C&D TECHNOLOGIES, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
FOR ALFRED WEBER
W I T N E S S E T H:
WHEREAS, C&D TECHNOLOGIES, INC., intends to adopt a nonqualified
supplemental executive retirement plan to provide supplemental retirement income
to Alfred Weber who is considered part of a "select group of management or
highly compensated employees" within the meaning of Sections 201(2), 301(a)(3)
and 401(a)(1) of ERISA and whose benefits under the Pension Plan and the Savings
Plan have been restricted by federal law.
NOW, THEREFORE, C&D TECHNOLOGIES, INC. adopts the C&D TECHNOLOGIES, INC.
Supplemental Executive Retirement Plan for Alfred Weber, effective as of
September 30, 1997, in order to provide supplemental retirement income to Alfred
Weber whose benefits have been restricted under the Pension Plan and the Savings
Plan.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the Company hereby adopts the Plan as follows:
1. DEFINITIONS. For purposes of this Plan, the following definitions apply:
(a) "Actuarial Equivalent" means an amount equal in value on an actuarial
basis, as determined by an actuary selected by the Committee, based upon the
UP-84 mortality table (unisex) with no setback and an annual interest rate of 7
1/4%.
(b) "Affiliate" means any company or other entity, presently or in the
future existing, which is affiliated with the Company within the meaning of
Sections 414(b), (c), (m) and (o) of the Code.
(c) "Board" means the Board of Directors of the Company.
(d) "Cause" means (i) in the case where there is no employment or
consulting agreement between the Company or an Affiliate and Executive, or where
there is an employment or consulting agreement, but such agreement does not
define cause (or words of like import), termination due to Executive's fraud,
willful misconduct, gross negligence with respect to the Company or an
Affiliate, or Executive's conviction of a felony; or (ii) in the case where
there is an employment or consulting agreement between the Company or an
Affiliate and Executive, termination that is or would be deemed to be for cause
(or words of like import) as defined under such agreement. The Committee shall
have sole discretion to determine whether Cause exists, and its determination
shall be final, binding and conclusive.
(e) "CEO" means Alfred Weber.
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(f) "Change of Control" means the occurrence of any of the following: (i)
any person (as defined in Section 3(a)(9) of the Exchange Act and as used in
Sections 13(d) and 14(d) thereof), excluding the Company, any Subsidiary and any
employee benefit plan sponsored or maintained by the Company or any Subsidiary
(including any trustee of any such plan acting in his capacity as trustee), but
including a "group" as defined in Section 13(d)(3) of the Exchange Act, becomes
the beneficial owner (as defined in Rule 13(d)-3 under the Exchange Act) of
shares of the Company having at least thirty percent (30%) of the total number
of votes that may be cast for the election of directors of the Company; (ii) the
shareholders of the Company shall approve any merger or other business
combination of the Company, sale of all or substantially all of the Company's
assets or combination of the foregoing transactions (a "Transaction"), other
than a Transaction involving only the Company and one or more of its
Subsidiaries, or a Transaction immediately following which the shareholders of
the Company immediately prior to the Transaction continue to have a majority of
the voting power in the resulting entity (excluding for this purpose any
shareholder of the Company owning directly or indirectly more than ten percent
(10%) of the shares of the other company involved in the Transaction) and no
person is the beneficial owner (as defined in Rule 13(d)-3 under the Exchange
Act) of at least thirty percent (30%) of the shares of the resulting entity as
contemplated by subparagraph (i) above; or (iii) within any twenty-four (24)
month period beginning on or after the date hereof, the persons who were
directors of the Company immediately before the beginning of such period (the
"Incumbent Directors") shall cease (for any reason other than death) to
constitute at least a majority of the Board or the board of directors of any
successor to the Company, provided that, any director who was not a director as
of the date hereof shall be deemed to be an Incumbent Director if such director
was elected to the Board by, or on the recommendation of or with the approval
of, at least two-thirds (2/3) of the directors who then qualified as Incumbent
Directors either actually or by prior operation of this subparagraph (iii),
unless such election, recommendation or approval was the result of an actual or
threatened election contest of the type contemplated by Rule 14a-11 promulgated
under the Exchange Act or any successor provision. Notwithstanding the
foregoing, no Change of Control of the Company shall be deemed to have occurred
for purposes of this Plan by reason of any actions or events in which Executive
participates in a capacity other than in his capacity as an executive of the
Company.
