EXHIBIT 10(a)
UNITED RENTALS, INC.
DEFERRED COMPENSATION PLAN FOR DIRECTORS
1. Definitions
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(a) Account. The bookkeeping account established for each Participant as
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provided in Section 4.
(b) Administrator. The committee appointed pursuant to Section 8.
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(c) Company. United Rentals, Inc., a Delaware corporation.
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(d) Company Stock. Common stock of the Company.
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(e) Directors' Fees. The cash amount payable to a Participant by the
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Company as fees for services rendered as a director of the Company.
(f) Effective Date. December 4, 2001.
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(g) Fee Deferrals. The portion of Directors' Fees that a Participant
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elects to defer in accordance with Section 3.
(h) Fee Deferral Election. The separate written agreement, submitted to
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the Administrator, by which a director agrees to participate in this
Plan and make Fee Deferrals hereunder.
(i) Participant. A director of the Company who elects to defer receipt
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of Directors' Fees hereunder and whose Account has not been fully
distributed.
(j) Plan. The United Rentals, Inc. Deferred Compensation Plan for
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Directors.
(k) Plan Year. The twelve (12) month period beginning on the first day
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of the calendar month in which the Company's annual shareholders'
meeting is held.
(l) Restricted Stock. Company Stock that vests as provided in Section
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3(c).
2. Participation
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(a) Eligibility for Participation. All non-employee directors of the
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Company are eligible to make Fee Deferrals hereunder.
(b) Commencement of Participation. A director becomes a Participant as
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of the date specified by the Administrator.
3. Contributions
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(a) Fee Deferrals.
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(i) The Company shall credit to the Account of a Participant an
amount equal to the Director's Fees that would have been
payable to the Participant had Participant not signed a Fee
Deferral Election therefor. Such amounts shall not be made
available to such Participant, except as provided in Section
5, and shall reduce such Participant's compensation from the
Company in accordance with the provisions of the applicable
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Fee Deferral Election. All such amounts shall in any event be
subject to the rights of the general creditors of the Company
as provided in Section 7.
(ii) Directors shall deliver a Fee Deferral Election to the
Administrator before any Fee Deferrals become effective. Such
Fee Deferral Election shall be void with respect to any Fee
Deferral unless submitted before the beginning of the
calendar year during which the amount to be deferred will be
earned; provided, however, that in the year in which this
Plan is first adopted or a director is first eligible to
participate, such Fee Deferral Election may be filed within
30 days of the date on which this Plan is adopted or the date
on which the director is first eligible to participate,
respectively, with respect to compensation earned during the
remainder of the calendar year.
(iii) The Fee Deferral Election shall designate the amount of
compensation from the Company deferred by each Participant
and such other items as the Administrator may prescribe. Such
designations shall remain effective unless amended as
provided below. There shall be no maximum limit on the Fee
Deferrals permitted for each Participant.
(iv) A Participant may amend his or her Fee Deferral Election from
time to time, but only as to Director's Fees that were not
payable theretofore.
(b) Time of Credits. Fee Deferrals shall be credited to the Plan as soon
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as administratively feasible following each quarterly period for
which fees are otherwise payable to the director.
(c) Vesting.
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(i) A Participant shall have a nonforfeitable right to the Fee
Deferrals which are deemed invested in a money market account
or in Company Stock hereunder; provided, however, that all
such amounts shall be subject to the rights of the general
creditors of the Company as provided in Section 7. See
Section (ii) as to vesting provisions for Restricted Stock.
(ii) Vesting of Restricted Stock.
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(A) Fee Deferrals for any Participant that are deemed
invested in Restricted Stock shall be subject to the
rights of the general creditors of the Company as
provided in Section 7 and shall vest on the earliest to
occur of the following events, provided that no shares of
Restricted Stock shall vest on any date on which the
Participant does not serve as a director of the Company:
(1) One-fifth on each of the first five anniversaries of
the date on which the Participant would otherwise
have received the Director's Fees that were deemed
invested in Restricted Stock;
(2) The date of Participant's death or permanent
disability while serving as a director of the
Company. Participant shall be deemed to be
permanently disabled if for a period of six
consecutive months Participant is unable to serve as
a director of the Company because of illness or
physical or mental disability or other incapacity;
and
(3) The date of the occurrence of a Change of Control.
