EXHIBIT 10(g)
UST CORP.
EXECUTIVE POLICY COMMITTEE PLAN
January, 1997
TABLE OF CONTENTS
ARTICLE I - NAME, PURPOSE AND EFFECTIVE DATE PAGE
1.01 Name and Purpose 1
1.02 Effective Date 1
ARTICLE II - DEFINITIONS
2.01 Accrued Benefit 2
2.02 Actuarial Equivalent 2
2.03 Board 2
2.04 Change of Control 2
2.05 Code 2
2.06 Committee 2
2.07 Compensation 2
2.08 Credited Service 2
2.09 Deferred Retirement Date 3
2.10 Early Retirement Date 3
2.11 Effective Date 3
2.12 Employee 3
2.13 Employer 3
2.14 Final Average Compensation 3
2.15 Normal Retirement Date 3
2.16 Participant 3
2.17 Plan 3
2.18 Qualified Plan 3
2.19 Qualified Plan Benefit 3
2.20 Social Security Benefit 3
2.21 Social Security Relirement Age 4
2.22 Supplemental Plan 4
2.23 Supplemental Plan Benefit 4
ARTICLE III - NORMAL AND DEFERRED RETIREMENT BENEFITS
3.01 Benefit Upon Normal Retirement 5
3.02 Benefit Upon Deferred Retirement 5
ARTICLE IV - EARLY RETIREMENT BENEFITS
4.01 Benefit Upon Early Retirement 6
4.02 Amount of Early Retirement Benefit 6
4.03 Commencement Date 6
ARTICLE V - DEATH BENEFITS
5.01 Death of a Participant Prior to Commencement Date 7
5.02 Death of a Participant After Commencement Date 7
ARTICLE VI - DISABILITY
6.01 Disability Defined 8
6.02 Disability Benefits 8
ARTICLE VII - FORM OF PAYMENT
7.01 Unmarried Participants 9
7.02 Married Participants 9
ARTICLE VIII - FUNDING
8.01 Funding 10
ARTICLE IX - ADMINISTRATION
9.01 Duties of the Committee 11
9.02 Finality of Decisions 11
9.03 Expenses of Administration 11
ARTICLE X - MISCELLANEOUS
10.01 Non-Guarantee of Employment 12
10.02 Rights under Plan 12
10.03 Amendments/Termination 12
10.04 Nonassignability 12
10.05 Claims Procedure 12
10.06 Entire Agreement: Successors 13
10.07 Change of Control 13
10.08 Successor Employer 13
10.09 Forfeiture 13
10.10 Governing Law 14
ARTICLE I
NAME, PURPOSE AND EFFECTIVE DATE
1.01 NAME AND PURPOSE
The plan set forth herein shall be known as the UST Corp. Executive Policy
Committee Plan (the "Plan"). The Plan, which is unfunded, was established,
and shall be maintained, solely for the purpose of providing deferred
compensation to a select group of management or highly compensated
employees within the meaning of Sections 201(2), 301(a), and 401(a)(1) of
the Employee Retirement Income Security Act of 1974, as amended, and shall
be administered in a manner consistent with that intent. The plan is
sponsored by UST Corp.
1.02 EFFECTIVE DATE
The Plan's effective date is January 1, 1997. This Plan shall apply to
Participants who retire or whose employment with the Employer terminates on
or after January 1, 1997.
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ARTICLE II
DEFINITIONS
When used herein, the following terms shall have the following meanings unless a
different meaning is clearly required by the context of the Plan:
2.01 "Accrued Benefit" shall mean a monthly benefit payable in the normal
form of annuity commencing on the Participant's Normal Retirement
Date, or Deferred Retirement Date if applicable, which is equal to an
amount calculated in accordance with Section 3.01.
2.02 "Actuarial Equivalent" means a benefit of equivalent actuarial value,
using the actuarial assumptions set forth in the Qualified Plan.
2.03 "Board" or "Board of Directors" means the Board of Directors of UST
Corp.
2.04 "Change of Control" shall mean a Change of Control as that term is
defined in the Employer's Stock Compensation Plan.
2.05 "Code" means the Internal Revenue Code of 1986, as amended.
2.06 "Committee" means the committee designated by the Board of Directors
to administer the Plan.