(g) "Code" means the Internal Revenue Code of 1986, as amended.
(h) "Committee" means the Compensation Committee of the Board to which the
Board has delegated its authority to administer this Plan on its behalf.
(i) "Company" means C&D TECHNOLOGIES, INC. or any successor thereto.
(j) "Disability" or "Disabled" means disability or disabled as defined in
the Pension Plan.
(k) "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
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(l) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(m) "Executive" means the CEO.
(n) "Maximum Annual Benefit" means an amount calculated by subtracting from
$150,000, indexed annually by 4% beginning September 30, 1998: (i) the annual
accrued benefit as of the Qualifying Event (based on a monthly single life
annuity) payable at age 66; (ii) one-half of Executive's Social Security Benefit
as of the Qualifying Event; and (iii) the annual single life annuity payable at
age 66 based on the Actuarial Equivalent of Executive's account under the
Savings Plan as of the Qualifying Event solely attributable to matching
contributions made by the Company.
(o) "Pension Plan" means the C&D TECHNOLOGIES, INC. Pension Plan for
Salaried Employees, as amended from time to time.
(p) "Plan" means this C&D TECHNOLOGIES, INC. Supplemental Executive
Retirement Plan, as amended from time to time.
(q) "Qualifying Event" means the occurrence of the first of any of the
following events while Executive is employed by the Company or an Affiliate: (i)
retirement on or after attainment of age 66; (ii) early retirement before age 66
and after age 62; (iii) Disability; (iv) death; (v) a Change of Control; and
(vi) the expiration of the CEO's employment agreement.
(r) "Savings Plan" means the C&D TECHNOLOGIES, INC. Savings Plan, which is
the Code Section 401(k) Plan maintained by the Company, as amended from time to
time.
(s) "SERP Benefit" means the vested benefit payable under this Plan.
(t) "Social Security Benefit" means the amount of Executive's social
security benefit that would be payable upon the Executive's attainment of age
66, calculated by the Company's actuary in accordance with reasonable actuarial
assumptions.
(u) "Subsidiary" means a subsidiary corporation under Section 424(f) of the
Code.
2. COVENANT NOT TO COMPETE.
(a) Except in the case of payment of the SERP Benefit to Executive upon a
Change of Control, during the period for which the SERP Benefit is paid and
during the period following Executive's termination of employment with the Board
or an Affiliate, Executive shall not, without having first obtained the written
consent of the Company, perform consulting or other services for, or have any
position with (whether as director, officer, employee, consultant, agent or
otherwise) or ownership interest in any business or organization which, in the
sole opinion of the Board, is engaged in any activity which is in competition
with the business then being conducted by the Company or any Affiliate. The term
"ownership interest" as used in the
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preceding sentence includes a proprietorship, partnership, joint venture, stock
or other equity interest of five percent (5%) or more held of record or
beneficially by Executive.
(b) Except in the case of payment of the SERP Benefit to Executive upon a
Change of Control, if Executive terminates his employment with the Company or an
Affiliate and performs service for a competitor, as defined in paragraph 2(a)
above, he shall forfeit all rights, privileges and claims hereunder and to any
SERP Benefit and all rights of Executive, his spouse, his designees and his
estate to any such SERP Benefit shall terminate and be forfeited (to the maximum
extent permitted by law).
