EXHIBIT 4.1
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JONES LANG LASALLE INCORPORATED
DEFERRED COMPENSATION PLAN
Effective January 1, 2004
TABLE OF CONTENTS
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ARTICLE 1 Definitions. . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 2 Selection, Enrollment, Eligibility . . . . . . . . . 8
2.1 Selection by Committee. . . . . . . . . . . . . 8
2.2 Enrollment Requirements . . . . . . . . . . . . 8
2.3 Eligibility; Commencement of Participation. . . 8
2.4 Termination of Participation
and/or Deferrals. . . . . . . . . . . . . . . . 8
ARTICLE 3 Deferrals. . . . . . . . . . . . . . . . . . . . . . 8
3.1 Minimum Deferrals . . . . . . . . . . . . . . . 8
3.2 Maximum Deferral. . . . . . . . . . . . . . . . 9
3.3 Election to Defer; Effect of Election Form. . . 10
3.4 Withholding and Crediting of
Annual Deferral Amounts . . . . . . . . . . . . 11
3.5 Company Contribution Amount . . . . . . . . . . 12
3.6 Company Restoration Matching Amount . . . . . . 12
3.7 SOP Amount. . . . . . . . . . . . . . . . . . . 12
3.8 Restricted Stock Amount . . . . . . . . . . . . 12
3.9 Stock Option Gain Amount. . . . . . . . . . . . 13
3.10 Vesting . . . . . . . . . . . . . . . . . . . . 13
3.11 Crediting/Debiting of Account Balances. . . . . 14
3.12 FICA and Other Taxes. . . . . . . . . . . . . . 16
ARTICLE 4 Deduction Limitation . . . . . . . . . . . . . . . . 17
4.1 Deduction Limitation on Benefit Payments. . . . 17
ARTICLE 5 In-Service Distribution;
Unforeseeable Financial Emergencies. . . . . . . . . 17
5.1 In-Service Distribution . . . . . . . . . . . . 17
5.2 Other Benefits Take Precedence
Over In-Service Distributions . . . . . . . . . 18
5.3 Withdrawal Payout/Suspensions for
Unforeseeable Financial Emergencies . . . . . . 18
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ARTICLE 6 Change In Control Benefit. . . . . . . . . . . . . . 18
6.1 Change in Control Benefit . . . . . . . . . . . 18
6.2 Payment of Change in Control Benefit. . . . . . 19
ARTICLE 7 Retirement Benefit . . . . . . . . . . . . . . . . . 19
7.1 Retirement Benefit. . . . . . . . . . . . . . . 19
7.2 Payment of Retirement Benefit . . . . . . . . . 19
ARTICLE 8 Termination Benefit. . . . . . . . . . . . . . . . . 19
8.1 Termination Benefit . . . . . . . . . . . . . . 19
8.2 Payment of Termination Benefit. . . . . . . . . 19
ARTICLE 9 Disability Waiver and Benefit. . . . . . . . . . . . 20
9.1 Disability Waiver . . . . . . . . . . . . . . . 20
9.2 Continued Eligibility; Disability Benefit . . . 20
ARTICLE 10 Survivor Benefit . . . . . . . . . . . . . . . . . . 21
10.1 Survivor Benefit . . . . . . . . . . . . . . . 21
10.2 Payment of Survivor Benefit. . . . . . . . . . 21
ARTICLE 11 Beneficiary Designation. . . . . . . . . . . . . . . 21
11.1 Beneficiary. . . . . . . . . . . . . . . . . . 21
11.2 Beneficiary Designation; Change of
Beneficiary Designation. . . . . . . . . . . . 21
11.3 Acknowledgement. . . . . . . . . . . . . . . . 22
11.4 No Beneficiary Designation . . . . . . . . . . 22
11.5 Doubt as to Beneficiary. . . . . . . . . . . . 22
11.6 Discharge of Obligations . . . . . . . . . . . 22
ARTICLE 12 Leave of Absence . . . . . . . . . . . . . . . . . . 22
12.1 Paid Leave of Absence. . . . . . . . . . . . . 22
12.2 Unpaid Leave of Absence. . . . . . . . . . . . 22
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ARTICLE 13 Termination, Amendment or Modification . . . . . . . 23
13.1 Termination. . . . . . . . . . . . . . . . . . 23
13.2 Amendment. . . . . . . . . . . . . . . . . . . 23
13.3 Plan Agreement . . . . . . . . . . . . . . . . 24
13.4 Effect of Payment. . . . . . . . . . . . . . . 24
ARTICLE 14 Administration . . . . . . . . . . . . . . . . . . . 24
14.1 Committee Duties . . . . . . . . . . . . . . . 24
14.2 Administration Upon Change In Control. . . . . 24
14.3 Agents . . . . . . . . . . . . . . . . . . . . 25
14.4 Binding Effect of Decisions. . . . . . . . . . 25
14.5 Indemnity of Committee . . . . . . . . . . . . 25
14.6 Employer Information . . . . . . . . . . . . . 25
ARTICLE 15 Other Benefits and Agreements. . . . . . . . . . . . 25
15.1 Coordination with Other Benefits . . . . . . . 25
ARTICLE 16 Claims Procedures. . . . . . . . . . . . . . . . . . 26
16.1 Presentation of Claim. . . . . . . . . . . . . 26
16.2 Notification of Decision . . . . . . . . . . . 26
16.3 Review of a Denied Claim . . . . . . . . . . . 27
16.4 Decision on Review . . . . . . . . . . . . . . 27
16.5 Legal Action . . . . . . . . . . . . . . . . . 27
ARTICLE 17 Trust. . . . . . . . . . . . . . . . . . . . . . . . 27
17.1 Establishment of the Trust . . . . . . . . . . 27
17.2 Interrelationship of the Plan
and the Trust. . . . . . . . . . . . . . . . . 27
17.3 Distributions From the Trust . . . . . . . . . 27
ARTICLE 18 Miscellaneous. . . . . . . . . . . . . . . . . . . . 28
18.1 Status of Plan . . . . . . . . . . . . . . . . 28
18.2 Unsecured General Creditor . . . . . . . . . . 28
18.3 Employer's Liability . . . . . . . . . . . . . 28
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18.4 Nonassignability . . . . . . . . . . . . . . . 29
18.5 Not a Contract of Employment . . . . . . . . . 29
18.6 Furnishing Information . . . . . . . . . . . . 29
18.7 Terms. . . . . . . . . . . . . . . . . . . . . 29
18.8 Captions . . . . . . . . . . . . . . . . . . . 29
18.9 Governing Law. . . . . . . . . . . . . . . . . 29
18.10 Notice . . . . . . . . . . . . . . . . . . . . 29
18.11 Successors . . . . . . . . . . . . . . . . . . 30
18.12 Spouse's Interest. . . . . . . . . . . . . . . 30
18.13 Validity . . . . . . . . . . . . . . . . . . . 30
18.14 Incompetent. . . . . . . . . . . . . . . . . . 30
18.15 Court Order. . . . . . . . . . . . . . . . . . 30
18.16 Distribution in the Event of Taxation. . . . . 30
18.17 Insurance. . . . . . . . . . . . . . . . . . . 31
18.18 Legal Fees To Enforce Rights After Change
in Control . . . . . . . . . . . . . . . . . . 31
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JONES LANG LASALLE INCORPORATED
DEFERRED COMPENSATION PLAN
Effective January 1, 2004
PURPOSE
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The purpose of this Plan is to provide specified benefits to a select
group of management or highly compensated Employees and Directors to induce
them to contribute materially to the continued growth, development and
business success of Jones Lang LaSalle Incorporated, a Maryland
corporation, and those subsidiaries, if any, that participate in the Plan.
This Plan shall be unfunded for tax purposes and for purposes of Title I of
ERISA.
ARTICLE 1
DEFINITIONS
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For the purposes of this Plan, unless otherwise clearly apparent from
the context, the following phrases or terms shall have the following
indicated meanings:
1.1 "Account Balance" shall mean, with respect to a Participant, a credit
on the records of the Employer equal to the sum of (i) the Deferral
Account balance, (ii) the Company Contribution Account balance,
(iii) the Company Restoration Matching Account balance, (iv) the SOP
Account balance, (v) the Restricted Stock Account balance, and (vi)
the Stock Option Gain Account balance. The Account Balance, and each
other specified account balance, shall be a bookkeeping entry only
and shall be utilized solely as a device for the measurement and
determination of the amounts to be paid to a Participant, or his or
her designated Beneficiary, pursuant to this Plan.
1.2 "Annual Deferral Amount" shall mean that portion of a Participant's
Base Salary, Bonus, Director Fees and LTIP Amounts that a Participant
defers in accordance with Article 3 for any one Plan Year. In the
event of a Participant's Retirement, Disability (if deferrals cease
in accordance with Section 9.1), death or a Termination of Employment
prior to the end of a Plan Year, such year's Annual Deferral Amount
shall be the actual amount withheld prior to such event.
1.3 "Annual Installment Method" shall be an annual installment payment
over the number of years selected by the Participant in accordance
with this Plan, calculated as follows: (i) for the first annual
installment, the vested Account Balance of the Participant shall be
calculated as of the close of business on or around the date on which
the Participant Retires or is deemed to have Retired in accordance
with Section 9.2(c), as determined by the Committee in its sole
discretion, and (ii) for remaining annual installments, the vested
Account Balance of the Participant shall be calculated on every
applicable anniversary of the date on which the Participant Retires
or is deemed to have Retired in accordance with Section 9.2(c). Each
annual installment shall be calculated by multiplying this balance by
a fraction, the numerator of which is one and the denominator of
which is the remaining number of annual payments due the Participant.
By way of example, if the Participant elects a ten (10) year Annual
Installment Method, the first payment shall be 1/10 of the vested
Account Balance, calculated as described in this definition. The
following year, the payment shall be 1/9 of the vested Account
Balance, calculated as described in this definition. Shares of Stock
1
that shall be distributable from the Stock Option Gain Account, the
SOP Account and the Restricted Stock Account shall be distributable
in shares of actual Stock in the same manner previously described.
However, the Committee may, in its sole discretion, (i) adjust the
annual installments in order to distribute whole shares of actual
Stock and/or (ii) accelerate the distribution of such actual shares
of Stock by payment of a lump sum.
1.4 "Base Salary" shall mean the annual cash compensation relating to
services performed during any calendar year, excluding distributions
from nonqualified deferred compensation plans, bonuses, commissions,
overtime, fringe benefits, stock options, relocation expenses,
incentive payments, non-monetary awards, director fees and other
fees, and automobile and other allowances paid to a Participant for
employment services rendered (whether or not such allowances are
included in the Employee's gross income). Base Salary shall be
calculated before reduction for compensation voluntarily deferred or
contributed by the Participant pursuant to all qualified or
non-qualified plans of any Employer and shall be calculated to
include amounts not otherwise included in the Participant's gross
income under Code Sections 125, 402(e)(3), 402(h), or 403(b) pursuant
to plans established by any Employer; provided, however, that all
such amounts will be included in compensation only to the extent that
had there been no such plan, the amount would have been payable in
cash to the Employee.
1.5 "Beneficiary" shall mean one or more persons, trusts, estates or
other entities, designated in accordance with Article 11, that are
entitled to receive benefits under this Plan upon the death of a
Participant.
1.6 "Beneficiary Designation Form" shall mean the form established from
time to time by the Committee that a Participant completes, signs and
returns to the Committee to designate one or more Beneficiaries.
1.7 "Board" shall mean the board of directors of the Company.
1.8 "Bonus" shall mean any cash compensation, in addition to Base Salary
and LTIP Amounts, payable to a Participant during a Plan Year, under
any Employer's annual bonus and cash incentive plans.
