding anything in this Plan to the contrary, at
any time during 2005, a Participant may terminate his or her
participation in the Plan and receive a distribution of his
Deferred Compensation Account balance on account of that
termination, so long as the full amount of such distribution
is includible in the Participant's income in 2005 or, if
later, in the taxable year of the Participant in which the
amount is earned and vested.
18.4 Payment Elections. Notwithstanding the provisions
of Sections 7.1 or 7.5 of the Plan, a Participant may elect
on or before December 31, 2008, the time or form of payment
of amounts subject to Section 409A of the Code provided that
such election applies only to amounts that would not
otherwise be payable in the year of the election and does
not cause an amount to paid in the year of the election that
would not otherwise be payable in such year.
30