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EXHIBIT 10-B-3
COUNTERPART NUMBER________
EXECUTED IN ___ COUNTERPARTS
AS AMENDED THROUGH JULY 8, 1996
__________________________________________
CHRYSLER
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
CONSOLIDATED
AS OF OCTOBER 1, 1996
__________________________________________
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CHRYSLER
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
DATED AS OF OCTOBER 1, 1996
Chrysler Corporation (or between June 1, 1986 and December 31, 1989 its
subsidiary Chrysler Motors Corporation), a corporation organized and existing
under the laws of the State of Delaware (hereinafter called the "Corporation"),
has had in effect since January 1, 1985 a plan called the Chrysler Supplemental
Executive Retirement Plan (prior to June 1, 1986 called the Chrysler
Corporation Supplemental Executive Retirement Plan and hereinafter called the
"Plan"). The Corporation has from time to time amended the Plan in certain
respects. The Plan was last consolidated as of June 1, 1995 and was
subsequently amended as of July 8, 1996.
The Corporation now desires to consolidate the Plan as of this date.
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CHRYSLER
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
AS OF OCTOBER 1, 1996
PAGE
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ARTICLE I Purpose of Plan 4
ARTICLE II Definitions 9
ARTICLE III Participation 17
ARTICLE IV Retirement and Deferred Retirement Benefits 17
4.01 Normal Retirement 17
4.02 Special Early Retirement 20
4.03 Early Retirement at Employee Option 23
4.04 PTD Retirement 25
4.05 Retirement Under Employment Contract 27
4.06 Deferred Vested Benefits 29
4.07 - 4.15 Other Provisions 31
ARTICLE V Death Benefits 41
ARTICLE VI Payment of Benefits 46
ARTICLE VII Contributions 57
ARTICLE VIII Plan Administration 57
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ARTICLE IX Amendment, Termination 62
ARTICLE X General 64
ARTICLE XI Special Provisions Applicable to
Designated Participants 67
APPENDIX A Actuarial Assumptions Under the Plan 69
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CHRYSLER
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
ARTICLE I. PURPOSE OF PLAN
1.01 The Plan is maintained for the purpose of providing the following
supplemental retirement benefits to Employees:
A. Incentive Compensation Retirement Benefit
This benefit is based on the aggregate awards earned out and paid to
Employees under the Incentive Compensation Plan, the Long Term Incentive
Plan, the Long Term Performance Plan, the Discretionary Incentive
Compensation Plan, and any benefits paid pursuant to Subsection 401A.5.
of the Plan.
B. ERISA Excess Retirement Benefit
This benefit is based on the excess of retirement benefits calculated
under the Salaried Employees' Retirement Plan without regard to the
limitations under Section 415 or Section 401(a)(17) of the Internal
Revenue Code, as amended, over the benefits payable under the Salaried
Employees' Retirement Plan because of such limitations.
This benefit includes a contributory benefit based on any Employee
contributions made pursuant to Section VII of this Plan that otherwise
could have been contributed under the Salaried Employees' Retirement Plan
were it not for contribution limitations imposed under Section 401(a)(17)
of the Internal Revenue Code, as amended. Although this benefit shall be
calculated and paid based solely on contributions made within this Plan,
it shall be computed in the same manner as the contributory benefit is
calculated under the Salaried Employees' Retirement Plan.
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The Benefit as calculated above, shall be further increased (prior
to the time the Salaried Employees' Retirement Plan is amended to comply
with applicable provisions of the Tax Reform Act of 1986) to include the
amount, if any, of additional non-contributory benefits excluded from
payment under the Salaried Employees' Retirement Plan by provisions of
the Internal Revenue Service Model Amendment #2, included in IRS Notice
88-31, as referenced in Subsection 4.01C of the Salaried Employees'
Retirement Plan. In respect to Employees who are participants in the
Chrysler First Retirement Account, all above references in this paragraph
to the Salaried Employees' Retirement Plan shall be deemed to mean the
Chrysler First Retirement Account. In respect to Employees who are
participants in the Gulfstream Aerospace Corporation Pension Plan, all
such references in this paragraph to the Salaried Employees' Retirement
Plan shall be deemed to mean the Gulfstream Aerospace Corporation Pension
Plan. The forms of benefits payable under this Plan to Employees who are
participants in the Chrysler First Retirement Account or the Gulfstream
Aerospace Corporation Pension Plan are the forms of benefits payable
under such plans.
C. Post Retirement Supplemental Benefit
This benefit is payable to Employees who retired as elected officers of
Chrysler Corporation and is based on the excess, if any, of the Basic
Pension Rate in effect on January 1, 1986 under the Chrysler Pension Plan
over the Basic Pension Rate in effect under the Pension Plan on the date
the officers
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retired, multiplied by the Employees' years of Credited Service.
D. American Motors Supplemental Pension Plan Benefit
This benefit is payable to Employees eligible for benefits under the
American Motors Corporation Supplemental Pension Plan, a plan
terminated by merger into this Plan effective December 31, 1989. Benefits
under the American Motors Supplemental Pension Plan shall be frozen as of
date of merger. If any Employee is eligible to receive a benefit under
the non-contributory part of the Chrysler Salaried Employees' Retirement
Plan and under an American Motors Corporation Pension Plan (including for
this purpose any frozen American Motors Corporation Pension Plan that has
been merged into this or any other Chrysler Pension Plan) and if his total
benefit amount under Chrysler and American Motors Corporation Pension
Plans exceeds the amount he would have received under Chrysler plans had
he participated under Chrysler plans for the entire period he was employed
by American Motors Corporation and Chrysler, his benefit under the
non-contributory part of the Chrysler Salaried Employees' Retirement Plan
will be reduced (but not below zero) by the amount of such excess. This
reduction shall supersede the minimum benefit guarantee that would
otherwise be applicable under the American Motors Supplemental Pension
Plan benefit payable under this Plan.
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E. Modified Special Early Retirement Program Special Leave of Absence
Benefit
This benefit is payable, prior to retirement under the Salaried
Employees' Retirement Plan, to all very highly compensated employees
(within the meaning of the Internal Revenue Code) and highly compensated
employees (as defined by such Code) designated by the Corporation who
choose to cease active employment with the Corporation between July 31,
1989 and October 31, 1989 or between January 31, 1990 and May 31, 1990
under terms of the 1989 or 1990 Chrysler Modified Special Early
Retirement Programs. The benefit payable pursuant to this paragraph
shall equal the benefit which would have been payable under the Salaried
Employees' Retirement Plan, the Pension Plan and the ERISA Excess
Retirement Benefits portion of this Plan had the Employees retired at
Corporation option under the Salaried Employees' Retirement Plan at the
date he ceased active employment.
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SUPPLEMENTARY MINIMUM BENEFIT
This benefit is payable to Salaried Employees (as defined in the Salaried
Employees' Retirement Plan) who cease active employment with the
Corporation under the 1989 or 1990 Chrysler Modified Special Early
Retirement Programs (either through retirement or through a Special Leave
of Absence as described in the first paragraph of this Section 1.01E).
Such benefit is equal to the amount by which a Salaried Employee's
combined monthly benefit for retirement at Corporation option under
whichever is applicable of the Salaried Employees' Retirement Plan, the
Pension Plan, the ERISA Excess Retirement Benefits portion of this Plan
and the Special Leave of Absence Benefit provisions of this Section 1.01E
are less than 115% of what his total retirement benefits would have been
under the Salaried Employees' Retirement Plan, the Pension Plan and, if
applicable, the ERISA Excess Retirement Benefits portion of this Plan had
he retired at his own option.
Notwithstanding the foregoing provisions of this Section 1.01E, no
benefits of any kind shall be payable pursuant to this Section 1.01E for
periods commencing on or after January 1, 1992.
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ARTICLE II. DEFINITIONS
Unless the text clearly indicates otherwise:
2.01 "Actuarial Equivalent" means an amount of equal value actuarially,
determined pursuant to actuarial tables or factors adopted by the Committee as
set forth in Appendix A to this Plan.
2.02 "Actuary" means the actuary for the Plan appointed by Chrysler
Corporation.
2.03 "Adjusted Tax Rate" means the Tax Rate determined without regard to
any employment taxes imposed under Section 3101(b) of the Internal Revenue Code
(or any successor section thereto).
2.04 "Additional Retirement Benefit" means the benefit described in
Article IV of the SERP and set forth in Appendix F thereto.
2.05 "Applicable Service and Compensation" means the service and
compensation of an Employee as of a Calculation Date, as determined pursuant to
Section 4.15.
2.06 "Annuity" means an annuity as defined in Section 4.15 of the Plan.
Any Annuity purchased in substitution of an Employee's accrued benefit as of
the corresponding Calculation Date shall be held separate and distinct from the
Plan and any assets of the Corporation or any of its Subsidiaries, regardless
of whether such assets are separately accounted for and segregated from other
corporate assets in order to meet the liability of any such entity for benefits
accrued hereunder.
2.07 "Basic Pension Rate" means the monthly basic pension rate for each
year of service as established from time to time under the Pension Plan.
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2.08 "Beneficiary" means any one or more individuals, partnerships,
corporations, fiduciaries or other entities designated under the Salaried
Employees' Retirement Plan as the beneficiary or contingent beneficiary to
receive any death benefits payable under this Plan, unless a separate
designation under the Plan is received by the Committee. If no beneficiary
designation has been filed under the Salaried Employees' Retirement Plan or
under the Plan, the beneficiary shall be the executor of the former Employee's
will or the probate administrator, on behalf of the former Employee's estate.
2.09 "Calculation Date" means the calculation date as defined in Section
4.15 of the Plan.
2.10 "Committee" means the Employee Benefits Committee established by the
Board of Directors of Chrysler Corporation by Resolution dated December 10,
1975, as constituted from time to time.
2.11 "Commuted Value" means an amount equal to the lump sum value at the
date of determination of periodic payments payable thereafter discounted from
the respective payment dates of such periodic payments to the date of
determination at the rate of interest adopted by the Committee and set forth in
Appendix A to this Plan.
2.12 "Corporation" means Chrysler Corporation and (i) any corporation
organized under the laws of the United States or any state thereof, all or
substantially all of the stock of which is owned by Chrysler Corporation
directly or through one or more subsidiaries which the Committee has designated
by resolution as a corporation to which, and to the salaried employees of which,
this
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Plan shall apply, and (ii) any corporation organized under the laws of a
foreign government or subdivision thereof, all or substantially all of the stock
of which is owned by Chrysler Corporation directly or through one or more
subsidiaries, which is a subsidiary corporation with respect to which there is
in effect an agreement entered into by Chrysler Corporation under Section 3121
(1) of the Internal Revenue Code or under any amendment thereof in effect at the
relevant time, and which at the time the Committee shall have designated by
resolution as a corporation to which, and to the salaried employees of which,
this Plan shall apply, but such corporation shall be included in the term
"Corporation" only with respect to those of its Employees who have been
transferred to such employment with such subsidiary from employment in the
United States with Chrysler Corporation or one of its subsidiary corporations,
and (iii) for purposes of the Incentive Compensation Retirement Benefits only,
any corporation organized under the laws of a foreign government or subdivision
thereof, all or substantially all of the stock of which is owned by Chrysler
Corporation directly or through one or more subsidiaries, which the Committee
has designated by resolution as a corporation to which, and to the salaried
employees of which, this Plan shall apply.
