EXHIBIT 10.22
DIMON INCORPORATED
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
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EFFECTIVE JANUARY 1, 1997
ARTICLE I DEFINITIONS....................................1
1.01. Accounting Firm......................................1
1.02. Administrator........................................1
1.03. Affiliate............................................1
1.04. Board................................................1
1.05. Cash Balance Plan....................................1
1.06. Capped Parachute Payments............................1
1.07. Change in Control....................................1
1.08. Code.................................................2
1.09. Committee............................................2
1.10. Compensation.........................................2
1.11. Competes.............................................2
1.12. Control Change Date..................................3
1.13. Corporation..........................................3
1.14. Credited Compensation................................3
1.15. Employee.............................................3
1.16. Executive............................................3
1.17. Fiscal Year..........................................3
1.18. Foreign Social Security Benefit......................3
1.19. Joint and Survivor Annuity...........................4
1.20. Net After-Tax Amount................................4
1.21. Normal Retirement Allowance..........................4
1.22. Normal Retirement Date...............................4
1.23. Offset Amount........................................4
1.24. Parachute Payment....................................5
1.25. Participant..........................................5
1.26. Pension Equalization Plan............................5
1.27. Plan.................................................5
1.28. Profit Sharing Account...............................5
1.29. Retirement, Retire or Retires........................6
1.30. Spouse...............................................6
1.31. Surviving Spouse.....................................6
1.32. Years of Service.....................................6
ARTICLE II PARTICIPATION.................................7
2.01. Beginning Participation..............................7
2.02. Change in Status.....................................7
ARTICLE III RETIREMENT ALLOWANCES........................8
3.01. Normal Retirement Allowance..........................8
3.02. Pre-Retirement Death Benefit.........................8
ARTICLE IV VESTING......................................10
4.01. Normal Vesting......................................10
4.02. Change in Control...................................10
4.03. Competition.........................................10
ARTICLE V ADMINISTRATION OF THE PLAN....................11
5.01. Generally...........................................11
5.02. Indemnification.....................................11
5.03. Determining Benefits................................11
5.04. Cooperation.........................................11
5.05. Claims..............................................12
5.06. Review of Claims....................................12
5.07. Delegation of Committee Responsibilities............14
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ARTICLE VI TERMINATION, AMENDMENT OR MODIFICATION OF PLAN15
6.01. Reservation of Rights...............................15
6.02. Limitation on Actions...............................15
6.03. Effect of Termination...............................15
ARTICLE VII MISCELLANEOUS...............................16
7.01. Limitation on Benefits..............................16
7.02. Unfunded Plan.......................................18
7.03. Other Benefits and Agreements.......................18
7.04. Restrictions on Transfer of Benefits................18
7.05. No Guarantee of Employment..........................19
7.06. Successors..........................................19
7.07. Construction........................................19
7.08. Governing Law.......................................19
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DIMON INCORPORATED
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
INTRODUCTION
The Board of Directors of DIMON Incorporated (the Corporation)
determined that the adoption of the DIMON Incorporated Supplemental
Executive Retirement Plan (the Plan) should assist it in attracting
and retaining those employees whose judgment, abilities and
experience will contribute to its continued progress and success.
The Board of Directors also determined that the Plan should further
those objectives by providing retirement and related benefits that
supplement the amounts payable under the deferred compensation
plans and arrangements currently maintained by the Corporation.
The Plan is effective January 1, 1997. The Plan is intended to
provide an unfunded supplemental retirement benefit to a select
group of management and highly compensated employees as such terms
are used in sections 201, 301, and 501 of the Employee Retirement
Income Security Act of 1974. The Plan must be interpreted and
administered in a manner that is consistent with that intent.
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ARTICLE I
DEFINITIONS
-----------
1.01. Accounting Firm
---------------
Accounting Firm means the accounting firm most
recently approved by the Corporation's shareholders as the
Corporation's auditor; provided, however, that if such
accounting firm declines to undertake the determinations
assigned to it under this Agreement, then the "Accounting
Firm" shall mean such other accounting firm designated by
the Corporation.