3. ELIGIBILITY FOR AND CALCULATION OF SERP BENEFIT.
(a) PAYMENT DATE. The Company shall pay the SERP Benefit to Executive (or,
in the case of death prior to a Qualifying Event, to Executive's spouse)
beginning on the first of the month following the date on which Executive has a
Qualifying Event. Notwithstanding the foregoing, in the event that Executive
shall have terminated employment with the Company or an Affiliate prior to a
Qualifying Event but on or after the date Executive becomes fully vested under
Section 3(f) of the Plan, the Company shall pay the SERP Benefit to Executive
(or, in the case of death prior to a Qualifying Event, to Executive's spouse)
beginning on the first of the month following the earliest of the following
events: (i) attainment of age 66; (ii) death; (iii) occurrence of a Change of
Control; or (iv) the expiration of the CEO's employment agreement.
(b) CALCULATION OF SERP BENEFIT. Except with respect to a Change of Control
or the expiration of the CEO's employment agreement, Executive shall not accrue
a SERP Benefit if the Qualifying Event occurs before Executive has completed
seven and one-half (7.5) full and consecutive years of employment with the
Company or an Affiliate. Except with respect to a Change of Control or the
expiration of the CEO's employment agreement, if the Qualifying Event occurs on
or after seven and one-half (7.5) full and consecutive years of employment with
the Company or an Affiliate, the SERP Benefit shall be calculated by multiplying
(i) the Maximum Annual Benefit by (ii) the appropriate percentage from the
following schedule:
Years of Employment
PRIOR TO QUALIFYING EVENT PERCENTAGE BENEFIT
less than 7.5 0%
7.5 50%
8 53.3%
9 60%
10 66.7%
11 73.3%
12 80%
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13 86.7%
14 93.3%
15 or more 100%
Notwithstanding anything herein to the contrary, if the Qualifying Event is
a Change of Control or the expiration of the CEO's employment agreement, the
SERP Benefit for Executive shall be calculated by multiplying (i) the Maximum
Annual Benefit by (ii) 100%.
EXAMPLE 1 - For Alfred Weber:
$150,000 (Assumed retirement in 1997)
- 35,000 Age 66 Pension Plan Benefit
- 15,000 1/2 Age 66 Social Security Benefit
- 5,000 Age 66 Savings Plan Benefit Annuity
-------
$ 95,000 Maximum Annual Benefit
X 100% Percentage Benefit @ 15 years
-------
$ 95,000* Annual Age 66 SERP Benefit
* To be adjusted on an Actuarial Equivalent basis for forms other than a
single life annuity.
(c) NORMAL FORM OF SERP BENEFIT. An Executive who is not married at the
time of a Qualifying Event shall receive the SERP Benefit in the form of a
single life annuity, providing for monthly benefits for the life of Executive,
with payments ceasing upon Executive's death. Subject to Section 3(d) below, an
Executive who is married at the time of a Qualifying Event shall receive the
SERP Benefit in the form of a joint and fifty percent (50%) survivor annuity,
which provides for benefits to be paid monthly to Executive for life, and if his
spouse at the time of the Qualifying Event survives him, for the spouse's life
or until the spouse remarries, whichever comes first, monthly payments in an
amount equal to fifty percent (50%) of the monthly amount received by Executive
while alive.
(d) OPTIONAL FORM OF SERP BENEFIT FOR MARRIED EXECUTIVES. Except in the
case of death prior to commencement of the SERP Benefit which is governed by
Section 6(a) or in the case of a Change of Control which is governed by Section
7, the Executive shall have the right, in a writing filed with the Committee, to
elect (subject to the written consent of a married Executive's spouse in a form
specified by the Committee) to have his SERP Benefit paid in the form of a
single life annuity, providing for monthly benefits for the life of Executive,
with payments ceasing upon Executive's death; provided, that such election is
made and filed with the Committee at least one (1) year prior to the Executive's
Qualifying Event. Such an election may be revoked by Executive at any time or
from time to time by written notice filed with the Committee at least one (1)
year prior to Executive's Qualifying Event.
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(e) ACTUARIAL EQUIVALENCE. The normal form of SERP Benefit for an Executive
who is not married at the time of a Qualifying Event shall be a single life
annuity. The normal form of SERP Benefit for an Executive who is married at the
time of a Qualifying Event shall be the Actuarial Equivalent of a single life
annuity payable in the form of a joint and fifty percent (50%) survivor annuity.
