EXHIBIT 10.4
SUN COMPANY, INC.
DEFERRED COMPENSATION PLAN
Introduction
A. Executive Resources who are participants in the Executive Incentive
Plan (hereinafter called the "Incentive Plan") of Sun Company, Inc.
(hereinafter called the "Company"), constitute a select group of management
or highly compensated employees.
B. The Incentive Plan provides that the Board of Directors may pay
bonuses annually, as additional compensation to such employees as the Board
determines have principally contributed to the profitability of the
Company.
C. The Company has established this Deferred Compensation Plan to provide
Executive Resources who are participants in the Incentive Plan with the
option to irrevocably defer the receipt of all or a portion of the bonus to
which such participants would otherwise be entitled, subject to the terms
and conditions hereinafter set forth.
SUBSTANTIVE PROVISIONS
ARTICLE I
Definitions
1.1 COMMITTEE means the Compensation Committee of the Board of Directors
of Sun Company, Inc.
1.2 DEFERRED BONUS ACCOUNT with respect to any Participant means the total
amount of the Company's promise to pay an executive the deferred
amount in his account, in addition to any interest accumulation.
1.3 EXECUTIVE RESOURCE means any employee who is employed by the Company
as a principal officer or in a job which, in accordance with the
Company's job evaluation program, has been assigned 1400 or more Hay
points, and any other employee who is designated by the Board
Committee as being an Executive for purposes of this Plan.
1.4 PARTICIPANT means an Executive Resource who meets the eligibility
requirements of the Incentive Plan and who is participating in this
Plan.
1.5 PERMANENT AND TOTAL DISABILITY - A Participant shall be deemed to be
permanently and totally disabled if he is eligible to receive benefits
under his employer's long-term disability plan.
1.6 PLAN means the Deferred Compensation Plan set forth herein and as it
may be amended from time to time.
1.7 RETIREMENT means the date on which a Participant is retired in
accordance with his employer's retirement plan, program, or policy.
1.8 SUBSIDIARIES means corporations in which the Company, directly or
indirectly owns fifty percent or more of the outstanding voting stock.
ARTICLE II
Deferral of Bonuses
2.1 ELECTION TO DEFER - A Participant may elect to defer all or a portion
of his bonus to be awarded under the Incentive Plan by filing a
written election with the Committee on forms to be prescribed by the
Committee. Such election must include a designation of beneficiary and
an irrevocable election of a method of payment as described in
Articles IV and V. Any such election shall apply only to bonuses to be
earned in years beginning after the effective date of the election.
2.2 AMOUNT OF DEFERRAL - The amount of bonus to be deferred in any year
shall be designated by the Participant as a percentage of his bonus in
multiples of 5% but shall not be less than 10%.
2.3 TIME OF ELECTION - A separate election to defer must be filed for each
year and must be received by the Committee by the end of the year
preceding the year in which the bonus is earned. Any election by a
Participant with respect to a bonus in a given year will not preclude
a different action with respect to bonuses in subsequent years.
ARTICLE III
Deferred Bonus Accounts
3.1 CREATION OF DEFERRED BONUS ACCOUNT - The Company shall establish a
Deferred Bonus Account for each Participant. The account will be the
method the Company shall use to record any deferred bonus at the time
Participant would have otherwise first been entitled to such bonus.
3.2 CREDITING INTEREST EQUIVALENTS - As additional deferred compensation,
the Company shall credit Participant's Deferred Bonus Account on
January 1, of each year with an interest factor determined each year
by the Committee, to be compounded on the basis of the balance in the
Participant's Deferred Bonus Account.
ARTICLE IV
Payment of Deferred Bonuses
4.1 TIME OF PAYMENT - All payments of a Participant's Deferred Bonus
Account shall be made at, or shall commence on, the earliest of the
following date:
a. Separation, from employment,
b. Retirement,
c. Permanent and total disability, and
d. Death of a participant, in which case, payment will be made to
the heir, beneficiary, or successor designated by the employee
under Article V.
provided, however, that the Participant may irrevocably designate such
other date on which payment will commence, so long as the latest date
shall not be more than three years following retirement or separation
from employment.