1.9 "Change in Control" shall mean the first to occur of any of the
following events:
(a) Any "person" (as that term is used in Section 13 and 14(d)(2)
of the Securities Exchange Act of 1934 ("Exchange Act"))
becomes the beneficial owner (as that term is used in
Section 13(d) of the Exchange Act), directly or indirectly, of
fifty percent (50%) or more of the Company's capital stock
entitled to vote in the election of the Board;
(b) During any period of not more than two consecutive years, not
including any period prior to the adoption of this Plan,
individuals who, at the beginning of such period constitute the
Board, and any new director (other than a director designated
by a person who has entered into an agreement with the Company
to effect a transaction described in clause (a), (c), (d) or
(e) of this Section 1.9) whose election by the Board or
nomination for election by the Company's stockholders was
approved by a vote of at least three-fourths (3/4ths) of the
Board then still in office, who either were Board members at
the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to
constitute at least a majority thereof;
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(c) The shareholders of the Company approve any consolidation or
merger of the Company, other than a consolidation or merger of
the Company in which the holders of the common stock of the
Company immediately prior to the consolidation or merger hold
more than fifty percent (50%) of the common stock of the
surviving corporation immediately after the consolidation or
merger;
(d) The shareholders of the Company approve any plan or proposal
for the liquidation or dissolution of the Company; or
(e) The shareholders of the Company approve the sale or transfer of
all or substantially all of the assets of the Company to
parties that are not within a "controlled group of
corporations" (as defined in Code Section 1563) in which the
Company is a member.
1.10 "Change in Control Benefit" shall have the meaning set forth in
Article 6.
1.11 "Claimant" shall have the meaning set forth in Section 16.1.
1.12 "Code" shall mean the Internal Revenue Code of 1986, as it may be
amended from time to time.
1.13 "Committee" shall mean the committee described in Article 14.
1.14 "Company" shall mean Jones Lang LaSalle Incorporated, a Maryland
corporation, and any successor to all or substantially all of the
Company's assets or business.
1.15 "Company Contribution Account" shall mean (i) the sum of the
Participant's Company Contribution Amounts, plus (ii) amounts
credited or debited to the Participant's Company Contribution Account
in accordance with this Plan, less (iii) all distributions made to
the Participant or his or her Beneficiary pursuant to this Plan that
relate to the Participant's Company Contribution Account.
1.16 "Company Contribution Amount" shall mean, for any one Plan Year, the
amount determined in accordance with Section 3.5.
1.17 "Company Restoration Matching Account" shall mean (i) the sum of all
of a Participant's Company Restoration Matching Amounts, plus (ii)
amounts credited or debited to the Participant's Company Restoration
Matching Account in accordance with this Plan, less (iii) all
distributions made to the Participant or his or her Beneficiary
pursuant to this Plan that relate to the Participant's Company
Restoration Matching Account.
1.18 "Company Restoration Matching Amount" for any one Plan Year shall be
the amount determined in accordance with Section 3.6.
1.19 "Deduction Limitation" shall mean the limitation on a benefit that
may otherwise be distributable pursuant to the provisions of this
Plan, as set forth in Article 4.
1.20 "Deferral Account" shall mean (i) the sum of all of a Participant's
Annual Deferral Amounts, plus (ii) amounts credited or debited to the
Participant's Deferral Account in accordance with this Plan, less
(iii) all distributions made to the Participant or his or her
Beneficiary pursuant to this Plan that relate to his or her Deferral
Account.
1.21 "Director" shall mean any member of the board of directors of any
Employer.
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1.22 "Director Fees" shall mean the annual fees paid by any Employer,
including retainer fees and meetings fees, as compensation for
serving on the board of directors.
1.23 "Disability" or "Disabled" shall mean a determination that a
Participant is disabled made by either (i) the carrier of any
individual or group disability insurance policy, sponsored by the
Participant's Employer, or (ii) the Social Security Administration.
Upon request by the Company, the Participant must submit proof of the
carrier's or Social Security Administration's determination.
1.24 "Disability Benefit" shall mean the benefit set forth in Article 9.
1.25 "Election Form" shall mean the form established from time to time by
the Committee that a Participant completes, signs and returns to the
Committee to make an election under the Plan.
1.26 "Eligible Stock Option" shall mean one or more non-qualified stock
option(s) (including incentive stock options disqualified as such and
treated as non-qualified options under the Code) selected by the
Committee in its sole discretion and exercisable under a plan or
arrangement of Jones Lang LaSalle Incorporated or any Employer
permitting a Participant under this Plan to defer gain with respect
to such option.
1.27 "Employee" shall mean a person who is an employee of any Employer.
1.28 "Employer(s)" shall mean the Company and/or any of its subsidiaries
(now in existence or hereafter formed or acquired) that have been
selected by the Board to participate in the Plan.
1.29 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as it may be amended from time to time.
1.30 "401(k) Plan" shall be that certain Jones Lang LaSalle Incorporated
Savings and Retirement Plan, originally adopted by the Company
effective July 1, 1977, as it may be amended from time to time.
1.31 "In-Service Distribution" shall mean the distribution set forth in
Section 5.1.
1.32 "LTIP Amounts" shall mean any compensation payable to a Participant
as an Employee under any Employer's long-term incentive plan or any
other long-term incentive arrangement designated by the Committee.
1.33 "Measurement Funds" shall have the meaning set forth in Section
3.11(a).
1.34 "Participant" shall mean any Employee or Director (i) who is selected
by the Committee to participate in the Plan, (ii) who elects to
participate in the Plan, (iii) who signs a Plan Agreement, an
Election Form and a Beneficiary Designation Form, (iv) whose signed
Plan Agreement, Election Form and Beneficiary Designation Form are
accepted by the Committee, (v) who commences participation in the
Plan, and (vi) whose Plan Agreement has not terminated. A spouse or
former spouse of a Participant shall not be treated as a Participant
in the Plan or have an account balance under the Plan, even if he or
she has an interest in the Participant's benefits under the Plan as a
result of applicable law or property settlements resulting from legal
separation or divorce.
1.35 "Plan" shall mean the Jones Lang LaSalle Incorporated Deferred
Compensation Plan, which shall be evidenced by this instrument and by
each Plan Agreement, as they may be amended from time to time.
4
1.36 "Plan Agreement" shall mean a written agreement, as may be amended
from time to time, which is entered into by and between an Employer
and a Participant. Each Plan Agreement executed by a Participant and
the Participant's Employer shall provide for the entire benefit to
which such Participant is entitled under the Plan; should there be
more than one Plan Agreement, the Plan Agreement bearing the latest
date of acceptance by the Employer shall supersede all previous Plan
Agreements in their entirety and shall govern such entitlement. The
terms of any Plan Agreement may be different for any Participant, and
any Plan Agreement may provide additional benefits not set forth in
the Plan or limit the benefits otherwise provided under the Plan;
provided, however, that any such additional benefits or benefit
limitations must be agreed to by both the Employer and the
Participant.
1.37 "Plan Year" shall mean a period beginning on January 1 of each
calendar year and continuing through December 31 of such calendar
year.
1.38 "Qualifying Gain" shall mean the incremental value inuring to a
Participant upon the exercise of an Eligible Stock Option, using a
Stock-for-Stock payment method, during any Plan Year. For purposes
of this section, the phrase "Stock-for-Stock payment method" shall,
in all events, be limited to the Participant's delivery of a properly
executed statement in which he or she attests to ownership of the
number of shares required to exercise the Eligible Stock Option,
rather than actual delivery of such shares. Such incremental value
shall be deliverable to the Participant in the form of additional
shares of Stock and shall be computed as follows: (i) the total fair
market value of the shares of Stock held/acquired as a result of the
exercise of an Eligible Stock Option using a Stock-for-Stock payment
method, minus (ii) the total exercise price. For example, assume a
Participant elects to exercise an Eligible Stock Option to purchase
1,000 shares of Stock at an exercise price of $20 per share (i.e., a
total exercise price of $20,000), when the Stock has a current fair
market value of $25 per share (i.e., a total current fair market
value of $25,000) and elects to defer one hundred (100) percent of
the Qualifying Gain (i.e., $5,000). Using the Stock-for-Stock
payment method, the Participant would deliver a properly executed
statement attesting to ownership of 800 shares of Stock (worth
$20,000 at exercise) to exercise the Eligible Stock Option and would
receive, in return, a Qualifying Gain, in the form of an unfunded and
unsecured promise by the Company for 200 shares of Stock in the
future (worth $5,000 at exercise). The number of additional shares
of Stock deliverable to the Participant in the future as a result of
the Qualifying Gain shall be fixed and determined as of the date of
the exercise of the Eligible Stock Option using the closing price of
the Stock as of the end of the business day closest to the date of
such exercise.
1.39 "Restricted Stock" shall mean rights to receive unvested shares of
restricted stock selected by the Committee in its sole discretion and
awarded to the Participant under any Jones Lang LaSalle Incorporated
stock incentive plan.
1.40 "Restricted Stock Account" shall mean the aggregate value, measured
on any given date, of (i) the number of shares of Restricted Stock
deferred by a Participant as a result of all Restricted Stock
Amounts, plus (ii) the number of additional shares credited to a
Participant's Restricted Stock Account as a result of the deemed
reinvestment of dividends in accordance with this Plan, less (iii)
the number of shares of Restricted Stock previously distributed to
the Participant or his or her Beneficiary pursuant to this Plan,
subject in each case to any adjustments to the number of such shares
determined by the Committee with respect to the Jones Lang LaSalle
Stock Unit Fund pursuant to Section 3.11. This portion of the
Participant's Account Balance shall only be distributable in actual
shares of Stock.
5
1.41 "Restricted Stock Amount" shall mean, with respect to a Participant
for any one Plan Year, the amount of Restricted Stock deferred in
accordance with Section 3.8 of this Plan, calculated using the
closing price of Stock at the end of the business day closest to the
date such Restricted Stock would otherwise vest, but for the election
to defer. In the event of a Participant's Retirement, Disability (if
deferrals cease in accordance with Section 9.1), death or a
Termination of Employment prior to the end of a Plan Year, such
year's Restricted Stock Amount shall be the actual amount withheld
prior to such event.
1.42 "Retirement", "Retire(s)" or "Retired" shall mean, with respect to an
Employee, severance from employment from all Employers for any reason
other than a leave of absence, death or Disability on or after the
earlier of the attainment of (a) age sixty-five (65) or (b) age sixty
(60) with ten (10) Years of Service; and shall mean with respect to a
Director who is not an Employee, severance of his or her
directorships with all Employers on or after the later of (y) the
attainment of age seventy (70), or (z) in the sole discretion of the
Committee, an age later than age seventy (70). Notwithstanding the
preceding sentence, if a Participant's employment terminates, and
such Participant is not otherwise eligible to Retire, the Committee
may, in its sole discretion, deem such Participant to have Retired
for purposes of this Plan. If a Participant is both an Employee and a
Director, Retirement shall not occur until he or she Retires as both
an Employee and a Director. Retirement under the preceding sentence
shall be deemed to be a Retirement as a Director. A Participant who
is both an Employee and a Director may elect, at least three years
prior to Retirement and in accordance with the policies and
procedures established by the Committee, to Retire for purposes of
this Plan at the time he or she Retires as an Employee, which
Retirement shall be deemed to be a Retirement as an Employee.
1.43 "Retirement Benefit" shall mean the benefit set forth in Article 7.
