Hilb, Rogal and Hamilton Company
Amended and Restated Outside Directors Deferral Plan
Effective
April 1, 1998
TABLE OF CONTENTS
Page
ARTICLE I
Definition of Terms
1.1 Accounts 1
1.2 Administrator 1
1.3 Affiliate 1
1.4 Beneficiary 1
1.5 Benefit Commencement Date 1
1.6 Board 2
1.7 Code 2
1.8 Compensation 2
1.9 Corporation 2
1.10 Death Benefit 2
1.11 Deferral Amount 2
1.12 Deferral Benefit 2
1.13 Deferral Contributions 2
1.14 Deferral Year 2
1.15 Deferral Election 2
1.16 Deferred Cash Account 2
1.17 Deferred Stock Unit 2
1.18 Deferred Stock Unit Account 3
1.19 Director 3
1.20 Effective Date 3
1.21 Eligible Director 3
1.22 Former Plan 3
1.23 Participant 3
1.24 Plan 3
1.25 Plan Year 3
1.26 Rate of Return 3
1.27 Short Plan Year 3
ARTICLE II
Eligibility and Participation
2.1 Eligibility 4
2.2 Notice and Election Regarding Active Participation 4
2.3 Commencement of Active Participation 4
2.4 Length of Participation 4
ARTICLE III
Determination of Deferral Benefits
3.1 Deferral Benefit 4
3.2 Transition Credits 5
3.3 Deferral Election 5
3.4 Subtractions from Deferred Cash Account and Deferred Stock
Unit Account 6
3.5 Crediting of Deemed Earnings to Deferred Cash Account 6
3.6 Equitable Adjustment in Case of Error or Omission 6
3.7 Statement of Benefits 6
ARTICLE IV
Accounts and Investments
4.1 Accounts 6
4.2 Deferred Stock Units 7
4.3 Hypothetical Nature of Accounts and Investments 8
ARTICLE V
Vesting
5.1 Vesting 8
ARTICLE VI
Death Benefits
6.1 Pre-Benefit Commencement Date Death Benefit 8
6.2 Post-Benefit Commencement Date Death Benefit 8
ARTICLE VII
Payment of Benefits
7.1 Payment of Deferral Benefit 8
7.2 Payment of Death Benefit 9
7.3 Form of Payment of Deferral Benefit 9
7.4 Benefit Determination and Payment Procedure 9
7.5 Payments to Minors and Incompetents 9
7.6 Distribution of Benefit When Distributee Cannot Be Located 9
ARTICLE VIII
Beneficiary Designation
8.1 Beneficiary Designation 9
ARTICLE IX
Withdrawals
9.1 No Withdrawals Permitted 10
ARTICLE X
Funding
10.1 Funding 10
ARTICLE XI
Change of Control
11.1 Change of Control 11
11.2 Effect of Change of Control 11
ARTICLE XII
Plan Administrator
12.1 Appointment of Administrator 12
12.2 Duties and Responsibilities of Plan Administrator 12
ARTICLE XIII
Amendment or Termination of Plan
13.1 Amendment or Termination of Plan 12
ARTICLE XIV
Miscellaneous
14.1 Non-assignability 12
14.2 Notices and Elections 13
14.3 Delegation of Authority 13
14.4 Service of Process 13
14.5 Governing Law 13
14.6 Binding Effect 13
14.7 Severability 13
14.8 Gender and Number 13
14.9 Titles and Captions 13
Hilb, Rogal and Hamilton Company
Amended and Restated Outside Directors Deferral Plan
Effective January 1, 1995, the Board of Directors of Hilb,
Rogal and Hamilton Company (the "Corporation") adopted the
Outside Directors Deferral Plan, under which non-employee
directors of the Corporation had the opportunity to defer receipt
of certain compensation until retirement or departure from the
Board.
The Board of Directors is of the opinion that it is in the
best interests of the Corporation to allow non-employee directors
of the Corporation to continue to have the opportunity to defer
receipt of certain compensation until retirement or departure
from the Board provided that the deferred amounts are aligned
with the interests of the Corporation by being tied to the
performance of the Corporation's common stock. Therefore, the
Board of Directors believes it to be in the best interest of the
Corporation to amend and restate the Outside Directors Deferral
Plan for such purpose.