4.2 METHOD OF PAYMENT - Participant shall have the option of selecting
either a lump sum payment or a series of annual installments (not
exceeding ten), provided such election is irrevocable and made at the
date of deferral.
4.3 HARDSHIP DISTRIBUTION - Participant may request a modification in the
payment terms hereunder only in the event of severe financial hardship
and only to the extent reasonably necessary to eliminate the hardship.
Such request shall specify in detail the grounds for the requested
modification and shall be referred to the Committee. A qualifying
severe financial hardship must be caused by accident, illness, or
event beyond the control of the Participant. The decision of the
Committee with respect to the requested modification shall be solely
at the discretion of the Committee and in accordance with its
evaluation of the exigencies of the situation. Such decision shall be
binding on the Company and Participant.
ARTICLE V
Designation of Beneficiaries
The Participant shall name a beneficiary to receive any payments due him at
the time of his death, with the right to change such beneficiary at any
time. In case of a failure of designation or the death of the designated
beneficiary without a designated successor, distribution shall be made to
the person or persons designated as beneficiary in the designation most
recently filed under the Sun Company, Inc. Stock Purchase Program or
Employees' Savings Program, or if no such designation has been made or the
Participant is not participating in such programs, the surviving spouse of
a deceased Participant, or, if there is no surviving spouse, the children
of the Participant in equal shares (the share of any child who predeceases
the Participant to go in equal shares to the issue of such deceased child),
or if there is no surviving spouse, child, or issue of such children, the
estate of the Participant. No designation of beneficiaries shall be valid
unless in writing signed by the Participant, dated and filed with the
Committee. Upon the Participant's death, any balance in the Participant's
Deferred Bonus Account is payable under the method elected by the
Participant or in such other manner as the Committee may determine in its
sole discretion.
ARTICLE VI
Source of Payment
All payments of deferred bonuses shall be paid in cash from the general
funds of the Company and the Company shall be under no obligation to
segregate any assets in connection with the maintenance of the Deferred
Bonus Account, nor shall anything contained in this Plan nor any action
taken pursuant to the Plan create or be construed to create a trust of any
kind, or a
fiduciary relationship between the Company and Participant. Title to the
beneficial ownership of any assets, whether cash or investments, which the
Company may designate to pay the amount credited to the Deferred Bonus
Account shall at all times remain in the Company and Participant shall not
have any property interest whatsoever in any specific assets of the
Company. Participant's interest in the Deferred Bonus Account shall be
limited to the right to receive payments pursuant to the terms of this Plan
and such rights to receive shall be no greater than the right of any other
unsecured general creditor of the Company.
ARTICLE VII
Nonalienation of Benefits
Participant shall not have the right to sell, assign, transfer or otherwise
convey or encumber in whole or in part the right to receive any payment
under this Plan except in accordance with Article V.
ARTICLE VIII
Acceptance of Terms
The terms and conditions of this Plan shall be binding upon the heirs,
beneficiaries, and other successors in interest of Participant to the same
extent that said terms and conditions are binding upon the Participant.
This Plan shall not be construed in any way as an employment contract
requiring the Company or Participant to continue the employment relation.
ARTICLE IX
Administration of the Plan
The Plan shall be administered by the Committee which may make such rules
and regulations and establish such procedures for the administration of
this Plan as it deems appropriate. In the event of any dispute or
disagreements as to the interpretation of this Plan or of any rules,
regulation, or procedure or as to any questioned right or obligation
arising from or related to this Plan, the decision of the Committee shall
be final and binding upon all persons.
ARTICLE X
Termination and Amendment
The Plan may be terminated at any time by the Board of Directors of Sun
Company, Inc., and may be amended at any time by the Committee provided,
however, that no such amendment or termination shall adversely affect the
rights of Participants or their beneficiaries with respect to amounts
credited to Deferred Bonus Accounts prior to such amendment or termination,
without the written consent of the Participant.
ARTICLE XI
Construction
In the case of any one or more of the provisions contained in this Plan
shall be invalid, illegal, or unenforceable in any respect the remaining
provisions shall be construed in order to effectuate the purposes hereof
and the validity, legality, and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby.