EXHIBIT 10.10 TO 2000 10-K
CONVERGYS COPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
(As amended effective June 2, 2000)
CONVERGYS CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
TABLE OF CONTENTS
PAGE
SECTION 1. STATEMENT OF PURPOSE. 1
SECTION 2. DEFINITIONS; GENDER AND NUMBER. 1
SECTION 3. ADMINISTRATION. 2
SECTION 4. BENEFITS. 2
SECTION 5. GENERAL PROVISIONS. 4
SECTION 6. PLAN MODIFICATION. 7
CONVERGYS CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
SECTION 1. STATEMENT OF PURPOSE.
The purpose of the Convergys Corporation Supplemental Executive
Retirement Plan (the "Plan") is to provide supplementary pension benefits and
death benefits for Senior Managers of Convergys Corporation ("Convergys") and
its affiliates.
SECTION 2. DEFINITIONS; GENDER AND NUMBER.
2.l. For purposes of the Plan, the following terms shall have the
meanings hereinafter set forth unless the context otherwise requires:
2.1.1 "Board of Directors" means the Board of Directors of
Convergys.
2.1.2 "Committee" means the Compensation Committee of the
Board of Directors.
2.1.3 "Convergys Entity" means Convergys and each direct and
indirect subsidiary of Convergys.
2.1.4 "Designated Beneficiary" mean the person or entity
designated by a Senior Manager, on forms furnished and in the manner prescribed
by the Committee, to receive any benefit payable under the Plan after the Senior
Manager's death. If a Senior Manager fails to designate a beneficiary or if, for
any reason, such designation is not effective, his "Designated Beneficiary"
shall be his surviving spouse, or, if none, his estate.
2.1.5 "Effective Date" means the date on which Cincinnati Bell Inc.
distributes to its shareholders all of the common shares of Convergys owned by
Cincinnati Bell Inc.
2.1.6 "Employee" means any person who is employed as a common
law employee of a Convergys Entity.
2.1.7 "Pension Plan" means the Convergys Corporation Pension
Plan.
2.1.8 "Senior Manager" means an Employee whose participation
in the Plan has been approved by the Board of Directors or the Committee.
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2.1.9 "Years of Service" means a Senior Manager's full years
of service as an Employee, computed on the basis that 12 full months of service
(whether or not consecutive) constitutes one full year of service. For purposes
of the Plan, service with Cincinnati Bell Inc. and its affiliates prior to the
Effective Date shall be deemed to be service with Convergys.
2.2 For purposes of the Plan, words used in any gender shall include
all other genders, words used in the singular form shall include the plural form
and words used in the plural form shall include the singular form.
SECTION 3. ADMINISTRATION.
3.1 Convergys shall be the Plan Administrator and the Sponsor of the
Plan as those terms are defined in the Employee Retirement Income Security Act
of 1974.
3.2 The Committee shall have the specific powers elsewhere herein
granted to it and shall have such other powers as may be necessary in order to
enable it to administer the Plan, except for powers herein granted or provided
to be granted to others.
3.2.1 The Committee may adopt such rules and regulations and
may employ such persons as it deems appropriate for the proper administration of
the Plan.
3.2.2 The Committee shall grant or deny claims for benefits
under the Plan, and authorize disbursements according to this Plan. Notice shall
be provided in writing to any participant or beneficiary whose claim has been
denied, setting forth the specific reasons for such denial. In the event that a
claim for benefits has been denied, the Committee shall afford the claimant a
full and fair review of the decision denying the claim.
3.2.3 The Committee shall determine conclusively for all
parties all questions arising in the administration of the Plan.
3.2.4 The expenses of the Committee in administering the Plan
shall be borne by the Convergys Entities in such proportions as the Committee
may determine.
3.2.5 The Board of Directors and the Committee each may
designate in writing other persons to carry out their responsibilities under the
Plan, and may employ persons to advise them with regard to any such
responsibilities.
SECTION 4. BENEFITS.