Pursuant to action taken by the Board of Directors, the
Hilb, Rogal and Hamilton Company Amended and Restated Outside
Directors Deferral Plan (the "Plan") is hereby adopted. The
Corporation's Outside Directors Deferral Plan is hereby amended
and restated in its entirety as follows:
ARTICLE I
Definition of Terms
The following words and terms as used in this Plan shall
have the meaning set forth below, unless a different
meaning is clearly required by the context:
1.1 "Account": A bookkeeping account established for a
Participant under Article IV hereof.
1.2 "Administrator": The Compensation Committee of the
Board is the Plan Administrator unless responsibility is
delegated as provided for in Article XII hereof.
1.3 "Affiliate": Any subsidiary, parent, affiliate, or
other related business entity to the Corporation.
1.4 "Beneficiary": The person or persons designated by a
Participant or otherwise entitled pursuant to Section 8.1 to
receive benefits under the Plan attributable to such Participant
after the death of such Participant.
1.5 "Benefit Commencement Date": The date irrevocably
elected by the Participant pursuant to Section 3.3. The Benefit
Commencement Date shall be January 1 following the Participant's
having attained age 55, 60, 65, 70 or 75. The same Benefit
Commencement Date shall be required for all Deferral
Contributions made and Deferral Benefits attributable to a
Deferral Year.
1.6 "Board": The present and any succeeding Board of
Directors of the Corporation, unless such term is used with
respect to a particular Affiliate and its Directors, in which
event it shall mean the present and any succeeding Board of
Directors of that Affiliate.
1.7 "Code": The Internal Revenue Code of 1986, as the same
may be amended from time to time.
1.8 "Compensation": Fees payable to a Participant for
service as a member of the Board, including (i) annual retainer
fee ("Retainer") and (ii) meeting or committee fees (collectively
referred to as "Additional Fees") paid by the Corporation to an
Eligible Director, but excluding any such compensation deferred
from a prior period, expense reimbursement and allowances and
benefits not normally paid in cash to the Participant.
1.9 "Corporation": Hilb, Rogal and Hamilton Company, or any
successor thereto.
1.10 "Death Benefit": The benefit with respect to a
Participant due a Participant's Beneficiary, determined in
accordance with Article VI hereof.
1.11 "Deferral Amount": With respect to each Plan Year, the
sum of the Deferral Contributions of a Participant with respect
to his Retainer and/or his Additional Fees to be paid during the
Plan Year.
1.12 "Deferral Benefit": The balance in a Participant's
Deferred Cash Account and Deferred Stock Unit Account.
1.13 "Deferral Contributions": That portion of a
Participant's Compensation which is deferred under the Plan or
which has been deferred under the Former Plan.
1.14 "Deferral Year": The Plan Year with respect to which a
Deferral Contribution is made. For purposes hereof, a Deferral
Contribution is considered made with respect to the Plan Year in
which the amount would otherwise have been paid to the
Participant.
1.15 "Deferral Election": An irrevocable election of a
Deferral Amount in writing executed by the Eligible Director or
Participant and timely filed with the Administrator.
1.16 "Deferred Cash Account": An unfunded, bookkeeping
account maintained on the books of the Corporation for a
Participant which reflects his interest in amounts attributable
to his Deferred Contributions under the Former Plan. The
Deferred Cash Account of a Participant consists of his Deferral
Contributions made under the Former Plan with respect to
Compensation earned after December 31, 1994 and before April 1,
1998. Separate subdivisions of the Deferred Cash Account shall
continue to be maintained to reflect Deferral Contributions made
and Deferral Benefits attributable with respect to each Deferral
Year and within each Deferral Year, the Deferral Contributions
and Deferral Benefits attributable to Deferral Contributions of
Retainer and Deferral Contributions of Additional Fees.
1.17 "Deferred Stock Unit": A hypothetical share of the
Corporation's common stock.
