EXHIBIT 10.3
EQUISTAR CHEMICALS LP
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SUPPLEMENTARY EXECUTIVE
RETIREMENT PLAN
Effective January 1, 1998
Equistar Chemicals, LP
Supplementary Executive Retirement Plan
TABLE OF CONTENTS
PAGE
ARTICLE I GENERAL PROVISIONS..................................................... 1
Section 1.1 Purpose and Intent of Plan.......................................... 1
Section 1.2 Effective Date of Plan.............................................. 1
Section 1.3 Plan Costs.......................................................... 1
Section 1.4 Definitions......................................................... 1
ARTICLE II SUPPLEMENTARY BENEFITS................................................ 5
Section 2.1 Types of Supplementary Benefits Provided............................ 5
Section 2.2 Eligibility in General.............................................. 5
Section 2.3 Amount of Supplementary Benefits (or Survivor Benefit) in General... 5
Section 2.4 Deferral/Incentive Supplement....................................... 6
Section 2.5 Qualification Limitation Supplement................................. 7
Section 2.6 Special Supplements................................................. 8
ARTICLE III FORM OF BENEFIT...................................................... 9
Section 3.1 Supplementary Benefits.............................................. 9
Section 3.2 Special Supplements................................................. 10
ARTICLE IV TIMING OF PAYMENT OF BENEFIT.......................................... 11
Section 4.1 Supplementary Benefits.............................................. 11
Section 4.2 Special Supplements................................................. 11
ARTICLE V ADMINISTRATION......................................................... 12
Section 5.1 Interpretation...................................................... 12
Section 5.2 Administrative Records.............................................. 12
Section 5.3 Claims.............................................................. 12
Section 5.4 Committee Liability................................................. 12
ARTICLE VI FACILITY OF PAYMENT AND LAPSE OF BENEFITS............................. 13
Section 6.1 Payment on Incapacity............................................... 13
Section 6.2 Payments or Deposits................................................ 13
ARTICLE VII MISCELLANEOUS........................................................ 14
Section 7.1 Unfunded Benefit Plan............................................... 14
Section 7.2 Unsecured General Creditor.......................................... 14
Section 7.3 Grantor Trust....................................................... 14
Section 7.4 Payments and Benefits Not Assignable................................ 14
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Section 7.5 No Right of Employment.............................................. 15
Section 7.6 Adjustments......................................................... 15
Section 7.7 Obligation to Company............................................... 15
Section 7.8 Protective Provisions............................................... 15
Section 7.9 Gender, Singular and Plural......................................... 15
Section 7.10 Law Governing...................................................... 15
Section 7.11 Validity........................................................... 15
Section 7.12 Notice............................................................. 16
Section 7.13 Successors and Assigns............................................. 16
ARTICLE VIII AMENDMENT AND DISCONTINUANCE........................................ 17
Section 8.1 Amendment of Plan................................................... 17
Section 8.2 Termination......................................................... 17
Section 8.3 Effect of Amendment or Termination.................................. 17
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ARTICLE I
GENERAL PROVISIONS
Section 1.1 Purpose and Intent of Plan.
This Plan is intended to provide supplemental retirement allowances in
accordance with its provisions to those Employees who are eligible to receive
Awards under the Equistar Chemical Company LP Key Manager or Executive Incentive
Plans, and, who
(a) have deferred a portion of their Salary under the Equistar Chemicals
LP Executive Deferral Plan or Key Management Deferral Plan, or
(b) have had the amount of their benefit reduced, due to federal legal
requirements, under a tax-qualified, defined benefit retirement plan maintained
by Equistar Chemicals LP, or
(c) have been granted a Special Supplement under Section 2.6 of this Plan.
Section 1.2 Effective Date of Plan.
This Plan document shall be effective January 1, 1998 and shall apply to
Employees who are employed by the Company on or after January 1, 1998, except to
the extent that certain provisions specify that they are effective on a
different date.
Section 1.3 Plan Costs.
All Plan costs, including administrative costs, shall be borne by the
Company and no Employee contributions shall be required or permitted.
Section 1.4 Definitions.