2.13 "Credited Service" means the credited service an Employee has under a
Pension Plan or, in the case of an Employee who is an elected officer or
director of the Corporation, the credited service he would have if elected
officers and directors were eligible under a pension plan. Notwithstanding the
above, however, in the case of an individual who has become an Employee of the
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Corporation or of Chrysler Corporation or one of its subsidiaries (excluding
American Motors Corporation and its subsidiaries as of August 5, 1987) upon
transfer after August 5, 1987 from employment with American Motors Corporation
or one of its subsidiaries, employment by American Motors Corporation or any of
its subsidiaries up to and including the last day he was so employed shall be
deemed to be included in Credited Service under this Plan for all purposes
other than for computation of benefit amounts.
2.14 "Employee" means a person (i) who, at the time, is employed by the
Corporation or a Non-Participating Subsidiary, or (ii) who, for the purposes of
the Incentive Compensation Retirement Benefits only, is employed by Chrysler
Canada Ltd., or Chrysler Credit Canada Ltd., and (iii) who is, or who has been
but no longer is, a Salaried Employee. Notwithstanding the foregoing, the term
"Employee" shall in no event include (i) persons employed on a temporary, fixed
term, project or daily basis, (ii) persons who are retained under a consultant
or independent contractor agreement, or on a Service Agreement basis or who are
assigned by an employment agency, supplier, subcontractor or other provider of
personnel. Where used in this Plan the terms "former Employee," "retired
Employee" or "terminated Employee" shall mean a person who at one time was an
Employee but who, by reason of retirement or other termination of employment is
no longer employed by the Corporation, a Non-Participating Subsidiary, Chrysler
Canada Ltd., or Chrysler Credit Canada Ltd., as applicable.
2.15 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
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2.16 "ERISA Excess Death Benefits" means the death benefit calculated by
reference to the ERISA Excess Retirement Benefit of an Employee or former
Employee as determined in whichever is applicable of Sections 5.01, 5.02, or
5.03.
2.17 "ERISA Excess Retirement Benefit" means a monthly retirement benefit
equal to the excess of the retirement benefit calculated under the Salaried
Employees' Retirement Plan without regard to the benefit and compensation
limitations set forth in that plan or imposed under Section 415 or
Sub-paragraph 401(a)(17) of the Internal Revenue Code over the benefit payable
under the Salaried Employees' Retirement Plan, determined as provided in
Section 4.01, because of such limitation.
2.18 "Incentive Compensation Plan" means the Chrysler Corporation
Incentive Compensation Plan, as in effect from time to time, established under
a stockholders' resolution adopted in 1929, as amended.
2.19 "Incentive Compensation Death Benefit" means the death benefit
calculated by reference to Incentive Compensation Retirement Benefits of an
Employee or retired Employee as determined in whichever is applicable of
Sections 5.01, 5.02, 5.03, or 5.04.
2.20 "Incentive Compensation Retirement Benefit" means a monthly
retirement benefit calculated by reference to the aggregate awards made to an
Employee under (a) the Incentive Compensation Plan, (b) the Chrysler
Corporation Long-Term Incentive Plan under the Incentive Compensation Plan
(herein called the "Long-Term Incentive Plan") (c) the Chrysler Corporation
Long-Term Performance Plan under the Chrysler Corporation 1991 Stock
Compensation Plan
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(herein called the "Long-Term Performance Plan"), (d) the Chrysler Corporation
Discretionary Incentive Compensation Plan (herein called the "Discretionary
Incentive Compensation Plan"), and (e) any benefits paid pursuant to Subsection
4.01A.5. of the Plan determined as provided in Section 4.01.
2.21 "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended."
2.22 "Non-Participating Subsidiary" means any branch of Chrysler
Corporation, or any of its wholly-owned subsidiaries, located outside the
United States and its possessions and any subsidiary of Chrysler Corporation
whether organized under the laws of the United States or of any state thereof
or of a foreign government or subdivision thereof, a majority of the voting
stock of which Chrysler Corporation owns at the time directly or through one or
more wholly-owned subsidiaries, and which branch or subsidiary the Committee
shall at the time have designated by resolution as a branch or corporation to
which and to the Employees of which the provisions of the Plan relating to a
Non-Participating Subsidiary shall apply. A branch of Chrysler Corporation, or
any of its wholly-owned subsidiaries, located outside the United States and its
possessions or a subsidiary described in clause (ii) of Section 2.07 may be a
Non-Participating Subsidiary with respect to those of its Employees who were
not transferred to such branch or subsidiary from employment in the United
States with Chrysler Corporation or one of its subsidiary corporations.
2.23 "Normal Retirement Date" means the last day of the month in which an
Employee attains his 65th birthday.
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2.24 "Pension Plan" means the Chrysler Pension Plan or the Chrysler
Financial Corporation Pension Plan, as applicable.
2.25 "Permanent Total Disability" means that the person is receiving
permanent total disability benefits under a Pension Plan or a group insurance
program of the Corporation.
2.26 "Plan" means this Supplemental Executive Retirement Plan.
2.27 "Plan Year" means the period of 12 calendar months ending with the
last day of the month of December in each year.
2.28 "Post Retirement Supplemental Benefit" means a monthly retirement
benefit payable to an Employee who retired or retires as an elected officer of
Chrysler Corporation, determined as provided in Section 4.08.
2.29 "Salaried Employee" means a person (i) who at the relevant time is
employed by the Corporation or a Non-Participating Subsidiary, or (ii) who, for
purposes of the Incentive Compensation Retirement Benefits only, is employed by
Chrysler Canada Ltd., or Chrysler Credit Canada Ltd., and who receives regular
compensation in the form of a base Salary, except that a person who is employed
either by a subsidiary of Chrysler Corporation described in clause (ii) of
Section 2.07 or a branch of Chrysler Corporation located outside the United
States and its possessions shall, in either such case, be deemed to be a
Salaried Employee only if he has been transferred to such employment, either
with such subsidiary or such branch, from employment in the United States.
2.30 "Salaried Employees' Retirement Plan (SERP)" means the Chrysler
Salaried Employees' Retirement Plan or the Chrysler Financial Corporation
Salaried Employees' Retirement Plan, as applicable, as in effect from time to
time.
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2.31 "Salary" means the base salary payable monthly (after any deductions
or any salary deferral pursuant to an agreement entered into under the Chrysler
Salaried Employees' Savings Plan, as amended, or the Chrysler Salaried
Employees' Supplemental Savings Plan, as amended) not including any contingent,
incentive or deferred compensation, bonuses, or other forms of extra
compensation. The term "Salary" shall include base salary amounts deferred
pursuant to the Chrysler Stock Unit Investment Program. The term "Salary"
shall further include amounts deducted from base salary under provisions of the
Chrysler Flexible Benefits Program but shall not include amounts added to base
compensation payments pursuant to the Flexible Benefits Program.
2.32 "Supplemental Payment" means the supplemental payment described in,
and payable to an Employee on the terms and subject to the conditions set forth
in, Section 4.15D of the Plan.
2.33 "Tax Rate" means the highest marginal rate of income taxation paid by
individuals in the jurisdiction in which the Employee resides on the
Calculation Date, plus the rate of tax imposed under Section 3101(b) of the
Code (or any successor section thereto)."
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ARTICLE III. PARTICIPATION
3.01 An Employee who has received or receives an award of incentive
compensation under the Incentive Compensation Plan for the year 1983 or any
subsequent year shall participate in the Plan with respect to the Incentive
Compensation Retirement Benefit and the Incentive Compensation Death Benefit.
3.02 An Employee who retires under the SERP and whose retirement or
termination benefits as calculated under SERP are in excess of the benefit and
compensation limitations set forth in that plan or imposed under Section 415 or
Sub-paragraph 401(a)(17) of the Internal Revenue Code shall participate in the
Plan with respect to the ERISA Excess Retirement Benefit and ERISA Excess Death
Benefit.
3.03 An Employee who retired as an elected officer of Chrysler Corporation
prior to January 1, 1986 shall participate in the Plan with respect to the Post
Retirement Supplemental Benefit.
3.04 Notwithstanding anything else contained in this Plan to the
contrary, an Employee who has received an Annuity in accordance with Section
4.15 hereof shall, as a condition of continued participation in the Plan with
respect to benefits accrued in respect of services performed and compensation
payable other than the Applicable Service and Compensation, irrevocably consent
to the payment of any such Annuity and Supplemental Payment in accordance with
and subject to the terms and conditions of such Section 4.15.
ARTICLE IV. RETIREMENT AND DEFERRED RETIREMENT BENEFITS
4.01 Except as otherwise expressly provided in Section 4.15 below, an
Employee who retires under the SERP, or for purposes of the Incentive
Compensation Retirement Benefits also under the
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Chrysler Canada Ltd. Salaried Employees' Retirement Plan on or after his Normal
Retirement Date shall be entitled to receive under this Plan, commencing on the
first day of the month next following his retirement date, retirement benefits
equal to the excess of (i) the sum of (1) any Incentive Compensation Retirement
Benefit for which he may be eligible as provided in Subsection A, and (2) any
ERISA Excess Retirement Benefit for which he may be eligible as provided in
Subsection B over (ii) any Additional Retirement Benefit for which he may be
eligible as provided in Section C.
A. The Incentive Compensation Retirement Benefit of an Employee retiring
as provided above in this Section 4.01 shall be a monthly amount equal to
the sum of the following:
1. An amount equal to .5 of 1 percent (.5%) of his
Incentive Compensation Plan awards for 1983 and 1984, plus
2. An amount equal to such percentage of his
combined (a) Incentive Compensation Plan award for each of the
years 1985 through 1992 and (b) Long-Term Incentive Plan award
(whether such award is payable in cash or Chrysler Stock)
earned out and paid for performance cycles ending in each of
the years 1987 through 1992, as the Incentive Compensation
Committee of the Board of Directors shall determine, but not
more than .5 of 1 percent (.5%) of his combined award for any
such year, plus
3. An amount equal to such percentage of his combined
(a) Incentive Compensation Plan award for 1993 and
(b) Long-Term Performance Plan award for the
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performance cycle ending in 1993 as the Incentive Compensation
Committee of the Board of Directors shall determine, but not
more than .5 of 1 percent (.5%) of his combined award for 1993
plus
4. An amount equal to such percentage of his combined (a)
Incentive Compensation Plan award for 1994 and each year
thereafter, (b) Long Term Performance Plan award for
performance cycles ending in 1994 and each year thereafter, and
(c) Discretionary Incentive Compensation Plan award for 1994
and each year thereafter as the Incentive Compensation
Committee of the Board of Directors shall determine, but not
more than .5 of 1 percent (.5%) of his combined award for any
such year plus
5. An amount equal to .5 of a percent (.5%) of his Incentive
Compensation Plan awards, Long Term Performance Plan awards,
Long Term Incentive Plan awards, and Discretionary Incentive
Compensation Plan awards, payable under such plans in the event
of a Change in Control (as defined in Section 4.13).