1.18 "Deferred Stock Unit Account": An unfunded, bookkeeping
account maintained on the books of the Corporation for a
Participant which reflects his interest in amounts attributable
to his Deferred Contributions under the Plan. The Deferred Stock
Unit Account of a Participant consists of his Deferral
Contributions made under the Plan with respect to Compensation
earned after April 1, 1998. Separate subdivisions of the
Deferred Stock Unit Account shall be maintained to reflect
Deferral Contributions made and Deferral Benefits attributable
with respect to each Deferral Year and within each Deferral Year,
the Deferral Contributions and Deferral Benefits attributable to
Deferral Contributions of Retainer and Deferral Contributions of
Additional Fees.
1.19 "Director": An individual who serves as a member of the
Board.
1.20 "Effective Date": The Effective Date of the Plan is
April 1, 1998.
1.21 "Eligible Director": A Director who is not an employee
of the Corporation and who has not reached the age of 75 before
the Deferral Year.
1.22 "Former Plan": The Hilb Rogal and Hamilton Company
Outside Directors Deferral Plan effective January 1, 1995.
1.23 "Participant": An Eligible Director who elects to
participate in the Plan, and further differentiated as follows:
(i) "Active Participant": A Participant who has an
election to make Deferral Contributions to the Plan in
effect at the time in question.
(ii) "Inactive Participant": A Participant who does not
have an election to make Deferral Contributions to the Plan
in effect at the time in question.
1.24 "Plan": This document, as contained herein or duly
amended, which shall be known as the "Hilb, Rogal and Hamilton
Amended and Restated Outside Directors Deferral Plan".
1.25 "Plan Year": The calendar year or any Short Plan Year.
1.26 "Rate of Return": Nine percent (9%) for the 1995
through 1999 Deferral Years, and nine percent (9%) for Deferral
Years after 1999 until, if ever, increased by the Compensation
Committee.
1.27 "Short Plan Year": The remaining portion of the
calendar year after the Effective Date of this Plan.
ARTICLE II
Eligibility and Participation
2.1 Eligibility. Each Eligible Director shall be eligible
to participate in the Plan and to defer Compensation hereunder
for such Plan Year.
2.2 Notice and Election Regarding Active Participation.
(a) The Administrator shall notify each Eligible Director
within a reasonable period of time prior to the beginning of each
Plan Year.
(b) In order to become an Active Participant and to make
Deferral Contributions with respect to a Plan Year, an Eligible
Director must file with the Administrator a Deferral Election, as
provided in Section 3.3 which is effective as of the first day of
the Plan Year, such election must be filed by the date
established by the Administrator, which date shall be no later
than the December 31 preceding such Plan Year or the last day
before the commencement of a Short Plan Year, whichever is
applicable.
(c) By executing and filing such election with the
Administrator, an Eligible Director consents and agrees to the
following:
(i) To execute such applications and take such
physical examinations and to supply truthfully and
completely such information as may be requested by any
health questionnaire provided by the Administrator;
(ii) To be bound by all terms and conditions of the
Former Plan, the Plan and all amendments thereto.
2.3 Commencement of Active Participation. An Eligible
Director shall become an Active Participant with respect to a
Plan Year only if he is expected to have Compensation during such
Plan Year, and he timely files and has in effect a Deferral
Election for such Plan Year.
2.4 Length of Participation. An individual who is or
becomes a Participant shall be or remain an Active Participant as
long as he has a Deferral Election in effect; and he shall be or
remain an Inactive Participant as long as he is entitled to
future benefits under the terms of the Plan and is not considered
an Active Participant.
ARTICLE III
Determination of Deferral
3.1 Deferral Benefit. For purposes hereof, a Participant's
Deferral Benefit shall be the balance in his Deferred Cash
Account and his Deferred Stock Unit Account at the time in
question.