(B) A "Change of Control" shall be deemed to have occurred
if:
(1) any "person" is or becomes a "beneficial owner" (as
defined in Rule 13d-3 under the Securities Exchange
Act of 1934 (the "Act") directly or indirectly, of
securities of United Rentals, Inc. representing 50%
or more of the total voting power represented by
then outstanding voting securities of United
Rentals, Inc., or has the power (whether as a result
of stock ownership, revocable or irrevocable
proxies, contract or otherwise) or ability to elect
or cause the election of directors consisting at the
time of such election of a majority of the Board.
The term "persons" is defined in Section 13(d) of
the Act, except that the term "person" shall not
include:
(a) any person or an Affiliate of such person who as
of of December 4, 2001 owned 10% or more of the
total voting power represented by the
outstanding voting securities of the Company;
and
(b) a trustee or other fiduciary holding securities
under any employee benefit plan of the Company
or a corporation which is owned directly or
indirectly by the stockholders of the Company in
substantially the same percentage as their
ownership in the Company; or
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(2) the stockholders of United Rentals, Inc. approve a
merger of United Rentals, Inc., or a plan of
complete liquidation of United Rentals, Inc., or an
agreement for the sale or disposition by United
Rentals, Inc. of all or substantially all of its
assets, or any other business combination of United
Rentals, Inc. with any other corporation, other than
any such merger or business combination which would
result in the voting securities of United Rentals,
Inc. outstanding immediately prior thereto
continuing to represent (either by remaining
outstanding or by being converted into voting
securities of the surviving entity) at least 50% of
the total voting power represented by the voting
securities of United Rentals, Inc. or such surviving
entity outstanding immediately after such merger or
business combination.
(C) An "Affiliate" of a person is a person that controls, is
controlled by, or is under common control with such
person.
(iii) Forfeiture. A Participant's shares of Restricted Stock shall
be forfeited if, before such shares of Restricted Stock are
vested under this Section, Participant ceases to be a
director of the Company for any reason other than death or
permanent disability as defined above, whether for cause or
without cause, or for good reason, or for no reason, or by
reason of the failure of the Board or of the Company to
nominate Participant for election as a director, or
Participant's resignation or otherwise.
4. Accounts
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(a) Bookkeeping Accounts.
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(i) The Administrator shall establish and maintain a bookkeeping
account in the name of each Participant. The Administrator
may also establish any subaccounts that it feels may be
appropriate.
(ii) Each Participant's Account shall be credited with Fee
Deferrals (as specified in the Participant's Fee Deferral
Election) and any earnings or losses on the foregoing. Each
Participant's Account shall be reduced by any distributions
made plus any federal and state tax withholding as may be
required by law.
(b) Investments, Gains and Losses.
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(i) By written investment directions to the Administrator, each
Participant shall direct the deemed investment of his or her
Account among the investment funds available under this Plan.
Unless modified by the Administrator, the deemed investment
funds shall consist of a money market fund selected by the
Administrator or shares of Company Stock or Restricted Stock.
For each investment which is based on Company Stock the
Participant's Account shall be credited with a number of
shares of Company Stock equal to (a) the Directors' Fees that
would have been paid in cash in the absence of the applicable
Fee Deferral, divided by (b) the market value of a share of
Company Stock at the close of business on such date. For each
investment which is based on Restricted Stock the
Participant's Account shall be credited with a number of
shares of Restricted Stock equal to (a) 120% of the
Directors' Fees that would have been paid in cash in the
absence of the applicable Fee Deferral, divided by (b) the
market value of a share of Company Stock at the close of
business on such date. Credits of Company Stock and
Restricted Stock shall be in the form of bookkeeping entries;
no actual shares of Company Stock or Restricted Stock shall
be issued except as provided in Section 5.
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(ii) Notwithstanding subsection (b)(i), the Administrator is not
obligated to follow any investment instruction received by a
Participant pursuant to subsection (b)(i).
(iii) Notwithstanding anything to the contrary in this Plan, no
Participant may make further investments under the Plan in
shares of Company Stock and Restricted Stock once
Participants in the aggregate have invested in a total of
75,000 shares of Company Stock and Restricted Stock under the
Plan.
(c) The Administrator shall adjust the amounts credited to each
Participant's Account to reflect Fee Deferrals, investment
experience, distributions and any other appropriate adjustments.
Such adjustments shall be made as frequently as is administratively
feasible.
5. Distributions
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(a) Payment.
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(i) Except as otherwise provided herein, lump sum payments of
vested amounts to a Participant shall be made on the first
day of the month immediately following the date that the
Participant terminates service as a director of the Company
or such other date as may be specified in the Fee Deferral
Election. Payment of amounts deemed invested in a money
market account shall be paid in cash. Payment of amounts
deemed invested in Company Stock shall be paid in Company
Stock. Payment of vested amounts deemed invested in
Restricted Stock shall be paid in Company Stock.