1.02. Administrator
-------------
Administrator means the Committee and any delegate of
the Committee appointed in accordance with Section 5.07.
1.03. Affiliate
---------
Affiliate means any corporation which, when
considered with the Corporation, would constitute a
controlled group of corporations within the meaning of
Code section 1563(a) determined without reference to Code
sections 1563(a)(4) and 1563(e)(3)(C) and any entity,
whether or not incorporated, which would be under common
control with the Corporation within the meaning of Code
section 414(c).
1.04. Board
-----
Board means the Board of Directors of the
Corporation.
1.05. Cash Balance Plan
-----------------
Cash Balance Plan means the DIMON Incorporated Cash
Balance Plan, and any successor thereto.
1.06. Capped Parachute Payments
-------------------------
Capped Parachute Payments means the largest amount of
Parachute Payments that may be paid to the Participant
without liability under Code section 4999.
1.07. Change in Control
-----------------
Change in Control means that (i) any "person" (as
such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended) becomes the
beneficial owner, directly or indirectly, of securities of
the Corporation representing more than 30% of the
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aggregate voting power of all classes of the Corporation's
voting securities on a fully diluted basis, after giving
effect to the conversion of all outstanding warrants,
options and other securities of the Corporation
convertible into or exercisable for voting securities of
the Corporation (whether or not such securities are then
exercisable); (ii) the shareholders of the Corporation
approve (A) a plan of merger, consolidation or share
exchange between the Corporation and an entity other than
a direct or indirect wholly-owned subsidiary of the
Corporation or (B) a proposal with respect to the sale,
lease, exchange or other disposal of all, or substantially
all, of the Corporation's property; or (iii) during any
period of two consecutive years (which period may be
deemed to begin prior to the date of this agreement),
individuals who at the beginning of such period
constituted the Board, together with any new members of
the Board whose election by the Board or whose nomination
for election by the shareholders of the Corporation was
approved by a majority of the members of the Board then
still in office who either were directors at the beginning
of such period or whose election or nomination for
election was previously so approved, cease for any reason
to constitute a majority of the Board.
1.08. Code
----
Code means the Internal Revenue Code of 1986, as
amended, or any successor thereto, as in effect at the
relevant time.
1.09. Committee
---------
Committee means a committee of the Board appointed to
administer the Plan.
1.10. Compensation
------------
Compensation means the taxable earnings paid in cash
by the Company to the Participant, excluding commissions
and extra pay for temporary foreign service, plus amounts
deferred under Code sections 401(k) and 125 pursuant to
the Participant's salary reduction agreement.
1.11. Competes
--------
Competes means that Participant, either directly or
indirectly, either as principal, agent, employee,
employer, owner, stockholder (owning more than 5% of the
value of a corporation's outstanding stock), partner,
contractor, consultant or in any other individual or
representative capacity, engages in the business of a
tobacco or flower dealer, importer or exporter or any
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other business in which the Corporation or an Affiliate is
engaged at such time. If any provision of the preceding
sentence or Section 4.03 is ever deemed to exceed the
time, geographic area, or activity limitations permitted
by applicable law, the Corporation and Participant (by
virtue of his participation in the Plan), agree that such
provisions must be and are reformed to the maximum time,
geographic area and activity limitations permitted by
applicable law, and expressly authorize a court having
jurisdiction to reform the provisions to the maximum time,
geographic area and activity limitations permitted by
applicable law.
1.12. Control Change Date
-------------------
Control Change Date means the date on which all of
the events necessary for a Change in Control have
occurred.
1.13. Corporation
-----------
Corporation means DIMON Incorporated and any
successor corporation.
1.14. Credited Compensation
---------------------
Credited Compensation means fifty percent (50%) of
the average of the Compensation paid to the Executive
during the three Fiscal Years occurring during the last
ten Fiscal Years that the Participant was employed by the
Company that yields the highest number.
