EXHIBIT 10.7
AGILENT TECHNOLOGIES, INC.
EXCESS BENEFIT RETIREMENT PLAN
SECTION 1. ESTABLISHMENT AND PURPOSE OF PLAN
On the Distribution Date, Hewlett-Packard Company distributed to its
shareholders its interest in the Company. In connection with this transaction,
the Agilent Technologies, Inc. Excess Benefit Retirement Plan was established
effective as of May 1, 2000 as a spin-off of the portion of the liabilities of
the Hewlett-Packard Company Excess Benefit Retirement Plan attributable to
Participants in this Plan. On and after May 1, 2000, all Participant's Plan
Benefits shall be payable from this Plan rather than the Hewlett-Packard Company
Excess Benefit Retirement Plan.
The Plan is intended to provide supplemental retirement benefits to
certain management and highly compensated employees equal to those benefits that
are limited under the Deferred Profit Sharing Plan and/or Retirement Plan
because of the limitations on contributions and benefits imposed by Section 415
of the Internal Revenue Code of 1986 (the "Code") and the limitation on
compensation imposed by Section 401(a)(17) of the Code. This Plan is intended to
be an unfunded excess benefit plan under Sections 3(36) and 4(b)(5) of the
Employee Retirement Income Security Act of 1974 ("ERISA"). The Plan is also
intended to be a plan which is
unfunded and is maintained by an employer primarily for the purpose of providing
deferred compensation for a select group of management or highly compensated
employees under Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA. The Company
retains the right, as provided in Section 8, to amend or terminate the Plan at
any time. The Plan is administered by the Compensation Committee of the Board of
Directors of the Company, as provided in Section 7.
SECTION 2. DEFINITIONS
Certain capitalized words and phrases used in the text of the Plan shall
have the meaning attributed to them in the DPSP or RP or the following meaning
unless the text further specifies the meaning or from the context it clearly
appears otherwise:
(a) "Actual DPSP Account" means the amount in the separate account
established for each Participant under the DPSP.
(b) "Actual RP Benefit" means the benefit in fact determined under the
RP as of the date when benefits are to be paid under the DPSP or RP.
(c) "Committee" means the Compensation Committee of the Board of
Directors of the Company; provided, that for purposes of Sections 5(b) and 9,
with respect to any Participant other than a Participant who is an executive
officer as defined under the Securities Exchange Act of 1934 and the regulations
thereunder, Committee means the Executive Committee of the Board of Directors of
the Company.
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(d) "Distribution Date" means the date the Company is no longer a member
of the Hewlett-Packard Company controlled group of corporations (within the
meaning of section 1563(a) of the Code).
(e) "DPSP" or "Deferred Profit Sharing Plan" means the Agilent
Technologies, Inc. Deferred Profit Sharing Plan adopted and effective as of May
1, 2000, and as it may be amended from time to time.
(f) "Participant" means any individual entitled to a Virtual DPSP
Account under Section 4 or a Virtual Retirement Benefit under Section 5.
(g) "Plan" means the Agilent Technologies, Inc. Excess Benefit
Retirement Plan, as described herein and as it may be amended from time to time.
(h) "RP" or "Retirement Plan" means the Agilent Technologies, Inc.
Retirement Plan adopted and effective as of May 1, 2000, and as it may be
amended from time to time.
(i) "Virtual DPSP Account" means a bookkeeping account established under
Section 4 to which is credited all investment earnings as provided in Section 4.
(j) "Virtual Retirement Benefit" means the benefit payable to a
Participant or Beneficiary determined under Section 5.
(k) "Virtual RP Benefit" means the benefit determined under the RP based
on the Annuity Value of the Actual DPSP Account, if applicable, but otherwise
without regard to the limitations of Section 415 or Section 401(a)(17) of the
Code.
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SECTION 3. ELIGIBILITY AND PARTICIPATION
(a) General Rule. Any individual who is participating in the DPSP and/or
the RP and who by reason of the limitations of Section 415 or Section 401(a)(17)
of the Code is unable to receive the formula contributions or benefits otherwise
provided under the DPSP and/or RP shall automatically be a Participant in this
Plan.
(b) Termination of Participation. An individual shall cease to be a
Participant as of the date he or she ceases to be an Employee, unless the
individual is entitled to benefits hereunder, in which event his or her status
as a Participant shall terminate on the earlier of the date of his or her death
or the date no further amount is payable to the individual hereunder.