Actuarial Equivalent or Actuarially Equivalent mean, in comparing benefits
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payable in different forms or at different times or in different circumstances,
a value under one set of circumstances which is the same as the value under a
different set of circumstances. The value shall be computed and determined by
using mortality assumptions, interest rates and other actuarial factors and
assumptions used to calculate actuarial equivalents under the Retirement Plan.
Administrative Committee means the Benefits Administrative Committee.
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Award means a cash award made under the Equistar Chemicals LP Key Manager
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or Executive Incentive Plan or their equivalents. An Award does not include
Deferred Cash as that term is used in those plans.
Base Pay means the annual amount of "Base Pay," as defined in the
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Retirement Plan.
Basic Retirement Amount means a single lump sum benefit payable to the
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Participant or its actuarial equivalent.
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Beneficiary means a person entitled to receive the Survivor Benefit under
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Sections 2.4, 2.5 and/or 2.6 when the Participant dies.
Code means the Internal Revenue Code of 1986, as amended, including any
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successor provisions and any regulations or other guidance promulgated by
applicable governmental agencies.
Company means Equistar Chemicals, LP, a Delaware limited partnership, or
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its successor.
Deferral/Incentive Supplement means a Supplementary Benefit described under
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Section 2.4.
Deferred Compensation means any amount of Salary which a Participant elects
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to defer according to the term of the Equistar Chemicals, LP Executive Deferral
Plan or Key Manager Deferral Plan.
Employee means any person who is regularly employed by the Company on or
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after January 1, 1998 and who is an exempt, salaried employee.
ERISA means the Employee Retirement Income Security Act of 1974, as amended
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including any successor provisions, and any regulations or other guidance
promulgated by applicable governmental agencies.
Fifty Percent Joint and Survivor Annuity means an annuity providing
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payments for the Participant's life, with a survivor annuity for his
Beneficiary's life, where each payment to the Beneficiary is 50 percent of the
amount payable during the Participant's life. Each payment during the
Participant's life shall be a percentage of the amount otherwise payable to the
Participant as a Basic Retirement Amount, so that the Fifty Percent Joint and
Survivor Annuity is the Actuarial Equivalent of that Basic Retirement Amount.
Financial Hardship means a condition of financial difficulty, determined by
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the Administrative Committee upon advice of counsel to be sufficient to justify
a change in the elected form of benefits under Section 3.1 without causing, in
counsel's judgment, any other Plan Participant to receive taxable income in
advance of actual payment of Plan benefits.
Participant means an active Employee or a former Employee who, at time of
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Termination of Employment, retirement or death, was employed by the Company or a
Related Company and who is entitled to receive Plan benefits by reason of having
(a) received one or more Awards that would be used to compute the Employee's
Average Final Base Pay under the Retirement Plan, if the Awards were recognized
as a part of Base Pay under the Retirement Plan; (b) deferred a portion of his
Salary that would be used to calculate the Employee's Average Final Base Pay
under the Retirement Plan if the Deferred Compensation recognized as a part of
Base Pay under the Retirement Plan; (c) had his benefit under the Retirement
Plan reduced due to required limitations under the Code or ERISA; and/or (d)
been granted a Special Supplement
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under Section 2.6. Participant shall include a former Employee who has not
received the entire benefit to which he is entitled under this Plan.
Plan means this Supplementary Executive Retirement Plan of Equistar
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Chemicals, LP.
Pre-Retirement Survivor Annuity means the benefit paid under the Retirement
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Plan to a survivor, payable on account of the Member's death prior to commencing
payment of the retirement benefit and after the Member became entitled to a
retirement benefit under that Plan.
Qualified Limitation Supplement means a Supplementary Benefit described in
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Section 2.5.
Related Company means
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(a) Any corporation that is a member of a controlled group of corporations
within the meaning of section 1563(e)(3)(C), of which Equistar Chemicals LP is a
member.
(b) All trades or businesses, whether or not incorporated, which, under
regulations prescribed by the Secretary of the Treasury pursuant to Section
210(d) of ERISA, are under common control with Equistar Chemicals LP, and
(c) Lyondell Chemical Company, LYONDELL-CITGO Refining Company, Ltd.,
Millennium Petrochemical Inc. or Occidental Petroleum Company, to the extent the
Related Company has agreed to recognize a Participant's Base Pay for purposes of
its retirement plan.