4.1 If a Senior Manager who has attained age 55 and completed at least
10 Years of Service ceases to be an Employee for any reason (other than his
death), he shall
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be entitled to receive a monthly benefit, commencing on the day next
following the date he ceases to be an Employee and payable for his life,
equal to the result obtained (not less than zero) by subtracting (a) his
Pension Benefit from (b) 55% of his Average Monthly Compensation. Provided,
however, that if the number of the Senior Manager's years of age and Years of
Service total less than 75, the amount determined under clause (b) of the
preceding sentence shall be reduced by 2.5% for each year by which the number
of his full years of age and Years of Service total less than 75.
4.1.1 For purposes of this Section 4.1, a Senior Manager's
"Average Monthly Compensation" shall be the average obtained by dividing (a) his
base salary and annual bonuses from all Convergys Entities earned for the
36-month period during the 60-month period ending on the date he ceases to be an
Employee which produces the highest dollar result by (b) 36. Any annual bonus
shall be deemed to have been earned on the last day of the performance period to
which it relates. A Senior Manager's base salary and annual bonuses shall
include base salary and annual bonus amounts deferred by the Senior Manager
pursuant to any deferred compensation plan or agreement, 401(k) plan, cafeteria
plan, as well as base salary and bonus amounts paid in the form of securities or
other property which are not immediately taxable to the Senior Manager. For
purposes of the Plan, compensation from Cincinnati Bell Inc. and its affiliates
prior to the Effective Date shall be deemed to be compensation from a Convergys
Entity.
4.1.2 For purposes of this Section 4.1, "Pension Benefit"
means the pension benefit (if any) which the Senior Manager is entitled to
receive under the Pension Plan, expressed as a monthly benefit commencing on the
day following the date on which he ceases to be an Employee and payable for his
life, including any Excess Pension Benefit (as defined in Section 5.6.3). If a
Senior Manager has received or is entitled to receive a benefit from a Convergys
Entity which, in the opinion of the Committee, is intended to supplement or be
in lieu of a benefit under the Pension Plan, the value of such other benefit
shall be deemed to be a benefit under the Pension Plan.
4.2 If a Senior Manager dies while an active Employee, his Designated
Beneficiary shall be entitled to receive a benefit payable in fifteen annual
installments, commencing as of the day following the date of the Senior
Manager's death, which shall be actuarially equivalent (as determined by the
Committee) to the monthly benefit which would have been payable to the Senior
Manager if he had retired on the day preceding the date of his death, assuming
for such purpose that the Committee elected to waive the minimum age and service
requirements in the first sentence of Section 4.1.
4.3 The Committee, in its sole discretion, may elect to waive in whole
or in part any service or age reduction or discount, or any minimum age or
service requirement, otherwise applicable to the amount of a benefit payable to
a Senior Manager under the Plan, on such terms and conditions as the Committee
may prescribe.
4.4 In the case of a Senior Manager who retires prior to attaining age
62, the Committee may, in its sole discretion, elect to provide the Senior
Manager with a monthly Social Security supplement from the date of his
retirement through the date he
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attains age 62 (or, if earlier, to the date of his death) in the amount of
the Senior Manager's unreduced monthly primary Social Security benefit at age
62. This Social Security supplement shall be in addition to any other
benefits provided under the Plan.
4.5 In lieu of a monthly benefit payable for the life of the Senior
Manager, with the consent of the Committee, and subject to such rules as the
Committee may prescribe, a Senior Manager may elect to have his benefit paid in
one of the following forms: (a) fifteen equal annual installments; or (b) an
annuity payable for the life of the Senior Manager and continuing to the Senior
Manager's contingent annuitant for his life at one-half of the rate payable
during their joint lives. Any optional form of benefit hereunder shall be
actuarially equivalent (as determined by the Committee) to the standard form of
benefit otherwise payable to the Senior Manager. If a Senior Manager whose
benefit is being paid in fifteen annual installments dies before receiving all
of the installments, the remaining installments shall be paid, when due, to his
Designated Beneficiary.
4.6 Except as otherwise provided in this Section 4 and Section 5, if a
Senior Manager ceases to be an Employee for any reason, neither he nor any
person claiming by or through him shall be entitled to receive any benefit under
the Plan.
