EAGLE-PICHER INDUSTRIES, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
AS AMENDED MAY 3, 1995
SECTION 1. ESTABLISHMENT OF THE PLAN
1.1 ESTABLISHMENT OF THE PLAN. Eagle-Picher Industries, Inc. (the
"Company") established, effective November 4, 1987, this supplemental retirement
plan for eligible employees of the Company, which plan shall be known as the
EAGLE-PICHER SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (the "Plan").
1.2 DESCRIPTION OF THE PLAN. This Plan has been established as an unfunded
plan in order to provide supplemental retirement benefits for a select group of
management or highly compensated employees and as such the Plan is exempt from
the participation, vesting, funding and fiduciary requirements of Title I of the
Employee Retirement Income Security Act of 1974, as amended.
SECTION 2. DEFINITIONS
2.1 DEFINITIONS. Whenever used in the Plan, the following terms shall mean:
(a) "Accrued Benefit" means the benefit payable to the Member under
Section 4.1 or Section 4.2 determined as if the Member's
participation under the Plan terminated as of the date the
accrued benefit is being measured.
(b) "Affiliate" means each wholly-owned subsidiary of the Company.
(c) "Board of Directors" means the Board of Directors of Eagle-Picher
Industries, Inc.
(d) "Committee" means the Committee as defined in Section 6.1 hereof.
(e) "Company" means Eagle-Picher Industries, Inc., or any successor
thereto.
(f) "Effective Date" means November 4, 1987.
(g) "Final Average Monthly Salary" means the sum of the Employee's
Salary for the five consecutive calendar years of his service as
a Member of this Plan in which
1
he had the highest Salary during his last ten calendar years of
service as a Member of this Plan divided by 60.
(h) "Other Pension" means the actuarial equivalent life annuity value
of any benefit from any qualified defined benefit or defined
contribution plan maintained by the Company or an Affiliate
(other than the Eagle-Picher Savings Plan) and the Member's
Primary Social Security.
(i) "Participant" means key employees designated by the Board of
Directors.
(j) "Plan" means The Eagle-Picher Industries, Inc. Supplemental
Executive Retirement Plan.
(k) "Plan Year" means the fiscal year of the Company (which presently
ends November 30).
(l) "Primary Social Security" means the monthly benefit which a
retired Member or a terminated Member receives or would be
entitled to receive at his 62nd birthday, or in the case of a
Member who terminates employment after age 62, at the date his
Benefit Service terminates as a primary insurance amount under
the U.S. Social Security Act, as amended, whether he applies for
such benefit or not, and even though he may lose part or all of
such benefit for any reason. The amount of such Primary Social
Security to which the retired or terminated Member is or would be
entitled shall be estimated and computed by the Company for the
purposes of the Plan as of the January 1 of the calandar year of
retirement or termination on the following basis:
(1) For a Member whose Benefit Service terminates on or after
his Normal Retirement Age, on the basis of the U.S. Social
Security Age as amended
2
and in effect, and the rate in effect, on the January 1
coincident with or next preceding his Normal Retirement Date
(regardless of any retroactive changes made by legislation
enacted after said January 1).
(2) For a Member whose Benefit Service terminates prior to his
Normal Retirement Age, on the basis and at the rate of the
U.S. Social Security Act as amended and in effect on the
January 1 coincident with or next preceding the date of
termination of his Benefit Service (regardless of any
retroactive changes made by legislation enacted after said
January 1), and, assuming that he will continue to have each
year until he reaches age 62, annual compensation in covered
employment under the Act at least equal to the maximum
earnings which are considered compensation subject to tax
under the Act.
In the case of a Member whose projected Benefit Service at age 62
will be less than 25 years, the amount of the Member's Primary
Social Security will be prorated based on Benefit Service
projected to age 62 (maximum 25 years) divided by 25 years. If a
Member's Benefit Service terminates after age 62 and is less than
25 years, his Primary Social Security will be prorated based on
actual years of Benefit Service (maximum 25 years) divided by 25
years.
(m) "Normal Retirement Age" means a Member's age when he has
attained his 62nd birthday and has completed ten years of
Vesting Service.
(n) "Normal Retirement Date" means the first day of the calendar
month coincident with or next following a Member's Normal
Retirement Age.