Retirement Plan means the Equistar Chemicals, LP Retirement Plan for Non-
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Represented Employees.
Salary means the Employee's regular base salary paid by the Company or a
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Related Company, excluding Awards and any other special or additional
compensatory payments.
Special Supplement means a supplementary retirement benefit approved for
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payment to an Employee under Section 2.6.
Supplementary Benefit means any of the types of supplementary benefits
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provided in Sections 2.4, 2.5 or 2.6.
Supplementary Benefits means, collectively, all Supplementary Benefits
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provided by this Plan, or all those Supplementary Benefits to which a particular
Participant is entitled, as the context requires.
Survivor Benefit means any survivor benefit that is payable to a
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Participant's Beneficiary under the provisions of Article II.
Termination of Employment or Terminate Employment means to cease performing
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services as an Employee for the Company or any Related Company. However, an
individual
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will not be considered to have Terminated Employment for Plan purposes solely
because the Company or Related Company's identity changes due to a sale of
substantially all of the Company's or Related Company's assets or stock, where
the individual continues, after the sale, to perform substantially the same
services for the purchaser as he performed for the Company or Related Company
immediately prior to the sale.
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ARTICLE II
SUPPLEMENTARY BENEFITS
Section 2.1 Types of Supplementary Benefits Provided.
This Plan provides for the following types of Supplementary Benefits:
(a) Deferral/Incentive Supplements, as described in Section 2.4;
(b) Qualification Limitation Supplements, as described in Section 2.5;
(c) Special Supplements, as described in Section 2.6.
Section 2.2 Eligibility in General.
(a) Eligibility for Benefit. A Employee who Terminates Employment with a
nonforfeitable right to a Basic Retirement Amount from the Retirement Plan
automatically is eligible for each type of Supplementary Benefit provided by
Sections 2.4 and 2.5 to the extent to which he satisfies the specific
eligibility requirements of the applicable Section. Supplementary Benefits shall
be paid in the form and at the time provided under Articles III and IV,
respectively.
(b) Eligibility for Survivor's Benefit. If a Participant dies prior to the
commencement of any Supplementary Benefit to which the Participant is entitled,
any person designated by the Participant as his Beneficiary will be eligible to
receive a Survivor Benefit that relates to the particular Supplementary Benefit.
The Participant must designate the same person as his Beneficiary for purposes
of all Survivor Benefits payable under this Plan. Survivor Benefits to which a
Beneficiary is entitled under this Article will automatically be paid to the
Beneficiary. If the Participant dies prior to commencing any Supplementary
Benefits without having designated a Beneficiary, the Beneficiary shall be the
Participant's spouse, if the Participant was married at the time of death, and
the Participant's estate if the Participant was single at the time of death. If
a Participant dies after commencing Plan benefits in a form that provides for
continued payments after the Participant's death, benefit payments shall
continue in accordance with the terms and provisions of that form of benefit.
Section 2.3 Amount of Supplementary Benefits (or Survivor Benefit) in General.
The total amount of a Supplementary Benefit (or Survivor Benefit, if
applicable) payable under this Plan shall be the sum of the benefits to which
the Participant is entitled (or Survivor Benefits to which the Participant's
Beneficiary is entitled, if applicable) under all types of Supplementary
Benefits whose requirements are satisfied by or with respect to the Participant.
Each type of Supplementary Benefits payable from this plan to a Participant
is the Participant's Excess Retirement Benefit. "Excess Retirement Benefit"
means the excess of:
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(a) the Participant's "Hypothetical Amount", as defined separately for
purposes of each type of Supplementary Benefit; over
(b) the retirement benefit the Participant would receive in form of the
Basic Retirement Amount from the Retirement Plan.
Section 2.4 Deferral/Incentive Supplement.
(a) Eligibility for Deferral/Incentive Supplement. A Participant is
eligible for a Deferral/Incentive Supplement if his Excess Retirement Benefit,
using the Hypothetical Amount in 2.4(b)(1), is positive. If a Participant
entitled to receive a Deferral/Incentive Supplement dies before commencing this
benefit, his Beneficiary will be paid a monthly Survivor Benefit described in
Section 2.4(b)(2) below.
(b) Calculation of Deferral/Incentive Supplement.