(f) VESTING OF SERP BENEFIT. An Executive's rights under this Plan to any
SERP Benefit shall be fully vested and nonforfeitable, except as set forth in
paragraph 2 hereof, solely upon the earliest of the: (i) completion of seven and
one-half (7.5) years of full and consecutive employment with the Company or an
Affiliate; (ii) occurrence of a Change of Control; or (iii) the expiration date
of the CEO's employment agreement. Notwithstanding anything herein to the
contrary, Executive shall not have any rights to a SERP Benefit in the event
Executive is terminated by the Company or an Affiliate for Cause.
4. REDUCTION FOR EARLY RETIREMENT OF EXECUTIVE.
The SERP Benefit of an Executive who retires from the Company or an
Affiliate before age 66 and after age 62 shall be reduced by seven percent (7%)
per year prior to age 66 and shall be paid on the first of the month following
the Qualifying Event.
5. DISABILITY OF EXECUTIVE.
(a) DISABILITY WHILE EMPLOYED. In the event that Executive becomes Disabled
while employed by the Company or an Affiliate, he shall cease to accrue benefits
under this Plan. Such Executive shall be entitled to retire and receive a SERP
Benefit at age 66 under the terms of this Plan if he remains Disabled until age
66. If such Executive does not remain Disabled, any SERP Benefit to which he is
eligible to receive hereunder or his right to participation hereunder shall be
determined under the provisions of this Plan as of the date his Disability
ceases. In the event that Executive is no longer disabled and he becomes
reemployed by the Company or an Affiliate immediately following such Disability,
then Executive: (i) shall begin to accrue benefits under this Plan from the date
of reemployment; and (ii) shall not be entitled to any accruals during the
period during which Executive was Disabled. Notwithstanding anything herein to
the contrary, Executive's full and consecutive years of employment with the
Company or an Affiliate prior to the Disability shall be added to Executive's
full and consecutive years of employment with the Company or an Affiliate after
the Disability for purposes of vesting under Section 3(f) of the Plan and for
purposes of calculating the SERP Benefit under Section 3(b) of the
Plan.
(b) DEATH WHILE DISABLED. Death benefits, if any, shall be paid to the
spouse of a Disabled Executive in accordance with Section 6.
6. DEATH OF EXECUTIVE.
(a) PRIOR TO COMMENCEMENT OF THE SERP BENEFIT. In the event of the death of
Executive while he is employed by the Company or an Affiliate, his spouse to
which he must have been married to for over one (1) year immediately prior to
his death, shall be entitled to a
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monthly single life annuity equal to fifty percent (50%) of the single life
annuity to which Executive would have received if he had retired on his date of
death payable beginning the first of the month following the date he would have
attained age 66.
(b) AFTER COMMENCEMENT OF THE SERP BENEFIT. In the event of the death of
Executive after commencement of the SERP Benefit, Executive's spouse shall be
entitled to a SERP Benefit solely to the extent provided under the form of
benefit payable to Executive and elected (subject to spousal consent, if
applicable) under Section 3 of the Plan.
(c) Spousal benefits shall terminate upon remarriage of spouse.
7. CHANGE OF CONTROL.
Notwithstanding anything herein to the contrary, a Qualifying Event due to
a Change of Control will result in a SERP Benefit, payable to Executive (or, in
the case of death, Executive's spouse) in an Actuarial Equivalent single lump
sum as soon as administratively feasible following the date of the Change of
Control (but in no event later than the first of the month following the Change
of Control), equal to the SERP Benefit calculated under Section 3(b) of the
Plan. Without limiting the generality of the foregoing, an Executive or spouse
who has commenced receiving payment of his SERP Benefit prior to a Change of
Control, shall receive, upon a Change of Control, an Actuarial Equivalent single
lump sum payment based on the remainder of the SERP Benefit that would have
otherwise been paid under the Plan had the Change of Control not occurred.