3.2 Transition Credits. Each Participant who has a balance
standing to his credit in the Former Plan as of April 1, 1998,
shall be permitted a one-time election, on or before April 1,
1998, to convert all or a portion of the balance standing to his
credit in the Former Plan to Deferred Stock Units as of April 1,
1998. A Participant who elects to convert all or a portion of
his Deferral Account (as defined in the Former Plan) in the
Former Plan to Deferred Stock Units shall be credited with the
number of Deferred Stock Units determined by dividing the portion
of his Deferred Cash Account under the Former Plan on April 1,
1998 for which such election is made, by the Closing Price of the
common stock of the Corporation on the date of the Participant's
election. If the formula produces a fractional Deferred Stock
Unit, then the fractional Deferred Stock shall be rounded off to
the nearest thousandth and credited to the Participant. Once a
Participant has made an election under this Section 3.2 to
convert some or all of his Deferred Cash Account to Deferred
Stock Units of the Corporation, the Corporation's rights and
obligations, if any, with respect to the Deferred Stock Units
will be governed by this Plan.
3.3 Deferral Election.
(a) Subject to the restrictions and conditions hereinafter
provided, a Participant may irrevocably elect, as a Deferral
Contribution with respect to a Plan Year, to receive an amount of
his Compensation which is specified by his Deferral Election for
such Plan Year in the form of Deferred Stock Units. Any such
election must be filed with the Administrator at the time
required under Section 2.2(b).
(b) The following conditions apply:
(i) The maximum Deferral Contribution of Retainer with
respect to any Participant for a Plan Year shall be one
hundred percent (100%) of his Retainer for such Plan Year
and such election shall be made in whole dollar amounts. A
Participant who elects to receive his Retainer in Deferred
Stock Units shall have credited to his Deferred Stock Unit
Account as of the first day of each calendar quarter the
number of Deferred Stock Units determined by dividing that
portion of his accrued, deferred Retainer for the quarter
(determined by dividing the amount of such Retainer
previously selected by the Participant to be applied to the
purchase of Deferred Stock Units by four) by the Closing
Price as of the first day of such calendar quarter.
(ii) The maximum Deferral Contribution of Additional
Fees with respect to any Participant for a Plan Year shall
be one hundred percent (100%) of his Additional Fees for
such Plan Year and such election shall be made in twenty-
five percent (25%) increments. A Participant who elects to
receive his Additional Fees in Deferred Stock Units shall
have credited to his Deferred Stock Unit Account as of the
day on which the Additional Fees are accrued the number of
Deferred Stock Units determined by multiplying his accrued
Additional Fees on said day by the percentage of such
Additional Fees previously selected by the Participant to be
applied to the purchase of Deferred Stock Units, and
dividing the product thereof by the Closing Price as of the
day on which the Additional Fees are accrued.
(iii) A Participant who elects to defer one hundred
percent (100%) of his Compensation shall receive additional
Deferred Stock Units equal to thirty percent (30%) of said
Participant's Compensation for the Plan Year. Such Deferred
Stock Units shall be credited to the Participant in addition
to the Deferred Stock Units received as a result of the
election to defer the Retainer and Additional Fees in the
manner provided by subsections (i) and (ii) above.
(iv) A separate Deferral Election must be filed for
each Plan Year.
(v) Each Deferral Election shall be made on a form
provided by the Administrator and shall specify the Deferral
Amount and source of deferrals and such additional
information as the Administrator may require.
(vi) A Deferral Election must specify the period of
payment. A Participant may elect to receive a lump sum
payment or installment payments over periods of five, ten or
fifteen years beginning after age 55, 60, 65, 70 or 75.
3.4 Subtractions from Deferred Cash Account and Deferred
Stock Unit Account. All distributions from a Participant's
Deferred Cash Account and Deferred Stock Unit Account shall be
subtracted when such distributions are made.
3.5 Crediting of Interest to Deferred Cash Account. There
shall be credited to each Participant's Deferred Cash Account an
amount representing interest on the balance of such account.
Under the Former Plan, the interest was credited as of the first
day of the Deferral Year. Under this Plan, interest shall be
credited as earned. Such interest shall be based on the
applicable Rate of Return for the Deferral Year.
3.6 Equitable Adjustment in Case of Error or Omission. If
an error or omission is discovered in the Deferred Cash Account
and Deferred Stock Unit Account of a Participant, the
Administrator shall make such equitable adjustment as the
Administrator deems appropriate.
3.7 Statement of Benefits. Within a reasonable time after
the end of the Plan Year and at the date a Participant's Deferral
Benefit or Death Benefit becomes payable under the Plan, the
Administrator shall provide to each Participant (or, if deceased,
to his Beneficiary) a statement of the benefit under the Plan.
