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EXHIBIT 10.5
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W. R. BERKLEY CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
AS ADOPTED MARCH 7, 1996
Section 1. Effective Date
The effective date of this Plan is March 7, 1996.
Section 2. Eligibility
Any member of the Board of Directors of W. R. Berkley Corporation (the
"Company"), including any person otherwise participating in the W. R. Berkley
Corporation Deferred Compensation Plan for Officers, is eligible to participate
in the Plan.
Section 3. Amount of Deferral
Prior to the beginning of each calendar year, a member of the Board of Directors
may elect to defer receipt of all of a portion of the retainer and/or meeting
fees otherwise payable to such person for that year on account of serving on the
Board of Directors.
Notwithstanding the foregoing, for the 1996 calendar year only, a member of the
Board of Directors may elect, not later than thirty days after the Effective
Date, to defer the receipt of all or a portion of the retainer and/or meeting
fees otherwise payable to such person for serving on the Board of Directors
subsequent to the date of making such election through December 31, 1996.
Notwithstanding the foregoing, for the calendar year in which a person first
becomes a member of the Board of Directors, such person may elect, not later
than thirty days after the date such person first becomes a member of the Board
of Directors to defer the receipt of all or a portion of the retainer and/or
meeting fees otherwise payable to such person for serving on the Board of
Directors subsequent to the date of making such election through December 31st
of such year.
Members of the Board of Directors who choose to defer amounts pursuant to this
Section 3 will be "Participants." All amounts deferred, and interest credited
thereon, will be classified as "Deferred Compensation."
Section 4. Type of Plan
The Plan is a non-qualified voluntary deferred compensation type of plan. The
Plan is not intended to be subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA"). To the extent the Plan is determined to
be so subject, it is intended, to the extent that any Participant is otherwise
an employee of the Company or of any subsidiary to constitute a "plan which is
unfunded and is maintained by the employer primarily for the purpose of
providing deferred compensation for a select group of management or highly
compensated employees," as such phrase is used in ERISA, and the terms of the
Plan shall be interpreted consistent with such intent.
Section 5. Funding; Participant's Rights Unsecured
The Company will not fund the amount of any Participant's Deferred Compensation.
The amount of each Participant's Deferred Compensation will be separately
accounted for in the bookkeeping records of the Company by setting up for each
Participant a Deferred Compensation account ("Deferred Compensation Account").
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The amount of Deferred Compensation is secured only by the Company's promise to
pay it from the assets of the Company and Participants will have the status of
general unsecured creditors of the Company with respect to their Deferred
Compensation. The Company will not be required to establish any special or
separate fund or to make any segregation of assets to assure the payment of any
amounts under the Plan.
Section 6. Investment Income
A reasonable rate of interest will be credited to a Participant's Deferred
Compensation Account, from the first of the month following the date of the
deferral, and will be compounded quarterly. The interest rate which shall apply
with respect to each year shall be such rate of interest which is in effect for
such year under Section 6 of the W. R. Berkley Corporation Deferred Compensation
Plan for Officers.
Section 7. Deferral Period
A Participant who is not otherwise an employee of the Company or of any
subsidiary may elect to defer the receipt of his/her Deferred Compensation until
a specified date in the future, but not later than such person's termination as
a member of the Board of Directors. A Participant who is otherwise an employee
of the Company or of any subsidiary may elect to defer the receipt of his/her
Deferred Compensation until a specified date in the future, but no later than
his/her termination as an employee. A separate such election will be made with
respect to that portion of his/her Deferred Compensation attributable to
retainer and/or meeting fees otherwise deferred with respect to each separate
year. The actual payment will be made or will commence within sixty days after
the earlier of (i) the date specified or (ii) the date of termination as a
member of the Board of Directors or termination of employment, as the case may
be.
Section 8. Form of Payment
A Participant may elect to receive his/her Deferral Compensation under the Plan
attributable to his/her retainer and/or meeting fees otherwise deferred with
respect to each separate year in either a lump sum or in annual installments
(not to exceed five), as specified by the Participant at the time the election
to defer is made.
Section 9. Death Prior to Receipt
In the event that a Participant dies prior to receipt of any or all of the
amounts payable to him/her pursuant to this Plan, any amounts that are then
credited as Deferred Compensation will be paid to his/her designated beneficiary
in a lump sum within sixty days following the Company's notification of the
Participant's death.