EXAMPLE 2 -
$ 95,000 Maximum Annual Benefit
X 6.5826 Lump Sum Conversion Factor (Based on Age 62)
-------
$625,347 Change of Control SERP Benefit
8. FUNDING.
(a) GENERAL ASSETS. 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 the Company and
Executive, the Executive's spouse or any other person. All benefits and rights
described under this Plan shall be and remain unsecured obligations of the
Company. The Company may prefund all or any portion of such benefits or rights
and may enter into a trust agreement solely for such purpose (a "grantor trust"
under the Code); provided that the assets of any such trust fund shall be
considered general assets of the Company and shall be subject to the claims of
the Company's general creditors. None of the Executive, the Executive's spouse
or any estate of such Executive or spouse shall have an interest, vested or
otherwise, in any trust fund hereunder or a secured or preferred position with
respect thereto or shall have any claim thereto other than as a general creditor
of the Company.
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(b) CHANGE OF CONTROL. Any trust hereunder shall be revocable by the
Company until the occurrence of a Change of Control, at which time the trust, if
any, shall become irrevocable.
9. CONSTRUCTION OF AGREEMENT.
(a) Any powers reserved by the Board under this Plan may be exercised by
the Committee which shall have general responsibility for the administration and
interpretation of the Plan including selection of participants, determinations
of years of employment for purposes of this Plan, and compliance, if required,
with reporting and disclosure rules of ERISA. Any determination or
interpretation of the Board or the Committee with respect to the Plan shall be
final, binding and conclusive on all persons.
(b) If the Board shall find that any person to whom any amount is payable
under this Plan is unable to care for his affairs because of illness, accident
or physical or mental incapacitation, is a minor, has died, or for any other
reason shall be incapable of properly or legally receiving benefits to which he
is entitled to under this Plan, then any SERP Benefit due him or his spouse may,
if the Board so elects, be paid to his spouse. Any such payment shall be in
complete discharge of the liability of the Company therefor.
(c) Neither this Plan nor any action taken hereunder shall be construed as
giving Executive the right to be retained or continue in the employ of the
Company or an Affiliate or as evidence of any agreement by the Company or an
Affiliate to employ Executive in any particular position or at any particular
rate of remuneration or affect the right of the Company or an Affiliate to
dismiss Executive.
(d) The making of this Plan does not constitute or create an employment
agreement between the Company or an Affiliate and Executive or give Executive
any legal or equitable right against the Company or an Affiliate, its agents, or
its successors or assigns, except as expressly provided by this Plan.
(e) Any SERP Benefit payable under this Plan shall not be deemed salary or
other compensation to Executive for the purpose of computing benefits to which
Executive may be entitled under any pension or profit-sharing plan or other
arrangement of the Company for the benefit of its employees nor shall anything
contained herein affect any rights or obligations which Executive may have under
any pre-existing agreement with the Company or an Affiliate.
(f) Employment, compensation paid, and insurance or other disability,
retirement, or death benefits or health plans to be taken into account under
this Plan shall include employment, compensation paid, and insurance or other
benefits or plans provided by any Affiliate or organization which Executive
served at the request of the Company.
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10. ASSIGNMENT AND NONALIENATION OF SERP BENEFIT.
(a) This Plan shall be binding upon and inure to the benefit of (i) the
Company and its successors, assigns and any purchaser of either the Company or
its assets; and (ii) Executive, his spouse, executors, administrators and legal
representatives.
No amount payable at any time under this Plan shall be subject in any
manner to alienation by anticipation, sale, transfer, assignment, bankruptcy,
pledge, attachment, charge or encumbrance of any kind nor in any manner be
subject to the debts or liabilities of any person, and any attempt to so
alienate or subject any such amount, whether presently or thereafter payable,
shall be null and void. If any person shall attempt to, or shall, alienate,
sell, transfer, assign, pledge, attach, charge or otherwise encumber any amount
payable under this Plan, or any part thereof, or if by reason of his bankruptcy
or other event happening at any such time such amount would be made subject to
his debts or liabilities or would otherwise not be enjoyed by him, then the
Board, if it so elects, may direct that such amount be withheld and that the
same or any part thereof be paid or applied to or for the benefit of such
person, in such manner and proportion as the Board may deem proper.