SECTION 5. GENERAL PROVISIONS.
5.1 All benefits for which a Senior Manager would be otherwise eligible
hereunder may be forfeited, in the sole and absolute discretion of the
Committee, under the following circumstances:
(a) The Senior Manager is discharged for cause (as determined
by the Board of Directors or the Committee in its sole and absolute discretion);
or
(b) Determination by the Board of Directors or the Committee,
in its sole and absolute discretion, that the Senior Manager engaged in
misconduct in connection with his employment with a Convergys Entity; or
(c) The Senior Manager, without the express written consent of
the Board of Directors or the Committee, at any time is employed by, becomes
associated with, renders service to, or owns an interest in any business that,
in the sole and absolute discretion of the Board of Directors or the Committee,
is competitive with any Convergys Entity or with any business in which a
Convergys Entity has a substantial interest (other than as a shareholder with a
nonsubstantial interest in such business).
5.2 Assignment or alienation of pensions or other benefits under this
Plan will not be permitted or recognized.
5.3 In all questions relating to age and service for eligibility for
any benefit hereunder, or relating to terms of employment and rates of pay for
determining benefits,
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the decision of the Committee, based upon this Plan and upon the records of
the Participating Company last employing such individual and insofar as
permitted by applicable law shall be final.
5.4 All benefits payable pursuant to the Plan shall be paid from
Convergys Entity operating expenses, or through the purchase of insurance from
an insurance company or otherwise, as the Committee may determine. If any
Convergys Entity elects to purchase insurance or other assets to provide
benefits under the Plan, no Senior Manager, beneficiary or annuitant shall have
any right or interest in such insurance or other assets.
5.5 Benefits payable to a former employee or retiree unable to execute
a proper receipt may be paid to other person(s) on behalf of the former employee
or retiree.
5.6 In the event of a Change in Control, the provisions of this Section
5.6 will supersede any conflicting provisions of the Plan.
5.6.1 In the event of a Change in Control, the full present
value of all accrued benefits under the Plan and the full present value of any
Excess Benefit, as determined in accordance with the provisions of the Plan and
the Convergys Corporation Grantor Trust (the "Trust"), shall be fully funded to
the Trust in cash or other property acceptable to the trustee, within five
business days of such Change in Control. The determination of the full present
value of the accrued benefits under the Plan shall be made using the following
assumptions: (i) the date of retirement for each Senior Manager shall be
considered to be the later of the date on which such Senior Manager's full years
of age and Years of Service total 75 or the date of the Change in Control, and
(ii) the interest and mortality assumptions shall be the same as those used for
funding the Pension Plan for the plan year in which the Change in Control occurs
or if such assumptions are not yet established, the assumptions used in the
immediately preceding year. In addition, the following assumptions also apply to
the determination of accrued benefits under the Plan: (i) for the purpose of the
benefit formula under Section 4 of this Plan (or any equivalent successor
provisions of such Plan or any successor Plan) each Senior Manager who has
attained age 55 and completed at least 10 Years of Service will be considered to
have a total of 75 years of age and Years of Service, and (ii) no Social
Security Supplements shall be granted.
5.6.2 In the event that the Plan is terminated or partially
terminated on or after a Change in Control and prior to the second anniversary
of such Change in Control as defined hereinafter, each Senior Manager affected
by such termination or partial determination may elect, within 90 days of the
proposed distribution date (as defined below), to receive the full present value
of the benefit accrued under this Plan and the Excess Pension Benefit, referred
to in Section 5.6.3, accrued under the Pension Plan to the date of the
termination in a single lump sum payment. If the Senior Manager so elects in
accordance with this Section 5.6.2 to receive a lump sum, such lump sum shall be
distributed to the Senior Manager or, in the event of the Senior Manager's
death, the Senior Manager's Designated Beneficiary in the amount which equals
the present value
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of the benefit or benefits projected to be paid under the Plan to the Senior
Manager, actuarially determined using the assumptions used by the Plan's
actuary for funding the Plan; provided, however, that such amount shall be
further reduced by an amount equal to 10% prior to distribution of such lump
sum. The proposed distribution date of the lump sum distribution shall be no
later than one year following the date of the termination or partial
termination of the Plan. Once such amount is paid, the obligation of the Plan
to such Senior Manager and/or his Designated Beneficiary shall be considered
to be fully and irrevocably satisfied. No Senior Manager shall have any right
under this Section 5.6.2 prior to the occurrence of a Change in Control.