SECTION 4. VIRTUAL DPSP ACCOUNTS
A separate account, called a "Virtual DPSP Account," shall be maintained
by the Committee for each Participant. The value of the Virtual DPSP Account as
of May 1, 2000 shall equal the value of the Virtual DPSP Account each
Participant had under the Hewlett-Packard Company Excess Benefit Retirement Plan
on the business day preceding May 1, 2000. As of the last day of each Plan Year,
or in the case of an Employee whose employment by the Affiliated Group has
terminated and who has made claim for benefits under the DPSP, as of the
Employee's Valuation Date (if other than the last day of the Plan Year), each
Virtual DPSP Account shall be revalued. For purposes of valuation, the Virtual
DPSP Account shall be deemed invested as the assets of the DPSP.
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SECTION 5. VIRTUAL RETIREMENT BENEFIT
(a) Determination of Benefit. The benefits payable under this Plan shall
be determined as of the date when benefits are to be paid under the DPSP or RP.
As of that date the Committee shall determine the Virtual RP Benefit and the
Actual RP Benefit. As of the same date the Committee shall determine the Annuity
Value of the Virtual DPSP Account, if any, in the same manner as the Annuity
Value of the Actual DPSP Account, if any, is determined under the RP. The
benefit payable under this Plan, if any, shall equal:
(i) The greater of the Virtual RP Benefit or the Annuity Value
of the Virtual DPSP Account; less
(ii) The Actual RP Benefit.
The benefit determined pursuant to the immediately preceding sentence shall be
known as the Virtual Retirement Benefit.
(b) Form and Time of Payment. The Participant's Virtual Retirement
Benefit shall be converted to a lump sum benefit as of the date the
Participant's DPSP or RP benefit is to be paid. The conversion shall be based on
the same actuarial factors that would be used to convert an RP benefit from an
annuity to a lump sum at the time of the conversion. Thereafter, the unpaid
portion of such lump sum Virtual Retirement Benefit shall be credited with
earnings (i) through May 31, 2000 as if it were a benefit invested in Fund B and
(ii) on and after June 1, 2000, as if it were a benefit invested in Fund A under
the DPSP, until it is paid out to the Participant under this Plan as set forth
below in this Section 5(b).
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Benefits are payable under this Plan in the form of a lump sum or annual
installments at such time or times as the Committee shall determine in its sole
discretion, subject to the following limitations:
(i) If benefits are payable under the DPSP, no benefits shall
be payable under this Plan until benefits are to be paid
under the DPSP;
(ii) The Committee may change the date a payment is to be made
at any time before the date of the scheduled payment;
(iii) Any annual installments shall be payable in January of the
particular year;
(iv) No lump sum may be payable later than January of the
calendar year following the later of (A) the calendar year
in which the Participant attains (or would have attained)
age 70-1/2, or (B) the calendar year in which the
Participant's employment by the Company terminates;
provided, that the Committee may allow the unpaid balance
to be paid in a lump sum after annual installment payments
have commenced;
(v) Annual installments must be 15 or fewer in number and
commence no later than January of the calendar year
following the later of (A) the calendar year in which the
Participant attains (or would have attained) age 70-1/2,
or (B) the calendar year in which the Participant's
employment by the Company terminates;
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(vi) The amount of each annual installment shall be determined
by dividing the unpaid balance as of the last day of the
prior Plan Year by the sum of the annual payments
remaining to be made; and
(vii) If at the time the Virtual Retirement Benefit is first
determined under this Section 5 the lump sum equivalent of
such benefit does not exceed one hundred fifty thousand
dollars ($150,000.00), benefits shall be payable under
this Plan as soon as administratively practicable after
the date the Virtual Retirement Benefit is first
determined and only in the form of a lump sum.
If the Committee has not otherwise determined, benefits shall be payable
in 15 annual installments commencing in January of the calendar year following
the later of (A) the calendar year in which the Participant attains (or would
have attained) age 70-1/2, or (B) the calendar year in which the Participant's
employment by the Company terminates.
In administering these payment provisions of the Plan, the Committee may
allow Participants to elect the form and time of payment that they desire
consistent with these rules, and the Committee may establish guidelines for its
own use in determining what elections made pursuant to these rules shall be
disapproved. However, such Participant elections and Committee guidelines shall
not in any way limit the Committee's sole discretion to determine the form and
time of payment of a Participant's Virtual Retirement Benefit consistent with
the rules set forth in this Section 5(b) of the Plan.