1.44 "SOP Account" shall mean the aggregate value, measured on any given
date, of (i) the number of shares of SOP Stock deferred by a
Participant as a result of all SOP Amounts, plus (ii) the number of
additional shares credited to a Participant's SOP Account as a result
of the deemed reinvestment of dividends in accordance with this Plan,
less (iii) the number of shares of SOP Stock previously distributed
to the Participant or his or her Beneficiary pursuant to this Plan,
subject in each case to any adjustments to the number of such shares
determined by the Committee with respect to the Jones Lang LaSalle
Stock Unit Fund pursuant to Section 3.11. This portion of the
Participant's Account Balance shall only be distributable in actual
shares of Stock.
1.45 "SOP Amount" shall mean, with respect to a Participant for any one
Plan Year, the amount of SOP Stock deferred in accordance with
Section 3.7 of this Plan, calculated using the closing price of Stock
at the end of the business day closest to the date such SOP Stock
would otherwise vest, but for the election to defer. In the event of
a Participant's Retirement, Disability (if deferrals cease in
accordance with Section 9.1), death or a Termination of Employment
prior to the end of a Plan Year, such year's SOP Amount shall be the
actual amount withheld prior to such event.
1.46 "SOP Stock" shall mean shall mean rights to receive unvested shares
of Stock selected by the Committee in its sole discretion and awarded
to the Participant under the Jones Lang LaSalle Incorporated Amended
and Restated Stock Award and Incentive Plan, as it may be amended
from time to time.
1.47 "Stock" shall mean Jones Lang LaSalle Incorporated common stock, $.01
par value, or any other equity securities of the Company designated
by the Committee.
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1.48 "Stock Option Gain Account" shall mean the aggregate value, measured
on any given date, of (i) the number of shares of Stock deferred by a
Participant as a result of all Stock Option Gain Amounts, plus (ii)
the number of additional shares credited to a Participant's Stock
Option Gain Account as a result of the deemed reinvestment of
dividends in accordance with this Plan, less (iii) the number of such
shares of Stock previously distributed to the Participant or his or
her Beneficiary pursuant to this Plan, subject in each case to any
adjustments to the number of such shares determined by the Committee
with respect to the Jones Lang LaSalle Stock Unit Fund pursuant to
Section 3.11. This portion of the Participant's Account Balance
shall only be distributable in actual shares of Stock.
1.49 "Stock Option Gain Amount" shall mean, with respect to a Participant
for any one Plan Year, the portion of Qualifying Gains deferred with
respect to an Eligible Stock Option exercise, in accordance with
Section 3.9 of this Plan. In the event of a Participant's
Retirement, Disability (if deferrals cease in accordance with Section
9.1), death or a Termination of Employment prior to the end of a Plan
Year, such year's Stock Option Gain Amount shall be the actual amount
withheld prior to such event.
1.50 "Survivor Benefit" shall mean the benefit set forth in Article 10.
1.51 "Termination Benefit" shall mean the benefit set forth in Article 8.
1.52 "Termination of Employment" shall mean the severing of employment of
a Participant with all Employers, or service as a Director,
voluntarily or involuntarily, for any reason other than Retirement,
Disability, death or an authorized leave of absence. If a
Participant is both an Employee and a Director, a Termination of
Employment shall occur only upon the termination of the last position
held. A Participant who is both an Employee and a Director may
elect, at least three years before Termination of Employment and in
accordance with the policies and procedures established by the
Committee, to be treated for purposes of this Plan as having
experienced a Termination of Employment at the time he or she ceases
employment with an Employer as an Employee.
1.53 "Trust" shall mean one or more trusts established by the Company in
accordance with Article 17.
1.54 "Unforeseeable Financial Emergency" shall mean an unanticipated
emergency that is caused by an event beyond the control of the
Participant that would result in severe financial hardship to the
Participant resulting from (i) a sudden and unexpected illness or
accident of the Participant or a dependent of the Participant, (ii) a
loss of the Participant's property due to casualty, or (iii) such
other extraordinary and unforeseeable circumstances arising as a
result of events beyond the control of the Participant, all as
determined in the sole discretion of the Committee.
1.55 "Years of Service" shall mean the total number of full years in which
a Participant has been employed by (i) the Company, (ii) any member
of the Company's controlled group under Section 414 of the Internal
Revenue Code, and (iii) any other entity designated by the Board of
Directors. For purposes of this definition, a year of employment
shall be a 365 day period (or 366 day period in the case of a leap
year) that, for the first year of employment, commences on the
Employee's date of hiring and that, for any subsequent year,
commences on an anniversary of that hiring date. The Committee shall
make a determination as to whether any partial year of employment
shall be counted as a Year of Service.
7
ARTICLE 2
SELECTION, ENROLLMENT, ELIGIBILITY
----------------------------------
2.1 SELECTION BY COMMITTEE. Participation in the Plan shall be limited
to a select group of management and highly compensated Employees of
the Employer and to the Directors, as determined by the Committee in
its sole discretion. From that group, the Committee shall select, in
its sole discretion, Employees and Directors to participate in the
Plan.
2.2 ENROLLMENT REQUIREMENTS. As a condition to participation, each
selected Employee or Director shall complete, execute and return to
the Committee a Plan Agreement, an Election Form and a Beneficiary
Designation Form, all by the time so designated by the Committee. In
addition, the Committee shall establish from time to time such other
enrollment requirements as it determines in its sole discretion are
necessary.
2.3 ELIGIBILITY; COMMENCEMENT OF PARTICIPATION. Provided an Employee or
Director selected to participate in the Plan has met all enrollment
requirements set forth in this Plan and required by the Committee,
including returning all required documents to the Committee within
the specified time period, that Employee or Director shall commence
participation in the Plan on the first day of the month following the
month in which the Employee or Director completes all enrollment
requirements. If an Employee or a Director fails to meet all such
requirements within the period required, in accordance with Section
2.2, that Employee or Director shall not be eligible to participate
in the Plan until the first day of the Plan Year following the
delivery to and acceptance by the Committee of the required
documents.
2.4 TERMINATION OF PARTICIPATION AND/OR DEFERRALS. If the Committee
determines in good faith that a Participant no longer qualifies as a
member of a select group of management or highly compensated
employees, as membership in such group is determined in accordance
with Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, the Committee
shall have the right, in its sole discretion, to (i) terminate any
deferral election the Participant has made for the remainder of the
Plan Year in which the Participant's membership status changes,
(ii) prevent the Participant from making future deferral elections
and/or (iii) immediately distribute the Participant's then vested
Account Balance as a Termination Benefit and terminate the
Participant's participation in the Plan.
ARTICLE 3
DEFERRALS
---------
3.1 MINIMUM DEFERRALS.
(a) ANNUAL DEFERRAL AMOUNT. For each Plan Year, a Participant may
elect to defer, as his or her Annual Deferral Amount, Base
Salary, Bonus, LTIP Amounts (if authorized) and/or Director
Fees in the following minimum amounts for each deferral
elected:
Deferral Minimum Amount
-------- --------------
Base Salary, Bonus, $5,000 aggregate
and/or LTIP Amounts
(if authorized)
Director Fees $0
8
If an election is made for less than the stated minimum
amounts, or if no election is made, the amount deferred
shall be zero.
Participants shall not be permitted to defer LTIP Amounts
unless the Committee authorizes such deferrals, in its
discretion.
(b) SOP AMOUNT. For each grant of SOP Stock, a Participant may
elect to defer, as his or her SOP Amount, SOP Stock in the
following minimum percentage:
Deferral Minimum Percentage
-------- ------------------
SOP Stock 0%
If no election is made, the percentage deferred shall be zero.
(c) RESTRICTED STOCK AMOUNT. For each grant of Restricted Stock, a
Participant may elect to defer, as his or her Restricted Stock
Amount, Restricted Stock in the following minimum percentage:
Deferral Minimum Percentage
-------- ------------------
Restricted Stock 0%
If no election is made, the percentage deferred shall be zero.
(d) STOCK OPTION GAIN AMOUNT. Participants shall not be permitted
to defer Qualifying Gains unless such deferrals are authorized
by the Committee, in its discretion. If the Committee
authorizes such deferrals, a Participant may elect to defer, as
his or her Stock Option Gain Amount, the following minimum
percentage of Qualifying Gain with respect to exercise of the
Eligible Stock Option:
Deferral Minimum Percentage
-------- ------------------
Qualifying Gain 0%
If no election is made, the percentage deferred shall be zero.
(e) SHORT PLAN YEAR. Notwithstanding the foregoing, if a
Participant first becomes a Participant after the first day of
a Plan Year, the minimum Annual Deferral Amount shall be an
amount equal to the minimum set forth above, multiplied by a
fraction, the numerator of which is the number of complete
months remaining in the Plan Year and the denominator of which
is 12.
3.2 MAXIMUM DEFERRAL.
(a) ANNUAL DEFERRAL AMOUNT. For each Plan Year, a Participant may
elect to defer, as his or her Annual Deferral Amount, Base
Salary, Bonus, LTIP Amounts (if authorized) and/or Director
Fees up to the following maximum percentages for each deferral
elected:
Deferral Maximum Percentage
-------- ------------------
Base Salary 75%
Bonus 100%
LTIP Amounts
(if authorized) 100%
Director Fees 100%
9
(b) SOP AMOUNT. For each grant of SOP Stock, a Participant may
elect to defer, as his or her SOP Amount, SOP Stock in the
following maximum percentage:
Deferral Maximum Percentage
-------- ------------------
SOP Stock 100%
(c) RESTRICTED STOCK AMOUNT. For each grant of Restricted Stock, a
Participant may elect to defer, as his or her Restricted Stock
Amount, Restricted Stock in the following maximum percentage:
Deferral Maximum Percentage
-------- ------------------
Restricted Stock 100%
(d) STOCK OPTION GAIN AMOUNT. If authorized by the Committee, a
Participant may elect to defer, as his or her Stock Option Gain
Amount, Qualifying Gain up to the following maximum percentage
with respect to exercise of the Eligible Stock Option:
Deferral Maximum Percentage
-------- ------------------
Qualifying Gain 100%
Stock Option Gain Amounts may also be limited by other terms or
conditions set forth in the stock option plan or agreement
under which such options are granted.
(e) SHORT PLAN YEAR. Notwithstanding the foregoing, if a
Participant first becomes a Participant after the first day of
a Plan Year, the maximum Annual Deferral Amount (i) with
respect to Base Salary and Director Fees shall be limited to
the amount of compensation not yet earned by the Participant as
of the date the Participant submits a Plan Agreement and
Election Form to the Committee for acceptance, and (ii) with
respect to Bonus and LTIP Amounts shall be limited to those
amounts deemed eligible for deferral, in the sole discretion of
the Committee.
3.3 ELECTION TO DEFER; EFFECT OF ELECTION FORM.
(a) FIRST PLAN YEAR. In connection with a Participant's
commencement of participation in the Plan, the Participant
shall make an irrevocable deferral election for the Plan Year
in which the Participant commences participation in the Plan,
along with such other elections as the Committee deems
necessary or desirable under the Plan. For these elections to
be valid, the Election Form must be completed and signed by the
Participant, timely delivered to the Committee (in accordance
with Section 2.2 above) and accepted by the Committee.
(b) SUBSEQUENT PLAN YEARS. For each succeeding Plan Year, an
irrevocable deferral election for that Plan Year, and such
other elections as the Committee deems necessary or desirable
under the Plan, shall be made by timely delivering a new
Election Form to the Committee, in accordance with its rules
and procedures, before the end of the Plan Year preceding the
Plan Year for which the election is made. If no such Election
Form is timely delivered for a Plan Year, the Annual Deferral
Amount shall be zero for that Plan Year.