5.6.3 For purposes of the Plan, "Excess Benefit" means that
portion of the Senior Manager's pension under the Pension Plan, determined as of
the proposed distribution date, that is in excess of the permissible amount
which may be distributed from the Pension Plan in accordance with Sections
401(a)(17) and 415 of the Internal Revenue Code and with respect to which
payments are to be made in accordance with the Pension Plan.
5.6.4 For the purposes of this Section 5.6, a "Change in
Control" means and shall be deemed to occur if, on or after the Effective Date:
(i) a tender offer shall be made and consummated for
the ownership of 30% or more of the outstanding voting securities of Convergys;
(ii) Convergys shall be merged or consolidated with
another corporation and as a result of such merger or consolidation less than
75% of the outstanding voting securities of the surviving or resulting
corporation shall be owned in the aggregate by the former shareholders of
Convergys other than affiliates (within the meaning of the Securities Exchange
Act of 1934) of any party to such merger or consultation, as the same shall have
existed immediately prior to such merger or consolidation;
(iii) Convergys shall sell substantially all of its
assets to another corporation which is not a wholly owned subsidiary;
(iv) a person within the meaning of Section 3(a)(9)
or of Section 13(d)(3) (as in effect on the Effective Date) of the Securities
Exchange Act of 1934, shall acquire 20% or more of the outstanding voting
securities of Convergys (whether directly, indirectly, beneficially or of
records), or a person, within the meaning of Section 3(a)(9) or
Section 13(d)(3) (as in effect on the Effective Date) of the Securities
Exchange Act of 1934, controls in any manner the election of a majority of
the directors of Convergys, or
(v) within any period of two consecutive years
commencing on or after the Effective Date, individuals who at the beginning of
such period constitute the Board of Directors cease for any reason to constitute
at least a majority thereof, unless the election of each director who was not a
director at the beginning of such period has been
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approved in advance by directors representing at least two-thirds of the
directors then in office who were directors at the beginning of the period.
For purposes hereof, ownership of voting securities shall take into account
and shall include ownership as determined by applying the provisions of Rule
13d-3(d)(1)(i) (as in effect on the Effective Date) pursuant to the
Securities Exchange Act of 1934.
5.6.5 In the event of a Change in Control, the provisions of
Section 5.6 may not be deleted or amended on or subsequent to the Change in
Control in any manner whatsoever which would be adverse to one or more Senior
Managers without the consent of each such Senior Manager who would be so
affected; provided, however, the Board of Directors may make minor or
administrative changes to Section 5.6 or changes to conform to applicable legal
requirements. This Section 5.6.5 shall not limit the Board of Directors from
making any amendment to or deleting all or any portion of Section 5.6 prior to a
Change in Control.
SECTION 6. PLAN MODIFICATION.
The Board of Directors retains the right to amend or terminate the Plan
in whole or in part at any time, for any reason, with or without notice. Subject
to the provisions of Section 5.6, said amendment or termination may result, at
the discretion of the Board of Directors, in the cancellation of any
entitlements or future entitlements to active Senior Managers; provided,
however, that the amendment, termination or partial termination of the Plan
shall not reduce the accrued benefit of any Vested Senior Manager, retired
Senior Manager or his beneficiary. For purposes of the Plan, vested Senior
Manager means a Senior Manager who has attained age 55 and who has completed at
least ten years of service.
IN WITNESS WHEREOF, Convergys Corporation has hereunto caused its name
to be subscribed as of the Effective Date.
CONVERGYS CORPORATION
/s/ Steven C. Mason
Steven C. Mason
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