2.07 "Compensation," with respect to any calendar year in which the
Participant earns Credited Service, shall mean the Participant's base
pay, bonuses and commissions. For purposes of determining compensation
for a calendar year, payments made under a bonus plan shall be
attributed to the year earned. Compensation shall not include:
(a) amounts payable under any long-term incentive plan,
(b) insurance premiums or benefits,
(c) relocation expenses, or
(d) special contractual agreements not deemed to be part of a
Participant's usual compensation.
2.08 "Credited Service" shall mean the Participant's period of employment
with the Employer, measured in years and months. One month of Credited
Service is earned in each calendar month that the Participant is
employed for one or more days.
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2.09 "Deferred Retirement Date" shall mean a Participant's actual retirement
date, if the Participant remains in active service after his Normal
Retirement Date.
2.10 "Early Retirement Date" shall mean the date on which a Participant
retires from the employ of the Employer, if such date is before the
date the Participant reaches Normal Retirement Date yet after the date
the Participant has attained age 55 and has completed 5 years of
Credited Service.
2.11 "Effective Date" of the Plan shall be January 1, 1997.
2.12 "Employee" means any person employed by the Employer.
2.13 "Employer" means UST Corp. and any subsidiary and/or affiliated
corporation which has adopted this Plan.
2.14 "Final Average Compensation" shall mean Compensation averaged over the
5 consecutive calendar years within the last 10 years of Credited
Service immediately preceding his termination date which produce the
highest such average. If an Employee has Compensation in fewer than 5
complete consecutive calendar years, Compensation shall be averaged
over the total number of complete consecutive calendar years, unless
using a partial calendar year as a complete calendar year would
increase the average.
2.15 "Normal Retirement Date" shall mean the first day of the month
coincident with or next following the date a Participant has attained
age 62 and completed 5 years of Credited Service.
2.16 "Participant" means any Employee or former Employee who is a member of
the Executive Policy Committee, excluding Domenic Colassaco.
2.17 "Plan" means the UST Corp. Executive Policy Committee Plan.
2.18 "Qualified Plan" means the UST Corp. Pension Plan.
2.19 "Qualified Plan Benefit" shall mean the annual amount of pension
benefit under the Qualified Plan assuming:
(a) payments commence on the first of the month coincident with or
next following actual retirement under this Plan and
(b) payments are in the form of a single life annuity.
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2.20 "Social Security Benefit" shall mean the annual Primary Insurance
Amount, which reflects any reduction for commencement prior to a
Participant's Social Security Retirement Age or any delayed retirement
credit for commencement after his Social Security Retirement Age, as
determined under the Social Security Act in effect on the January 1
preceding the date benefits commence (or such other date specified by
the Plan), and based upon the following assumptions:
(a) the Participant had no earnings during the calendar year which
includes the date his employment with the Employer terminates,
or in any subsequent calendar year;
(b) the Participant's earnings in each prior year are equal to the
maximum amount of wages subject to old age survivor and
disability insurance tax under the Federal Insurance Act;
(c) benefits commence on the first of the month coincident with or
next following actual retirement date; and
(d) if the Participant's benefit commencement date precedes the
Participant's Social Security Retirement Age, the Social
Security Benefit otherwise payable at Social Security
Retirement Age shall be reduced by
(i) 5/9ths of 1% for each of the first 36 months that
benefit commencement precedes Social Security
Retirement Age plus
(ii) 5/12ths of 1% for each month in excess of 36 months
that benefit commencement precedes Social Security
Retirement Age.
2.21 "Social Security Retirement Age" means the earliest age at which
unreduced benefits are payable from the Social Security Administration.
2.22 "Supplemental Plan" means the UST Corp. Supplemental Retirement
Benefits Plan.
2.23 "Supplemental Plan Benefit" means the benefit payable under the UST
Corp. Supplemental Retirement Benefits Plan, assuming
(a) payments commence on the first of the month coincident with or
next following actual retirement under this Plan and
(b) payments are in the form of a single life annuity.