1.15. Employee
--------
Employee means a person who is an employee of the
Corporation or an Affiliate.
1.16. Executive
---------
Executive means an Employee who is compensated at
Grade 23 or above.
1.17. Fiscal Year
-----------
Fiscal Year means the Corporation's taxable year for
Federal income tax purposes.
1.18. Foreign Social Security Benefit
-------------------------------
Foreign Social Security Benefit means the excess, if
any of (a) the benefit payable to a Participant at normal
retirement age under a retirement program maintained or
established by a foreign government over (b) the benefit
that would have been payable to the Participant at normal
retirement age under the United States Social Security
program had the Participant been covered by such program.
1.19. Joint and Survivor Annuity
--------------------------
Joint and Survivor Annuity means an annuity for the
life of the Participant with a survivor annuity for the
life of the Spouse which is equal to fifty percent (50%)
of the amount payable during the joint lives of the
Participant and Spouse and which is the actuarial
equivalent (using the actuarial assumptions and methods
applicable to the Cash Balance Plan) of an annuity for the
life of the Participant.
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1.20. Net After-Tax Amount
---------------------
Net After-Tax Amount means the amount of any
Parachute Payments or Capped Parachute Payments, as
applicable, net of taxes imposed under Code sections 1,
3101(b) and 4999 and any State or local income taxes
applicable to the Participant as in effect on the date of
the first payment under this Plan after a Control Change
Date. The determination of the Net After Tax Amount shall
be made using the highest combined effective rate imposed
by the foregoing taxes on income of the same character as
the Parachute Payments or Capped Parachute Payments, as
applicable, in effect for the year in which the
determination is made.
1.21. Normal Retirement Allowance
---------------------------
Normal Retirement Allowance means the benefit
described in Section 3.01, 3.02.
1.22. Normal Retirement Date
----------------------
Normal Retirement Date means the first day of the
month coincident with or next following a Participant's
retirement from the Corporation or an Affiliate after
attaining age 65.
1.23. Offset Amount
-------------
Offset Amount means the sum of the monthly benefits,
if any, payable to or on behalf of a Participant under the
Cash Balance Plan, the Pension Equalization Plan, the
Profit Sharing Account, the Foreign Social Security
Benefit or any employment agreement between the Company
(or any Affiliate or predecessor thereof) and the
Participant, or any other supplemental executive
retirement plan maintained by the Corporation or an
Affiliate and any other benefit plan maintained by the
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Corporation or an Affiliate, except to the extent that
such plan provides a benefit attributable to a
Participant's elective deferrals under Code section
401(k). For purposes of Section 3.01(a), the Offset
Amount shall be determined as a single life annuity (in
the case of a Participant who is not legally married on
the date he Retires) and shall be determined as the amount
payable to the Participant during his lifetime under a
Joint and Survivor Annuity (in the case of a Participant
who is legally married on the date he Retires). For
purposes of Sections 3.01(b) and 3.02, the Offset Amount
shall be determined as the amount payable to the Surviving
Spouse after the Participant's death under a Joint and
Survivor Annuity. The Offset Amount shall be determined
using the actuarial assumptions and methods applicable to
the Cash Balance Plan and assuming a benefit commencement
date as of the date that Participant Retires.
1.24. Parachute Payment
-----------------
Parachute Payment means a payment that is described
in Code section 280G(b)(2) (without regard to whether the
aggregate present value of such payments exceeds the limit
prescribed by Code section 280G(b)(2)(A)(ii)). The amount
of any Parachute Payment shall be determined in accordance
with Code section 280G and the regulations promulgated
thereunder, or, in the absence of final regulations, the
proposed regulations promulgated under Code section 280G.
1.25. Participant
-----------
Participant means an Executive who satisfies the
requirements of Article II.
1.26. Pension Equalization Plan
-------------------------
Pension Equalization Plan means the Dibrell Brothers,
Incorporated Pension Equalization Plan, and any successor
thereto.