ARTICLE IV
Accounts and Investments
4.1 Accounts. A separate Account under the Plan shall be
established for each Participant. Such Account shall be (a)
credited with the amounts credited in accordance with Sections
3.2 and 3.3, (b) credited (or charged, as the case may be) with
the investment results determined in accordance with Sections 4.2
and 4.3, and (c) charged with the amounts paid by the Plan to or
on behalf of the Participant in accordance with Article VII.
With each Participant's Account, separate subaccounts (including,
as necessary, a Deferred Stock Unit Account and a Deferred Cash
Account) shall be maintained to the extent that the Board
determines them necessary or useful in the administration of the
Plan.
4.2 Deferred Stock Units. Except as provided below, a
Participant's Deferred Stock Unit Account shall be treated as if
it were invested in Deferred Stock Units that are equivalent in
value to the fair market value of the shares of the Corporation's
common stock in accordance with the following rules:
(a) Before the Benefit Commencement Date, the number of
Deferred Stock Units credited to a Participant's Deferred Stock
Unit Account shall be increased on each date on which a dividend
is paid on the Corporation's common stock. The number of
additional Deferred Stock Units credited to a Participant's
Deferred Stock Unit Account as a result of such increase shall be
determined by (i) multiplying the total number of Deferred Stock
Units (with fractional Deferred Stock Units rounded off to the
nearest thousandth) credited to the Participant's Deferred Stock
Unit Account immediately before such increase by the amount of
the dividend paid per share of the Corporation's Common Stock on
the dividend payment date, and (ii) dividing the product so
determined by the Closing Price on the dividend payment date.
(b) The dollar value of the Deferred Stock Units credited
to a Participant's Deferred Stock Unit Account on any date shall
be determined by multiplying the number of Deferred Stock Units
(including fractional Deferred Stock Units) credited to the
Participant's Deferred Stock Unit Account by the Closing Price on
that date.
(c) In the event of a transaction or event described in
this subsection (c), the number of Deferred Stock Units credited
to a Participant's Deferred Stock Unit Account shall be adjusted
in such manner as the Board, in its sole discretion, deems
equitable. A transaction or event is described in this
subsection (c) if (i) it is a dividend (other than regular
quarterly dividends) or other distribution (whether in the form
of cash, shares, other securities, or other property),
extraordinary cash dividend, recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation, split-
up, spin-off, repurchase, or exchange of shares or other
securities, the issuance or exercisability of stock purchase
rights, the issuance of warrants or other rights to purchase
shares or other securities, or other similar corporate
transaction or event and (ii) the Board determines that such
transaction or event affects the shares of the Corporation's
Common Stock, such that an adjustment pursuant to this paragraph
(c) is appropriate to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available
under the Plan.
(d) A Participant who elects to receive distribution of his
Accounts in annual installments will not have his or her Deferred
Stock Unit Account credited with Deferred Stock Units on or after
the Benefit Commencement Date.
(e) On the Benefit Commencement Date, the Deferred Stock
Unit Account of a Participant who has elected to receive his
Deferral Benefit in annual installments shall be converted to a
Deferred Cash Account which shall accrue annual interest at the
Rate of Return.
4.3 Hypothetical Nature of Accounts and Investments. Each
Account established under this Article IV shall be maintained for
bookkeeping purposes only. Neither the Plan nor any of the
Accounts established under the Plan shall hold any actual funds
or assets. The Deferred Stock Units established hereunder shall
be used solely to determine the amounts to be paid hereunder,
shall not represent an equity security of the Corporation, shall
not be convertible into or otherwise entitle a Participant to
acquire an equity security of the Corporation and shall not carry
any voting or dividend rights.
ARTICLE V
Vesting
5.1 Vesting. A Participant's Deferred Cash Account and
Deferred Stock Unit Account shall be fully vested and non-
forfeitable at all times.