B. The ERISA Excess Retirement Benefit of an Employee retiring as
provided above in this Section 4.01 shall be a monthly amount equal to
the excess of:
1. The retirement benefit calculated under the provisions of
Section 4.01 of the SERP (irrespective of whether payments
under the SERP are actually made in the form described in
Section 4.01 of the SERP) without regard to the benefit and
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compensation limitations set forth in that plan or imposed
under Section 415 or Sub-paragraph 401(a)(17) of the Internal
Revenue Code over
2. The retirement benefit calculated under Sections 4.01 A and B
of the SERP.
Notwithstanding anything to the contrary in this Plan, the retirement
benefits of an Employee of the Corporation or a Non-Participating Subsidiary,
who continues active service until his 65th birthday, shall be nonforfeitable.
C. The amount of any Additional Retirement Benefit of an Employee shall
be as defined in Section 2.04.
4.02 Except as otherwise expressly provided under Section 4.15 below, an
Employee who retires under the Special Early Retirement provisions of the SERP
or, for purposes of the Incentive Compensation Retirement Benefit, retires at
the option of the Corporation under the Chrysler Canada Ltd. Salaried
Employees' Retirement Plan on or after his 55th birthday but before his 62nd
birthday and who at the date of his early retirement has 10 years or more of
Credited Service (or who shall have attained such lesser age or years of
Credited Service as may be required under terms of a specific Early Retirement
Program if he retires pursuant to such program) shall be entitled to receive
under this Plan, commencing on the first day of the month next following the
date of his retirement, retirement benefits equal to the excess of (i) the sum
of (1) any Incentive Compensation Retirement Benefit for which he may be
eligible as provided in Section A., and (2) any ERISA Excess Retirement Benefit
for which he may be eligible as provided in
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Section B over (ii) any Additional Retirement Benefit for which he may be
eligible as provided in Section C.
A. The Incentive Compensation Retirement Benefit of an Employee
retiring early as provided in this Section 4.02 shall be a monthly
amount calculated as described in Section 4.01A.
B. The ERISA Excess Retirement Benefit of an Employee retiring
early as provided in this Section 4.02 shall be a monthly amount
calculated as described in Section 4.01B.
C. The amount of any Additional Retirement Benefit of an
Employee shall be as defined in Section 2.04.
D. The reduced age, Credited Service, and date specifications
applicable to specific Special Early Retirement Programs are as
follows:
1. 1991 Program
a. Minimum age: 53
b. Minimum Credited Service: 10 years
c. Eligibility date: August 31, 1991
d. Retirement date: April 30, 1991 or, if later, the end of the
month prior to September, 1991 when age and Credited Service
requirements are first met (Retirements may occur at a later
date as approved by the Corporation and agreed to by the
Employee but not beyond December 31, 1991)
2. 1992 Program
a. Minimum age: 55
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b. Minimum Credited Service: 7 years
c. Eligibility date: December 31, 1992 (Must be actively at
work during the March 1, 1992 to May 31, 1992 period)
d. Retirement date: August 31, 1992 or as early as May 31, 1992
if age and Credited Service requirements are met or, in the
case of an Employee who first meets the age and Credited
Service requirements of the Program between September 1, 1992
and December 31, 1992, the end of the month the Employee
first meets such requirements (Retirement may occur at a
later date as approved by the Corporation and agreed to by
the Employee but not beyond December 31, 1992)
3. 1993 Program
a. Minimum age: 54
b. Minimum Credited Service: 10 years
c. Eligibility date: December 31, 1993
d. Retirement date: April 30, 1993 or, if later, the end of the
month prior to January 1, 1994 when age and Credited Service
requirements are first met (Retirements may occur at a later
date as approved by the Corporation and agreed to by the
Employee but not beyond December 31, 1993)
4. 1994 Program
a. Minimum age 54
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b. Minimum Credited Service: 10 years
c. Eligibility Date: December 31, 1994
d. Retirement Date: Not later than December 31, 1994 (Retirement
can not be earlier than September 15, 1994. However,
incentives under the program are also applicable, effective
January 1, 1995, to employees who retired under Section 4.03 of
the plan between May 31, 1994 and July 31, 1994).
Provided, however, that in the case of an Employee retiring under this
Section 4.02 who is employed or becomes employed by any competing firm, as
determined by the Committee, payment of his monthly retirement benefits
provided under Section 4.02A shall not be made for any month during which
he is so employed by any such competing firm prior to the first day of the
month next following his 65th birthday.
4.03 Except as otherwise provided in Section 4.15 below, an Employee who
retires under the SERP, or for purposes of the Incentive Compensation
Retirement Benefit also under the Chrysler Canada Ltd. Salaried Employees'
Retirement Plan at his option on or after his 55th birthday but before his 65th
birthday and (a) who has not attained age 60 and whose combined years of age and
years of Credited Service (to the nearest 1/12 in each case) shall total 85 or
more, or (b) who has attained age 60 but not 65 and has 10 or more years of
Credited Service, shall in any such case be entitled to receive under this Plan,
commencing on the first day of the month next following the date of his
retirement, retirement benefits equal to the excess of (i) the sum of (1) any
Incentive
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Compensation Retirement Benefit for which he may be eligible as provided in
Section A, and (2) any ERISA Excess Retirement Benefit for which he may be
eligible as provided in Section B over (ii) Any Additional Retirement Benefit
for which he may be eligible as provided in Section C subject to the provisions
of Section D, below.
A. The Incentive Compensation Retirement Benefit of an Employee
retiring early as provided in this Section 4.03 shall be a monthly
amount calculated as described in Section 4.01A.
B. The ERISA Excess Retirement Benefit of an Employee retiring
early as provided in this Section 4.03 shall be a monthly amount
calculated as described in Section 4.01B.
C. The amount of any Additional Retirement Benefit of an
Employee shall be as defined in Section 2.04.
D. The retirement benefits described above in Sections 4.03A and
4.03B shall be reduced by multiplying such benefits by a percentage
as set forth in the following table:
Age When
Benefit Commences Percentage*
----------------- -----------
55 57.9%
56 63.5
57 69.4
58 75.2
59 80.8
60 86.7
61 93.3
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62 100.0
63 100.0
64 100.0
=== =====
* Prorated for intermediate ages computed to the nearest whole month
Provided, however, that in the case of an Employee retiring under this
Section 4.03 who is employed or becomes employed by any company other than the
Corporation, payment of his monthly retirement benefit provided under Section
4.03A shall not be made for any month during which he is so employed by any
company other than the Corporation prior to the first day of the month next
following his 65th birthday, unless the Committee approves such payment
annually.
4.04 Except as otherwise expressly provided in Section 4.15 below, an
Employee who retires under the SERP, or for purposes of the Incentive
Compensation Retirement Benefit also under the Chrysler Canada Ltd. Salaried
Retirement Plan because of Permanent Total Disability with 10 years or more of
Credited Service (i) on or after his 55th birthday but before his Normal
Retirement Date or (ii) before his 55th birthday and who has been a participant
for at least 10 years since he attained age 35, or (iii) before his 55th
birthday and who has been a participant for five years but less than 10 years
since he attained age 35, shall be entitled to receive under this Plan,
retirement benefits equal to the excess of (i) the sum of (1) any Incentive
Compensation Retirement Benefit for which he may be eligible as provided in
Section A and (2) any ERISA Excess Retirement Benefit for which he may be
eligible as
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provided in Section B below over (ii) any Additional Retirement Benefit for
which he may be eligible as provided in Section C.
A. The Incentive Compensation Retirement Benefits of an Employee retiring
as provided in this Section 4.04 shall be a monthly amount calculated as
described in Section 4.01A and
B. The ERISA Excess Retirement Benefits of an Employee retiring as
provided in this Section 4.04 shall be a monthly amount as calculated in
Section 4.01B and such monthly retirement benefits shall commence on the
first day of the month next following the date of his retirement, except
that with respect to an Employee retiring as described in (iii) above in
this Section 4.04, such monthly retirement benefits shall commence on the
first day of the month immediately following the month in which he
attains age 55.
Provided, however, that in the case of an Employee retiring under this
Section 4.04 who is employed or becomes employed by any competing firm,
as determined by the Committee, payment of his monthly retirement benefits
provided under Section 4.04A shall not be made for any month during which
he is so employed by such competing firm prior to the first day of the
month next following his 65th birthday.
C. The amount of any Additional Retirement Benefit of an
Employee shall be as defined in Section 2.04.
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4.05
A. Except as otherwise provided in Section 4.15 below, an Employee who
retires under an employment contract at the option of the Corporation or
because of Permanent Total Disability on or after his 55th birthday but
before his 65th birthday shall be entitled to receive under this Plan,
commencing on the first day of the month next following his retirement
date, an Incentive Compensation Retirement Benefit in a monthly amount
calculated as described in Section 4.01A.
Provided, however, that in the case of an Employee retiring under
this Section 4.05A who is employed or becomes employed by any competing
firm, as determined by the Committee, payment of his monthly retirement
benefits provided under Section 4.05A shall not be made for any month
during which he is so employed by any such competing firm prior to the
first day of the month next following his 65th birthday.
B. Except as otherwise provided in Section 4.15 below, an Employee who
retires under an employment contract at his option on or after his 55th
birthday but before his 65th birthday shall be entitled to receive under
this Plan, commencing on the first day of the month next following his
retirement date, an Incentive Compensation Retirement Benefit in a monthly
amount calculated as described in Section 4.01A, reduced by multiplying
such benefits by a percentage as set forth in the following table:
Age When
Benefit Commences Percentage*
----------------- -----------
27
29
55 57.9
56 63.5
57 69.4
58 75.2
59 80.8
60 86.7
61 93.3
62 100.0
63 100.0
64 100.0
==== ========
*Prorated for intermediate ages computed to the nearest whole month
Provided, however, that in the case of an Employee retiring under this
Section 4.05B who is employed or becomes employed by any company other than the
Corporation, payment of his monthly retirement benefit provided under Section
4.05B shall not be made for any month during which he is so employed by any
company other than the Corporation prior to the first day of the month next
following his 65th birthday, unless the Committee approves such payment
annually.
C. Except as otherwise provided in Section 4.15 below, an Employee who
retires under an employment contract, and who on his retirement date has
not attained age 55, shall be entitled to receive under this Plan,
commencing on the first day of the month next following his Normal
Retirement Date, an Incentive Compensation Retirement Benefit in a
monthly amount calculated as described in Section 4.01 A.
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30
D. Notwithstanding any other contrary provision, each of the benefits
described in Sections 4.05A, B, and C above shall be reduced by the
amount of any Additional Retirement Benefit of an Employee.
4.06 Except as otherwise provided in Section 4.15 below, an Employee whose
employment terminates under the SERP, or for purposes of the Incentive
Compensation Retirement Benefits also under the Chrysler Canada Ltd. Salaried
Employees' Retirement Plan otherwise than by death or retirement shall be
entitled to receive under this Plan a deferred retirement benefit equal to the
excess of (i) the sum of (1) any Incentive Compensation Retirement Benefit for
which he is eligible as provided in Section A below, and (2) any ERISA Excess
Retirement Benefit for which he is eligible as provided in Section B below over
(ii) any Additional Retirement Benefit for which he is eligible as provided in
Section C below, subject to the provisions of Sections D and E below.