1.27. Plan
----
Plan means the DIMON Incorporated Supplemental
Executive Retirement Plan.
1.28. Profit Sharing Account
----------------------
Profit Sharing Account means, as of any date, a
Participant's March 31, 1998 profit sharing account
balance in the DIMON International Profit Sharing Plan as
adjusted for gains and losses as if such March 31, 1998
account balance had been invested in the Stable Value Fund
of the DIMON Incorporated Savings and Profit Sharing Plan
or such successor fund as may be designated by the
Administrator.
1.29. Retirement, Retire or Retires
-----------------------------
Retirement, Retire or Retires means the termination
of a Participant's employment with the Company or an
Affiliate that occurs on or after the Participant's Normal
Retirement Date.
1.30. Spouse
------
Spouse means the person to whom the Participant is
legally married on the date the Participant Retires.
1.31. Surviving Spouse
----------------
Surviving Spouse means the person to whom the
Participant is legally married on the date the Participant
Retires and who survives the Participant.
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1.32. Years of Service
----------------
Years of Service is defined in Section 1.41 of the
Cash Balance Plan.
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ARTICLE II
PARTICIPATION
-------------
2.01. Beginning Participation
-----------------------
An Executive shall become a Participant in the Plan
as of the date that his participation is approved in writing
by a resolution adopted by the Administrator. An Employee
who is not an Executive shall become a Participant in the
Plan as of the date that his participation is approved in
writing by a resolution adopted by the Administrator. As a
condition of, and in consideration for, participation in
the Plan, an Executive or Employee must agree in writing
(on a form acceptable to the Administrator), that he will
not Compete with the Corporation or an Affiliate before a
Control Change Date and that he accepts and agrees to be
bound by the terms of Section 4.03.
2.02. Change in Status
----------------
A Participant shall cease to be a Participant in
the Plan as of the date that his designation as a
Participant is revoked or rescinded in writing by a
resolution adopted by the Administrator, on the date
that he ceases to be an Employee unless, as of that date,
he is entitled to receive a benefit under the Plan in
accordance with Article IV or on the date prescribed
by Section 4.03.
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ARTICLE III
RETIREMENT ALLOWANCES
3.01. Normal Retirement Allowance
---------------------------
(a) Subject to the requirements and limitations of
Article IV and Section 7.01, a Participant who Retires shall be
entitled to receive his Normal Retirement Allowance under the
Plan. The Normal Retirement Allowance is a monthly benefit
which shall be equal to the difference between (i) and
(ii) below where
(i) = The Participant's Credited Compensation
(determined as of his Normal Retirement Date) divided by
twelve (12), and
(ii) = Offset Amount.
The Normal Retirement Allowance shall be payable in
accordance with the payroll practices of the Corporation
and its Affiliates, commencing as of the date the Participant
Retires and ending with the payment for the month in which
the Participant dies. Payments of the Normal Retirement
Allowance shall be reduced in accordance with income and
employment tax withholding requirements.
(b) A monthly allowance shall be paid to the
Participant's Surviving Spouse, if any, commencing with
the month following the month in which the Participant
dies and ending with the payment for the month in which
the Surviving Spouse dies. Such benefit shall be equal
to the difference between (i) and (ii) below where
(i) = One-half (1/2) of the Participant's
Credited Compensation (determined as of his Normal
Retirement Date) divided by twelve (12), and
(ii) = Offset Amount.
The preceding sentences to the contrary notwithstanding,
no benefit shall be payable under this Section 3.01(b)
unless Participant Retires and becomes eligible to
receive his Normal Retirement Allowance under
Section 3.01(a).
3.02. Pre-Retirement Death Benefit
----------------------------
A monthly allowance shall be paid to the Participant's
Surviving Spouse, if any, commencing with the later of
the month in which the Participant would have attained
age sixty (60) and the month following the month in
which the Participant dies and ending with the payment
for the month in which the Surviving Spouse dies.