10
(c) SOP STOCK DEFERRAL. For an election to defer SOP Stock to be
valid: (i) a separate irrevocable Election Form must be
completed and signed by the Participant, with respect to such
SOP Stock; and (ii) such Election Form must be timely delivered
to the Committee and accepted by the Committee at least thirty
days prior to the date such SOP Stock vests under the terms of
the Jones Lang LaSalle Incorporated Amended and Restated Stock
Award and Incentive Plan.
(d) RESTRICTED STOCK DEFERRAL. For an election to defer Restricted
Stock to be valid: (i) a separate irrevocable Election Form
must be completed and signed by the Participant, with respect
to such Restricted Stock; and (ii) such Election Form must be
timely delivered to the Committee and accepted by the Committee
at least thirty days prior to the date such Restricted Stock
vests under the terms of the Jones Lang LaSalle Incorporated
stock incentive plan.
(e) STOCK OPTION GAIN DEFERRAL.
(i) For an election to defer gain upon the exercise of an
Eligible Stock Option exercise to be valid: (i) a
separate Election Form must be completed and signed by
the Participant with respect to the Eligible Stock
Option; (ii) such election must be irrevocable; (iii) the
executed Election Form must be timely delivered to the
Committee or its designee at least six (6) months prior
to the date the Participant elects to exercise the
Eligible Stock Option; (iv) the Participant must agree
not to exercise the Eligible Stock Option prior to six
(6) months from the date the executed, irrevocable
Election Form is submitted to the Committee or its
designee; (v) the Eligible Stock Option must be exercised
using the "Stock-for-Stock payment method"; and (vi) the
Stock constructively delivered by the Participant to
exercise the Eligible Stock Option must have been owned
by the Participant during the entire six (6) month period
prior to its delivery and/or otherwise qualify the
Eligible Stock Option for favorable accounting treatment,
as determined in the sole discretion of the Committee.
(ii) Notwithstanding any other provision of this Plan to the
contrary, (i) an Eligible Stock Option may be exercised
prior to the end of the six (6) month period following
the date on which the executed Election Form is delivered
to the Committee or its designee, and (ii) the resulting
Qualifying Gain will not be deferred into this Plan, if
(a) a Change in Control occurs, or (b) the Participant
Retires, dies while an Employee or Director, or
experiences a Termination of Employment, and the Eligible
Stock Option would otherwise expire prior to the end of
the six (6) month period following the date on which the
executed Election Form was delivered to the Committee or
its designee.
3.4 WITHHOLDING AND CREDITING OF ANNUAL DEFERRAL AMOUNTS. For each Plan
Year, the Base Salary portion of the Annual Deferral Amount shall be
withheld from each regularly scheduled Base Salary payroll in equal
amounts, as adjusted from time to time for increases and decreases in
Base Salary. The Bonus, LTIP Amounts and/or Director Fees portion of
the Annual Deferral Amount shall be withheld at the time the Bonus,
LTIP Amounts and/or Director Fees are or otherwise would be paid to
the Participant, whether or not this occurs during the Plan Year
itself. Annual Deferral Amounts shall be credited to a Participant's
Deferral Account at the time such amounts would otherwise have been
paid to the Participant. Participants shall not be permitted to
defer LTIP Amounts unless such deferrals are authorized by the
Committee, in its discretion.
11
3.5 COMPANY CONTRIBUTION AMOUNT.
(a) For each Plan Year, an Employer may be required to credit
amounts to a Participant's Company Contribution Account in
accordance with employment or other agreements entered into
between the Participant and the Employer. Such amounts shall
be credited on the date or dates prescribed by such agreements.
(b) For each Plan Year, an Employer, in its sole discretion, may,
but is not required to, credit any amount it desires to any
Participant's Company Contribution Account under this Plan,
which amount shall be for that Participant the Company
Contribution Amount for that Plan Year. The amount so credited
to a Participant may be smaller or larger than the amount
credited to any other Participant, and the amount credited to
any Participant for a Plan Year may be zero, even though one or
more other Participants receive a Company Contribution Amount
for that Plan Year. The Company Contribution Amount described
in this Section 3.5(b), if any, shall be credited on a date or
dates to be determined by the Committee, in its sole
discretion.
3.6 COMPANY RESTORATION MATCHING AMOUNT. A Participant's Company
Restoration Matching Amount for any Plan Year shall be equal to (i)
the "match" provided in the 401(k) Plan that the Company would have
credited to the Participant on the amount of Base Salary and Bonus
deferred into this Plan for such Plan Year had such Base Salary and
Bonus deferral been contributed to the 401(k) Plan, to the extent
allowable under the limitations applicable to the 401(k) Plan,
reduced by (ii) the amount of the "match" the Company makes to the
Participant during such Plan Year under the 401(k) Plan. The amount
so credited to a Participant under this Plan shall be for that
Participant the Company Restoration Matching Amount for that Plan
Year and shall be credited to the Participant's Company Restoration
Matching Account on a date or dates to be determined by the
Committee, in its sole discretion.
3.7 SOP AMOUNT. Subject to any terms and conditions imposed by the
Committee, Participants may elect to defer, under this Plan, SOP
Stock, which amount shall be for that Participant the SOP Amount for
that Plan Year. The portion of any SOP Stock deferred shall, at the
time the SOP Stock would otherwise vest under the terms of the Jones
Lang LaSalle Incorporated Amended and Restated Stock Award and
Incentive Plan, but for the election to defer, be reflected on the
books of the Company as an unfunded, unsecured promise to deliver to
the Participant a specific number of actual shares of Stock in the
future. The Company shall, however, transfer Stock in the amount of
the SOP Amount for that Plan Year to the grantor trust as described
in Section 18.2.
3.8 RESTRICTED STOCK AMOUNT. Subject to any terms and conditions imposed
by the Committee, Participants may elect to defer, under the Plan,
Restricted Stock, which amount shall be for that Participant the
Restricted Stock Amount for that Plan Year. The portion of any
Restricted Stock deferred shall, at the time the Restricted Stock
would otherwise vest under the terms of the Jones Lang LaSalle
Incorporated stock incentive plan, but for the election to defer, be
reflected on the books of the Company as an unfunded, unsecured
promise to deliver to the Participant a specific number of actual
shares of Stock in the future. The Company shall, however, transfer
Stock in the amount of the Restricted Stock Amount for that Plan Year
to the grantor trust as described in Section 18.2.
12
3.9 STOCK OPTION GAIN AMOUNT. Participants shall not be permitted to
defer Stock Option Gain Amounts unless authorized by the Committee,
in its discretion. If the Committee permits deferral of Stock Option
Gain Amounts, Participants may elect to defer, under the Plan, all or
some portion of Qualifying Gains attributable to an Eligible Stock
Option exercise, which amount shall be for that Participant the Stock
Option Gain Amount for that Plan Year. Such shares of Stock would
otherwise have been delivered to the Participant, pursuant to the
Eligible Stock Option exercise, but for the Participant's election to
defer. The portion of any Qualifying Gains shall be reflected on the
books of the Company as an unfunded, unsecured promise to deliver to
the Participant a specific number of actual shares of Stock in the
future. The Company shall, however, transfer Stock in the amount of
the Qualifying Gain to the grantor trust as described in Section
18.2.
3.10 VESTING.
(a) A Participant shall at all times be 100% vested in his or her
Deferral Account, SOP Account, Restricted Stock Account and
Stock Option Gain Account.
(b) A Participant shall be vested in his or her Company
Contribution Account in accordance with the vesting schedule(s)
set forth in his or her Plan Agreement, employment agreement or
any agreement entered into between the Participant and the
Company or the Employer. If not addressed in such agreements,
a Participant shall vest in his or her Company Contribution
Account in accordance with the schedule declared by the
Committee in its sole discretion.
(c) A Participant shall be vested in his or her Company Restoration
Matching Account only to the extent that the Participant would
be vested in such amounts under the provisions of the 401(k)
Plan, as determined by the Committee in its sole discretion.
(d) Notwithstanding anything to the contrary contained in this
Section 3.10, in the event of a Change in Control, or upon a
Participant's Retirement, death while employed by an Employer,
or Disability, a Participant's Company Contribution Account and
Company Restoration Matching Account shall immediately become
100% vested (if it is not already vested in accordance with the
above vesting schedules).
(e) Notwithstanding subsection 3.10(d) above, the vesting schedule
for a Participant's Company Contribution Account and Company
Restoration Matching Account shall not be accelerated upon a
Change in Control to the extent that the Committee determines
that such acceleration would cause the deduction limitations of
Section 280G of the Code to become effective. In the event
that all of a Participant's Company Contribution Account and/or
Company Restoration Matching Account is not vested pursuant to
such a determination, the Participant may request independent
verification of the Committee's calculations with respect to
the application of Section 280G. In such case, the Committee
must provide to the Participant within ninety (90) days of such
a request an opinion from a nationally recognized accounting
firm selected by the Company (the "Accounting Firm"). The
opinion shall state the Accounting Firm's opinion that any
limitation in the vested percentage hereunder is necessary to
avoid the limits of Section 280G and contain supporting
calculations. The cost of such opinion shall be paid for by
the Company.
13
(f) Section 3.10(e) shall not prevent the acceleration of the
vesting schedule applicable to a Participant's Company
Contribution Account and/or Company Restoration Matching
Account if such Participant is entitled to a "gross-up"
payment, to eliminate the effect of the Code section 4999
excise tax, pursuant to his or her employment agreement or
other agreement entered into between such Participant and the
Company or the Employer.
3.11 CREDITING/DEBITING OF ACCOUNT BALANCES. In accordance with, and
subject to, the rules and procedures that are established from time
to time by the Committee, in its sole discretion, amounts shall be
credited or debited to a Participant's Account Balance in accordance
with the following rules:
(a) MEASUREMENT FUNDS. Subject to the restrictions found in
Section 3.11(c) below, the Participant may elect one or more of
the measurement funds selected by the Committee, in its sole
discretion, which are based on certain mutual funds (the
"Measurement Funds"), for the purpose of crediting or debiting
additional amounts to his or her Account Balance. As necessary,
the Committee may, in its sole discretion, discontinue,
substitute or add a Measurement Fund. Each such action will
take effect as of the first day of the first calendar quarter
that begins at least thirty (30) days after the day on which
the Committee gives Participants advance written notice of such
change.
(b) ELECTION OF MEASUREMENT FUNDS. Subject to the restrictions
found in Section 3.11(c) below, a Participant, in connection
with his or her initial deferral election in accordance with
Section 3.3(a) above, shall elect, on the Election Form, one or
more Measurement Fund(s) (as described in Section 3.11(a)
above) to be used to determine the amounts to be credited or
debited to his or her Account Balance. If a Participant does
not elect any of the Measurement Funds as described in the
previous sentence, the Participant's Account Balance shall
automatically be allocated into the lowest-risk Measurement
Fund, as determined by the Committee, in its sole discretion.
Subject to the restrictions found in Section 3.11(c) below, the
Participant may (but is not required to) elect, by submitting
an Election Form to the Committee that is accepted by the
Committee, to add or delete one or more Measurement Fund(s) to
be used to determine the amounts to be credited or debited to
his or her Account Balance, or to change the portion of his or
her Account Balance allocated to each previously or newly
elected Measurement Fund. If an election is made in accordance
with the previous sentence, it shall apply as of the first
business day deemed reasonably practicable by the Committee, in
its sole discretion, and shall continue thereafter for each
subsequent day in which the Participant participates in the
Plan, unless changed in accordance with the previous sentence
(c) JONES LANG LASALLE STOCK UNIT FUND.