(o) "Salary" means a Member's total aggregate calendar year
compensation before any deferral under the Eagle-Picher
Savings Plan or the Eagle-Picher Flex Plan,
3
including bonuses, commissions, overtime pay and severance
pay, but excluding fringe benefits (including but not
limited to automobile allowances, imputed income from group
term life insurance, relocation allowances, income from the
exercise of non-qualified stock options or disposition of
incentive stock option stock, interest reimbursements, and
income from annuity purchases under Section 5.1 or tax
reimbursements under Section 5.2 of this Plan). Bonuses
accrued after 1984 shall be included in Salary for the
calendar year of accrual if actually paid by January 15th of
the following year. All other bonuses shall be included in
Salary for the calendar year in which paid.
2.2 GENDER REFERENCE. Any words in this Plan document (or amendments to it)
which are used in one gender shall be read and construed to mean or include the
other sender wherever they would so apply.
SECTION 3. MEMBERSHIP AND SERVICE
3.1 MEMBERSHIP. A person will become a Member upon designation by the Board
of Directors. A Member's participation in the Plan may be terminated by action
of the Board of Directors if the Member's position with the Company is changed.
3.2 SERVICE. A Member's Vesting Service and Benefit Service under the Plan
shall be computed in the same manner as they would be computed under the
Eagle-Pitcher Salaried Plan; provided, however, that the Executive Committee of
the Board of Directors, in its discretion, may grant additional Vesting Service
and Benefit Service to a Member by written notice to the Member with a copy to
the Committee.
SECTION 4. BENEFITS
4.1 TERMINATION ON OR AFTER AGE 62. The monthly benefit payable for life
4
commencing at age 62 for an individual who terminates employment with the
Company or an Affiliate on or after attainment of age 62 with at least 10 years
of Vesting Service shall be equal to:
(1) .024 multiplied by the Member's Final Average Monthly Salary
and multiplied by his Benefit Service (maximum 25 years)
(2) minus any Other Pension payable at that date.
4.2 TERMINATION BEFORE AGE 62. The monthly benefit payable for life
commencing at age 62 for an individual who terminates employment with the
Company or an Affiliate before age 62 with at least 10 years of Vesting Service
shall be equal to:
(1) .024 multiplied by the Member's Final Average Monthly Salary
and multiplied by his Benefit Service projected to age 62
(maximum 25 years)
(2) minus any Other Pension (projecting service to age 62, using
the Member's current Final Average Monthly Salary and the
Member's Primary Social Security payable at age 62)
(3) multiplied by Benefit Service earned (maximum 25 years)
divided by Benefit Service projected to age 62 (maximum 25
years);
provided, however, that in no event shall the sum of the Member's Other Pension
and the benefit payable under this section be less than .024 multiplied by the
Member's Final Average Monthly Salary and multiplied by his Benefit Service
earned (maximum 25 years).
4.3 TERMINATION WITHOUT 10 YEARS OF VESTING SERVICE. A Member who
terminates employment with the Company or an Affiliate before earning ten years
of Vesting Service shall not be entitled to any benefits under this Plan.
4.4 FORM OF BENEFITS. The normal form of benefits payable under this Plan
5
shall be monthly payments for the life of the Member. To the extent the Company
has purchased annuity contracts for the Member's Accrued Benefit under the Plan,
payments made under the annuity contracts shall satisfy the Company's obligation
hereunder.
SECTION 5. ANNUITY PURCHASES AND TAX REIMBURSEMENT
5.1 ANNUITY PURCHASES. The Company may purchase single premium
annuity contracts from time to time to provide for a Member's Accrued Benefit
under the Plan. Upon a Member's termination of employment, the Company may
distribute the cost of purchasing an annuity to the Member rather than
purchasing an annuity for the portion of his benefit not otherwise provided
for.
5.2 TAX REIMBURSEMENT. The Company will reimburse the Member an amount
calculated to approximate the income and excise tax liability attributable to
any annuity purchase. The Committee shall determine the federal, state and local
tax rates to be used. The Committee's determination of these tax rates shall be
final. The Member will have a basis in the annuity contract equal to the amount
the Company pays for the annuity.
SECTION 6. ADMINISTRATION
6.1 PLAN ADMINISTRATOR AND FIDUCIARY. The Committee shall be the Plan
Administrator and shall be named fiduciary under the Plan. The Committee shall
consist of not less than three persons (who may be Members) who shall be
appointed by the Board of Directors. The number of members on the Committee may
be increased or decreased from time to time provided the total number of members
shall at all times be an odd number and shall not be less than three. A member
of the Committee may resign or he may be removed by the Board of Directors.