Such benefit shall be equal to the difference between
(i) and (ii) below with such difference multiplied by
(iii) below where
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(i) = One-half (1/2) of the Participant's Credited
Compensation (determined as of his date of death)
divided by twelve (12), and
(ii) = Offset Amount, and
(iii) = A fraction, the numerator of which is the
sum of the Participant's age at death and his Years
of Service (but such total shall not exceed 80) and
the denominator of which is 80.
The preceding sentences to the contrary notwithstanding,
no benefit shall be payable under this Section 3.02 unless
Participant dies after attaining age fifty (50) but before
becoming eligible to receive his Normal Retirement
Allowance under Section 3.01(a).
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ARTICLE IV
VESTING
4.01. Normal Vesting
--------------
No benefit will be payable to a Participant
or Surviving Spouse under the Plan unless the
Participant, while an employee of the
Corporation or an Affiliate, attains age sixty (60)
and the sum of the Participant's age and the number
of Years of Service credited to the Participant
equal eighty (80).
4.02. Change in Control
-----------------
Notwithstanding Section 4.01, any Participant
who is a Participant on a Control Change Date shall
be entitled to benefit payments in accordance with
Article III.
4.03. Competition
-----------
Notwithstanding Sections 4.01 and 4.02, a Participant
shall cease to be a Participant on, and no benefits shall
be payable under the Plan to a Participant or the
Participant's Surviving Spouse after, the date that
Participant engages in conduct that Competes with the
Corporation or an Affiliate. The preceding sentence shall
not apply on or after a Control Change Date.
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ARTICLE V
ADMINISTRATION OF THE PLAN
--------------------------
5.01. Generally
---------
The Plan shall be administered by the Administrator.
Subject to the provisions of the Plan, the Administrator may
adopt such rules and regulations as may be necessary to carry
out the purposes of the Plan. The Administrator's discretion
to perform or consent to any act or to interpret the Plan
is exclusive and shall be final and conclusive if all
similarly situated Participants are treated in a consistent
manner.
5.02. Indemnification
---------------
The Corporation shall indemnify and save harmless the
Administrator against any and all expenses and liabilities
arising out of the administration of the Plan, excepting
only expenses and liabilities arising out of his own willful
misconduct. Expenses against which the Administrator shall
be indemnified hereunder shall include without limitation,
the amount of any settlement or judgment, costs, counsel
fees, and related charges reasonably incurred in
connection with a claim asserted, or a proceeding
brought or settlement of a claim. The foregoing right of
indemnification shall be in addition to any other rights
to which the Administrator may be entitled.
5.03. Determining Benefits
--------------------
In addition to the powers hereinabove specified, the
Administrator shall have the power to compute and certify
the amount and kind of benefits from time to time payable
to or on behalf of Participants under the Plan, to
authorize all disbursements for such purposes, and to
determine whether a Participant or Surviving Spouse
is entitled to a benefit under the Plan.
5.04. Cooperation
-----------
To enable the Administrator to perform its functions,
the Corporation and its Affiliates shall supply full and
timely information to the Administrator on all matters
relating to the compensation of all Participants, their
retirement, death or other reason for termination of
employment, and such other pertinent facts as the
Administrator may require.
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5.05. Claims
------
It is not necessary to file a claim in order
to receive Plan benefits.
On receipt of a claim for Plan benefits, the
Administrator must respond in writing within ninety days.
If necessary, the Administrator's first notice must
indicate any special circumstances requiring an extension
of time for the Administrator's decision. The extension
notice must indicate the date by which the Administrator
expects to render a decision; an extension of time for
processing may not exceed ninety days after the end
of the initial period.
If a claim is wholly or partially denied, the
Administrator must give written notice within the time
provided in the preceding paragraph. An adverse
notice must specify each reason for denial. There must
be specific reference to provisions of the Plan or
related documents on which the denial is based. If
additional material or information is necessary for
the claimant to perfect the claim, it must be described
and there must be an explanation of why that material
or information is necessary. Adverse notice must
disclose appropriate information about the steps
that the claimant must take if he wishes to submit
the claim for review. If notice that a claim has
been denied is not furnished within the time required
in the preceding paragraph, the claim is deemed denied.