At the time the election to defer is made, a Participant may designate a
beneficiary under this Plan. The Participant may change the beneficiary by
writing to the General Counsel of the Company. If a beneficiary is not named,
the value of the Participant's Deferred Compensation Account will be paid to
his/her estate.
Section 10. Effect of Election
An election to defer retainer and/or meeting fees for any year will be
irrevocable once the term to which it applies has commenced, and can be revoked
or modified only on a showing of severe financial hardship as a result of an
unanticipated emergency, as determined by the Compensation Committee of the
Board of Directors of the Company; provided, however, that a Participant who is
also a member of the Compensation Committee shall not participate in any
determination by the Compensation Committee as to whether such Participant in
fact has such a severe financial hardship.
Section 11. Statement of Account
Statements will be sent to each Participant by February 15th each year as to the
value of his/her Deferred Compensation Account as of the end of the preceding
December.
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Section 12. Assignability
No right to receive payments hereunder will be transferable or assignable by a
Participant, except by will or by the laws of descent and distribution.
Section 13. Administration
This Plan will be administered on a day-to-day basis on behalf of the
Compensation Committee of the Board of Directors of the Company by the General
Counsel of the Company, who will have the authority to adopt rules and
regulations for carrying out the Plan. The Compensation Committee of the Board
of Directors of the Company will have the authority to interpret, construe and
implement the provisions of the Plan and to prescribe the form of the request
for deferral of compensation under the Plan. Notwithstanding the foregoing, in
the case of any Participant who is also a member of the Compensation Committee,
such person shall not participate in any action by the Compensation Committee
which affects only such individual Participant's rights under the Plan.
Section 14. Amendment/Termination
This Plan may at any time or from time to time be amended, modified or
terminated by the Board of Directors of the Company. No amendment, modification
or termination will, without the consent of the Participant, adversely affect
any amounts credited to such Participant's Deferred Compensation Account.
Section 15. Tax Treatment
Deferred Compensation and credited interest are taxed as ordinary income when
payment is actually received. Distributions received from the Plan are not
eligible for favorable tax treatment or rollovers as permitted under qualified
plans.
Section 16. Other Benefits
The compensation and basis for other Company provided benefits in the case of
any member of the Board of Directors who is also an employee of the Company or
of any affiliate may be affected if a Participant elects to defer a portion of
his/her retainer and/or meeting fees.
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W. R. BERKLEY CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
ELECTION FORM
In accordance with and subject to the W. R. Berkley Corporation Deferred
Compensation Plan for Directors (the "Plan"), I hereby request to defer the
receipt of my annual retainer and/or meeting fees for the year ending December
31, ____, as follows:
Amount to be Deferred:
I. Annual Retainer:
__ (a) ALL (100%), OR
__ (b) $___ (multiples of $1,000)
II. Meeting Fees:
__ (a) ALL (100%), OR
__ (b) $___ (multiples of $1,000)
Period of Deferral:
__ (a) Year in which payments should be made or commence (not later
than the date of termination as a member of the Board of
Directors (if I am not otherwise an employee of W. R. Berkley
Corporation or any affiliate) or termination of employment (if I
am otherwise an employee of W. R. Berkley Corporation or any
affiliate)) _______, OR
__ (b) Until termination as a member of the Board of Directors (if I am
not otherwise an employee of W. R. Berkley Corporation or any
affiliate) or termination of employment (if I am otherwise an
employee of W. R. Berkley Corporation or any affiliate)
Form of Distribution:
__ Lump sum, OR
__ Annual installments __________________
(not to exceed 5)
A Participant should contact his/her Tax Advisor prior to making an election to
defer his/her annual retainer and/or meeting fees. I have received a copy of the
Plan. I understand that, in the event of my death prior to receipt of all
amounts payable to me pursuant to the Plan, the amount credited to my Deferred
Compensation Account will be paid to my designated beneficiary in the form of a
lump sum.
Beneficiary Name ________________________ Participant Name __________________
Address _________________________________ Address ___________________________
Beneficiary Participant
Social Security No. _____________________ Social Security No. _______________
_________________________________________ Date ______________________________
Signature of Participant