6.2 CHAIRMAN AND SECRETARY. The Committee shall select a Chairman and
6
may select a Secretary (who need not be a member of the Committee) to keep its
records or to assist it in the performance of any of its functions.
6.3 POWERS AND DUTIES. The Committee shall administer the Plan and shall
have the power and the duty to take all action, and to make all decisions
necessary or proper to carry out the Plan, including, without limitation, the
following:
(a) To interpret the Plan, which interpretations shall be final and
conclusive;
(b) To resolve all questions concerning the Plan;
(c) To compute the benefit to be paid to any person under the Plan.
Provided, however, that the Committee may delegate all or part of its
powers and duties in connection with administering the Plan to a named delegate.
6.4 APPOINTMENT OF AGENTS AND DELEGATION OF DUTIES. The Committee may
appoint such accountants, actuaries, counsel, specialists and other persons as
it shall deem necessary or desirable in connection with the administration of
the Plan. The Committee and any person to whom it may delegate any duty or power
in connection with administering the Plan shall be entitled to rely conclusively
upon, and shall be fully protected in any action taken by them in good faith in
reliance upon, any tables, valuations, certificates, opinions or reports which
shall be furnished to them by any such actuary, counsel or other specialist.
6.5 ACTION OF COMMITTEE. The Committee may act by a majority of its members
either at a meeting or in writing without a meeting.
6.6 COMPENSATION. Unless otherwise agreed to by the Company, members of the
Committee shall serve without compensation. All expenses of the Committee shall
be paid by the Company.
7
6.7 INDEMNITY FOR LIABILITY. The Company shall indemnify the Committee, its
members and delegates, against any and all claims, losses, damages, expenses,
including counsel fees, incurred by these parties and any liability, including
any amounts paid in settlement with the Committee's approval, arising from the
Committee's, its members' and/or delegates' action or failure to act, except
when the same is judicially determined to be attributable to the gross
negligence or willful misconduct of such Member.
6.8 CLAIMS PROCEDURE.
(a) Claim, Denial and Notice: All claims for benefits shall be in writing
and signed by the Member or Beneficiary. Any Member or Beneficiary
whose written request to the Committee for benefits has been denied in
whole or in part shall be furnished with written notice of the denial
of this claim by the Committee within sixty (60) days of receipt by
the Committee of the claim. Such notice shall be written in a manner
calculated to be understood by the Member or Beneficiary and shall
contain the specific reasons for such denial, specific references to
pertinent Plan provisions on which the denial is based, a description
of additional material or information which is needed to complete the
claim and why such is necessary, and an explanation of the Plan's
appeal procedure.
(b) Appeal: Within sixty (60) days after the receipt of a notice that his
claim was denied, the claimant may appeal in writing the denial of his
claim to the Committee stating the reason for his appeal and
submitting any issues or comments for the Committee's review.
(c) Decision on Appeal: Within sixty (60) days of receipt of an appeal,
the Committee shall mail to the applicant a written notice of its
decision setting forth
8
in a manner calculated to be understood by the applicant the specific
reasons for its decision and specific references to the pertinent Plan
provisions on which the Committee's decision was based.
SECTION 7. AMENDMENT AND TERMINATION
7.1 AMENDMENT AND TERMINATION. Eagle-Picher Industries, Inc. reserves the
right to make any modifications or amendments to the Plan or to terminate it at
any time for any reason. No amendment or termination of the Plan shall reduce
benefits already accrued and vested under the Plan.
SECTION 8. MISCELLANEOUS AND APPLICABLE LAW
8.1 NO GUARANTEE OF EMPLOYMENT. The Plan shall not be deemed a contract of
employment between the Company and any Member, nor shall it impede the right of
the Company to discharge any Member at any time.
8.2 APPLICABLE LAW. The Plan and all rights hereunder shall be governed by
and construed according to the laws of the State of Ohio.
IN WITNESS WHEREOF, this document is executed on May 3, 1995.
EAGLE-PICHER INDUSTRIES, INC.
By: /s/ Thomas E. Petry
--------------------------------
Thomas E. Petry, Chief Executive
Officer and Chairman of the Board
ATTEST:
/s/ James A. Ralston
---------------------------------
James A. Ralston, Secretary
9