(1) Participant's Benefit. Subject to Sections 2.4(c), (d) and (e),
the Hypothetical Amount of the Participant's Deferral/Incentive Supplement shall
be the retirement benefit the Participant would have received in the form of the
Basic Retirement Amount from the Retirement Plan, if the Base Pay used to
calculate that benefit under the Retirement Plan had included the Participant's
Awards and Deferred Compensation.
If the Participant transfers directly from the Company's employment to a
Related Company's employment, Base Pay to calculate the Hypothetical Amount will
include the Participant's Awards and Deferred Compensation while he is employed
by the Related Company, if the Company recognizes the Participant's salary while
employed by the Related Company to determine the Participant's Retirement Plan
benefits.
(2) Survivor Benefit. The monthly amount of the Survivor Benefit
payable with respect to a Participant who dies before commencing a
Deferral/Incentive Supplement under this Plan shall be (i) minus (ii), where:
(i) is the monthly Pre-Retirement Survivor Annuity that would be
payable with respect to the Participant from the Retirement Plan if it were
calculated using the Participant's Hypothetical Amount described in Section
2.4(b)(1), and
(ii) is the monthly amount of Pre-Retirement Survivor Annuity
actually payable with respect to the Participant from the Retirement Plan.
(c) Maximum Limitation on Deferral/Incentive Supplement Benefits.
Notwithstanding the provisions of Paragraphs (a) and (b) of this Section 2.4,
the amount of a Participant's Deferral/Incentive Supplement (or Survivor Benefit
payable with respect to the Participant, as applicable) shall be limited to the
extent necessary so that the total annual benefits payable to or with respect to
the Participant (i) from the Retirement Plan; (ii) as a Qualification Limitation
Supplement if any, payable under Section 2.5; and (iii) as a Deferral/Incentive
Supplement under this Section, will not exceed 65 percent of the greater of (a)
the sum of the
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Participant's annual Salary as of his Termination of Employment plus his most
recent Award, or (b) the average of the Participant's highest 3 consecutive
years of Salary and Awards for each year during the Participant's prior ten
years of employment with the Company or a Related Company.
(d) Recalculation Due to Subsequent Award. The Award used to determine the
Hypothetical Amount for the calendar year in which the Participant's Termination
of Employment or death occurs is equal to a prorata share of the Award, if any,
for the calendar year immediately preceding that event. If the Participant
receives an actual Award after Termination of Employment, the actual Award shall
be used to recalculate the Deferral/Incentive Supplement. A Supplement already
being paid may be increased, but not decreased, by this recalculation.
(e) Termination of Employment. If a Participant, is not eligible for a
Basic Retirement Amount from the Retirement Plan at the time of his Termination
of Employment or if a Survivor Benefit is not payable under the Retirement Plan
on the Participant's death, the Participant's rights, and the rights of any
person claiming under or by right of the Participant, to any Deferral/Incentive
Supplement benefits shall cease.
Section 2.5 Qualification Limitation Supplement.
(a) Eligibility for Qualification Limitation Supplement. An Employee shall
be eligible for a Qualification Limitation Supplement if his Excess Retirement
Benefit using the Hypothetical Amount in Section 2.5(b)(1) is positive. If a
Participant entitled to receive a Qualification Limitation Supplement dies
before commencing this benefit, his Beneficiary will be paid a monthly Survivor
Benefit described in Section 2.5(b)(2) below.
(b) Amount of Qualification Limitation Supplement.
(1) Participant's Benefit. The Hypothetical Amount of the
Participant's Qualification Limitation Supplement shall be the retirement
benefit the Participant would have received, in the form of the Basic Retirement
Amount, from the Retirement Plan if the amount of the Participant's retirement
benefit under the Retirement Plan was not subject to limitations or reductions
required under the Code or ERISA.
(2) Survivor Benefit. The monthly amount of the Survivor Benefit
payable with respect to a Participant who dies before commencing a Qualification
Limitation Supplement under this Plan shall be (i) minus (ii), where:
(i) is the monthly Pre-Retirement Survivor Annuity that would be
payable from the Retirement Plan if the amount of the Participant's
retirement benefit under the Retirement Plan was calculated by using the
Participant's Hypothetical Amount described in Section 2.5(b)(i), and
(ii) is the monthly amount of the Pre-Retirement Survivor Annuity
actively payable from the Retirement Plan with respect to the Participant.