(i) JONES LANG LASALLE STOCK UNIT FUND. A Participant's SOP
Account, Restricted Stock Account and Stock Option Gain
Account will be automatically and irrevocably allocated
to the Jones Lang LaSalle Stock Unit Fund Measurement
Fund. Participants may not select any other Measurement
Fund to be used to determine the amounts to be credited
or debited to their SOP Account, Restricted Stock Account
or Stock Option Gain Account. Furthermore, no other
portion of the Participant's Account Balance can be
either initially allocated or re-allocated to the Jones
Lang LaSalle Stock Unit Fund.
14
(ii) Any stock dividends, cash dividends or other non-cash
dividends that would have been payable on the Stock
credited to a Participant's Account Balance shall be
credited to the Participant's Account Balance in the form
of additional shares of Stock and shall automatically and
irrevocably be deemed to be re-invested in the Jones Lang
LaSalle Stock Unit Fund until such amounts are
distributed to the Participant. The number of shares
credited to the Participant for a particular stock
dividend shall be equal to (a) the number of shares of
Stock credited to the Participant's Account Balance as of
the payment date for such dividend in respect of each
share of Stock, multiplied by (b) the number of
additional shares of Stock actually paid as a dividend in
respect of each share of Stock. The number of shares
credited to the Participant for a particular cash
dividend or other non-cash dividend shall be equal to (a)
the number of shares of Stock credited to the
Participant's Account Balance as of the payment date for
such dividend in respect of each share of Stock,
multiplied by (b) the fair market value of the dividend,
divided by (c) the fair market value of the Stock on the
payment date for such dividend.
(iii) The number of shares of Stock credited to the
Participant's Account Balance may be adjusted by the
Committee, in its sole discretion, to prevent dilution or
enlargement of Participants' rights with respect to the
portion of his or her Account Balance allocated to the
Jones Lang LaSalle Stock Unit Fund in the event of any
reorganization, reclassification, stock split, or other
unusual corporate transaction or event which affects the
value of the Stock, provided that any such adjustment
shall be made taking into account any crediting of shares
of Stock to the Participant under Section 3.11.
(iv) For purposes of this Section 3.11(c), the fair market
value of the Stock shall be determined by the Committee
in its sole discretion.
(d) PROPORTIONATE ALLOCATION. In making any election described in
Section 3.11(b) above, the Participant shall specify on the
Election Form, in increments of one percent (1%), the
percentage of his or her Account Balance to be allocated to a
Measurement Fund (as if the Participant was making an
investment in that Measurement Fund with that portion of his or
her Account Balance).
(e) CREDITING OR DEBITING METHOD. The performance of each
Measurement Fund (either positive or negative) will be
determined by the Committee, in its sole discretion on a daily
basis based on the manner in which such Participant's Account
Balance has been hypothetically allocated among the Measurement
Funds by the Participant.
(f) NO ACTUAL INVESTMENT. Notwithstanding any other provision of
this Plan that may be interpreted to the contrary, the
Measurement Funds are to be used for measurement purposes only,
and a Participant's election of any such Measurement Fund, the
allocation of his or her Account Balance thereto, the
calculation of additional amounts and the crediting or debiting
of such amounts to a Participant's Account Balance SHALL NOT be
considered or construed in any manner as an actual investment
of his or her Account Balance in any such Measurement Fund. In
the event that the Company or the Trustee (as that term is
defined in the Trust), in its own discretion, decides to invest
15
funds in any or all of the investments on which the Measurement
Funds are based, no Participant shall have any rights in or to
such investments themselves. Without limiting the foregoing, a
Participant's Account Balance shall at all times be a
bookkeeping entry only and shall not represent any investment
made on his or her behalf by the Company or the Trust; the
Participant shall at all times remain an unsecured creditor of
the Company.
3.12 FICA AND OTHER TAXES.
(a) ANNUAL DEFERRAL AMOUNTS. For each Plan Year in which an Annual
Deferral Amount is being withheld from a Participant, the
Participant's Employer(s) shall withhold from that portion of
the Participant's Base Salary, Bonus and LTIP Amounts that are
not being deferred, in a manner determined by the Employer(s),
the Participant's share of FICA and other employment taxes on
such Annual Deferral Amount. If necessary, the Committee may
reduce the Annual Deferral Amount in order to comply with this
Section 3.12.
(b) COMPANY RESTORATION MATCHING ACCOUNT AND COMPANY CONTRIBUTION
ACCOUNT. When a Participant becomes vested in a portion of his
or her Company Restoration Matching Account or Company
Contribution Account, the Participant's Employer(s) shall
withhold from the Participant's Base Salary, Bonus and/or LTIP
Amounts that are not deferred, in a manner determined by the
Employer(s), the Participant's share of FICA and other
employment taxes. If necessary, the Committee may reduce the
vested portion of the Participant's Company Restoration
Matching Account or Company Contribution Account, as
applicable, in order to comply with this Section 3.12.
(c) SOP AMOUNTS, RESTRICTED STOCK AMOUNTS AND STOCK OPTION GAIN
AMOUNTS. For each Plan Year in which an SOP Amount, Restricted
Stock Amount or Stock Option Gain Amount is being first
withheld from a Participant, the Participant's Employer(s)
shall withhold from that portion of the Participant's Base
Salary, Bonus, LTIP Amounts, SOP Stock, Restricted Stock and
Qualifying Gains that are not being deferred, in a manner
determined by the Employer(s), the Participant's share of FICA
and other employment taxes on such SOP Amount, Stock Option
Gain Amount or Restricted Stock Amount. If necessary, the
Committee may reduce the SOP Amount, Stock Option Gain Amount
or the Restricted Stock Amount in order to comply with this
Section 3.12.
(d) DISTRIBUTIONS. The Participant's Employer(s), or the trustee
of the Trust, shall withhold from any payments made to a
Participant under this Plan all federal, state and local
income, employment and other taxes required to be withheld by
the Employer(s), or the trustee of the Trust, in connection
with such payments, in amounts and in a manner to be determined
in the sole discretion of the Employer(s) and the trustee of
the Trust. If necessary, the Committee may reduce the SOP
Amount, Stock Option Gain Amount or the Restricted Stock Amount
in order to comply with this Section 3.12.
16
ARTICLE 4
DEDUCTION LIMITATION
--------------------
4.1 DEDUCTION LIMITATION ON BENEFIT PAYMENTS. If the Company determines
in good faith prior to a Change in Control that there is a reasonable
likelihood that any compensation paid to a Participant for a taxable
year of an Employer would not be deductible by the Employer solely by
reason of the limitation under Code Section 162(m), then to the
extent deemed necessary by the Company to ensure that the entire
amount of any distribution to the Participant pursuant to this Plan
prior to the Change in Control is deductible, the Company may defer
all or any portion of a distribution under this Plan. Any amounts
deferred pursuant to this limitation shall continue to be
credited/debited with additional amounts in accordance with Section
3.11 above, even if such amount is being paid out in installments.
The amounts so deferred and amounts credited thereon shall be
distributed to the Participant or his or her Beneficiary (in the
event of the Participant's death) at the earliest possible date, as
determined by the Company in good faith, on which the deductibility
of compensation paid or payable to the Participant for the taxable
year of the Employer during which the distribution is made will not
be limited by Section 162(m), or if earlier, the effective date of a
Change in Control. Notwithstanding anything to the contrary in this
Plan, the Deduction Limitation shall not apply to any distributions
made after a Change in Control.
ARTICLE 5
IN-SERVICE DISTRIBUTION; UNFORESEEABLE FINANCIAL EMERGENCIES
------------------------------------------------------------
5.1 IN-SERVICE DISTRIBUTION. In connection with each election to defer
an Annual Deferral Amount, a Participant may irrevocably elect to
receive an In-Service Distribution from the Plan with respect to all
or a portion of (i) the Annual Deferral Amount, (ii) the Company
Contribution Amount, and (iii) the Company Restoration Matching
Amount. The In-Service Distribution shall be a lump sum payment in
an amount that is equal to the portion of the Annual Deferral Amount,
the vested portion of the Company Contribution Amount and the vested
portion of the Company Restoration Matching Amount that the
Participant elected to have distributed as an In-Service
Distribution, plus amounts credited or debited in the manner provided
in Section 3.11 above on that amount, calculated as of the close of
business on or around the date on which the In-Service Distribution
becomes payable, as determined by the Committee in its sole
discretion. Subject to the other terms and conditions of this Plan,
each In-Service Distribution elected shall be paid out during a sixty
(60) day period commencing immediately after the first day of any
Plan Year designated by the Participant. The Plan Year designated by
the Participant must be at least three Plan Years after the end of
the Plan Year in which the Annual Deferral Amount is actually
deferred, or the vested portion of the Company Contribution Amount or
Company Restoration Matching Amount is actually contributed. By way
of example, if an In-Service Distribution is elected for Annual
Deferral Amounts that are deferred in the Plan Year commencing
January 1, 2004, the In-Service Distribution would become payable
during a sixty (60) day period commencing January 1, 2008.
Notwithstanding the language set forth above, the Committee shall, in
its sole discretion, adjust the amount distributable as an In-Service
Distribution if any portion of the Company Contribution Amount or
Company Restoration Matching Amount is unvested on the In-Service
Distribution Date.
17
5.2 OTHER BENEFITS TAKE PRECEDENCE OVER IN-SERVICE DISTRIBUTIONS. Should
an event occur that triggers a benefit under Article 6, 7, 8, 9 or
10, any Annual Deferral Amount, Company Contribution Amount, and/or
Company Restoration Matching Amount, plus amounts credited or debited
thereon, that are subject to an In-Service Distribution election
under Section 5.1 shall not be paid in accordance with Section 5.1
but shall be paid in accordance with the other applicable Article.
5.3 WITHDRAWAL PAYOUT/SUSPENSIONS FOR UNFORESEEABLE FINANCIAL
EMERGENCIES.
(a) If the Participant experiences an Unforeseeable Financial
Emergency, the Participant may petition the Committee to
suspend deferrals of Base Salary, Bonus, Director Fees, LTIP
Amounts, SOP Stock, Restricted Stock and Qualifying Gains
required to be made by such Participant, to the extent deemed
necessary by the Committee to satisfy the Unforeseeable
Financial Emergency. If suspension of deferrals is not
sufficient to satisfy the Participant's Unforeseeable Financial
Emergency, the Participant may further petition the Committee
to receive a partial or full payout from the Plan. The
Participant shall only receive a payout from the Plan to the
extent such payout is deemed necessary by the Committee to
satisfy the Participant's Unforeseeable Financial Emergency.
(b) The payout shall not exceed the lesser of (i) the Participant's
vested Account Balance, excluding the portion of the Account
Balance attributable to the SOP Account, Restricted Stock
Account and the Stock Option Gain Account, calculated as of the
close of business on or around the date on which the amount
becomes payable, as determined by the Committee in its sole
discretion, or (ii) the amount reasonably needed to satisfy the
Unforeseeable Financial Emergency. Notwithstanding the
foregoing, a Participant may not receive a payout from the Plan
to the extent that the Unforeseeable Financial Emergency is or
may be relieved (A) through reimbursement or compensation by
insurance or otherwise, (B) by liquidation of the Participant's
assets, to the extent the liquidation of such assets would not
itself cause severe financial hardship or (C) by suspension of
deferrals under this Plan.
(c) If the Committee, in its sole discretion, approves a
Participant's petition for suspension, the Participant's
deferrals under this Plan shall be suspended as of the date of
such approval. If the Committee, in its sole discretion,
approves a Participant's petition for suspension and payout,
the Participant's deferrals under this Plan shall be suspended
as of the date of such approval and the Participant shall
receive a payout from the Plan as soon as administratively
feasible, but not later than sixty (60) days after the date of
such approval.