A. If he has 5 years or more of Credited Service at the date his
employment terminates and (i) his employment terminated other than
because of discharge for cause or resignation to work for a
competitor or (ii) his employment terminated because of discharge
for cause, or resignation to work for a competitor and, in either
case, the Committee approves vesting of the terminated Employee's
accrued Incentive Compensation Retirement Benefit, he shall be
entitled to receive Incentive Compensation Retirement Benefits in a
monthly amount calculated as described in Section 4.01A. Any
non-vested Incentive Compensation Retirement Benefits are forfeited.
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31
Notwithstanding the preceding provisions of this Subsection A.(a) all
Incentive Compensation Retirement Benefits accrued as of December 31,
1993 shall be fully vested as of such date in respect to Band 96 and
above employees who are actively at work and who have five or more
years of Credited Service as of such date and (b) all Incentive
Compensation Retirement Benefits accrued as of January 1, 1994 shall
be fully vested as of such date in respect to employees below Band 96
who are actively at work and who have five or more years of Credited
Service as of such date.
B. The deferred age 65 ERISA Excess Retirement Benefit he shall
be entitled to receive shall be a monthly amount equal to the excess
of (i) the deferred retirement benefit calculated under the
provisions of Section 4.06 of the SERP without regard to the benefit
limitations contained in section 415(b)(1) and/or Section 415(e) of
the Internal Revenue Code, as amended, over (ii) the deferred
retirement benefit payable under SERP because of such limitation.
C. The amount of any Additional Retirement Benefit of an
Employee shall be as defined in Section 2.04.
D. Any deferred retirement benefits under this Section 4.06
except as otherwise provided below in Subsection D, shall be a
monthly pension commencing as of the first day of the first month
after the Employee attains age 65 in the full unreduced amount for
which he is eligible under this Section 4.06.
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E. Deferred retirement benefits paid to a terminated Employee may, if
such Employee makes written application, begin prior to age 65 (but
in no event earlier than the month the terminated Employee attains
age 60) on a reduced Actuarial Equivalent basis but shall not be paid
for any month prior to age 65 in which the terminated Employee is
employed by any company other than the Corporation, unless the
Committee approves such payment annually, or is employed
by any competing firm, as determined by the Committee.
4.07
A. If a retired Employee who has commenced receiving retirement benefits under
this Plan is reemployed on or after the effective date of the Plan he shall
continue to receive during such reemployment the retirement benefits to which
he is otherwise entitled (taking into account the provisions of Section 4.15
below), provided, however, that such reemployment shall not result in the
accrual of any additional benefits under the Plan.
B. If a former Employee eligible for a deferred retirement benefit under
this Plan, who has not yet commenced receiving such benefit, is
reemployed, then his eligibility therefore shall cease and the accrued
retirement benefit, if any, he had at the date his employment terminated
(taking into account the provisions of Section 4.15 below) shall be
reinstated.
C. If a former employee whose employment had terminated as a result of
resignation or discharge is subsequently reemployed, the Committee may,
at its discretion, reinstate all or apart of any Incentive Compensation
Retirement Benefit
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33
that had been previously forfeited pursuant to provisions of Section 4.06
of this Plan.
4.08 Except as otherwise provided in Section 4.15 below, a retired
Employee who on the date of his retirement was an elected officer of Chrysler
Corporation and who retired under Section 4.01, 4.02, 4.03, 4.04, or 4.05 of
the SERP shall be entitled to receive under this Plan, commencing on January 1,
1986, a Post Retirement Supplemental Benefit which shall be a monthly amount
equal to the excess of (i) the highest Basic Pension Rate in effect on January
1, 1986 under the Chrysler Pension Plan for employees who retired when the
Employee retired over (ii) the highest Basic Pension Rate in effect under the
Chrysler Pension Plan on the date the Employee retired, multiplied by the
Employee's years of Credited Service.
4.09 Except as otherwise expressly provided in Section 4.15 below, no
Employee shall be entitled to retirement benefits under this Plan except as set
forth in Sections 4.01, 4.02, 4.03, 4.04, 4.05, 4.08 and 4.12, of this Plan,
and no Employee shall have any vested right under the Plan except such rights,
if any, as may accrue to him under Section 4.06 or Section 4.12. At his Normal
Retirement Date, he shall not be entitled to receive any retirement benefits
payable to him pursuant to the terms hereof until his subsequent retirement.
At that time he shall be entitled to receive a monthly retirement benefit
commencing on the first day of the month next following the date of his
retirement in the amount computed as provided in Section 4.01 (but adjusted as
provided in Section 4.15 below).
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34
4.10 Except as otherwise provided in Section 4.15 below, an Employee who
performs any service after December 31, 1987 shall be entitled to have both his
Salary and service taken into account for purposes of calculating his
retirement benefit under this Plan, irrespective of whether such service occurs
before or after the Employee's Normal Retirement Date.
4.11 Except as otherwise provided in Section 4.15 below, a Special
Incentive Compensation Benefit is payable, prior to retirement under the
Salaried Employees' Retirement plan, to those entitled to a Special Leave of
Absence benefit pursuant to the first paragraph of Section 1.01E who would, if
they were retired, be entitled to an Incentive Compensation Retirement Benefit
under this Article IV. The Special Incentive Compensation Benefit shall be
calculated and paid in the same manner as the Incentive Compensation Retirement
Benefit under this Article IV.
4.12 Notwithstanding any other provisions hereof, upon the occurrence of
a 'Change in Control' (as defined in Section 4.13), each Employee who has
participated in the Plan with respect to the Incentive Compensation Retirement
Benefit shall be vested in his accrued Incentive Compensation Retirement
Benefit (reduced to reflect receipt by such Employee of an Additional
Retirement Benefit and/or an Annuity and Supplemental Payment in respect of all
or any portion thereof). If the employment of any such Employee by the
Corporation is terminated by the Corporation without 'cause' (as defined below)
within the two-year period immediately following a Change in Control, the
Corporation shall pay such Employee, within ten (10) days of such termination,
the Commuted Value of his adjusted Incentive Compensation Retirement
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35
Benefit, calculated as described in Section 4.01A (and adjusted in accordance
with Section 4.01C and 4.15) and as if payment of such monthly retirement
benefit were to commence on the first day of the month next following the later
of his termination date or the date he attains age 65. The Commuted Value shall
be determined for this purpose by using the interest rate set forth in Appendix
A to this Plan. Cause, for purposes of this Section 4.12, shall mean the
willful engaging by the Employee in conduct which is demonstrably injurious to
the Corporation, monetarily or otherwise.
4.13 'Change in Control' shall mean a change in control of Chrysler
Corporation, which shall be deemed to have occurred if the conditions set forth
in any one of the following paragraphs shall have been satisfied:
A. Any Person (defined below) shall become the Beneficial Owner (defined
below) of securities of Chrysler Corporation representing 20% or more of
the combined voting power of Chrysler Corporation's then outstanding
securities (unless the event causing the 20% threshold to be crossed is
an acquisition of securities directly from Chrysler Corporation);
B. During any period of two consecutive years beginning after June 7,
1990, individuals who at the beginning of such period constitute the
Board of Directors of Chrysler Corporation and any new director (other
than a director designated by a Person who has entered into an agreement
with Chrysler Corporation to effect a transaction described in paragraph
A, C or D of this Change in Control definition) whose election or
nomination for election was approved by a vote of at least two-thirds of
the directors then in office
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36
who either were directors at the beginning of such two year period or
whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority of the Board of Directors;
C. The stockholders of Chrysler Corporation approve a merger or
consolidation of Chrysler Corporation (other than a merger or
consolidation which would result in the voting securities of Chrysler
Corporation outstanding immediately prior to such merger or consolidation
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the entity surviving such merger or
consolidation), in combination with voting securities of Chrysler
Corporation or such surviving entity held by a trustee or other fiduciary
pursuant to any employee benefit plan of Chrysler Corporation or such
surviving entity of any subsidiary of Chrysler Corporation or such
surviving entity, at least 80% of the combined voting power of the
securities of Chrysler Corporation or such surviving entity outstanding
immediately after such merger or consolidation); or
D. The stockholders of Chrysler Corporation approve a plan of complete
liquidation or dissolution of Chrysler Corporation or an agreement for the
sale or disposition by Chrysler Corporation of all or substantially all of
Chrysler Corporation's assets.
The following terms, as used in this Change in Control
definition, shall have the meanings stated below:
"Beneficial Owner", with respect to any securities, means any Person
who, directly or indirectly, has the right to vote
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37
or dispose of such securities or otherwise has "Beneficial Ownership" of
such securities (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the 'Exchange Act')), pursuant to any
agreement, arrangement or understanding (whether or not in writing);
provided however, that (i) a Person shall not be deemed the Beneficial
Owner of any security as a result of an agreement, arrangement or
understanding to vote such security (x) arising solely from a revocable
proxy or consent given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the Exchange Act
and the applicable rules and regulations thereunder or (y) made in
connection with, or to otherwise participate in, a proxy or consent
solicitation made, or to be made, pursuant to, and in accordance with, the
applicable provisions of the Exchange Act and the applicable rules and
regulations thereunder, in either case described in clause (x) or clause
(y) above, whether or not such agreement, arrangement or understanding is
also then reportable by such Person on Schedule 13D under the Exchange Act
(or any comparable or successor report), and (ii) a Person engaged in
business as an underwriter of securities shall not be deemed to be the
Beneficial Owner of any securities acquired through such Person's
participation in good faith in a firm commitment underwriting until the
expiration of forty days after the date of such acquisition.
"Person" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act, as supplemented by Section 13(d)(3) of the
Exchange Act, provided, however, that
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38
Person shall not include (i) Chrysler Corporation, any subsidiary of
Chrysler Corporation or any other Person controlled by Chrysler
Corporation, (ii) any trustee or other fiduciary holding securities under
any employee benefit plan of Chrysler Corporation or any subsidiary of
Chrysler Corporation, or (iii) a corporation owned, directly or
indirectly, by the stockholders of Chrysler Corporation in substantially
the same proportions as their ownership of securities of Chrysler
Corporation.
4.14 Notwithstanding any other provision of this Article IV or of this
Plan, a Salaried Employee who retires prior to age 55 pursuant to provisions of
the Chrysler Canada, Ltd. Salaried Employees' Retirement Plan, shall be
considered an employment termination rather than a retirement for purposes of
determining the nature, amount, and timing of any benefits to which he may be
entitled under this Plan.
4.15 A. Notwithstanding anything else contained in the Plan to the
contrary, the Corporation may at any time, and from time to time, substitute an
individual annuity contract or an interest in a group annuity contract meeting
the terms and conditions of this Section 4.15 (an "Annuity") for all or any
portion of the benefits of any Employee, any class of Employees or all
Employees accrued under this Article IV as of a date (the "Calculation Date")
determined by the committee of the Board then responsible for the compensation
of officers of the Corporation (the "Board Committee") in its sole discretion.