ARTICLE VI
Death Benefits
6.1 Pre-Benefit Commencement Date Death Benefit. In the
event that a Participant dies prior to his Benefit Commencement
Date, then the Participant's Deferred Stock Unit Account shall be
converted to a Deferred Cash Account as of the first of January
following the Participant's date of death, which Deferred Cash
Account shall accrue annual interest thereafter at the Rate of
Return to the extent not paid out in a lump sum pursuant to the
Participant's election form. If the Participant has not reached
age 65 at the time of the Participant's death, the Beneficiary of
such Participant shall be entitled to receive as a Death Benefit
an amount equal to the Deferral Benefit as of the Benefit
Commencement Date that the Participant would have received had
the Participant lived to received the full Deferral Benefit. If
the Participant is age 65 or older at the time of the
Participant's death, the Beneficiary of such Participant shall be
entitled to receive as a Death Benefit an amount equal to the
Deferral Benefit as of the Participant's date of death. This
Death Benefit shall be paid pursuant to the Participant's
election form except that the payment shall be made, or begin, on
the first of January after the Participant's date of death.
6.2 Post-Benefit Commencement Date Death Benefit. In the
event that a Participant dies after his Benefit Commencement
Date, then the Beneficiary of such participant shall be entitled
to receive as a Death Benefit a continuation of the payment of
the Deferral Benefit in the same manner and in the same amount
that the Participant would have received had the Participant
lived to receive the Deferral Benefit.
ARTICLE VII
Payment of Benefits
7.1 Payment of Deferral Benefit. A Participant's Deferral
Benefit, if any, shall become payable to the Participant as of
the Benefit Commencement Date specified in his Deferral Election
or as soon thereafter as is administratively practical. If the
Participant has elected to receive the Deferral Benefit in
installments, each of the Participant's annual installment
payments shall be comprised of accrued interest for the year, if
any, and that portion of the Participant's Deferral Benefit equal
to the balance in the Participant's Deferred Cash Account divided
by the number of remaining annual installment payments to be made
to the Participant.
7.2 Payment of Death Benefit. A Participant's pre-
commencement Death Benefit shall be payable to his Beneficiary as
set forth in Article VI. A Participant's post-commencement Death
Benefit shall be paid in installments payable annually over the
period irrevocably elected by the Participant pursuant to his
Deferral Election.
7.3 Form of Payment of Deferral Benefit. A Participant
shall be paid his Deferral Benefit beginning at the Benefit
Commencement Date in a lump sum or in periodic installment
payments payable annually over a period of five, ten, or fifteen
years as irrevocably elected by the Participant pursuant to
Section 3.3.
7.4 Benefit Determination and Payment Procedure. The
Administrator shall make all determinations concerning
eligibility for benefits under the Plan, the time or terms of
payment, and the form or manner of payment to the Participant or
the Participant's Beneficiary, in the event of the death of the
Participant. The Administrator shall promptly notify the
Corporation of each such determination that benefit payments are
due and provide to the Corporation all other information
necessary to allow the Corporation to carry out said
determination, whereupon the Corporation shall pay such benefits
in accordance with the Administrator's determination.
7.5 Payments to Minors and Incompetents. If a Participant
or Beneficiary entitled to receive any benefits hereunder is a
minor or is adjudged to be legally incapable of giving valid
receipt and discharge for such benefits, or is deemed so by the
Administrator, benefits will be paid to such person as the
Administrator may designate for the benefit of such Participant
or Beneficiary. Such payments shall be considered a payment to
such Participant or Beneficiary and shall, to the extent made, be
deemed a complete discharge of any liability for such payments
under the Plan.
7.6 Distribution of Benefit When Distributee Cannot Be
Located. The Administrator shall make all reasonable attempts to
determine the identity and/or whereabouts of a Participant or a
Participant's Beneficiary entitled to benefits under the Plan,
including the mailing by certified mail of a notice to the last
known address shown on the Corporation's or the Administrator's
records. If the Administrator is unable to locate such a person
entitled to benefits hereunder, or if there has been no claim
made for such benefits, the Corporation shall continue to hold
the benefit due such person, subject to any applicable statute of
escheats.