ARTICLE 6
CHANGE IN CONTROL BENEFIT
-------------------------
6.1 CHANGE IN CONTROL BENEFIT. The Participant will receive a Change in
Control Benefit, which shall be equal to the Participant's vested
Account Balance, calculated as of the close of business on or around
the date of the Change in Control, as selected by the Committee in
its sole discretion, if (i) the Participant has elected to receive a
Change in Control Benefit, as set forth in Section 6.2 below, and
(ii) if a Change in Control occurs prior to the Participant's
Termination of Employment, Retirement, death or Disability.
18
6.2 PAYMENT OF CHANGE IN CONTROL BENEFIT. A Participant, in connection
with his or her commencement of participation in the Plan, shall
irrevocably elect on an Election Form whether to (i) receive a Change
in Control Benefit, or (ii) have his or her Account Balance remain in
the Plan upon the occurrence of a Change in Control and to have his
or her Account Balance remain subject to the terms and conditions of
the Plan. If a Participant does not make any election with respect
to the payment of the Change in Control Benefit, then such
Participant's Account Balance shall remain in the Plan upon a Change
in Control and shall be subject to the terms and conditions of the
Plan. The Change in Control Benefit, if any, shall be paid to the
Participant in a lump sum no later than sixty (60) days after a
Change in Control.
ARTICLE 7
RETIREMENT BENEFIT
------------------
7.1 RETIREMENT BENEFIT. A Participant who Retires shall receive, as a
Retirement Benefit, his or her vested Account Balance, calculated as
of the close of business on or around the date on which the
Participant Retires, as determined by the Committee in its sole
discretion.
7.2 PAYMENT OF RETIREMENT BENEFIT. A Participant, in connection with his
or her commencement of participation in the Plan, shall irrevocably
elect on an Election Form to receive the Retirement Benefit in a lump
sum or pursuant to an Annual Installment Method of up to 15 years.
If a Participant does not make any election with respect to the
payment of the Retirement Benefit, then such benefit shall be payable
in a lump sum. The lump sum payment shall be made, or installment
payments shall commence, no later than sixty (60) days after the date
on which the Participant Retires. Remaining installments, if any,
shall be paid no later than sixty (60) days after each anniversary of
the date on which the Participant Retires.
ARTICLE 8
TERMINATION BENEFIT
-------------------
8.1 TERMINATION BENEFIT. A Participant who experiences a Termination of
Employment shall receive a Termination Benefit, which shall be equal
to the Participant's vested Account Balance, calculated as of the
close of business on or around the date on which the Participant
experiences a Termination of Employment, as determined by the
Committee in its sole discretion
8.2 PAYMENT OF TERMINATION BENEFIT. The Termination Benefit shall be
paid to the Participant in a lump sum payment no later than sixty
(60) days after the date on which the Participant experiences the
Termination of Employment.
19
ARTICLE 9
DISABILITY WAIVER AND BENEFIT
-----------------------------
9.1 DISABILITY WAIVER.
(a) WAIVER OF DEFERRAL. A Participant who is suffering from a
Disability shall continue to be eligible for the benefits
provided in Articles 5, 6, 7, 8, 9 or 10 in accordance with the
provisions of those Articles, and any previously elected
deferrals of SOP Stock, Restricted Stock and Qualifying Gains
shall continue to be withheld during such Disability in
accordance with Section 3.3. However, such Disabled
Participant shall be excused from fulfilling his or her Annual
Deferral Amount commitment that would otherwise have been
withheld during the remainder of the Plan Year in which the
Participant first suffers the Disability. During the period of
Disability, the Participant shall not be allowed to make any
additional deferral elections.
(b) DEFERRAL FOLLOWING DISABILITY. If a Participant returns to
employment, or service as a Director, with an Employer after a
Disability ceases, the Participant may elect to defer an Annual
Deferral Amount, SOP Amount, Restricted Stock Amount and Stock
Option Gain Amount for the Plan Year following his or her
return to employment or service and for every Plan Year
thereafter while a Participant in the Plan; provided such
deferral elections are otherwise allowed and an Election Form
is delivered to and accepted by the Committee for each such
election in accordance with Section 3.3 above.
9.2 CONTINUED ELIGIBILITY; DISABILITY BENEFIT.
(a) CONTINUED ELIGIBILITY. A Participant suffering a Disability
shall, for benefit purposes under this Plan, continue to be
considered to be employed, or in the service of an Employer as
a Director, and shall be eligible for the benefits provided for
in Articles 5, 6, 7, 8 or 10 in accordance with the provisions
of those Articles. Notwithstanding the above, the Committee
shall have the right to, in its sole and absolute discretion
and for purposes of this Plan only, deem the Participant's
employment to have terminated at any time after such
Participant is determined to be suffering a Disability.
(b) DEEMED TERMINATION OF EMPLOYMENT. If, in the Committee's
discretion, the Disabled Participant's employment has
terminated, and such Participant is not otherwise eligible to
Retire, the Participant shall be deemed to have experienced a
Termination of Employment for purposes of this Plan and will
receive a Disability Benefit. The Disability Benefit shall be
equal to his or her vested Account Balance, calculated as of
the close of business on or around the date on which the
Disabled Participant is deemed to have experienced a
Termination of Employment, as determined by the Committee in
its sole discretion. The Participant shall receive his or her
Disability Benefit in a lump sum payment no later than sixty
(60) days after the date on which the Committee deems the
Disabled Participant to have experienced a Termination of
Employment.
20
(c) DEEMED RETIREMENT. If, in the Committee's discretion, the
Disabled Participant's employment has terminated, and such
Participant is otherwise eligible to Retire, the Participant
shall be deemed to have Retired for purposes of this Plan and
will receive a Disability Benefit. The Disability Benefit
shall be equal to his or her vested Account Balance, calculated
as of the close of business on or around the date on which the
Participant is deemed to have Retired, as determined by the
Committee in its sole discretion. The Participant shall
receive his or her Disability Benefit in the same form in which
such Participant elected to receive his or her Retirement
Benefit. The lump sum payment shall be made, or installment
payments shall commence, no later than sixty (60) days after
the date on which the Disabled Participant is deemed to have
Retired. Remaining installments, if any, shall be paid no
later than sixty (60) days after each anniversary of the date
on which the Disabled Participant is deemed to have Retired.
ARTICLE 10
SURVIVOR BENEFIT
----------------
10.1 SURVIVOR BENEFIT. The Participant's Beneficiary(ies) shall receive a
Survivor Benefit upon the Participant's death which will be equal to
the Participant's vested Account Balance, calculated as of the close
of business on or around the date of the Participant's death, as
selected by the Committee in its sole discretion, if the Participant
dies prior to (i) his or her Retirement, Termination of Employment or
Disability, or (ii) the complete distribution of his or her
Retirement Benefit or Disability Benefit, calculated as of the close
of business on or around the date of the Participant's death, as
selected by the Committee in its sole discretion.
10.2 PAYMENT OF SURVIVOR BENEFIT. The Survivor Benefit shall be paid to
the Participant's Beneficiary(ies) in a lump sum payment no later
than sixty (60) days after the date on which the Committee is
provided with proof that is satisfactory to the Committee of the
Participant's death.
ARTICLE 11
BENEFICIARY DESIGNATION
-----------------------
11.1 BENEFICIARY. Each Participant shall have the right, at any time, to
designate his or her Beneficiary(ies) (both primary as well as
contingent) to receive any benefits payable under the Plan upon the
death of a Participant. The Beneficiary designated under this Plan
may be the same as or different from the Beneficiary designation
under any other plan of an Employer in which the Participant
participates.
11.2 BENEFICIARY DESIGNATION; CHANGE OF BENEFICIARY DESIGNATION. A
Participant shall designate his or her Beneficiary by completing and
signing the Beneficiary Designation Form, and returning it to the
Committee or its designated agent. A Participant shall have the
right to change a Beneficiary by completing, signing and otherwise
complying with the terms of the Beneficiary Designation Form and the
Committee's rules and procedures, as in effect from time to time.
Upon the acceptance by the Committee of a new Beneficiary Designation
Form, all Beneficiary designations previously filed shall be
canceled. The Committee shall be entitled to rely on the last
Beneficiary Designation Form filed by the Participant and accepted by
the Committee prior to his or her death.
21
11.3 ACKNOWLEDGMENT. No designation or change in designation of a
Beneficiary shall be effective until received and acknowledged in
writing by the Committee or its designated agent.
11.4 NO BENEFICIARY DESIGNATION. If a Participant fails to designate a
Beneficiary as provided in Sections 11.1, 11.2 and 11.3 above or, if
all designated Beneficiaries predecease the Participant or die prior
to complete distribution of the Participant's benefits, then the
Participant's designated Beneficiary shall be deemed to be his or her
surviving spouse. If the Participant has no surviving spouse, the
benefits remaining under the Plan to be paid to a Beneficiary shall
be payable to the executor or personal representative of the
Participant's estate.
11.5 DOUBT AS TO BENEFICIARY. If the Committee has any doubt as to the
proper Beneficiary to receive payments pursuant to this Plan, the
Committee shall have the right, exercisable in its discretion, to
cause the Participant's Employer to withhold such payments until this
matter is resolved to the Committee's satisfaction.
11.6 DISCHARGE OF OBLIGATIONS. The payment of benefits under the Plan to
a Beneficiary shall fully and completely discharge all Employers and
the Committee from all further obligations under this Plan with
respect to the Participant, and that Participant's Plan Agreement
shall terminate upon such full payment of benefits.
ARTICLE 12
LEAVE OF ABSENCE
----------------
12.1 PAID LEAVE OF ABSENCE. If a Participant is authorized by the
Participant's Employer to take a paid leave of absence from the
employment of the Employer, (i) the Participant shall continue to be
considered eligible for the benefits provided in Articles 5, 6, 7, 8,
9 or 10 in accordance with the provisions of those Articles, and (ii)
the Annual Deferral Amount and any previously elected deferrals of
SOP Stock, Restricted Stock and Qualifying Gains shall continue to be
withheld during such paid leave of absence in accordance with
Section 3.3.
12.2 UNPAID LEAVE OF ABSENCE. If a Participant is authorized by the
Participant's Employer to take an unpaid leave of absence from the
employment of the Employer for any reason, such Participant shall
continue to be eligible for the benefits provided in Articles 5, 6,
7, 8, 9 or 10 in accordance with the provisions of those Articles,
and any previously elected deferrals of SOP Stock, Restricted Stock
and Qualifying Gains shall continue to be withheld during such unpaid
leave of absence in accordance with Section 3.3. However, the
Participant shall be excused from fulfilling his or her Annual
Deferral Amount commitment that would otherwise have been withheld
during the remainder of the Plan Year in which the unpaid leave of
absence is taken. During the unpaid leave of absence, the
Participant shall not be allowed to make any additional deferral
elections. However, if the Participant returns to employment, the
Participant may elect to defer an Annual Deferral Amount, SOP Amount,
Restricted Stock Amount and Stock Option Gain Amount for the Plan
Year following his or her return to employment and for every Plan
Year thereafter while a Participant in the Plan; provided such
deferral elections are otherwise allowed and an Election Form is
delivered to and accepted by the Committee for each such election in
accordance with Section 3.3 above.