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Section 2.6 Special Supplements.
In addition to any other Supplementary Benefits to which an Employee may be
entitled under this Plan, at its sole discretion, the Compensation Committee of
the Partnership Governance Committee of the Company may award a Special
Supplement to any Employee in an amount, or to be computed on a basis it
determines. These awards may be granted for any reason the Compensation
Committee deems appropriate, including, without limitation, recognition of all
or any part of the Employee's years of service with an organization or entity
acquired by, or merged into, the Company, any Related Company, or any
predecessor of the Company. A Special Supplement shall not be granted to or on
account of any Employee who is not a member of a select group of management or
other highly compensated employee, as defined from time to time by the
Compensation Committee. A certified copy of the resolution granting a Special
Supplement shall be furnished to the Administrative Committee prior to the date
any Plan payment is to be made. The form, the time of commencement, the duration
of any periodic payments, and any other relevant factors affecting the Company's
obligation to provide a Special Supplement to an Employee, or any related
Survivor Benefit to the Employee's Beneficiary, if that benefit is specified by
the Compensation Committee, shall be determined at the sole discretion of the
Compensation Committee and shall be set forth in the certified copy of the
resolution.
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ARTICLE III
FORM OF BENEFIT
Section 3.1 Supplementary Benefits.
(a) Optional Forms of Benefit. The Participant may elect to receive
payment of his Supplementary Benefits in any form available to pay the normal
retirement benefit under the Retirement Plan, provided that (1) the same payment
form must be elected for all Supplementary Benefits to which the Participant is
entitled and (2) if the Participant elects an annuity form for the Supplementary
Benefits and for the retirement benefit under the Retirement Plan, then he must
elect the same annuity form under both plans.
(b) Elections.
(1) The Participant must elect the form of payment within the time
period and in the manner prescribed by the Administrative Committee and
communicated to the Participant before the date the Participant is eligible to
commence Supplementary Benefit payments.
(2) If the Participant fails to elect the form of Supplementary
Benefit payment within the time period designated by the Administrative
Committee, then the Participant only may elect one of the annuity forms then
available under the Retirement Plan. If the Participant fails to elect a
specific annuity form at retirement, the Participant will receive (i) an annuity
paid in the form of a Fifty Percent Joint and Survivor Annuity, with the
surviving spouse as the Beneficiary, if the Participant is married at the time
of retirement, or (ii) an annuity paid in the form of a single life annuity, if
the Participant is single at the time of retirement.
(3) If the Participant elects the form of benefit payment within the
time period designated by the Administrative Committee and subsequently wishes
to change that election prior to benefit commencement or, if the Participant is
being paid an annuity and wishes to receive the Actuarial Equivalent of the
remaining annuity installments, then he may apply in writing to the
Administrative Committee to change the previously elected payment form (i)
without any reduction in, or imposition of any penalty on, the amount of
Supplementary Benefits if the Administrative Committee determines that the
Participant has experienced a Financial Hardship justifying an election change,
or (ii) if the Administrative Committee, in its sole discretion, determines that
it is appropriate to grant the Participant's request.
(4) A Participant may elect payment of Survivor Benefits in any form
payable under the Retirement Plan at the time the Participant dies before
commencing his benefit. If the Participant fails to make this election, payment
to the Beneficiary will be in the form of a life annuity, payable for the
Beneficiary's life with a value equal to the Actuarially Equivalent value of the
Survivor Benefit payable in any other available form. The Beneficiary may
request the Administrative Committee change the Participant's prior election,
and the form may be changed if the Administrative Committee determines that a
Financial Hardship exists or it is appropriate to grant the Beneficiary's
request.
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Section 3.2 Special Supplements.
Any Special Supplement described in Section 2.6 shall be paid in a form
prescribed in the Compensation Committee's resolution conferring the benefit.
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ARTICLE IV
TIMING OF PAYMENT OF BENEFIT
Section 4.1 Supplementary Benefits.
(a) Supplementary Benefits shall commence at the same time as the
Participant's benefits is paid under the Retirement Plan.