The full value of a payment made according to
the provisions of the Plan satisfies that much of the
claim and all related claims under the Plan against the
Administrator and the Corporation and its Affiliates,
each of whom, as a condition to a payment from it or
directed by it, may require the Participant, Surviving
Spouse, or legal representative to execute a receipt
and release of the claim in a form determined by the
person requesting the receipt and release.
5.06. Review of Claims
----------------
The Committee must review a claimant's proper
written request for review of a denied claim.
The Committee must receive the written request before
sixty-one days after the claimant's receipt of notice
that a claim has been denied according to the preceding
Plan Section. The claimant and an authorized
representative are entitled to be present and heard
if any hearing is used as part of the review.
The Committee must determine whether there
will be a hearing. Before any hearing, the claimant
or a duly authorized representative may review all
Plan documents and other papers that affect the claim
and may submit issues and comments in writing. The
Committee must schedule any hearing to give sufficient
time for this review and submission, giving notice of
the schedule and deadlines for submissions.
The Committee must advise the claimant in writing
of the final determination after review. The decision
on review must be written in a manner calculated to be
understood by the claimant, and it must include specific
reasons for the decision and specific references to the
pertinent provisions of the Plan or related documents on
which the decisions is based. Except as otherwise
provided in this Section, the written advice must be
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rendered within sixty days after the request for review
is received, unless special circumstances require an
extension of time for processing. If an extension is
necessary, the decision must be rendered as soon as
possible but no later than 120 days after receipt of
the request for review. If the Committee has regularly
scheduled meetings at least quarterly, the following
rules govern the time for the decision after review.
If the claimant's written request for review is
received more than thirty days before a Committee
meeting, the decision of the Committee must be
rendered at the next meeting after the request for
review is received. If the claimant's written request
for review is received thirty days or less before a
Committee meeting, the decision of the Committee
must be rendered at the Committee's second meeting
after the request for review has been received.
If special circumstances (such as the need to hold
a hearing) require an extension of time for
processing, the decision of the Committee must be
rendered not later than the Committee's third
meeting after the request for review has been
received. If an extension of time for review is
required, written notice of the extension must be
furnished to the claimant before the extension
begins. If notice that a claim has been denied
on review is not received by the claimant within the
time required in this paragraph, the claim is
deemed denied on review.
5.07. Delegation of Committee Responsibilities
----------------------------------------
The Committee, in its discretion, may delegate
to one or more officers of the Corporation or an Affiliate
all or part of the Committee's authority and duties under
the Plan; provided, however, that the Committee may not delegate
its authority or duties under Article II, Article VI or
Section 5.06. The Committee may revoke or amend the terms
of a delegation in accordance with the preceding sentence
but such action shall not invalidate any prior actions of
the Committee's delegate or delegates that were consistent
with the terms of the Plan and the prior delegation.
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ARTICLE VI
TERMINATION, AMENDMENT OR MODIFICATION OF PLAN
----------------------------------------------
6.01. Reservation of Rights
----------------------
Except as otherwise specifically provided, the
Corporation reserves the right to terminate, amend or modify
this Plan wholly or partially at any time and from time to
time. Such right to terminate, amend or modify the Plan
shall be exercised by the Committee or its delegate.
Notwithstanding the preceding, with respect to an affected
Participant, the Plan may not be amended, modified or
terminated after a Change in Control unless the affected
Participant agrees to such amendment, modification or
termination in writing.
6.02. Limitation on Actions
---------------------
The rights of the Corporation set forth in the
preceding Section are subject to the condition that except
as provided in Section 4.03, the Committee or its delegate
shall take no action to terminate the Plan or decrease
the benefit that would become payable or is payable, as
the case may be, with respect to a Participant or his
Surviving Spouse after a Control Change Date or after
the Participant has satisfied the requirements of
Section 4.01.
