BALL CORPORATION 1988 DEFERRED COMPENSATION PLAN
(as Amended July 1, 1994)
BALL CORPORATION 1988 DEFERRED COMPENSATION PLAN
1. Statement of Purpose
The purpose of the 1988 Deferred Compensation Plan (the "Plan") is to aid
Ball Corporation (the "Company") and its subsidiaries in attracting and
retaining key employees by providing a non-qualified deferred compensation
vehicle.
2. Definitions
2.1. Beneficiary - "Beneficiary" means the person or persons designated as
such in accordance with Section 8.
2.2. Class Year - "Class Year" means the year in respect of which
compensation is deferred under the Plan.
2.3. Compensation - "Compensation" means the Participant's incentive
compensation for the Class Year.
2.4. Deferral Amount - "Deferral Amount" means the amount of Elective
Deferred Compensation deferred by the Participant for each Class
Year.
2.5. Deferred Compensation Account - "Deferred Compensation Account" means
the account for each Class Year maintained by the Company for each
Participant pursuant to Section 6.
2.6. Distribution Date - "Distribution Date" means the date on which the
Employer makes distributions from the Participant's Deferred
Compensation Account.
2.7. Effective Date - "Effective Date" means December 1, 1987, the date on
which the Plan commences.
2.8. Election Form - "Election Form" means the form or forms attached to
this Plan and filed with the Human Resources Committee by the
Participant in order to participate in the Plan. The terms and
conditions specified in the Election Form(s) are incorporated by
reference herein and form a part of the Plan.
2.9. Elective Deferred Compensation - "Elective Deferred Compensation"
means the amount elected to be deferred by an Eligible Employee in
his Election Form.
2.10. Eligible Employee - "Eligible Employee" means those employees of the
Company who have been selected by the Human Resources Committee.
2.11. Employer - "Employer" means Ball Corporation and any of its fifty
percent (50%) or more owned subsidiaries.
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2.12. Human Resources Committee - "Human Resources Committee" (also
referred to as the "Committee") means the committee appointed by the
Board of Directors who will administer the Plan.
2.13. Moody's - "Moody's" means the annual average composite yield on
Moody's Seasoned Corporate Bond Yield Index for the twelve (12)
months ending October 31 immediately preceding the Valuation Date, as
determined from Moody's Bond Record published by Moody's Investors
Service, Inc. (or any successors thereto), or, if such yield is no
longer published, a substantially similar average selected by the
Company.
2.14. Participant - "Participant" means an Eligible Employee participating
in the Plan in accordance with the provisions of Section 4.
2.15. Substantially Equal Installments - "Substantially Equal
Installments'' means a series of annual payments, such that equal
payments over the remaining payment period would exactly amortize the
Deferred Compensation Account balance as of the Distribution Date if
the credited interest rate remained constant at the level credited as
of the Valuation Date immediately preceding the Distribution Date for
the remainder of the payment period.
2.16. Termination of Employment - "Termination of Employment" means the
termination of a Participant's employment with Employer for any
reason other than Disability.
2.17. Valuation Date - "Valuation Date" means the date on which the value
of a Participant's Deferred Compensation Account for each Class Year
is determined as provided in Section 6 hereof. Unless and until
changed by the Committee, the Valuation Date shall be the last day of
each calendar year.
3. Administration of the Plan
The Human Resources Committee, by appointment of the Board of Directors of
the Company, shall be the sole administrator of the Plan. The Committee
shall have full power to formulate additional details and regulations for
carrying out this Plan. The Committee shall also be empowered to make any
and all of the determinations not herein specifically authorized which may
be necessary or desirable for the effective administration of the Plan. Any
decision or interpretation of any provision of this Plan adopted by the
Committee shall be final and conclusive.
4. Participation
Participation in the Plan shall be limited to Eligible Employees who elect
to participate in the Plan by filing an Election Form prior to the beginning
of the Class Year in which the Participant's Compensation is earned.
Notwithstanding the foregoing, an employee who first becomes an Eligible
Employee during any Class Year may elect to participate in the Plan for such
Class Year by filing an Election Form within thirty (30) days after becoming
an Eligible Employee.
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The minimum annual deferral shall be $1,000, and the maximum deferral shall
be one hundred percent (100%) of the Participant's Compensation.
5. Vesting of Deferred Compensation Account
A Participant's interest in his Deferred Compensation Account and interest
credited thereto shall vest immediately.
6. Accounts and Valuations
6.1. Deferred Compensation Accounts. The Committee shall establish and
maintain a separate Deferred Compensation Account for each
Participant for each Class Year. Elective Deferred Compensation
shall be deemed credited to the Deferred Compensation Account as of
the close of business on December 31 of the Class Year, and no
interest shall be earned for that calendar year.