The amount payable in respect of any Employee under such Annuity shall (i) be
based on the Employee's service completed and compensation earned through the
Calculation
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39
Date or such earlier date as may be specified by the Board Committee (the
"Applicable Service and Compensation") and (ii) be, on a net after tax basis (as
determined pursuant to this Section 4.15), substantially the same amount that he
or she would have received under Article IV hereof, based on the Applicable
Service and Compensation. For purposes of the immediately preceding sentence,
the amount payable to the Employee on a net after tax basis shall be determined
assuming that (i) all amounts that would have been payable under Article IV
would have been taxable at the Tax Rate, (ii) all taxable income received by the
Employee from the Annuity (i.e., all amounts in excess of the Employee's return
of basis, as determined by applying the exclusion ratio determined under Section
72 of the Internal Revenue Code (or any successor section thereon)) is taxable
at the Adjusted Tax Rate, and (iii) for purposes of determining the effect of
any state, local or foreign tax, at the time the Employee would receive any
retirement income, whether under Article IV hereof or pursuant to the terms of
the Annuity, such Employee will be deemed to reside in the same jurisdiction as
it used to determine the Tax Rate for such Employee. The remaining terms and
conditions applicable to such Annuity, or the receipt thereof, shall be
determined by the Committee and communicated by the Corporation to the Employee
at such time and in such manner as the Committee shall determine, but subject
to any disclosure requirements under applicable law.
B. Except as otherwise provided in this Section 4.15 or as required under
applicable law, the retirement income payable pursuant to an Annuity shall be
payable on substantially the same terms and
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40
conditions as set forth in Article VI as in effect on the corresponding
Calculation Date.
C. Notwithstanding the purchase of any Annuity pursuant to Section 4.15A,
unless the Committee otherwise determines, the death benefits described in
Article V hereof shall continue to be provided pursuant to any such Annuity.
Nothing in the Section 4.15C shall be construed to obligate the Corporation,
following the purchase of an Annuity, to pay under this Plan any survivor
benefits payable under Article VI with respect to the Applicable Service and
Compensation used to calculate the benefits payable under such an Annuity.
D. Notwithstanding the provisions of Article VI, no Annuity shall permit an
Employee to surrender such Annuity and receive a lump sum payment equal to the
cash value of the Annuity, provided, however, that the Board Committee (or its
delegate) may offer to any or every Employee the opportunity to receive, in
lieu of an Annuity, a lump sum distribution equal to the present value of such
Employee's retirement benefits accrued as of the applicable Calculation Date
under Article IV, or under Section 1.01C (Post Retirement Supplemental
Benefit) or Section 1.01D (American Motors Supplemental Pension Plan Benefit)of
Article I, determined on a basis and using such assumptions as the Board
Committee (or its delegate) shall determine.
E. If the Board Committee elects to distribute retirement benefits in the form
of an Annuity to, or permit a lump sum option to be exercised by, any Employee
or class of Employees pursuant to this Section 4.15, the Board Committee shall
not be obligated or otherwise required to provide an Annuity or a lump sum to
each
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Employee or to all similarly situated Employees. Moreover, the distribution of
an Annuity or lump sum with respect to accrued benefits on one or more
occasions shall not obligate the Corporation to make such a distribution with
respect to benefits accrued thereafter. To the extent an Employee does not
receive retirement benefits in the form of an Annuity or a lump sum pursuant to
this Section 4.15, the retirement benefits for such Employee shall continue to
be determined in accordance with the terms of the Plan other than this Section
4.15.
F. Subject to the conditions of this Section 4.15, if the Board Committee
determines that, in lieu of a distribution of retirement benefits accrued under
Article IV thereof, an Employee shall receive an Annuity pursuant to this
Section 4.15, it shall also direct the Corporation to make a supplemental
payment, which may be provided under the Plan, to each such Employee in an
amount equal to the amount of the applicable income and employment taxes, if
any, payable in respect of the distribution of the Annuity, calculated assuming
that an employee pays such taxes at the Tax Rate (the "Supplemental Payment").
In no event shall a Supplemental Payment be made to any Employee who received a
lump sum payment in lieu of an Annuity pursuant to Section 4.15D hereof.
Payment of an Annuity and a Supplemental Payment, shall be in lieu of, and in
full and complete substitution for the Employee's rights hereunder (other than
with respect to the death benefits described in Article V) in respect of all
benefits accrued under Article IV as of the corresponding Calculation Date
as to which the Annuity pertains. Any Employee who, after receiving a
Supplemental Payment pursuant to this Section 4.15F, objects to the
distribution of the Annuity
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or asserts a claim against the Corporation by reason of his or her participation
in the Plan for any retirement benefits or any other amounts in respect of the
Applicable Service and Compensation used in calculating the amount of such
Annuity shall be obligated to return to the Corporation the amount of such
Supplemental Payment, plus interest thereon, compounded annually at 120% of the
long-term "Applicable Federal Rate" (as defined in Section 1274(d) of the
Internal Revenue Code) in effect on the date such Supplemental payment was made.
ARTICLE V. DEATH BENEFITS
5.01 If a former Employee dies (a) on or after the date of his retirement
under the SERP, or for purposes of the Incentive Compensation Retirement
Benefits also under the Chrysler Canada Ltd. Salaried Employees' Retirement
Plan in the case of a former Employee who retired under any of such plans, or
(b) on or after the date his employment terminated, in the case of a former
Employee whose employment terminated otherwise than by retirement under the
SERP, or for purposes of the Incentive Compensation Retirement Benefit also
under the Chrysler Canada Ltd. Salaried Employees' Retirement Plan, and who was
eligible for a deferred retirement benefit under Section 4.06 at the time of
such termination, and if in either such case no election under Section 6.04 was
in effect for such former Employee at the time of his death, then in any such
case the Beneficiary of any such former Employee shall be entitled to receive
under this Plan (i) any Incentive Compensation Death Benefit for which he was
eligible as a former Employee as provided in Subsection A below, (ii) any ERISA
Excess Death Benefits for which he was eligible as provided in
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43
Subsection B below, and (iii) any Modified Special Early Retirement Program
Death Benefit, for which he was eligible as provided in Subsection C below.
A. The Incentive Compensation Death Benefit of such a former Employee
shall be:
1. If at the time of his death the former Employee
was receiving an Incentive Compensation Retirement Benefit
(whether due to retirement or termination of employment) or if
commencement of receipt of an Incentive Compensation
Retirement Benefit was deferred as provided in Section 6.03,
an amount equal to the Commuted Value of any unpaid guaranteed
payments of the Incentive Compensation Retirement Benefit.
B. The ERISA Excess Death Benefit of such a former Employee shall be:
1. If at the time of his death he was receiving an
ERISA Excess Retirement Benefit (whether due to retirement or
termination of employment) or if commencement of receipt of an
ERISA Excess Retirement Benefit was deferred as provided in
Section 6.03, an amount equal to the Commuted Value of any
unpaid guaranteed payments of the ERISA Excess Retirement
Benefit.
2. If he was entitled to an ERISA Excess Retirement
Benefit under Section 4.06B and if he dies prior to
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44
the date payment of such ERISA Excess Retirement Benefit
commences, and
a. If such ERISA Excess Retirement
Benefit includes a monthly amount of contributory
retirement benefit as provided for under the provisions
of either or both of Section(s) 4.06A of the SERP, or
1.01B of this Plan, his ERISA Excess Death Benefit based
on such contributory retirement benefit shall be in an
amount equal to 100 times the amount of such monthly
benefit, and
b. If such ERISA Excess Retirement Benefit includes a
monthly amount of the SERP non-contributory retirement
benefit calculated under the provisions of Section
4.06B of the SERP, his ERISA Excess Death Benefit based
on such non-contributory retirement benefit shall be in
an amount equal to the Commuted Value of the 120
monthly payments of such benefit that he would have
received under the Plan had he elected to receive
immediate payment of benefits commencing on the date
immediately preceding the date of his death.
C. The Modified Special Early Retirement Program Death Benefit of such a
former Employee shall be:
1. An amount equal to the Commuted Value of the
remainder of 120 guaranteed monthly payments for the
contributory and non-contributory Supplementary
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45
Minimum Benefit to which the Employee is entitled pursuant to
Section 1.01E of this Plan and/or
2. An amount equal to the Commuted Value of the
remainder of 120 guaranteed monthly payments for the
contributory and non-contributory Special Leave of Absence
Benefit (excluding, however, monthly payments under the
Pension Plan which shall not be guaranteed) to which the
Employee is entitled pursuant to Section 1.01E of this Plan.
5.02 If an Employee dies while participating in the SERP, or for purposes
of the Incentive Compensation Retirement Benefits also under the Chrysler
Canada Ltd. Salaried Employees' Retirement Plan and after his Normal Retirement
Date and if he is not deemed to have made the election provided in Section
6.05, his Beneficiary shall be entitled to receive the sum of (i) any Incentive
Compensation Death Benefit for which the Employee was eligible as provided in
Subsection A and (ii) any ERISA Excess Death Benefit for which the Employee was
eligible as provided in Subsection B below.
A. The Incentive Compensation Death Benefit of such an Employee shall be
an amount equal to the Commuted Value of 120 monthly payments of the
monthly Incentive Compensation Retirement Benefit which would have been
payable to the Employee if he had retired under the Plan on the date of
his death.
B. The ERISA Excess Death Benefit of such an Employee shall be an amount
equal to the Commuted Value of 120 monthly payments of the monthly ERISA
Excess Retirement Benefit that
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46
he would have received under the Plan had he retired on the date of his
death.
5.03 If an Employee dies while participating in the SERP, or for purposes
of the Incentive Compensation Retirement Benefit also under the Chrysler Canada
Ltd. Salaried Employees' Retirement Plan and on or prior to his Normal
Retirement Date, his Beneficiary shall be entitled to receive the sum of (i)
any Incentive Compensation Death Benefit for which the Employee was eligible at
the time of his death as provided in Subsection A and (ii) any ERISA Excess
Death Benefit for which the Employee was eligible as provided in Subsection B
below.
A. The Incentive Compensation Death Benefit of such an Employee shall be
an amount equal to the Actuarial Equivalent of his accrued age 65 monthly
Incentive Compensation Retirement Benefit.
B. The ERISA Excess Death Benefit of such an Employee shall be an amount
equal to the excess of (i) the death benefit calculated under the SERP
without regard to the benefit and compensation limitations set forth in
that plan or imposed under Section 415 or Sub-paragraph 401(a)(17) of
the Internal Revenue Code over (ii) the death benefit payable under the
SERP because of such ERISA limitations. Any death benefit payable under
this Plan shall be computed based on any contributions under Section VII
of this Plan.
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ARTICLE VI. PAYMENT OF BENEFITS
6.01 An Employee desiring to retire and receive a retirement benefit under
the Plan or a terminated Employee desiring to apply for a deferred retirement
benefit under the Plan shall, in either such case, obtain a form of application
for that purpose and shall file his written application with the Committee,
furnishing the information the Committee shall request together with
documentary evidence in support of the same, satisfactory to the Committee, and
any authority in writing that the Committee may request authorizing it to
obtain pertinent information or records, certificates or transcripts from any
public office.