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(c) Death of Participant. If a Participant dies, without regard to
whether he or she is employed by any member of the Affiliated Group at the time
of death, his or her Beneficiary shall be the individual (or individuals)
designated on the form prescribed by the Committee (or, in the absence of such a
designation, his or her Beneficiary under the DPSP, or, in the absence of a DPSP
benefit, his or her Beneficiary under the RP). Such Beneficiary shall be
entitled to the unpaid portion (if any) of the Virtual Retirement Benefit
determined under Section 5(a). The Beneficiary shall be subject to the rules of
form and time of payment established under Section 5(b).
SECTION 6. FUNDING POLICY AND METHOD
Benefits and administrative expenses shall be paid as needed solely from
the general assets of the Company. This Plan shall be unfunded within the
meaning of Section 4(b)(5) of ERISA. No contributions are required or permitted
from any Participant.
SECTION 7. ADMINISTRATION
The Plan shall be administered by the Committee. No member of the
Committee shall become a Participant in the Plan. The Committee shall make such
rules, interpretations and computations as it may deem appropriate, and any
decision of the Committee with respect to the Plan, including (without
limitation) any determination of eligibility to participate in the Plan and any
calculation of benefits under the Plan shall be conclusive and binding on all
persons. Those responsibilities of the Committee that do not involve the
exercise of its discretion may be performed on behalf of the Committee by the
Company through its employees.
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SECTION 8. AMENDMENT AND TERMINATION OF THE PLAN
The Company reserves the right to amend or terminate the Plan at any
time by resolution of the Company's Board of Directors or by resolution of any
proper delegatee of the Company's Board of Directors. Any amendment or
termination of the Plan will not affect the entitlement of any Participant who
terminates employment before the amendment or termination. All benefits to which
any Participant may be entitled shall be determined under the Plan as in effect
at the time the Participant terminates employment and shall not be affected by
any subsequent change in the provisions of the Plan. Participants will be given
notice prior to the discontinuance of the Plan or reduction of any benefits
provided by the Plan.
SECTION 9. GENERAL PROVISIONS
(a) Choice of Law. This Plan, and all rights under this Plan, shall be
interpreted and construed in accordance with the law of the State of California.
(b) Assignment. The interest and property rights of any person in the
Plan or in any payment to be made under the Plan shall not be subject to option
nor be assignable either by voluntary or involuntary assignment or operation of
law, including (without limitation) bankruptcy, garnishment, attachment or other
creditor's process, and any act in violation of this Section 9(b) shall be void.
(c) Number. Except as otherwise clearly indicated, the singular shall
include the plural, and vice versa.
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(d) Headings and Captions. The headings and captions herein are provided
for reference and convenience only and shall not be considered part of the Plan
nor shall they be employed in the construction of the Plan.
(e) Competency to Handle Benefits. If, in the opinion of the Committee,
any person becomes unable to properly handle any property distributable to such
person under the Plan, the Committee may make any reasonable arrangement for the
distribution of Plan benefits on such person's behalf as it deems appropriate.
Payment to anyone described in this Section 9(e) will release the Company from
all further liability to the extent of the payment made.
(f) Severability of Provisions. If any provision of the Plan shall be
held invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision hereof, and the Plan shall be construed and enforced
as if such provision had not been included.
(g) Tax Withholding. If any Federal or state tax withholding or payroll
tax is required with respect to a Participant's Virtual Retirement Benefit, the
Committee shall make appropriate arrangements with the Participant for
satisfaction of such obligation.
(h) No Employment Rights. Nothing in the Plan, nor any action of the
Committee or the Company pursuant to the Plan, shall be deemed to give any
person any right to remain in the employ of the Company or affect the right of
the Company to terminate a person's employment at any time, with or without
cause.
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SECTION 10. EXECUTION
To record the adoption of the Plan as set forth herein, the Company has
caused its Chair of the Compensation Committee of the Board of Directors to
affix the Company's name and seal hereto this____________day of__________, 2000.
AGILENT TECHNOLOGIES, INC.
By:
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David M. Lawrence, M.D.
Chair of the Compensation
Committee of the Board
of Directors
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