22
ARTICLE 13
TERMINATION, AMENDMENT OR MODIFICATION
--------------------------------------
13.1 TERMINATION. Although the Company anticipates that it will continue
the Plan for an indefinite period of time, there is no guarantee that
it Employer will continue the Plan or will not terminate the Plan at
any time in the future. Accordingly, the Company reserves the right
to discontinue its sponsorship of the Plan and/or to terminate the
Plan at any time with respect to any or all of the participating
Employees and Directors, by action of the Board. Upon the
termination of the Plan with respect to any Employer, the Plan
Agreements of the affected Participants who are employed by that
Employer, or in the service of that Employer as Directors, shall
terminate and their vested Account Balances shall be determined (i)
as if they had experienced a Termination of Employment on the date of
Plan termination; or (ii) if Plan termination occurs after the date
upon which a Participant was eligible to Retire, then with respect to
that Participant as if he or she had Retired on the date of Plan
termination. Such benefits shall be paid to the Participants as
follows: (i) prior to a Change in Control, if the Plan is terminated
with respect to all of its Participants, the Company shall have the
right, in its sole discretion, and notwithstanding any elections made
by the Participant, to pay such benefits in a lump sum or pursuant to
an Annual Installment Method of up to 15 years, with amounts credited
and debited during the installment period as provided herein; or (ii)
prior to a Change in Control, if the Plan is terminated with respect
to less than all of its Participants, the Company shall be required
to pay such benefits in a lump sum; or (iii) after a Change in
Control, if the Plan is terminated with respect to some or all of its
Participants, the Company shall be required to pay such benefits in a
lump sum. In the event clause (i) of the preceding sentence applies
and a Participant's distribution election would provide for a
complete distribution at an earlier date than would otherwise be
provided pursuant to clause (i), such Participant's distribution
election shall apply and supercede clause (i). The termination of
the Plan shall not adversely affect any Participant or Beneficiary
who has become entitled to the payment of any benefits under the Plan
as of the date of termination; provided however, that the Employer
shall have the right to accelerate installment payments without a
premium or prepayment penalty by paying the vested Account Balance in
a lump sum or pursuant to an Annual Installment Method using fewer
years (provided that the present value of all payments that will have
been received by a Participant at any given point of time under the
different payment schedule shall equal or exceed the present value of
all payments that would have been received at that point in time
under the original payment schedule).
13.2 AMENDMENT. The Company may, at any time, amend or modify the Plan in
whole or in part by the action of the Board; provided, however, that:
(i) no amendment or modification shall be effective to decrease or
restrict the value of a Participant's vested Account Balance in
existence at the time the amendment or modification is made,
calculated as if the Participant had experienced a Termination of
Employment as of the effective date of the amendment or modification
or, if the amendment or modification occurs after the date upon which
the Participant was eligible to Retire, the Participant had Retired
as of the effective date of the amendment or modification, and (ii)
no amendment or modification of this Section 13.2 or Section 14.2 of
the Plan shall be effective. The amendment or modification of the
Plan shall not affect any Participant or Beneficiary who has become
entitled to the payment of benefits under the Plan as of the date of
the amendment or modification; provided, however, that the Company
shall have the right to accelerate installment payments by paying the
23
vested Account Balance in a lump sum or pursuant to an Annual
Installment Method using fewer years (provided that the present value
of all payments that will have been received by a Participant at any
given point of time under the different payment schedule shall equal
or exceed the present value of all payments that would have been
received at that point in time under the original payment schedule).
13.3 PLAN AGREEMENT. Despite the provisions of Sections 13.1 and 13.2
above, if a Participant's Plan Agreement contains benefits or
limitations that are not in this Plan document, the Company may only
amend or terminate such provisions with the written consent of the
Participant.
13.4 EFFECT OF PAYMENT. The full payment of the Participant's vested
Account Balance under Articles 5, 6, 7, 8, 9 or 10 of the Plan shall
completely discharge all obligations to a Participant and his or her
designated Beneficiaries under this Plan and the Participant's Plan
Agreement shall terminate.
ARTICLE 14
ADMINISTRATION
--------------
14.1 COMMITTEE DUTIES. Except as otherwise provided in this Article 14,
this Plan shall be administered by the Committee, which shall consist
of the Compensation Committee of the Board, or such committee of
current employees of the Employers as the Compensation Committee
shall appoint. Members of the Committee may be Participants under
this Plan. The Committee shall also have the discretion and
authority to (i) make, amend, interpret, and enforce all appropriate
rules and regulations for the administration of this Plan and
(ii) decide or resolve any and all questions including
interpretations of this Plan, as may arise in connection with the
Plan. Any individual serving on the Committee who is a Participant
shall not vote or act on any matter relating solely to himself or
herself. When making a determination or calculation, the Committee
shall be entitled to rely on information furnished by a Participant
or the Company.
14.2 ADMINISTRATION UPON CHANGE IN CONTROL. For purposes of this Plan,
the Committee shall be the "Administrator" at all times prior to the
occurrence of a Change in Control. Within one hundred and twenty
(120) days following a Change in Control, an independent third party
"Administrator" may be selected by the individual who, immediately
prior to the Change in Control, was the Company's Chief Executive
Officer or, if not so identified, the Company's highest ranking
officer (the "Ex-CEO"), and approved by the Trustee. The Committee,
as constituted prior to the Change in Control, shall continue to be
the Administrator until the earlier of (i) the date on which such
independent third party is selected and approved, or (ii) the
expiration of the one hundred and twenty (120) day period following
the Change in Control. If an independent third party is not selected
within one hundred and twenty (120) days of such Change in Control,
the Committee, as described in Section 14.1 above, shall be the
Administrator. The Administrator shall have all of the powers of the
Committee, including the discretionary power to determine all
questions arising in connection with the administration of the Plan
and the interpretation of the Plan and Trust including, but not
limited to benefit entitlement determinations, as well as the power
to direct the investment of Plan or Trust assets or select any
investment manager or custodial firm for the Plan or Trust. Upon and
24
after the occurrence of a Change in Control, the Company must: (1)
pay all reasonable administrative expenses and fees of the
Administrator; (2) indemnify the Administrator against any costs,
expenses and liabilities including, without limitation, attorney's
fees and expenses arising in connection with the performance of the
Administrator hereunder, except with respect to matters resulting
from the gross negligence or willful misconduct of the Administrator
or its employees or agents; and (3) supply full and timely
information to the Administrator on all matters relating to the Plan,
the Trust, the Participants and their Beneficiaries, the Account
Balances of the Participants, the date and circumstances of the
Retirement, Disability, death or Termination of Employment of the
Participants, and such other pertinent information as the
Administrator may reasonably require. Upon and after a Change in
Control, the Administrator may be terminated (and a replacement
appointed) by the Trustee only with the approval of the Ex-CEO. Upon
and after a Change in Control, the Administrator may not be
terminated by the Company.
14.3 AGENTS. In the administration of this Plan, the Committee may, from
time to time, employ agents and delegate to them such administrative
duties as it sees fit (including acting through a duly appointed
representative) and may from time to time consult with counsel who
may be counsel to any Employer.
14.4 BINDING EFFECT OF DECISIONS. The decision or action of the
Administrator with respect to any question arising out of or in
connection with the administration, interpretation and application of
the Plan and the rules and regulations promulgated hereunder shall be
final and conclusive and binding upon all persons having any interest
in the Plan.
14.5 INDEMNITY OF COMMITTEE. All Employers shall indemnify and hold
harmless the members of the Committee, any Employee to whom the
duties of the Committee may be delegated, and the Administrator
against any and all claims, losses, damages, expenses or liabilities
arising from any action or failure to act with respect to this Plan,
except in the case of willful misconduct by the Committee, any of its
members, any such Employee or the Administrator.
14.6 EMPLOYER INFORMATION. To enable the Committee and/or Administrator
to perform its functions, the Company and each Employer shall supply
full and timely information to the Committee and/or Administrator, as
the case may be, on all matters relating to the compensation of its
Participants, the date and circumstances of the Retirement,
Disability, death or Termination of Employment of its Participants,
and such other pertinent information as the Committee or
Administrator may reasonably require.
ARTICLE 15
OTHER BENEFITS AND AGREEMENTS
-----------------------------
15.1 COORDINATION WITH OTHER BENEFITS. The benefits provided for a
Participant and Participant's Beneficiary under the Plan are in
addition to any other benefits available to such Participant under
any other plan or program for employees of the Participant's
Employer. The Plan shall supplement and shall not supersede, modify
or amend any other such plan or program except as may otherwise be
expressly provided.
25
ARTICLE 16
CLAIMS PROCEDURES
-----------------
16.1 PRESENTATION OF CLAIM. Any Participant or Beneficiary of a deceased
Participant (such Participant or Beneficiary being referred to below
as a "Claimant") may deliver to the Committee a written claim for a
determination with respect to the amounts distributable to such
Claimant from the Plan. If such a claim relates to the contents of a
notice received by the Claimant, the claim must be made within sixty
(60) days after such notice was received by the Claimant. All other
claims must be made within 180 days of the date on which the event
that caused the claim to arise occurred. The claim must state with
particularity the determination desired by the Claimant.
16.2 NOTIFICATION OF DECISION. The Committee shall consider a Claimant's
claim within a reasonable time, but no later than ninety (90) days
after receiving the claim. If the Committee determines that special
circumstances require an extension of time for processing the claim,
written notice of the extension shall be furnished to the Claimant
prior to the termination of the initial ninety (90) day period. In
no event shall such extension exceed a period of ninety (90) days
from the end of the initial period. The extension notice shall
indicate the special circumstances requiring an extension of time and
the date by which the Committee expects to render the benefit
determination. The Committee shall notify the Claimant in writing:
(a) that the Claimant's requested determination has been made, and
that the claim has been allowed in full; or
(b) that the Committee has reached a conclusion contrary, in whole
or in part, to the Claimant's requested determination, and such
notice must set forth in a manner calculated to be understood
by the Claimant:
(i) the specific reason(s) for the denial of the claim, or
any part of it;
(ii) specific reference(s) to pertinent provisions of the Plan
upon which such denial was 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;
(iv) an explanation of the claim review procedure set forth in
Section 16.3 below; and
(v) a statement of the Claimant's right to bring a civil
action under ERISA Section 502(a) following an adverse
benefit determination on review.
16.3 REVIEW OF A DENIED CLAIM. On or before sixty (60) days after
receiving a notice from the Committee that a claim has been denied,
in whole or in part, a Claimant (or the Claimant's duly authorized
representative) may file with the Committee a written request for a
review of the denial of the claim. The Claimant (or the Claimant's
duly authorized representative):
(a) may, upon request and free of charge, have reasonable access
to, and copies of, all documents, records and other information
relevant to the claim for benefits;
(b) may submit written comments or other documents; and/or
26
(c) may request a hearing, which the Committee, in its sole
discretion, may grant.
16.4 DECISION ON REVIEW. The Committee shall render its decision on
review promptly, and no later than sixty (60) days after the
Committee receives the Claimant's written request for a review of the
denial of the claim. If the Committee determines that special
circumstances require an extension of time for processing the claim,
written notice of the extension shall be furnished to the Claimant
prior to the termination of the initial sixty (60) day period. In no
event shall such extension exceed a period of sixty (60) days from
the end of the initial period. The extension notice shall indicate
the special circumstances requiring an extension of time and the date
by which the Committee expects to render the benefit determination.
In rendering its decision, the Committee shall take into account all
comments, documents, records and other information submitted by the
Claimant relating to the claim, without regard to whether such
information was submitted or considered in the initial benefit
determination. The decision must be written in a manner calculated
to be understood by the Claimant, and it must contain:
(a) specific reasons for the decision;
(b) specific reference(s) to the pertinent Plan provisions upon
which the decision was based;
(c) 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 (as
defined in applicable ERISA regulations) to the Claimant's
claim for benefits; and
(d) a statement of the Claimant's right to bring a civil action
under ERISA Section 502(a).