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ARTICLE III
NORMAL AND DEFERRED RETIREMENT BENEFITS
3.01 BENEFIT UPON NORMAL RETIREMENT
Upon reaching Normal Retirement Date, a Participant may retire from the
employ of the Employer and shall be entitled to receive a lifetime
monthly "Normal Retirement Benefit" (also referred to as the Accrued
Benefit) commencing on his Normal Retirement Date. The Participant's
monthly Normal Retirement Benefit shall be equal to one-twelfth of the
"Target Benefit" reduced by the sum of:
(a) his Qualified Plan Benefit; plus
(b) his Supplemental Plan Benefit; plus
(c) his Social Security Benefit.
Changes to a Participant's Qualified Plan Benefit, Supplemental Plan
Benefit, or Social Security Benefit which occur after the date of the
Participant's termination of employment shall not be reflected in the
determination of benefits payable from this Plan.
The "Target Benefit" is equal to 50% of his Final Average Compensation
multiplied by the ratio (not to exceed 1.0) of the Participant's
Credited Service divided by 20.
3.02 BENEFIT UPON DEFERRED RETIRIEMENT
Upon retiring on a Deferred Retirement Date, a Participant shall be
entitled to receive a benefit commencing on the first day of the month
coincident with or next following the Participant's Deferred Retirement
Date and continuing monthly for the lifetime of the Participant. The
amount of such benefit shall be equal to the amount otherwise payable
under Section 3.01 based on the Participant's Final Average
Compensation, Credited Service, Qualified Plan Benefit, Supplemental
Plan Benefit, and Social Security Benefit determined as of the
Participant's Deferred Retirement Date.
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ARTICLE IV
EARLY RETIREMENT BENEFITS
4.01 BENEFIT UPON EARLY RETIREMENT
If a Participant terminates employment on or after his Early Retirement
Date, but prior to his Normal Retirement Date, and any of conditions
(a), (b) or (c) immediately below apply, he shall be entitled to a
lifetime monthly "Early Retirement Benefit" as described in Section
4.02 below:
(a) his termination of employment was involuntary,
(b) his retirement was requested by the Board, or
(c) his retirement has the consent of the Board.
4.02 AMOUNT OF EARLY RETIREMENT BENEFIT
The amount of the Participant's Early Retirement Benefit shall be equal
to the Target Benefit, as determined in accordance with the provisions
of Section 3.01; multiplied by the fraction shown below to reflect the
early commencement of benefits; and reduced by the sum of the Qualified
Plan Benefit, Supplemental Plan Benefit, and Social Security Benefit.
AGE AT RETIREMENT FACTOR
62 100%
61 95%
60 9o%
59 85%
58 80%
57 75%
56 70%
55 65%
(interpolated on a straight line basis for fractional ages)
4.03 COMMENCEMENT DATE
The Participant's Early Retirement Benefit shall commence on the first
day of the month coincident with or next following the Participant's
Early Retirement Date.
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ARTICLE V
DEATH BENEFITS
5.01 DEATH OF PARTICIPANT PRIOR TO COMMENCEMENT OF BENEFITS
If a Participant who has been married for at least one year dies after
completing 5 years of Credited Service, but prior to the date his
benefits under this Plan commence, his Surviving Spouse shall be
eligible to receive a monthly lifetime benefit commencing on the first
day of the month following the later of the Participant's 55th birthday
and the Participant's death. The benefit payable to his Surviving
Spouse shall be equal to 50% of the benefit the Participant accrued
based upon his Target Benefit, Qualified Plan Benefit, Supplemental
Plan Benefit, and Social Security Benefit determined as of the date of
his death. The Target Benefit shall be reduced for early commencement
(based upon the Participant's age at commencement) in accordance with
the factors set forth in Section 4.02.
5.02 DEATH OF PARTICIPANT AFTER COMMENCEMENT OF BENEFITS
If a Participant dies after the commencement of his benefits under this
Plan, no death benefit will be payable hereunder except as otherwise
provided under the form of annuity payment in effect on the date of
death.
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ARTICLE VI
DISABILITY
6.01 DISABILITY DEFINED
For purposes of this Plan, a Participant shall be deemed to be disabled
if he is eligible for and receiving benefits under an
Employer-sponsored Long-Term Disability plan.
6.02 DISABILITY BENEFITS
No benefits shall be payable hereunder solely on account of disability.
However, if a Participant is deemed to be disabled under Seetion 6.01,
he shall continue to accrue Credited Service until the earliest of the
following events:
(a) the Participant attains his Normal Retirement Date;
(b) the Participant dies;
(c) the Participant ceases to be disabled;
(d) the Participant terminates employment for any other reason.