(b) Survivor Benefits payable under this Plan shall normally be paid on
the earliest date the Participant would have become eligible to begin receiving
a retirement benefit under the Retirement Plan. A Participant may elect that the
Survivor Benefit be paid immediately following his death as a single lump sum,
rather than being paid on the Participant's earliest retirement eligibility date
and a Beneficiary may request that the Administrative Committee permit payment
of the Basic Retirement Amount at the time of the Participant's death, according
to requirements of Section 3.1(b)(4).
Section 4.2 Special Supplements.
Any Special Supplement payable under Section 2.6 shall be payable at the
time or times and prescribed in the Compensation Committee's resolution
conferring that benefit.
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ARTICLE V
ADMINISTRATION
Section 5.1 Interpretation.
The Administrative Committee has the exclusive right and discretionary
authority to interpret the Plan's provisions and to decide questions arising in
its administration. The Administrative Committee decisions and interpretations
shall be final and binding on the Company, Employees, Participants and all other
persons.
Section 5.2 Administrative Records.
The Administrative Committee shall keep records reflecting Plan
administration, which the Company may audit.
Section 5.3 Claims.
The Administrative Committee shall provide adequate written notice to any
Participant or Beneficiary whose claim for Plan benefits has been denied,
setting forth the specific reasons for the denial. The Participant or
Beneficiary will be given an opportunity for a full and fair review by the
Administrative Committee of its decision denying the claim. The Participant or
Beneficiary shall be given 60 days from the date of the notice denying any claim
within which to request the review.
Section 5.4 Committee Liability.
No Administrative Committee member shall be liable for any action taken in
good faith or for exercise of any power given to the Administrative Committee,
or for the actions of other Administrative Committee members.
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ARTICLE VI
FACILITY OF PAYMENT AND LAPSE OF BENEFITS
Section 6.1 Payment on Incapacity.
If the Administrative Committee deems that any person entitled to receive
any Plan payment is incapable of receiving or disbursing the payment because of
minority, illness or infirmity, mental incompetence, or incapacity of any kind,
the Administrative Committee, in its sole discretion, may take any one or more
of the following actions: it may apply the payment directly for the person's
comfort, support and maintenance; it may reimburse any person for any support
previously supplied to the person entitled to receive any payment; or it may pay
any other person the Administrative Committee selects to disburse the payment
for the person's comfort, support and maintenance, including, without
limitation, to any relative who has undertaken, wholly or partially, the expense
of person's comfort, care and maintenance, or any institution in whose care or
custody the person entitled to the payment may be. The Administrative Committee,
in its sole discretion, may deposit any payment due to a minor to the minor's
credit in any savings or commercial bank of the Administrative Committee's
choice.
Section 6.2 Payments or Deposits.
Payments or deposits under this Article VI shall be a complete discharge,
to the extent of the payment or deposit, of the Plan or all other liability of
the Administrative Committee, the Company and this Plan. Receipt of any payment,
distribution or deposit shall be a complete acquittance by the person(s)
receiving the payment. There shall be no liability to see to the application of
any Plan payments, distributions or deposits.
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ARTICLE VII
MISCELLANEOUS
Section 7.1 Unfunded Benefit Plan.
(a) Benefits under Sections 2.4 and 2.6 of this Plan are intended to
constitute a plan that is unfunded and maintained primarily for the purpose of
providing deferred compensation in the form of additional retirement benefits to
a select group of management or highly compensated employees as defined in
Sections 201(a)(2), 301(a)(3) and 401(a)(1) of ERISA.
(b) Benefits under Section 2.5 of this Plan are intended to constitute an
unfunded, "excess benefit plan" within the meaning of Section 3(36) of ERISA.
Section 7.2 Unsecured General Creditor.
Participants and their Beneficiaries shall have no legal or equitable
rights, claims or interests in any specific Company assets or property, nor are
they the Beneficiaries of, or have any rights, claims or interests in any life
insurance policies, annuity contracts, or the proceeds of those policies or
contracts, which the Company owns or acquires (the "Policies"). Any Policies or
other Company assets shall be and shall remain general, unpledged, unrestricted
Company assets. The Company's obligation under the Plan is merely an unfunded
and unsecured Company promise to pay money in the future.
Section 7.3 Grantor Trust.