6.02 A Retirement benefit, except as provided under Section 6.10 of the
Plan, shall be paid in monthly installments. The first installment shall be
payable on the first day of the month following the actual retirement of an
Employee retiring from the employ of the Corporation or of a Non-Participating
Subsidiary or, in the case of an Employee whose employment terminates otherwise
than by retirement, on the first day of the first month after the Employee
attains age 65. Subsequent installments of the retirement benefit shall be
payable on the first day of each month thereafter during the lifetime of the
retired or former Employee, and the standard form of payment of the retirement
benefit shall be for the lifetime of the retired or former Employee with a
guarantee of 120 monthly payments, except for the Post Retirement Supplemental
Benefit described in Section 4.05., for which the standard form of payment
shall be monthly payments during the lifetime of the former Employee without any
guaranteed number of payments.
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6.03 Anything to the contrary in this Plan notwithstanding, monthly
retirement benefit payments under the Plan shall not commence until the first
day of the month following the ceasing of any sickness or accident benefits
(including payments under the Disability Absence Plan of the Corporation,
disability benefits under the Salary Continuation Plan of the Corporation, and
payments or benefits of like purpose or kind under any similar plan of the
Corporation or of a Non-Participating Subsidiary in effect at the time) toward
which the Corporation or a Non-Participating Subsidiary contributes by payment
of premiums, taxes or otherwise; provided, however, that commencement of a
monthly retirement benefit shall not be deferred by reason of receipt of (a) a
Permanent Total Disability Benefit under any pension plan or group life
insurance policy of the Corporation or of a Non-Participating Subsidiary, or
(b) a disability benefit under the Federal Social Security Act, or (c) a
benefit under the Long Term Disability Plan or the Extended Disability Plan of
the Corporation or a benefit or payment of like purpose or kind under any
similar plan of the Corporation or of a Non-Participating Subsidiary at the
time in effect.
6.04 In lieu of payment of a retirement benefit in the standard form as
described in Section 6.02 and lieu of payment of a death benefit as described
in Article V, payment of all such benefits shall be made in the form of a
surviving spouse option, as provided in Subsection A below, to an Employee who
retires and who is entitled to a retirement benefit. The Employee or former
Employee shall automatically be deemed to have elected the form of surviving
spouse option provided in Subsection A below (sometimes
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called "Qualifying Option" in this Article VI) except where otherwise provided
in such Subsection A. The surviving spouse option in the form provided below
shall be applicable only with respect to an Employee or former Employee who is
married on the date such election is deemed to have been made.
A. The retirement benefit under the Qualifying Option for an Employee or
former Employee who automatically elects it, as hereinabove provided,
shall consist of reduced monthly payments after the effective date of his
election during his lifetime with a guarantee of 120 monthly payments,
with provision that if his death occurs on or after the effective date of
his election and if the person who was his spouse at the date of his
retirement (or in the case of a former Employee entitled to a deferred
retirement benefit under Section 4.06, on the date he files his
application) is living at the last to occur of his death or the
expiration of such 120-month period, benefits in the amount specified
below shall be payable monthly to such surviving spouse during her
remaining lifetime. Notwithstanding anything to the contrary in this
Subsection A, the above provisions relating to a guarantee of 120 monthly
payments do not apply to the Post Retirement Supplemental Benefit. The
Qualifying Option shall automatically apply, in respect to the Post
Retirement Supplemental Benefit, to the extent payable by the Corporation
from its general assets, in respect to employees or former employees who
have the Qualifying Option under the Chrysler Salaried Employees'
Retirement Plan pursuant to Section 6.05 of that plan. Those participants
in this Plan who do not have
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the Qualifying Option under the Chrysler Salaried Employees' Retirement
Plan may elect to receive Post Retirement Supplemental Benefit payments
payable until the death of both the Employee or former Employee and his
spouse but such election shall not be automatic.
1. The reduced monthly payment of a retirement benefit payable to
the Employee or former Employee whose age does not differ from
that of his spouse by more than 5 years shall be an amount
equal to the monthly payment that would have been payable to
him in the standard form, reduced by an amount equal to 5% of
the amount of the retirement benefits that would be payable to
him in the standard form at his Normal Retirement Date
if he had elected the standard form of payment. If the age of
the spouse is less than the age of such Employee or former
Employee, the percentage shall be 5% increased by 1/2 of 1% for
each year in excess of 5 years that the age of the spouse is
less than the age of the Employee or former Employee. If the
age of the spouse is greater than the age of the Employee or
former Employee, the percentage shall be 5% decreased by 1/2 of
1% for each year in excess of 5 years that the age of the
spouse exceeds the age of the Employee or former Employee (but
not less than 0%). For this purpose, the ages of the Employee
or former Employee and his spouse shall each be the age at his
or her last birthday prior to the
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effective date of election as provided in Subsection B below.
The reductions provided in this paragraph shall be made in all
monthly payments paid to the Employee or former Employee on or
after the date on which his election becomes effective, except
as otherwise provided below in Subsections E and F of this
Section 6.04.
2. The benefits payable to the surviving spouse, if the death of
the Employee or former Employee occurs on or after the
effective date of his election (or in the case of a former
Employee entitled to a deferred retirement benefit under
Section 4.06, on or after the date he files his application)
and the person who was his spouse is living at the last to
occur of his death or the expiration of the 120 guaranteed
monthly payments, shall be monthly payments equal to 60% of the
reduced monthly payments determined as provided in paragraph 1
above.
Notwithstanding anything to the contrary in this
Subsection 2, any monthly amount payable to a surviving
spouse which is calculated on the basis of the Post
Retirement Supplemental Benefit under the provisions of
Section 4.05 shall commence on the first day of the month
following the month in which the Employee died and terminate
with the last monthly payment before her death.
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B. An election of the surviving spouse option that is deemed to have been
made as provided in Subsection A above, shall be deemed to have been made
at the time the Employee or former Employee files his application for a
retirement benefit or a deferred retirement benefit, and the effective
date of the election shall be the date payment of the retirement benefit
commences, except that, in the case of an Employee or former Employee who
is married when his election would otherwise become effective, but whose
marriage at that date has been continuously in effect for less than one
year, the effective date of his election shall be the first day of the
month following the month in which such marriage has been continuously in
effect for one year. However, in the case of an Employee or former
Employee who marries during the twelve month period immediately preceding
the date payment of a retirement benefit commences and has been married
to that spouse for at least one year ending on the date of the Employee's
or former Employee's death, he shall be deemed to have been married for
one year ending on the date payment of his retirement benefit commenced.
C. If an Employee or former Employee is deemed to have made the election
provided above in Subsection A of this Section 6.04 and if his spouse
dies or should otherwise cease to be his spouse after he has made such
election but before the effective date of such election, the election
shall be revoked automatically. The election shall be irrevocable on or
after the effective date of the election if the Employee or former
Employee and his designated spouse are both living on such
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date except as otherwise provided below in Subsections E and F of this
Section 6.04. If such designated spouse dies or should otherwise cease
to be the spouse of the Employee or former Employee after the
effective date of the election and during his lifetime, the reduced
monthly payments payable to him shall not be affected, except as otherwise
provided below in Subsections E and F of this Section 6.04.
D. Upon the request of the Committee an Employee or former Employee
deemed to have made the election provided in Subsection A of this Section
6.04 must produce an official marriage certificate or other evidence of
his marriage to his spouse satisfactory to the Committee.
E. An Employee or former Employee who is deemed to have made the election
provided above in Subsection A of this Section 6.04 and whose designated
spouse predeceases him may have his monthly payments restored to the
amount payable without reduction for such election, and shall become
eligible for all death benefits as provided in Article V, effective the
first day of the month following the month in which the Committee receives
evidence satisfactory to it of the spouse's death.
F. If an Employee or former Employee is deemed to have made the election
provided above in Subsection A of this Section 6.04 and if the Employee
or former Employee and his spouse are divorced by court decree or
judgment, such Employee or former Employee is deemed to have canceled
such election and will have his monthly payments restored to the amount
payable without reduction for such election and shall become eligible for
death benefits as provided in Article V, effective the
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first day of the third month following the month in which the Committee
receives such Employee's or former Employee's written revocation of the
election because of divorce, on a form approved by the Committee, and
accompanied by evidence satisfactory to the Committee of a final decree or
judgment of divorce.
G. A retired Employee who (i) was deemed to have made the election
provided above in Subsection A of this Section 6.04 and whose designated
spouse dies or otherwise ceases to be his designated spouse or (ii) was
not married on the date provided for such election in Subsection B of
this Section 6.04, and who marries or remarries shall automatically be
deemed to have reelected the form of surviving spouse option provided
above in Subsection A of this Section 6.04. Such election shall become
effective on the first day of the month following the month in which the
retired Employee has been married one year.
6.05 Every Employee for whom Section 6.04 is inapplicable may designate a
Beneficiary to receive payments in the event of his death by filing with the
Committee a designation in writing signed by him in such form as the Committee
shall prescribe, and may change or revoke the designation from time to time and
at any time by filing with the Committee a new designation; provided, however,
that an Employee shall be deemed to have designated as his Beneficiary the
beneficiary designated in the SERP, or for purposes of the Incentive
Compensation Retirement Benefit also under the Chrysler Canada Ltd. Salaried
Employees' Retirement Plan, unless the Participant specifically designates
another Beneficiary.
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6.06 Any death benefit provided in Article V with respect to an Employee
for whom there is in effect no election as provided in Section 6.04 shall be
paid in a lump sum.
6.07 No benefit or right to payment under this Plan shall be subject to
any claim of any creditor of any Employee, Beneficiary or surviving spouse of a
deceased Employee or former Employee and shall not be subject to attachment or
garnishment or other legal process by any creditor, nor shall any Employee,
former Employee, Beneficiary or surviving spouse have any right to alienate,
anticipate, commute, pledge, encumber or assign any of the benefits under this
Plan.
6.08 In the event of the death of a person entitled to any benefit under
the Plan, or in the event that the Committee shall find that any such person is
unable to care for his affairs because of illness or accident, the Committee
may cause any benefit payments due, unless claim shall have been made therefor
by a duly appointed legal representative, to be paid to the spouse, a child, a
parent or other blood relative, or to any person deemed by the Committee to
have incurred expense for such person, and any such payments so made shall be a
complete discharge of the liabilities of the Plan therefor. In the event that,
at the time a benefit becomes payable to any persons under the Plan, the
Committee after reasonably diligent search is unable, within six years from the
time the benefit is payable, to find the person to whom the benefit is payable,
then the benefit shall be treated as a forfeiture and all right, title, and
interest of the person therein and thereto shall terminate.