The Participant's Compensation during the period of disability shall,
for purposes of this Plan, be deemed to be equal to the Participant's
Compensation for the most recent complete calendar year of employment.
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ARTICLE VII
FORM OF PAYMENT
7.01 UNMARRIED PARTICIPANTS
The form of payment under this Plan for an unmarried Participant or a
Participant who has been married for less than one year on the date his
employment terminates is a single life annuity: a benefit payable
monthly for the lifetime of the Participant, the first payment to be
due on the date specified in Section 3 or 4 hereof, and the last
payment to be due on the first day of the calendar month in which death
occurs.
7.02 MARRIED PARTICIPANTS
The form of payment under this Plan for a Participant who has been
married for at least one year on the date his employment terminates is
a joint and contingent annuity, which is a benefit payable monthly for
the lifetime of the Participant with a benefit equal to 50% of such
benefit payable monthly to the surviving spouse for the lifetime of the
spouse. The amount of the monthly benefit payable as a joint and
contingent annuity is the Actuarial Equivalent of the monthly benefit
payable as a single life annuity.
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ARTICLE VIII
FUNDING
8.01 FUNDING
There is no fund associated with this Plan. The Employer shall be
required to make payments only as benefits become due and payable under
the Plan. No person shall have any right, other than the right of an
unsecured general creditor, against the Employer with respect to the
benefits payable hereunder, or which may be payable hereunder, to any
Participant, surviving spouse or beneficiary hereunder. If the
Employer, acting in its sole discretion, establishes a reserve or other
fund associated with this Plan, no person shall have any right to or
interest in any specific amount or asset of such reserve or fund by
reason of amounts which may be payable to such person under this Plan,
nor shall such person have any right to receive any payment under this
Plan except as and to the extent expressly provided in this Plan. The
assets in any such reserve or fund shall be subject to the control of
the Employer and need not be used to pay benefits hereunder.
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ARTICLE IX
ADMINISTRATION
9.01 DUTIES OF THE COMMITTEE
The Plan shall be administered by the Committee in accordance with its
terms and purposes. The Committee shall determine the amount and manner
of payment of the benefits due to or on behalf of each Participant from
the Plan and shall cause them to be paid by the Employer accordingly.
9.02 FINALITY OF DECISIONS
The Committee expressly is granted, without intending any limitation,
the discretion to construe the terms of the Plan and to determine
eligibility for benefits hereunder. The decisions made by and the
actions taken by the Committee in the administration of the Plan shall
be final and conclusive on all persons, and neither the Committee nor
the Employer shall be subject to individual liability with respect to
the Plan.
9.03 EXPENSES OF ADMINISTRATION
All expenses incurred in connection with the execution of this Plan and
in carrying out the provisions hereof shall be paid by the Employer.
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ARTICLE X
MISCELLANEOUS
10.01 NON-GUARANTEE OF EMPLOYMENT
Nothing contained in the Plan shall be construed as a contract of
employment between the Employer and any Participant, or as a right of
any such Participant to be continued in the employment of the Employer,
or as a limitation on the right of the Employer to deal with any
Participant, as to his/her hiring, discharge, layoff, compensation, and
all other conditions of employment in all respects as though the Plan
did not exist.
10.02 RIGHTS UNDER PLAN
Nothing in the Plan shall be construed to limit, broaden, restrict, or
grant any right to a Participant, surviving spouse or any beneficiary
thereof under the Pension Plan, nor to grant any additional rights to
any such person under the Pension Plan, nor in any way to limit,
modify, repeal or otherwise affect the Employer's right to amend or
modify the Pension Plan.
10.03 AMENDMENTS/TERMINATION
The Employer reserves the right to amend or terminate this Plan by
written instrument signed by a duly authorized officer, provided that
no such amendment or termination shall reduce any benefits earned under
the terms of the Plan prior to the date of the termination or
amendment.
10.04 ON-ASSIGNABILITY
The benefits payable under the Plan shall not be subject to alienation,
assignment, garnishment, execution or levy of any kind and any attempt
to cause any benefits to be so subjected shall not be recognized,
except to the extent required by law.