6.03. Effect of Termination
---------------------
Except as otherwise provided in this Article VI,
upon the termination of this Plan by the Committee, the
Plan shall be of no further force or effect, and neither
the Corporation or its Affiliates or the Administrator
nor the Participant or his Surviving Spouse shall have
any further obligation or right under this Plan.
Likewise, except as otherwise provided in this
Article VI, the rights of any individual who was a
Participant and who ceases to be a Participant shall
be forfeited on the date that the individual ceases
to be a Participant.
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ARTICLE VII
MISCELLANEOUS
-------------
7.01. Limitation on Benefits
----------------------
(a) If any benefits payable under this Plan
and any other payments that the Participant is entitled to
receive under other plans and agreements constitute
Parachute Payments that are subject to the "golden
parachute" rules of Code section 280G and the excise
tax of Code section 4999, the Parachute Payments shall
be reduced if, and only to the extent that, a reduction
will allow the Participant to receive a greater Net
After Tax Amount than he would receive absent a reduction.
The remaining provisions of this Section describe how
that intent will be effectuated.
(b) The Accounting Firm will first determine
the amount of any Parachute Payments that are payable to
the Participant. The Accounting Firm will also determine
the Net After Tax Amount attributable to the Participant'
total Parachute Payments.
(c) The Accounting Firm will next determine
the amount of the Participant's Capped Parachute Payments.
Thereafter, the Accounting Firm will determine the Net
After Tax Amount attributable to the Participant's
Capped Parachute Payments.
(d) The Participant will receive the total
Parachute Payments unless the Accounting Firm determines
that the Capped Parachute Payments will yield the
Participant a higher Net After Tax Amount, in which
case the Participant will receive the Capped Parachute
Payments. If the Participant will receive the Capped
Parachute Payments, the Participant's total Parachute
Payments will be adjusted by first reducing the amount
payable under other plans and agreements (with the
reductions first coming from cash benefits and then
from noncash benefits). The Accounting Firm will
notify the Participant and the Corporation if it
determines that the Parachute Payments must be reduced
to the Capped Parachute Payments and will send the
Participant and the Corporation a copy of its detailed
calculations supporting that determination.
(e) As a result of any uncertainty in the
application of Code sections 280G and 4999 at the time
that the Accounting Firm makes its determinations under
this Section, it is possible that amounts will have
been paid or distributed to the Participant that should
not have been paid or distributed under this
Section 7.01 ("Overpayments"), or that additional amounts
should be paid or distributed to the Participant under
this Section 7.01 ("Underpayments"). If the Accounting
Firm determines, based on either controlling precedent,
substantial authority or the assertion of a deficiency
by the Internal Revenue Service against the Participant
or the Corporation, which assertion the Accounting
Firm believes has a high probability of success, that
an Overpayment has been made, that Overpayment will be
treated for all purposes as a loan ab initio that
-- ------
the Participant must repay to the Corporation together
with interest at the applicable federal rate under
Code section 7872(f)(2); provided, however, that no
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loan will be deemed to have been made and no amount will
be payable by the Participant to the Corporation unless,
and only to the extent that, the deemed loan and payment
would either reduce the amount on which the Participant
is subject to tax under Code section 4999 or generate
a refund of tax imposed under Code section 4999. If
the Accounting Firm determines, based upon
controlling precedent or substantial authority, that
an Underpayment has occurred, the Accounting Firm
will notify the Participant and the Corporation of
that determination and the amount of that Underpayment
will be paid to the Participant promptly by the
Corporation.
(f) All determinations made by the Accounting
Firm under this Section 7.01 are binding on the Participant
and the Corporation and must be made within sixty days
after the Participant's termination of employment with
the Corporation and its Affiliates unless reasonable
cause requires an extension of time. The Accounting Firm
must provide the Participant and the Corporation written
notice of any required extension before the end of the
sixty-day period; but the Accounting Firm must make its
determinations under this Section 7.01 as soon as possible
and not later than nine months after the Participant's
termination of employment with the Corporation and its
Affiliates.