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6.09 Notwithstanding anything to the contrary herein, the Committee shall
pay the Actuarial Equivalent of any amount(s) payable under this Plan to a
participant or Beneficiary before such amount(s) would otherwise be paid (and
in discharge of all obligations with respect thereto) if, based on any of the
following events, the Committee determines, in good faith based on consultation
with counsel, that such participant or Beneficiary has or will recognize income
for federal income tax purposes with respect to such amount(s) before such
amount(s) are otherwise to be paid:
A. a change in the Internal Revenue Code or Title 1 of ERISA, or the
Treasury or Department of Labor Regulations thereunder, respectively, or
a binding or predominant judicial construction thereof,
B. a published ruling or similar announcement issued by the Internal
Revenue Service or the Department of Labor,
C. a decision by a court of competent jurisdiction involving a
participant in the Plan, a Beneficiary of the Plan, the Corporation, or
any entity involved in making payments under the Plan, or
D. a final determination of tax liability following a contested tax or
ERISA dispute or audit (or a closing agreement made under section 7121 of
the Internal Revenue Code) that involves a participant in the Plan, a
Beneficiary of the Plan, the Corporation, or any entity involved in
making payments under the Plan.
6.10
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A. An employee eligible to receive an Incentive Compensation Retirement
Benefit under Article IV of the Plan may elect to receive such benefit in
a lump sum payment. Such lump sum payment shall be equal to the lesser
of (a) an amount equal to 80% of the cost of a typical commercial
insurance policy equivalent in value to the Plan's 10 years certain and
life standard form of payment or (b) an amount calculated based on the
Plan's cost/funding assumptions, except that a 10% interest rate shall be
used. An election to receive an immediate lump sum payment may be made
at retirement. If such election is not made at retirement, a subsequent
election may be made subject to a waiting period of one year. Eligible
recipients of Incentive Compensation Retirement benefits who retired
prior to January 1, 1994 shall be provided a one time 90 day window
election period, as determined by the Corporation, to make a lump sum
payment election without a one year waiting period. The value of the
lump sum payment will be determined based on the remaining value of the
Plan's 10 years certain and life normal provision.
B. A terminated employee eligible to receive a deferred Incentive
Compensation Retirement Benefit under Section 4.06 of the Plan may elect
to receive such benefit in a lump sum payment subject to Committee
approval. Such lump sum payments, however, may not be elected prior to
age 65. In addition, if such lump sum payment election is made later
than age 65, it is subject to a waiting period of one year. If benefits
have commenced prior to the lump sum payment, the value of the lump sum
payment will be determined based on the
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remaining value of the Plan's 10 years certain and life normal provision,
assuming the terminated employee had elected such normal provision when
his benefits commenced.
ARTICLE VII. CONTRIBUTIONS
7.01 Employee contributions shall be permitted under this Plan solely for
the purpose of providing an ERISA Excess Retirement Contributory Benefit
pursuant to Section 1.01B of this Plan and an ERISA Excess Death Benefit
pursuant to Paragraph 5.01B.2.a of this Plan.
7.02 Employee contributions under this Plan shall be voluntary and shall
be permitted in the amount and to the extent they would have been permitted
under the Salaried Employees' Retirement Plan ("SERP") had they not been
curtailed by limitations imposed by Sub-paragraph 401(a)(17) of the Internal
Revenue Code, as amended, as embodied in Subsection 4.01C of SERP.
ARTICLE VIII. PLAN ADMINISTRATION
8.01 The Committee shall have exclusive authority to control and manage
the operation and administration of this Plan except as specifically set forth
in Section 4.15 and in Section 8.04 below.
8.02 The Committee may make rules and regulations for the administration
of the Plan which are not inconsistent with the terms and provisions of the
Plan. The Committee shall have discretionary authority to construe and
interpret the Plan and decide all questions of eligibility, benefit settlement
and payment. It may correct any defect or supply any omission or reconcile any
inconsistency in such manner and to such extent as it shall deem expedient to
carry the Plan into effect and it shall be the sole and final judge of such
expediency. In addition the
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Committee, or such person or persons it shall designate for that purpose as
provided in Section 8.03, shall maintain the following claim review procedure:
A. Claim Review Procedure. (a) If any former Employee or any Beneficiary
has not received a benefit under the Plan to which he thinks he is
entitled, he or his authorized representative, within 180 days after the
event that he thinks entitled him to the benefit, may file with the
Committee a written claim for the benefit, in any form reasonably
calculated to bring the nature of his claim to the attention of the
Committee. If the claim is wholly or partially denied, the Committee
within 180 days of its receipt of the claim, shall give to the claimant
written notice of the denial, setting forth in a manner calculated to be
understood by the claimant the specific reason or reasons for the denial.
A claimant whose claim to benefits under the Plan has been wholly or
partially denied, or his authorized representative, may request a review
of his claim by the Committee by making written application for review to
the Committee within 90 days after the claimant's receipt of written
notification of denial of his Claim. In connection with the review, the
claimant or his authorized representative may submit issues and comments
in writing. Not later than 90 days after the receipt by the Committee of
the claimant's request for review, the Committee shall give its decision
in writing, setting forth the specific reasons for the decision, written
in a manner calculated to be understood by the claimant. Subject to any
rights to remedies accorded by applicable law, the final decision of the
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Committee shall be conclusive and binding upon the Corporation, the
claimant and all other persons interested in the claim.
B. The Committee shall also make arrangements for authorizing the payment of
benefits to retired Employees, former Employees, surviving spouses and
Beneficiaries entitled thereto. The payment of such benefits shall
commence as of the first day of the first calendar month beginning after
the date which is 90 days following the Committee's decision in 8.02 A.
8.03 The Committee may appoint a secretary and one or more assistant
secretaries and such other agents and representatives as it may deem advisable,
who may but need not be Employees otherwise covered by this Plan, to keep its
records or assist it in doing any other acts or things, and any such
appointment shall be deemed a designation.
8.04
A. In the performance of its duties under this Plan the Committee may act
by a majority of its members then in office and any action expressed from
time to time by a vote at a meeting or in writing without a meeting shall
constitute action of such Committee and shall have the same effect for
all purposes as if assented to by all of the members of such Committee
then in office.
B. Any action which this Plan authorizes or requires the Committee to do
shall, if done in good faith by such committee, be final and binding upon
Employees, retired Employees, former Employees, surviving spouses,
Beneficiaries, and the Corporation. The fact that any member of either
such
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Committee is an Employee, officer, director or stockholder of Chrysler
Corporation or is covered by this Plan shall not disqualify him from
doing any act or thing which this Plan authorizes or requires him to do as
a member of such Committee or render him accountable for any benefit
received by him as an Employee covered by this Plan. No Committee member
shall participate in any decision of the Committee that would directly
and specifically affect the timing or amount of his benefits under the
Plan.
C. The members of the Committee shall discharge their duties under the
Plan solely in the interest of the Employees and their Beneficiaries and
(i) for the exclusive purpose of providing benefits to such Employees and
their Beneficiaries and defraying reasonable expenses of administering
the Plan (ii) with the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent man acting in a like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims; and (iii) in
accordance with the provisions of the Plan, as the same may be from time
to time amended.
D. The Committee and the members of the Committee shall be entitled to
rely upon all information certified to it by the Corporation, all
certificates and reports furnished by the Actuary or by any qualified
public accountant and all opinions given by any duly appointed legal
counsel (who may be also counsel for Chrysler Corporation); and neither
the Committee nor any member of the Committee shall be deemed imprudent in
respect of any action taken or permitted by them in good faith
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in reliance upon any such certificates, reports or opinions. Except to
the extent otherwise provided by law neither the Committee nor any of the
members of the Committee shall be liable to the Corporation or to any
Employee or to any Beneficiary on account of any act done or omitted or
determination made by the Committee acting in good faith in the
performance of its duties under the Plan, nor for any act done or omitted
by any agent or representative of the Committee selected by such Committee
with reasonable care, nor shall any member of the Committee be liable to
any person for any act done or omitted by any other member of the
Committee in which he did not concur. The Corporation agrees, to
the extent permitted by law, to indemnify and hold the Committee and each
of the members of the Committee harmless from and against any liability it
or they may incur in connection with the Plan, unless arising from their
own negligent or willful breach of their fiduciary responsibility as set
forth in subsection C of this section.
E. Any act that the Plan authorizes or requires the Committee to do, or
any determination in good faith by the Committee of any matter or
question under the Plan shall, in any such case, be final and binding
upon any Employee, retired Employee, former Employee, surviving spouse or
Beneficiary.
F. All expenses of the Committee in the performance of its duties under
this Plan shall be payable by the Corporation.
8.05 The Corporation, as long as the Plan remains in effect, shall pay or
cause to be paid the benefits provided by the Plan and the incurred costs and
expenses of the Plan.
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ARTICLE IX. AMENDMENT, TERMINATION
9.01 The Board of Directors of Chrysler Corporation shall have the right
to amend the Plan at any time and from time to time, to any extent that it may
deem advisable, except that no such amendment shall adversely affect the rights
of any Employee with respect to retirement benefits theretofore accrued under
the Plan.
9.02 The Committee shall have the right to amend this Plan at any time and
from time to time, to any extent that it may deem advisable, except that no
such amendment shall
A. adversely affect the rights of any Employee with respect to retirement
benefits theretofore accrued under the Plan; or
B. change the benefit formula for determining the amount of retirement or
death benefits provided under the Plan unless approved by the Board of
Directors of Chrysler Corporation. (The Committee shall, however, have
full authority to approve amendments that provide additional benefit
incentives under special early retirement programs and, except as limited
by the first sentence of this Section 9.02B, to approve basic design and
administrative amendments that affect retirement eligibility and the
amount of benefits);
C. decrease the age or length of service that employees are required to
have under the Plan in order to be eligible for benefits upon early
retirement or termination of employment (notwithstanding the preceding
sentence, however, the Committee shall have specific authority to
establish reduced age or service requirements pursuant to special early
retirement programs designed to achieve work force reductions provided,
however, that (i) special early retirement offers
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for officers and other Board roll employees must be approved in advance by
the Management Resources Committee and (ii) special early retirement
programs that lower the age of retirement below 50 or the number of years
of Credited Service below seven must be approved by the Board of
Directors of Chrysler Corporation);
D. permit the termination of this Plan other than by the authority of the
Board of Directors of Chrysler Corporation; or
E. alter the provisions of Article VIII or of this Article IX; or
F. alter the provisions of Section 4.15.
9.03 Any amendment to this Plan shall be set out in an instrument in
writing executed on behalf of Chrysler Corporation under its corporate seal by
the President or a Vice President or the Treasurer and by the Secretary or an
Assistant Secretary, and authorized by a resolution of the Committee or of the
Board of Directors.
9.04 Chrysler Corporation by action of its Board may direct the Committee
to terminate the Plan in whole or in part at any time. In the case of complete
or partial termination of the Plan, no further benefits shall be accrued under
the affected portions of the Plan with respect to affected Employees, and
benefits theretofore accrued shall be paid in accordance with the provisions of
Articles IV through VI of the Plan. Except with the consent of the Employee,
no such termination of the Plan shall adversely affect the rights of any
Employee with respect to retirement benefits theretofore accrued under the
Plan.