Although the Company is responsible for all Plan benefits, the Company, in
its discretion, may contribute funds to a grantor trust for the purpose, as it
deems appropriate, to pay Plan benefits. The trust may be irrevocable, but trust
assets shall be subject to the claims of creditors of Equistar Chemicals, LP.
To the extent any Plan benefits are actually paid from the trust, the Company
shall have no further obligation for those benefits, but to the extent the
benefit is not paid, benefits shall remain the obligation of, and shall be paid
by, the Company. Participants shall be unsecured creditors insofar as their
legal claim for Plan benefits and Participants shall have no security interest
in the grantor trust.
Section 7.4 Payments and Benefits Not Assignable.
Payments to and benefits under this Plan are not assignable, transferable
or subject to alienation since they are primarily for the support and
maintenance of the Participants and their joint annuitant or Beneficiaries after
retirement. Likewise, payments shall not be subject to attachments by creditors
of, or through legal process against, the Company, the Administrative Committee
or any Participant. Payments may be offset by the Company as provided under
Section 7.7
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Section 7.5 No Right of Employment.
The Plan provisions shall not give an Employee the right to be retained in
Company service nor shall this Plan or any action taken under it be construed as
an employment contract.
Section 7.6 Adjustments.
At the Company's request, the Administrative Committee may adjust the
Participant's Plan benefit or make other adjustments required to correct
administrative errors or provide uniform treatment of Participants, in a manner
consistent with the Plan's intent and purpose.
Section 7.7 Obligation to Company.
If a Participant becomes entitled to a distribution of Plan benefits and
the Participant has any debt, obligation, or other liability representing an
amount owed to the Company or any Company benefit plan, then the Administrative
Committee may offset the amount owed to the Company or the benefit plan against
the amount of benefits otherwise distributable under this Plan.
Section 7.8 Protective Provisions.
Each Participant shall cooperate with the Company by furnishing any and all
information the Company requests to facilitate the payment of Plan benefits,
taking any physical examinations the Company deems necessary and taking other
relevant action the Company requests. If a Participant refuses to cooperate, the
Company shall have no further obligation to the Participant under the Plan. If
the Participant makes any material misstatement of information or nondisclosure
of medical history, no benefits will be payable to the Participant or his
Beneficiary unless, at the Company's sole discretion, benefits are payable in an
amount reduced to compensate the Company for any loss, cost, damage or expense
suffered or incurred by the Company as a result in any way of any Participant
action, misstatement or nondisclosure.
Section 7.9 Gender, Singular and Plural.
All pronouns and any variations are deemed to refer to the masculine,
feminine, or neuter, as the identity of the person or persons requires. The
singular may be read as the plural and the plural as the singular, as the
context may require.
Section 7.10 Law Governing.
This Plan shall be construed, regulated and administered under the laws of
the State of Texas, except to the extent that those laws are preempted by ERISA.
Section 7.11 Validity.
If any Plan provision is held invalid, void, or unenforceable, it shall not
affect the validity of any other Plan provision in any respect whatsoever.
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Section 7.12 Notice.
Any notice or filing required or permitted to be given to the
Administrative Committee under the Plan shall be sufficient if in writing and
hand delivered, or sent by registered or certified mail, to the Company's
principal office, directed to the attention of the Secretary of the
Administrative Committee. Notice shall be deemed given as of the date of
delivery or, if delivery is made by mail, as of the date shown or the postmark
on the receipt for registration or certification.
Section 7.13 Successors and Assigns.
This Plan shall be binding upon the Company and its successors and assigns.
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ARTICLE VIII
AMENDMENT AND DISCONTINUANCE
Section 8.1 Amendment of Plan.
This Plan may be amended from time to time by a resolution of the
Compensation Committee of the Partnership Governance Committee of Equistar
Chemicals, LP.
Section 8.2 Termination.
Equistar Chemicals, LP intends to continue this Plan indefinitely, but
reserves the right to terminate it at any time for any reason, in its sole
discretion.
Section 8.3 Effect of Amendment or Termination.
No Plan amendment or termination may adversely affect the benefit payable
to any Participant receiving Plan benefits or entitled to receive benefits prior
to the effective date of the amendment or termination. However, the Company may
amend the Plan to eliminate any optional form of payment and if so, the
amendment will not be deemed to adversely affect any Participant's benefit
entitlement.
17