ARTICLE VIII
Beneficiary Designation
8.1 Beneficiary Designation.
(a) A Participant may designate a Beneficiary as part of
his Deferral Election. Any Beneficiary designation made
hereunder shall be effective only if properly signed and dated by
the Participant and delivered to the Administrator prior to the
time of the Participant's death. Any Beneficiary designation
hereunder shall remain effective until changed or revoked
hereunder.
(b) A Beneficiary designation may be changed by the
Participant at any time, or from time to time, by filing a new
designation in writing with the Administrator.
(c) If the Participant dies without having designated a
Beneficiary, or if the Beneficiary so designated has predeceased
him, then his estate shall be deemed to be his Beneficiary.
(e) If a Beneficiary of the Participant shall survive the
Participant but shall die before the Participant's entire benefit
under the Plan has been distributed, then the unpaid balance
thereof shall be distributed to any other beneficiary named by
the deceased Beneficiary to receive his interest or, if none, to
the estate of the deceased Beneficiary.
ARTICLE IX
Withdrawals
9.1 No Withdrawals Permitted. No withdrawals or other
distributions shall be permitted from the Deferred Cash Account
and Deferred Stock Unit Account except as provided in Article
VII.
ARTICLE X
Funding
10.1 Funding.
(a) All Plan Participants and Beneficiaries are general
unsecured creditors of the Corporation with respect to the
benefits due hereunder and the Plan constitutes a mere promise by
the Corporation to make benefit payments in the future. It is
the intention of the Corporation that the Plan be considered
unfunded for tax purposes.
(b) The Corporation may, but is not required to, purchase
life insurance in amounts sufficient to provide some or all of
the benefits provided under this Plan or may otherwise segregate
assets for such purpose.
(c) The Corporation may, but is not required to, establish
a grantor trust which may be used to hold assets of the
Corporation which are maintained as reserves against the
Corporation's unfunded, unsecured obligations hereunder. Such
reserves shall at all times be subject to the claims of the
Corporation's creditors. To the extent such trust or other
vehicle is established, and assets contributed, for the purpose
of fulfilling the Corporation's obligation hereunder, then such
obligation of the Corporation shall be reduced to the extent such
assets are utilized to meet its obligations hereunder. Any such
trust and the assets held thereunder are intended to conform in
substance to the terms of the model trust described in Revenue
Procedure 92-64.
ARTICLE XI
Change of Control
11.1 Change of Control.
A "Change of Control" shall mean and shall be deemed to
have taken place if: (i) any individual, entity or group (within
the meaning of Sections 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934 (the "Exchange Act")) becomes the beneficial
owner of shares of the Company having 25 percent or more of the
total number of votes that may be cast for the election of
directors of the Company, other than (x) as a result of any
acquisition directly from the Company, or (y) as a result of any
acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or its subsidiaries; or
(ii) a change in the composition of the Board such that the
individuals who, as of the date hereof, constitute the Board (the
Board as of such date shall be hereinafter referred to as the
"Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, for purposes of this
Section, that any individual who becomes a member of the Board
subsequent to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by a vote of
at least a majority of those individuals who are members of the
Board and who were also members of the Incumbent Board (or deemed
to be such pursuant to this proviso) shall be considered as
though such individual were a member of the Incumbent Board; but,
provided further, that any such individual whose initial
assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-
11 of Regulation 14A promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies or consents by or on
behalf of a person other than the Board shall not be so
considered as a member of the Incumbent Board.
11.2 Effect of Change of Control.
Notwithstanding any other provision in any other Article of
this Plan to the contrary, (i) the value of all amounts deferred
by a Participant which have not yet been credited to the
Participant's Account and (ii) the value of such Participant's
Account shall be paid to such Participant in each case in a lump-
sum cash payment on the occurrence of a Change of Control or as
soon thereafter as practicable, but in no event later than five
days after the Change of Control. The amount of cash credited to
each Participant's Account prior to determining the amount of
cash to be paid from the Account shall be determined by the Board
(which, for this purpose, shall be comprised of employee members
of the Board prior to the Change of Control) so as to reflect
fairly and equitably appropriate interest and dividends and
circumstances as the Board deems appropriate, including, without
limitation, the recent price of shares of the Corporation's
common stock. For purposes of payments under this Article XI,
the value of a Deferred Stock Unit shall be computed as the
greater of (1) the Closing Price on or nearest the date on which
the Change of Control is deemed to occur, or (2) the highest per
share price for shares of the Corporation's common stock actually
paid in connection with the Change of Control.