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9.05 Notwithstanding any other provisions hereof, during the two-year
period beginning on the date of a Change in Control, the Plan shall not be
terminated (whether in whole or in part) and the Plan shall not be amended in
any way which detrimentally affects the right of any Employee (i) to
participate in the Plan, (ii) to accrue, or to continue to accrue, supplemental
retirement benefits under the Plan, or (iii) to vest in any such supplemental
retirement benefits.
ARTICLE X. GENERAL
10.01 This Plan is purely voluntary on the part of the Corporation.
Neither the establishment of this Plan nor the payment of any benefit shall be
construed as giving any Employee or any other person any legal or equitable
right against the Corporation or the Committee, unless the same shall be
expressly provided for in this Plan or conferred by affirmative action of the
Committee or the Corporation in accordance with the terms and provisions of the
Plan, or as giving any Employee the right to be retained in the service of the
Corporation, and all Employees shall remain subject to discharge to the same
extent as if this Plan had never been established.
10.02 The validity and construction of this Plan shall be determined
according to the laws of the United States and of the State of Michigan.
10.03 Titles of articles are for general information only and this Plan
is not to be construed by reference thereto.
10.04 In all cases where they would so apply, words used in the
masculine or feminine shall be construed to include the
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opposite gender, and words used in the singular shall be construed to include
the plural.
10.05 In case any provisions of this Plan shall be held illegal or
invalid for any reason, such illegality or invalidity shall not affect the
remaining parts of this Plan, but this Plan shall be construed and enforced as
if such illegal or invalid provisions had never been inserted herein.
10.06 Any payment or distribution to any Employee, retired Employee,
former Employee, Beneficiary, or surviving spouse in accordance with the
provisions of this Plan shall be in full satisfaction of all claims against the
Committee and the Corporation.
10.07 No liability shall attach to or be incurred by members of the
Committee, stockholders, officers or directors, as such, of the Corporation,
under or by reason of any of the provisions of this Plan or implied therefrom,
and all liability of every kind and nature and all rights and claims against the
Corporation and every member of the Committee, any stockholder, officer or
director, past, present or future, as such, whether arising in common law or in
equity or created by statute or constitution or otherwise are hereby expressly
waived and released as a condition of and part of the consideration for the
contributions of the Corporation under this Plan. Each Employee, retired
Employee, former Employee, surviving spouse, or Beneficiary, as a condition of
receiving any benefits under the Plan, shall be conclusively deemed for all
purposes to have assented to the Plan and shall be bound hereby with the same
force and effect as if he had executed a consent to all the terms and provisions
of the Plan.
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10.08 The Corporation shall not be required to segregate any assets
which may at any time be represented as compensation reduction amounts, accrued
benefits or earnings credited to a participant. The Corporation shall not, by
any provisions of this Plan, be deemed to be a trustee of any property, and the
liabilities of the Corporation to any participant shall be those of a debtor
pursuant to such contract obligations as are created by the Plan, and no such
obligation of the Corporation shall be deemed to be secured by any pledge or
other encumbrance on any property of the Corporation.
10.09 The Committee is authorized to satisfy all requirements for tax
withholding on distributions under the Plan, through a deduction from the
participant's benefit payment, excluding any tax imposed on the employer.
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ARTICLE XI. SPECIAL PROVISIONS APPLICABLE TO DESIGNATED PARTICIPANTS
11.01 Additional years of Credited Service shall be granted in respect of
any individual listed below, for all purposes under the Plan, including,
without limitation, determining the individual's (i) total retirement benefits
under Chrysler pension plans and (ii) right to vest in the benefits, and to be
eligible for any early retirement or other benefits based on Credited Service,
provided under this Plan.
The total amount of additional Chrysler pension benefits attributable to
such additional years of Credited Service shall be paid under the ERISA Excess
Retirement Benefit part of this plan described in Section 1.01B. Individuals
eligible for such additional years of Credited Service and the amount of such
additional Credited Service to be recognized shall be as follows:
A. L. A. Iacocca (Social Security ####-##-####)-4 years, 10 months
(After recognition of 3 additional years of credited service under the
1992 Salaried Employees' Special Early Retirement Program.)
B. R. J. Eaton (Social Security ####-##-####)-5 years
C. R. A. Lutz (Social Security ####-##-####)-5 years
11.02 Special conditions shall apply, in respect to any individual listed
below, for purposes of determining certain Chrysler retirement benefits payable
to him from this Plan. Individuals to whom such special conditions apply and a
description of such special conditions are as follows:
A. J.A. Pilulas. (Social Security ####-##-####) Additional
benefits that would have been paid Mr. Pilulas under the Chrysler
Pension Plan and the Chrysler Salaried
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Employees Retirement Plan had he retired on June 1, 1989 under the
Special Early Retirement provisions of such plans will be paid under
the ERISA Excess Retirement Benefit part of this Plan described
in Section 1.01B. In addition, benefits he had forfeited under the
Incentive Compensation Retirement Benefit part of this Plan
described in Section 1.01A shall be paid on an unreduced basis.
Benefits provided under this Section 11.02A shall be provided
prospectively only commencing November 1, 1992.
B. R. J. Eaton, (Social Security ####-##-####)
R. A. Lutz, (Social Security ####-##-####)
T. G. Denomme, (Social Security ####-##-####) and
G. C. Valade, (Social Security ####-##-####)
In the event that any of the above named individuals retires or
otherwise terminated employment on or prior to the second anniversary
of the date as of which a Change of Control (as defined in Section
4.13) occurs, such individual shall be deemed to have retired under the
Special Early Retirement provisions of the SERP. Any benefits not
payable under SERP will be paid under the ERISA Excess Retirement
Benefit part of this Plan.
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APPENDIX A
ACTUARIAL ASSUMPTIONS UNDER THE PLAN
SECTION PURPOSE ACTUARIAL ASSUMPTIONS
OR
BASIS FOR
DETERMINATION
1. 2.06 To determine the The basis for
single sum value or determining these
lump sum value of commuted values will
periodic payments be amounts determined
payable in the future. using an interest rate
as set forth hereafter
in this Appendix.
2. 4.12 To determine the The rate of interest
Commuted Value of used in computing the
Incentive Compen- Commuted Value will be
sation Retirement the FAS 87 Discount
Benefits for payout to Rate which was used in
participants at the determining the Plan's
time of the part- liabilities for
icipants' termination Chrysler Corporation's
of employment fol- financial statement
lowing a change in purposes as of the
control. latest December 31,
or, if no determin-
ation was made as of
such date - 9%
compounded annually.
3. 5.01A1 To determine the The number of payments
Commuted Value of any remaining in the
unpaid guaranteed certain period at the
payments of Incentive time of death will be
Compensation discounted to the last
Retirement Benefits at day of the month in
the time of a former which death occurs at
Employee's death. a rate of interest of
10% compounded
annually.
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SECTION PURPOSE ACTUARIAL ASSUMPTIONS
OR
BASIS FOR
DETERMINATION
4. 5.01B1 To determine the The number of payments
Commuted Value of any remaining in the
unpaid guaranteed certain period at the
payments of ERISA time of death will be
Excess Retirement discounted to the last
Benefits at the time day of the month in
of a former Employee's which death occurs at
death. a rate of 9%
compounded annually.
5. 5.01B2 To determine the The Commuted Value
Commuted Value of 120 will be based on the
monthly payments of rate of interest of 9%
ERISA Excess compounded annually
Retirement Benefit of and the monthly
a former Employee payment the former
whose death occurs Employee would have
prior to the date received had he
monthly payments elected to have
commence. benefits commence on
the date immediately
preceding the date of
his death.
6. 5.02A To determine the The Commuted Value
Commuted Value of 120 will be determined
monthly payments of based on a rate of 10%
the monthly Incentive compounded annually
Compensation and the monthly
Retirement Benefits Incentive Compensation
with respect to an Retirement Benefit the
Employee who dies Employee would have
while still employed received had he
after his Normal retired on the date of
Retirement Date. his death.
7. 5.02B To determine the The Commuted Value
Commuted Value of 120 will be determined
monthly payments of based on a rate of
the monthly * ERISA interest of 9%
Excess Retirement compounded annually
Benefits with respect and the monthly ERISA
to an Employee who Excess Retirement
dies while still Benefit the Employee
employed but after his would have received
Normal Retirement had he retired on the
Date. date of his death.
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72
SECTION PURPOSE ACTUARIAL ASSUMPTIONS
OR
BASIS FOR
DETERMINATION
8. 5.03A To determine an The actuarial
Actuarial Equivalent. assumptions that will
be used in determining
an Actuarial
Equivalent will be the
1971 Group Annuity
Mortality Table
(weighted 70% for
males and 30% for
females), an interest
rate of 10% compounded
annually, and an
expected retirement
date of the latter of
a) the date
immediately preceding
the date of the
Employee's death or b)
the date the Employee
would have first
become eligible to
retire at his option.
9. 5.03B To determine the ERISA The death benefit of
Excess Death Benefit such an Employee shall
of an Employee whose be the Commuted Value,
death occurs on or at 9% interest
after his 60th compounded annually,
birthday with ten of 120 monthly
years or more of payments equal to the
Credited Service. monthly
Non-Contributory
Retirement Benefit
that he would have
received had he
retired on the date of
his death reduced by
5/8 of 1% for each
full month by which
the date of his death
precedes his Normal
Retirement Date.
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73
SECTION PURPOSE ACTUARIAL ASSUMPTIONS
OR
BASIS FOR
DETERMINATION
10. 6.02 To determine the The actuarial
equivalent lump sum, assumptions used in
quarterly, half determining the
yearly, or yearly equivalent benefits
benefits with respect will be the 1971 Group
to monthly benefits Annuity Mortality
that are less than Table (weighted 70%
$10. for males and 30% for
females), and 9% (10%
for an Incentive
Compensation
Retirement Benefit)
interest compounded
annually.
11. 6.10 To determine the value The lump sum value
of a lump sum will be determined
Incentive Compensation based on a rate of
Retirement Benefit interest of 10%
compounded annually
and the provisions
specified in Section
6.10 of the Plan.
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74
SECTION PURPOSE ACTUARIAL ASSUMPTIONS
OR
BASIS FOR
DETERMINATION
12. Sections not listed To determine an The actuarial
above Actuarial Equivalent. assumptions that will
be used in determining
an Actuarial
Equivalent will be the
1971 Group Annuity
Mortality table
(weighted 70% for
males and 30% for
females), an interest
rate of 9% (10% for an
Incentive Compensation
Retirement Benefit)
compounded annually,
and an expected Normal
Retirement Date of the
1st day of the month
following Age 65.
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75
SECOND ARTICLE
The Plan, except as modified in this Instrument, shall continue in full
force and effect.
IN WITNESS WHEREOF, the Corporation has caused this Instrument to be
executed by its duly authorized officers and its corporate seal to be hereunto
affixed as of the 1st day of October, 1996.
CHRYSLER CORPORATION
By /S/ K. M. Oswald
----------------------------
K. M. Oswald
Vice President -
Human Resources
October 1, 1996
--------------------------------
Date Executed
Attest:
/S/ H. E. Leese
- -------------------------
H. E. Leese
Assistant Secretary
(CORPORATE SEAL)
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