7.02. Unfunded Plan
-------------
The Corporation and its Affiliates have only a
contractual obligation to make payments of the
benefits described in the Plan. All benefits are to be
satisfied solely out of the general corporate assets of
the Corporation and its Affiliates which shall remain
subject to the claims of its creditors. No assets of
the Corporation or its Affiliates will be segregated
or committed to the satisfaction of its obligations to
any Participant or Surviving Spouse under this Plan.
If the Corporation or an Affiliate, in its sole
discretion, elects to purchase life insurance on
the life of a Participant in connection with the Plan,
the Participant must submit to a physical examination,
if required by the insurer, and otherwise cooperate
in the issuance of such policy or his rights under
the Plan will be forfeited. The Corporation may
establish a trust, the assets of which shall remain
subject to the claims of creditors of the Corporation
and Affiliates, in anticipation of the Corporation's
obligations under the Plan. If not previously established,
such trust shall be established as of a Control Change
Date and the Corporation (or its successor) shall
contribute assets to such trust at least equal to the
present value of Participants' benefits (whether or
not vested and determined using the actuarial
assumptions and methods applicable to the Cash Balance
Plan) and maintain such funded status until all
obligations owed by the Plan to Participants and their
Surviving Spouses have been paid in full.
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7.03. Other Benefits and Agreements
-----------------------------
The benefits, if any, provided for a Participant
or a Surviving Spouse under the Plan are in addition to any
other benefits available to such persons under any other
plan or program of the Corporation for its employees, and,
except as may otherwise be expressly provided for, the Plan
shall supplement and shall not supersede, modify or amend
any other plan or program of the Corporation or an
Affiliate in which a Participant is participating.
7.04. Restrictions on Transfer of Benefits
------------------------------------
No right or benefit under the Plan shall be subject
to anticipation, alienation, sale, assignment, pledge,
encumbrance or charge, and any attempt to do so shall be
void. No right or benefit hereunder shall in any manner be
liable for or subject to the debts, contracts, liabilities,
or torts of the person entitled to such benefit. If any
Participant or his Surviving Spouse should become bankrupt
or attempt to anticipate, alienate, sell, assign, pledge,
encumber or charge any right to a benefit hereunder, then
such right or benefit, in the discretion of the Administrator,
shall cease and terminate, and, in such event, the
Administrator may hold or apply all or part of the benefit
of such Participant or Surviving Spouse in such manner and
in such portion as the Administrator may deem proper.
7.05. No Guarantee of Employment
--------------------------
The Plan does not in any way limit the right of
the Corporation or an Affiliate at any time and for any
reason to terminate the Participant's employment or such
Participant's status as an officer of the Corporation or
an Affiliate. In no event shall the Plan by its terms or
implications constitute an employment contract of any
nature whatsoever between the Corporation or an
Affiliate and a Participant.
7.06. Successors
----------
The Plan shall be binding upon the Corporation
and its successors and assigns; subject to the powers
set forth in Article VI, and upon a Participant and his
Surviving Spouse and either of their assigns, heirs,
executors and administrators.
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7.07. Construction
------------
Headings are given for ease of reference and
must be disregarded in interpreting the Plan.
Masculine pronouns wherever used shall include feminine
pronouns and the use of the singular shall include the
plural.
7.08. Governing Law
-------------
This Plan shall be governed by the laws of
the Commonwealth of Virginia (other than its choice-
of-laws provisions) except to the extent that the
laws of the Commonwealth of Virginia are preempted
by the laws of the United States.
As evidence of its adoption of the Plan,
DIMON Incorporated has caused this instrument to be signed
by 30 day of July, 1998.
DIMON INCORPORATED
By: /s/ J. O. Hunnicutt
Title: V.P. Administration
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