6.2. Interest Credited. Each Deferred Compensation Account of each
Participant shall be credited with interest on each Valuation Date,
as provided hereinafter, at an annual rate equal to Moody's plus five
(5) percentage points, except as may otherwise be provided under
Section 7.5.
6.3. Timing of Crediting of Interest. Each Deferred Compensation Account
of each Participant shall be revalued as of each Valuation Date. As
of each Valuation Date, the value of each Deferred Compensation
Account shall consist of the balance of such Deferred Compensation
Account as of the immediately preceding Valuation Date minus the
amount of all distributions, if any, made from such Deferred
Compensation Account since the preceding Valuation Date, plus
interest credited on the net balance after deducting said
distributions. Normal benefit distributions (under Section 7.1) made
on or before February 15 of the year of payment will be considered to
have been made from the account and deducted from the account balance
as of January 1 of such year for the purpose of crediting interest
under this Section 6.3. Interest on Hardship Benefits distributed
will be prorated to the date of distribution for the purpose of
crediting interest under this Section 6.3.
7. Benefits
7.1. Normal Benefit
a. A Participant's Deferred Compensation Account shall be paid to
the Participant as requested in his Election Form, subject to the
terms and conditions set forth in the Plan, including the
Election Form. If a Participant elects to receive payment of his
Deferred Compensation Account in installments, payments shall be
made in Substantially Equal Installments. Unless the Committee
determines otherwise, and subject to the provisions of Section
7.4. as to when payments shall commence, distribution payments,
whether lump sum or installment, shall be made on or before the
fifteenth (15th) day of February of each year. A Participant may
elect different payment schedules for different Deferred
Compensation Accounts.
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b. If a Participant dies before receiving his total Deferred
Compensation Account balance, whether or not distributions have
earlier commenced, his Beneficiary shall be entitled to the
remaining account balance in accordance with the payment
elections in the Election Form, except that such payments, if not
already commenced, shall commence on or before February 15 next
following the date of the Participant's death.
7.2. Hardship Benefit. In the event that the Committee, upon written
request of a Participant or Beneficiary of a deceased Participant,
determines in its sole discretion, that such person has suffered an
unforeseeable financial emergency, the Company shall pay to such
person, from the Deferred Compensation Account designated by the
Participant or Beneficiary, as soon as practicable following such
determination, an amount necessary to meet the emergency, not in
excess of the amount of the Deferred Compensation Account. The
Deferred Compensation Account of the Participant shall thereafter be
reduced to reflect the payment as of the date paid of a Hardship
Benefit.
7.3. Request to Committee for Delay in Payment. A Participant shall have
no right to modify in any way the schedule for the distribution of
amounts from his Deferred Compensation Account which he has specified
in his Election Form. However, upon a written request submitted by
the Participant to the Committee, the Committee may, in its sole
discretion, for each Class Year postpone one time the date on which
payment shall commence, not beyond the year in which he will attain
age seventy-one (71); and at the same time increase the number of
installments to a number not to exceed fifteen (15). Any such
request(s) must be made prior to the earlier of (a) the beginning of
the year which the Participant has elected for distributions to
commence, or (b) the Termination of Employment.
7.4. Date of Payments. Except as otherwise provided in this Plan,
payments under this Plan shall begin on or before the fifteenth
(15th) day of February of the calendar year following receipt of
notice by the Committee of an event which entitles a Participant (or
Beneficiary) to payments under the Plan, or at such earlier date
after receipt of such notice as may be determined by the Committee.
7.5. Termination of Employment Before Age 55. In the event a Participant
has a Termination of Employment prior to his attaining age fifty-five
(55) (other than by death, for which benefits and/or accounts will be
paid in accordance with Section 7.1.b.), then, whether or not
distributions have earlier commenced, the Participant's Deferred
Compensation Account will be paid to him in a lump sum on or before
the fifteenth (15th) day of February in the year following the year
in which the Termination of Employment occurred, unless otherwise
determined by the Committee. Upon written request of the Participant
made within thirty (30) days following Termination of Employment, the
Committee may, in its sole discretion, determine that, in lieu of a
lump sum, payments shall be made to the Participant in not more than
five (5) Substantially Equal Installments, commencing on or before
such next fifteenth (15th) day of February following the date of
Termination of Employment. The interest credited to the
Participant's Deferred Compensation Account on the Valuation Date
next following the Termination of Employment shall be as provided in
Section 6., above. If payments are to be made in installments, the
interest rate credited to the Participant's Deferred Compensation
Account on all Valuation Dates subsequent to the Valuation Date next
following Termination of Employment (and to be considered as the
interest rate on such Valuation Date next following Termination of
Employment for the sole
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purpose of calculating Substantially Equal Installments under Section
2.15., above) shall be limited to the daily average of the best
interest rate available to the Company during the then calendar year
for short-term borrowings.