ARTICLE XII
Plan Administrator
12.1 Appointment of Administrator.
(a) The Compensation Committee may appoint one or more
persons to serve as the Plan Administrator (the "Administrator")
for the purpose of administering the Plan. In the event more
than one person is appointed, the persons shall form a committee
for the purpose of functioning as the Administrator of the Plan.
The person or committeemen serving as Administrator shall serve
for indefinite terms at the pleasure of the Compensation
Committee, and may, by thirty (30) days prior written notice to
the Compensation Committee, terminate such appointment.
12.2 Duties and Responsibilities of Plan Administrator.
(a) The Administrator shall maintain and retain necessary
records regarding its administration of the Plan.
(b) The Administrator is empowered to settle claims against
the Plan and to make such equitable adjustments in a
Participant's or Beneficiary's rights or entitlements under the
Plan as it deems appropriate in the event an error or omission is
discovered or claimed in the operation or administration of the
Plan.
(c) The Administrator may construe the Plan, correct
defects, supply omissions or reconcile inconsistencies to the
extent necessary to effectuate the Plan, and such action shall be
conclusive.
ARTICLE XIII
Amendment or Termination of Plan
13.1 Amendment or Termination of the Plan. The Plan may be
terminated or amended at any time by the Board, effective as of
any date specified. Any such action taken by the Board shall be
evidenced by a resolution and shall be communicated to
Participants and Beneficiaries prior to the effective date
thereof. No amendment or termination shall decrease a
Participant's Deferral Benefit accrued prior to the effective
date of the amendment or termination. The Board reserves the
right to unilaterally shorten the deferral period of any
Participant hereunder in its sole discretion if, in its sole
discretion, it determines that to do so will be fair and
equitable to the Participant.
ARTICLE XIV
Miscellaneous
14.1 Non-assignability. The interests of each Participant
under the Plan are not subject to claims of the Participant's
creditors; and neither the Participant nor his Beneficiary shall
have any right to sell, assign, transfer or otherwise convey the
right to receive any payments hereunder or any interest under the
Plan, which payments and interest are expressly declared to be
non-assignable and non-transferable.
14.2 Notices and Elections. All notices required to be given
in writing and all elections required to be made in writing under
any provision of the Plan shall be invalid unless made on such
forms as may be provided or approved by the Administrator and, in
the case of a notice or election by a Participant or Beneficiary,
unless executed by the Participant or Beneficiary giving such
notice or making such election. Notices and elections shall be
deemed given or made when received by any member of the committee
that serves as Administrator.
14.3 Delegation of Authority. Whenever the Corporation is
permitted or required to perform any act, such act may be
performed by its Chief Executive Officer or President or other
person duly authorized by its Chief Executive Officer or
President or its Board.
14.4 Service of Process. The Administrator shall be the
agent for service of process on the Plan.
14.5 Governing Law. The Plan shall be construed, enforced
and administered in accordance with the laws of the Commonwealth
of Virginia.
14.6 Binding Effect. The Plan shall be binding upon and
inure to the benefit of the Corporation, its successors and
assigns, and the Participant and his heirs, executors,
administrators and legal representatives.
14.7 Severability. If any provision of the Plan should for
any reason be declared invalid or unenforceable by a court of
competent jurisdiction, the remaining provisions shall
nevertheless remain in full force and effect.
14.8 Gender and Number. In the construction of the Plan, the
masculine shall include the feminine or neuter and the singular
shall include the plural and vice-versa in all cases where such
meanings would be appropriate.
14.9 Titles and Captions. Titles and captions and headings
herein have been inserted for convenience of reference only and
are to be ignored in any construction of the provisions hereof.
IN WITNESS WHEREOF, the Corporation has caused the Plan to
be signed on its behalf by its duly authorized officer on the 1st
day of April, 1998.
Hilb, Rogal and Hamilton Company
By: /s/ Dianne F. Fox
Its Senior Vice-President and Secretary
0396446.05