10.05 CLAIMS PROCEDURE
Any Participant or Beneficiary of a deceased Participant may deliver to
the Committee a written claim for a determination with respect to the
amounts distributable to such claimant under the Plan. The procedures
for handling such request shall follow the claims procedures of the
Pension Plan.
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10.06 ENTIRE AGREEMENT: SUCCESSORS
The Plan, including any subsequently adopted amendments, shall
constitute the entire agreement or contract between the Employer and
any Participant regarding the Plan. There are no covenants, promises,
agreements, conditions or understandings, either oral or written,
between the Employer and any Participant relating to the subject matter
hereof, other than those set forth in the Plan. The Plan and any
amendment shall be binding on the parties hereto and their respective
heirs, administrators, trustees, successors and assigns, and on all
designated beneficiaries of the Participant.
10.07 CHANGE OF CONTROL
Upon a Change of Control, each Participant will become fully vested in
a minimum benefit which is based on the Participant's Final Average
Compensation, Qualified Plan Benefit, Supplemental Plan Benefit, and
Social Security Benefit earned through the Change of Control date, and
Credited Service determined assuming the Participant has three
additional years of Credited Service. Furthermore, the minimum benefit
payable on an Early Retirement Date shall assume the Participant is
three years older. Benefits, reduced for commencement prior to Normal
Retirement Date, if applicable, should commence at the later of the
date the Participant terminates employment and the first day of the
month coincident with or next following the Participant's 55th
birthday.
A Participant shall continue to earn benefits under this Plan for
employment which occurs subsequent to a Change of Control. The benefit
earned as of a date subsequent to a Change of Control shall be the
greater of the Accrued Benefit as of such date and the minimum benefit
as of the Change of Control date. The vesting which occurs in
accordance with the preceding paragraph does not apply to benefits in
excess of the minimum benefit.
10.08 SUCCESSOR EMPLOYER
In the event of the dissolution, merger, consolidation or
reorganization of the Employer, provision may be made by which a
successor to all or a major portion of the Employer's property or
business shall continue the Plan, and the successor shall have all the
powers, duties and responsibilities of the Employer under the Plan.
10.09 FORFEITURE
Except as provided in Section 10.07, the benefits otherwise payable by
the Plan on behalf of the Participant or his beneficiary shall be
forfeited if any one of the following events occur:
(a) The Participant, during the twenty-four month period following
the date the Participant's employment with the Employer
terminates, becomes an officer,
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director, shareholder (of more than 10% of the stock of a
corporation), or employer of a corporation, or the owner of a
business, or a member of a partnership which conducts a business
in competition with the business of the Employer.
(b) The Participant is discharged from the Employer on the basis of
fraud or dishonesty.
(c) Employment with the Employer is terminated prior to attaining
both age 55 and five years of Credited Service.
1O.10 GOVERNING LAW
This Plan shall be construed and enforced in accordance with, and
governed by, the laws of the Commonwealth of Massachusetts and of the
United States.
IN WITNESS WHEREOF, UST Corp. has caused this instrument to be executed in its
name and on its behalh on the 18th day of February ,1997.
UST CORP.
/s/ William Schwartz
------------------------------
William Schwartz
Title: Chairman of the Board
Attest:
/s/ Eric R.Fischer
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(Seal)
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UST CORP. EXECUTIVE POLICY COMMITTEE PLAN
ILLUSTRATIVE BENEFIT CALCULATION WORKSHEET
TARGET BENEFIT
50% of Final Average Compensation ______________
x Service Ratio = Credited Service/20 (not to exceed 1.0) x ______________
x Reduction for Early Commencement x ______________
= Target Benefit = ______________
- - QUALIFIED PLAN BENEFIT payable at Benefit
Commencement Date - ______________
- - SUPPLEMENTAL PLAN BENEFIT payable at Benefit
Commencement Date - ______________
- - SOCIAL SECURITY BENEFIT payable at Benefit
Commeneement Date - ______________
= EXECUTIVE POLICY COMMITTEE PLAN BENEFIT
payable as a single life annuity = ______________
x 50% Joint and Contingent Annuity factor,
if married at least one year x ______________
= EXECUTIVE POLICY COMMITTEE PLAN BENEFIT
payable as a 50% Joint and Contingent annuity = ______________