7.6. Taxes; Withholding. To the extent required by law, the Company shall
withhold from payments made hereunder any amount required to be
withheld by the federal or any state or local government.
7.7. Liquidating Distribution. Notwithstanding any provisions of the Plan
or the Participant's Election Form to the contrary, the Company
shall, as soon as practicable (but no later than 30 days) following
the receipt of a written request from a Participant (or Beneficiary)
for a Liquidation Distribution, pay to the Participant (or
Beneficiary) the Participant's (or Beneficiary's) Liquidating
Distribution Account Balance in a lump sum. "Liquidating
Distribution" shall mean a distribution requested by the Participant
(or Beneficiary following the death of the Participant) in writing
directed to the Committee and specifically referencing this section.
If the Participant requesting the Liquidating Distribution is, at the
time of the request, an active employee of the Employer, "Liquidating
Distribution Account Balance" shall mean all of the Deferred
Compensation Accounts under the Plan in which the Participant has an
undistributed balance, increased by interest credited on the
account(s) to the date of distribution from the preceding Valuation
Date (based upon the interest rate credited on the preceding
Valuation Date), and decreased by a forfeiture penalty equal to six
percent (6%) of the value of the Participant's Deferred Compensation
Account(s) as of the preceding Valuation Date. If the Participant
requesting the Liquidating Distribution is, at the time of the
request, no longer an active employee of the Employer, or in the case
of a request made by a Participant's Beneficiary, "Liquidating
Distribution Account Balance" shall mean all of the Deferred
Compensation Accounts under the Plan in which the Participant (or
Beneficiary) has an undistributed balance and all of the Deferred
Compensation Accounts under any Comparable Plans maintained by the
Employer in which the Participant (or Beneficiary) has an
undistributed balance, increased by interest credited on the
account(s) to the date of distribution from the preceding Valuation
Date, and decreased by a forfeiture penalty equal to six percent
(6%), of the value of the Participant's (or Beneficiary's) Deferred
Compensation Account(s) as of the preceding Valuation Date.
"Comparable Plans" shall mean the Ball Corporation 1986 Deferred
Compensation Plan, the Ball Corporation 1989 Deferred Compensation
Plan, the Ball-InCon Glass Packaging Corp. Deferred Compensation
Plan, and any comparable successor plans so designated by the
Committee.
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Notwithstanding any provisions of the Plan or the Participant's
Election Form to the contrary, if the Participant requesting the
Liquidating Distribution is, at the time of the request, an active
employee of the Employer, then the Participant shall, for a period of
one (1) Class Year beginning with the Class Year during which the
request for the Liquidating Distribution is made, be ineligible to
participate in the Plan or any Comparable Plans with respect to any
Compensation not yet deferred.
8. Beneficiary Designation
A Participant shall have the right at any time, and from time to time, to
designate and/or change or cancel any person, persons, or entity as his
Beneficiary or Beneficiaries (both principal and contingent) to whom payment
under this Plan shall be paid in the event of his death prior to complete
distribution to Participant of the benefits due him under the Plan. Each
beneficiary change or cancellation shall become effective only when filed in
writing with the Committee during the Participant's lifetime on a form
provided by the Committee.
The filing of a new Beneficiary designation form will cancel all Beneficiary
designations previously filed. Any finalized divorce of a Participant
subsequent to the date of filing of a Beneficiary designation form shall
revoke such designation. The spouse of a married Participant domiciled in a
community property jurisdiction shall be required to join in any designation
of Beneficiary or Beneficiaries other than the spouse in order for the
Beneficiary designation to be effective.
If a Participant fails to designate a Beneficiary as provided above, or, if
his beneficiary designation is revoked by divorce, or otherwise, without
execution of a new designation, or if all designated Beneficiaries
predecease the Participant, then the distribution of such benefits shall be
made in a lump sum to the Participant's estate.
If any installment distribution has commenced to a Beneficiary and the
Beneficiary dies before receiving all installments, any remaining
installments shall be paid in a lump sum to the estate of the Beneficiary.
9. Amendment and Termination of Plan
9.1. Amendment. The Board of Directors may at any time amend the Plan in
whole or in part, provided, however, that no amendment shall be
effective to reduce the value of any Participant's Deferred
Compensation Account or to affect the Participant's vested right
therein, and, except as provided in 9.2. or 9.3., no amendment shall
be effective to decrease the future benefits under the Plan payable
to any Participant or Beneficiary with respect to any Elective
Deferred Compensation which was deferred prior to the date of the
amendment. Written notice of any amendments shall be given promptly
to each Participant.