16.5 LEGAL ACTION. A Claimant's compliance with the foregoing provisions
of this Article 16 is a mandatory prerequisite to a Claimant's right
to commence any legal action with respect to any claim for benefits
under this Plan.
ARTICLE 17
TRUST
-----
17.1 ESTABLISHMENT OF THE TRUST. In order to provide assets from which to
fulfill the obligations of the Participants and their beneficiaries
under the Plan, the Company shall establish a trust by a trust
agreement with a third party, the trustee, to which each Employer
shall contribute cash or other property, including securities issued
by the Company, to provide for the benefit payments under the Plan,
(the "Trust").
17.2 INTERRELATIONSHIP OF THE PLAN AND THE TRUST. The provisions of the
Plan and the Plan Agreement shall govern the rights of a Participant
to receive distributions pursuant to the Plan. The provisions of the
Trust shall govern the rights of the Employers, Participants and the
creditors of the Employers to the assets transferred to the Trust.
Each Employer shall at all times remain liable to carry out its
obligations under the Plan.
17.3 DISTRIBUTIONS FROM THE TRUST. Each Employer's obligations under the
Plan may be satisfied with Trust assets distributed pursuant to the
terms of the Trust, and any such distribution shall reduce the
Employer's obligations under this Plan.
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ARTICLE 18
MISCELLANEOUS
-------------
18.1 STATUS OF PLAN. The Plan is intended to be a plan that is not
qualified within the meaning of Code Section 401(a) and that "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" within the meaning of ERISA Sections
201(2), 301(a)(3) and 401(a)(1). The Plan shall be administered and
interpreted to the extent possible in a manner consistent with that
intent.
18.2 UNSECURED GENERAL CREDITOR. The Company shall establish the Trust,
which shall be a grantor trust, and to which the Company may, in its
discretion, make contributions as a means to finance liabilities that
accrue under the Plan. Except as provided below in the case of a
Change in Control, the Company shall not be required to make
contributions to the Trust. As soon as practicable after a Change in
Control, the Company shall determine the amount that would be needed
to pay Participants and their Beneficiaries the benefits which they
have accrued pursuant to the terms of a Plan as of the date of the
Change in Control. This amount is referred to herein as the "Trust
Funding Requirement." In the event that the fair market value of the
Trust assets is less than the Trust Funding Requirement on such date,
the Company shall make an additional contribution to the Trust in an
amount sufficient to bring the fair market value of the assets in the
Trust up to at least 100% of the Trust Funding Requirement. The
Company shall establish the Trust Funding Requirement on a monthly
basis thereafter and make additional contributions as necessary to
bring the value of the assets in the Trust Fund up to the Trust
Funding Requirement as of the valuation date. Contributions under
this Section 18.2, if any, shall be made as soon as reasonably
practicable after the Trust Funding Requirement is established for a
valuation date. When computing the Trust Funding Requirement, the
Company may exclude the benefits attributable to any Participant if
contributions to the Trust on behalf of the Participant could cause
the Participant to incur income tax liability on account of the
contribution.
Notwithstanding the foregoing, Participants and their Beneficiaries,
heirs, successors and assigns shall remain unsecured general
creditors and shall have no legal or equitable rights, interests or
claims in any property or assets of an Employer. For purposes of the
payment of benefits under this Plan, any and all of an Employer's
assets shall be, and remain, the general, unpledged unrestricted
assets of the Employer. An Employer's obligation under the Plan
shall be merely that of an unfunded and unsecured promise to pay
money in the future.
18.3 EMPLOYER'S LIABILITY. An Employer's liability for the payment of
benefits shall be defined only by the Plan and the Plan Agreement, as
entered into between the Employer and a Participant. An Employer
shall have no obligation to a Participant under the Plan except as
expressly provided in the Plan and his or her Plan Agreement.
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18.4 NONASSIGNABILITY. Neither a Participant nor any other person shall
have any right to commute, sell, assign, transfer, pledge,
anticipate, mortgage or otherwise encumber, transfer, hypothecate,
alienate or convey in advance of actual receipt, the amounts, if any,
payable hereunder, or any part thereof, which are, and all rights to
which are expressly declared to be, unassignable and non-transfer
able. No part of the amounts payable shall, prior to actual payment,
be subject to seizure, attachment, garnishment or sequestration for
the payment of any debts, judgments, alimony or separate maintenance
owed by a Participant or any other person, be transferable by
operation of law in the event of a Participant's or any other
person's bankruptcy or insolvency or be transferable to a spouse as a
result of a property settlement or otherwise.
18.5 NOT A CONTRACT OF EMPLOYMENT. The terms and conditions of this Plan
shall not be deemed to constitute a contract of employment between
any Employer and the Participant. Such employment is hereby
acknowledged to be an "at will" employment relationship that can be
terminated at any time for any reason, or no reason, with or without
cause, and with or without notice, unless expressly provided in a
written employment agreement. Nothing in this Plan shall be deemed
to give a Participant the right to be retained in the service of any
Employer, either as an Employee or a Director, or to interfere with
the right of any Employer to discipline or discharge the Participant
at any time.
18.6 FURNISHING INFORMATION. A Participant or his or her Beneficiary will
cooperate with the Committee by furnishing any and all information
requested by the Committee and take such other actions as may be
requested in order to facilitate the administration of the Plan and
the payments of benefits hereunder, including but not limited to
taking such physical examinations as the Committee may deem
necessary.
18.7 TERMS. Whenever any words are used herein in the masculine, they
shall be construed as though they were in the feminine in all cases
where they would so apply; and whenever any words are used herein in
the singular or in the plural, they shall be construed as though they
were used in the plural or the singular, as the case may be, in all
cases where they would so apply.
18.8 CAPTIONS. The captions of the articles, sections and paragraphs of
this Plan are for convenience only and shall not control or affect
the meaning or construction of any of its provisions.
18.9 GOVERNING LAW. Subject to ERISA, the provisions of this Plan shall
be construed and interpreted according to the internal laws of the
State of Illinois without regard to its conflicts of laws principles.
18.10NOTICE. Any notice or filing required or permitted to be given to
the Committee under this Plan shall be sufficient if in writing and
hand-delivered, or sent by registered or certified mail, to both the
Chief Human Resources Officer and the Global General Counsel at the
address below:
Jones Lang LaSalle Incorporated
Attn: Chief Human Resources Officer and
Global General Counsel
200 East Randolph Drive
Chicago, IL 60601
Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the
receipt for registration or certification.
Any notice or filing required or permitted to be given to a
Participant under this Plan shall be sufficient if in writing and
hand-delivered, or sent by mail, to the last known address of the
Participant.
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18.11SUCCESSORS. The provisions of this Plan shall bind and inure to the
benefit of the Participant's Employer and its successors and assigns
and the Participant and the Participant's designated Beneficiaries.
18.12SPOUSE'S INTEREST. The interest in the benefits hereunder of a
spouse of a Participant who has predeceased the Participant shall
automatically pass to the Participant and shall not be transferable
by such spouse in any manner, including but not limited to such
spouse's will, nor shall such interest pass under the laws of
intestate succession.
18.13VALIDITY. In case any provision of this Plan shall be illegal or
invalid for any reason, said illegality or invalidity shall not
affect the remaining parts hereof, but this Plan shall be construed
and enforced as if such illegal or invalid provision had never been
inserted herein.
18.14INCOMPETENT. If the Committee determines in its discretion that a
benefit under this Plan is to be paid to a minor, a person declared
incompetent or to a person incapable of handling the disposition of
that person's property, the Committee may direct payment of such
benefit to the guardian, legal representative or person having the
care and custody of such minor, incompetent or incapable person. The
Committee may require proof of minority, incompetence, incapacity or
guardianship, as it may deem appropriate prior to distribution of the
benefit. Any payment of a benefit shall be a payment for the account
of the Participant and the Participant's Beneficiary, as the case may
be, and shall be a complete discharge of any liability under the Plan
for such payment amount.
18.15COURT ORDER. The Committee is authorized to make any payments
directed by court order in any action in which the Plan or the
Committee has been named as a party. In addition, if a court
determines that a spouse or former spouse of a Participant has an
interest in the Participant's benefits under the Plan in connection
with a property settlement or otherwise, the Committee, in its sole
discretion, shall have the right, notwithstanding any election made
by a Participant, to immediately distribute the spouse's or former
spouse's interest in the Participant's benefits under the Plan to
that spouse or former spouse.
18.16DISTRIBUTION IN THE EVENT OF TAXATION.
(a) IN GENERAL. If, for any reason, all or any portion of a
Participant's benefits under this Plan becomes taxable to the
Participant prior to receipt, a Participant may petition the
Committee before a Change in Control, or the trustee of the
Trust after a Change in Control, for a distribution of that
portion of his or her benefit that has become taxable. Upon
the grant of such a petition, which grant shall not be
unreasonably withheld (and, after a Change in Control, shall be
granted), the Company shall distribute to the Participant
immediately available funds in an amount equal to the taxable
portion of his or her benefit (which amount shall not exceed a
Participant's unpaid vested Account Balance under the Plan).
If the petition is granted, the tax liability distribution
shall be made within 90 days of the date when the Participant's
petition is granted. Such a distribution shall affect and
reduce the benefits to be paid under this Plan.
(b) TRUST. If the Trust terminates in accordance with its terms
and benefits are distributed from the Trust to a Participant in
accordance therewith, the Participant's benefits under this
Plan shall be reduced to the extent of such distributions.
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18.17INSURANCE. The Employers, on their own behalf or on behalf of the
trustee of the Trust, and, in their sole discretion, may apply for
and procure insurance on the life of the Participant, in such amounts
and in such forms as the Trust may choose. The Employers or the
trustee of the Trust, as the case may be, shall be the sole owner and
beneficiary of any such insurance. The Participant shall have no
interest whatsoever in any such policy or policies, and at the
request of the Employers shall submit to medical examinations and
supply such information and execute such documents as may be required
by the insurance company or companies to whom the Employers have
applied for insurance.
18.18LEGAL FEES TO ENFORCE RIGHTS AFTER CHANGE IN CONTROL. The Company
and each Employer is aware that upon the occurrence of a Change in
Control, the Board or the board of directors of a Participant's
Employer (which might then be composed of new members) or a
shareholder of the Company or the Participant's Employer, or of any
successor corporation might then cause or attempt to cause the
Company, the Participant's Employer or such successor to refuse to
comply with its obligations under the Plan and might cause or attempt
to cause the Company or the Participant's Employer to institute, or
may institute, litigation seeking to deny Participants the benefits
intended under the Plan. In these circumstances, the purpose of the
Plan could be frustrated. Accordingly, if, following a Change in
Control, it should appear to any Participant that the Company, the
Participant's Employer or any successor corporation has failed to
comply with any of its obligations under the Plan or any agreement
thereunder or, if the Company, such Employer or any other person
takes any action to declare the Plan void or unenforceable or
institutes any litigation or other legal action designed to deny,
diminish or to recover from any Participant the benefits intended to
be provided, then the Company and the Participant's Employer
irrevocably authorize such Participant to retain counsel of his or
her choice at the expense of the Company and the Participant's
Employer (who shall be jointly and severally liable) to represent
such Participant in connection with the initiation or defense of any
litigation or other legal action, whether by or against the Company,
the Participant's Employer or any director, officer, shareholder or
other person affiliated with the Company, the Participant's Employer
or any successor thereto in any jurisdiction.
IN WITNESS WHEREOF, the Company has signed this Plan document as of
November 1, 2003.
JONES LANG LASALLE INCORPORATED,
a Maryland corporation
By: /s/ Larry Deans
Name: Larry Deans
Title: Chief HR Officer
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