11. ADMINISTRATION.
(a) ADMINISTRATION OF PLAN. The Board and the Committee shall have full
power and responsibility to administer this Plan. The Board may, in its sole
discretion, appoint a committee, an agent or agents to carry out designated
administrative functions.
(b) LEGAL, ACCOUNTING, CLERICAL AND OTHER SERVICES. The Board may authorize
one or more of its members, the Committee or the management of the Company to
act on its behalf and may contract for legal, accounting, clerical and other
services to carry out the purposes of this Plan. All expenses of the Board in
this regard shall be paid by the Company.
(c) CLAIMS PROCEDURE. The Committee shall be responsible for determining
all claims for benefits under this Plan by Executive or his spouse. Within
ninety (90) days after receiving a claim (or within up to one hundred eighty
(180) days, if the claimant is so notified, including notification of the reason
for the delay), the Committee shall provide adequate notice in writing to any
Executive or spouse whose claim for benefits under this Plan has been denied,
setting forth the specific reasons for such denial. The Executive or spouse will
be given an opportunity for a full and fair review by the Committee of the
decision denying the claim. The Executive or spouse shall be given sixty (60)
days from the date of the notice denying any such claim to request such review
by written notice to the Committee. Within sixty (60) days after receiving a
request for review, the Committee shall notify the claimant in writing of (i)
its decision; (ii) the reasons therefor; and (iii) the Plan provisions upon
which it is based. The Committee may at any time alter the claims procedure set
forth herein, so long as the revised claims procedure complies with ERISA, and
the regulations issued thereunder.
(d) LIMITATION OF LIABILITY. No officer of the Company or member of the
Committee, the Board or any of its authorized agents acting under this Plan
shall be liable for any action
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taken or omitted in good faith hereunder or for exercise of any power given
hereunder or for the actions of other members of the Board or the Committee with
regard to the Plan. As a condition precedent to the establishment of this Plan
or the receipt of benefits hereunder, or both, such liability, if any, is
expressly waived and released by Executive, his spouse and all persons claiming
under or through Executive or his spouse. Such waiver and release shall be
conclusively evidenced by the acceptance of any benefits under this Plan.
(e) INDEMNIFICATION. Each officer of the Company or member of the Board or
the Committee, whether or not acting under this Plan, shall be indemnified by
the Company against expenses (other than amounts paid in a settlement to which
the Company does not consent) reasonably incurred by him in connection with any
action to which he may be a party by reason of performance of administrative
functions and duties under this Plan, except in relation to matters as to which
he shall be adjudged in such action to be personally guilty of gross negligence
or willful misconduct in the performance of his duties. The foregoing right to
indemnification shall be in addition to such other rights as the officer or
member of the Board or the Committee may enjoy as a matter of law or by reason
of insurance coverage of any kind. Rights granted hereunder shall be in addition
to and not in lieu of any rights to indemnification pursuant to the by-laws of
the Company.
12. AMENDMENT AND TERMINATION.
The Board has the right at any time and from time to time to amend or
terminate (whether retroactively or otherwise) this Plan for any reason in any
manner which does not reduce any benefit previously accrued hereunder.
13. MISCELLANEOUS.
(a) GOVERNING LAW. Except to the extent preempted by federal law, this Plan
shall be governed by the laws of the Commonwealth of Pennsylvania from time to
time in effect without regard to its conflict of law provisions.
(b) WITHHOLDINGS. The Company shall have the right to make such provisions
as it deems necessary or appropriate to satisfy any obligations it may have to
withhold federal, state or local income or other taxes incurred by reason of
this Plan.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed this
11th day of December, 1997.
By: /s/ Stephen E. Markert, Jr.
Title: Vice President Finance
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