9.2. Termination of Plan
a. Employer's Right to Terminate. The Board of Directors may at any
time terminate the Plan as to prospective contributions and
credits of interest, if it determines in good faith that the
economic acceptability of the Plan has been substantially
impaired and that the resulting cost to the Company is
substantially and unacceptably greater than the cost anticipated
at the Effective Date. No such termination of the Plan shall
reduce the balance in a Participant's Deferred Compensation
Account or affect the Participant's vested right therein.
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b. Payments Upon Termination of Plan. Upon any termination of the
Plan under this Section 9.2., Compensation for additional Class
Years shall not be deferred under the Plan. With respect to
then-existing Deferred Compensation Accounts, the Employer will,
depending upon the Participant's election at that time: (i) pay
to the Participant, in a lump sum, the value of each of his
Deferred Compensation Accounts; (ii) continue to defer the
Compensation under the Plan, but with the interest rate credited
on all future Valuation Dates to be equal to the daily average of
the best interest rate available to the Company during the then
calendar year for short-term borrowings; or (iii) make such other
arrangement as the Committee determines appropriate.
9.3. Successors and Mergers, Consolidations or Change in Control. The
terms and conditions of this Plan and Election Form shall enure to
the benefit of and bind the Company, the Participants, their
successors, assignees, and personal representatives. If substantially
all of the stock or assets of the Company are acquired by another
corporation or entity or if the Company is merged into, or
consolidated with, another corporation or entity, then the
obligations created hereunder shall be obligations of the acquiror or
successor corporation or entity.
10. Miscellaneous
10.1. Unsecured General Creditor. Participants and their beneficiaries,
heirs, successors and assigns shall have no legal or equitable
rights, interests, or other claims in any property or assets of the
Employer, nor shall they be beneficiaries of, or have any rights,
claims, or interests in any life insurance policies, annuity
contracts, or the policies therefrom owned or which may be acquired
by the Company ("policies"). Such policies or other assets shall not
be held under any trust for the benefit of Participants, their
beneficiaries, heirs, successors, or assigns, or held in any way as
collateral security for the fulfilling of the obligations of the
Company under this Plan. Any and all of such assets and policies
shall be and remain general, unpledged, unrestricted assets of the
Employer. The Company's obligation under the Plan shall be that of
an unfunded and unsecured promise to pay money in the future.
10.2. Obligations to the Employer. If a Participant becomes entitled to a
distribution of benefits under the Plan, and if at such time the
Participant has outstanding any debt, obligation, or other liability
representing an amount owed to the Employer, then the Employer may
offset such amounts owing it or an affiliate against the amount of
benefits otherwise distributable. Such determination shall be made
by the Committee.
10.3. Non-Assignability. Neither a Participant nor any other person shall
have any right to commute, sell, assign, transfer, pledge,
anticipate, mortgage, or otherwise encumber, transfer, hypothecate 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 nontransferable. No
part of the amounts payable shall, prior to actual payment, be
subject to seizure or sequestration for the payment of any debts,
judgments, alimony or separate maintenance owed by a Participant or
any other person, nor be transferable by operation of law in the
event of a Participant's or any other person's bankruptcy or
insolvency.
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10.4. Employment or Future Eligibility to Participate Not Guaranteed.
Nothing contained in this Plan nor any action taken hereunder shall
be construed as a contract of employment or as giving any Eligible
Employee any right to be retained in the employ of the Employer.
Designation as an Eligible Employee may be revoked at anytime by the
Committee with respect to any Compensation not yet deferred.
10.5. Protective Provisions. In order to be eligible to participate in
this Plan, Participant will cooperate with the Company by furnishing
any and all information requested by the Company in order to
facilitate the payment of benefits hereunder, including taking such
physical examinations as the Company may deem necessary and taking
such other relevant action as may be requested by the Company. If a
Participant refuses to cooperate, the Company shall have no further
obligation to the Participant to allow him to begin participation in
the Plan.
10.6. Gender, Singular and Plural. All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine, or neuter, as
the identity of the person or persons may require. As the context
may require, the singular may be read as the plural and the plural as
the singular.
10.7. Captions. The captions to 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.
10.8. Applicable Law. This Plan shall be governed and construed in
accordance with the laws of the State of Indiana.
10.9. Validity. In the event any provision of this Plan is held invalid,
void, or unenforceable, the same shall not affect, in any respect
whatsoever, the validity of any other provision of this Plan.
10.10. Notice. Any notice or filing required or permitted to be given to
the Committee shall be sufficient if in writing and hand delivered,
or sent by registered or certified mail, to the principal office of
the Company, directed to the attention of the Chief Executive Officer
of the Company. 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.
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