(ii) The Administrator may permit an early distribution of part or
all of any vested deferred amounts; provided, however, that
such distribution shall be made only if the Administrator, in
its sole discretion, determines that the Participant has
experienced an unforeseen emergency that is caused by an
event beyond the control of the Participant and that would
result in severe financial hardship to the Participant if
early distribution were not permitted. Any distribution
pursuant to this subsection is limited to the amount
necessary to meet the hardship.
(iii) Upon the death of a Participant, all vested amounts credited
to his or her Account shall be paid to his or her beneficiary
or beneficiaries, as determined under Section 6.
(b) Transferability.
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(i) Each Participant is deemed to represent, and as a condition
to the receipt of any distribution will be required to
represent, that he or she will acquire Company Stock or
Restricted Stock for Participant's own account and not on
behalf of others.
(ii) Participant's rights hereunder are not transferable by the
Participant, whether by sale, assignment, exchange, pledge,
or hypothecation, or by operation of law or otherwise.
(iii) Whether or not the Company Stock or Restricted Stock have
vested, Federal and state securities laws govern and restrict
the right to offer, sell or otherwise dispose of any Company
Stock or Restricted Stock unless otherwise covered by a Form
S-8 or unless the offer, sale or other disposition thereof is
otherwise registered under the Securities Act of 1933, as
amended, (the "1933 Act") and state securities laws or, in
the opinion of the Company's counsel, such offer, sales or
other disposition is exempt from registration thereunder. The
Company is not required to file a Form S-8 or any other
registration statement. Participant will in no event offer,
sell or otherwise dispose of any Company Stock or Restricted
Stock in any manner which would: (i) require the Company to
file any registration statement (or similar filing under
state laws) with the Securities and Exchange Commission or to
amend or
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supplement any such filing or (ii) violate or cause the
Company to violate the 1933 Act, the rules and regulations
promulgated thereunder or any other state or federal law.
Stock certificates representing the Company Stock or
Restricted Stock shall bear a legend (the "1933 Act Legend")
in substantially the following form, in addition to the
Vesting Legend, the Brokerage Legend and any other legends
that may be required under federal or state securities laws:
The securities represented by this certificate have not been
registered pursuant to the Securities Act of 1933, as amended
(the "Act"), or any state securities law, and such securities
may not be sold, transferred or otherwise disposed of unless
the same are registered and qualified in accordance with the
Act and any applicable state securities laws, or in the
opinion of counsel satisfactory to the Company such
registration and qualification are not required.
(iv) The Company shall not be required to transfer on its books
any of the Company Stock or Restricted Stock that shall have
been sold or transferred in violation of any of the
provisions set forth in this Agreement, or to treat any
transferee to whom such shares have been so sold or
transferred as a stockholder of the Company.
(c) No Rights as a Stockholder. Until Participant receives a certificate
for Company Stock or Restricted Stock, Participant shall not be
entitled to any rights of a stockholder with respect to such shares.
Without limiting the generality of the foregoing, Participant shall
not have the right to vote the Company Stock or Restricted Stock and
to receive dividends and/or other distributions declared on such
shares.
6. Beneficiaries
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(a) Beneficiaries. Each Participant may from time to time designate one
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or more persons (who may be any one or more members of such
Participant's family or other persons, administrators, trusts,
foundations or other entities) as his or her beneficiary under this
Plan. Such designation shall be made on a form prescribed by the
Administrator. Each Participant may at any time and from time to
time, change any previous beneficiary designation, without notice to
or consent of any previously designated beneficiary, by amending his
or her previous designation on a form prescribed by the
Administrator. If the beneficiary does not survive the Participant
(or is otherwise unavailable to receive payment) or if no
beneficiary is validly designated, then the amounts payable under
this Plan shall be paid to the Participant's surviving spouse, if
any, and, if none, to the Participant's estate and such person shall
be deemed to be a beneficiary hereunder. If more than one person is
the beneficiary of a deceased Participant, each such person shall
receive a pro rata share of any death benefit payable unless
otherwise designated on the applicable form. If a beneficiary who is
receiving benefits dies, all benefits that were payable to such
beneficiary shall then be payable to the estate of that beneficiary.
(b) Lost Beneficiary.
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(i) All Participants and beneficiaries shall have the obligation
to keep the Administrator informed of their current address
until such time as all benefits due have been paid.
(ii) If a Participant or beneficiary cannot be located by the
Administrator exercising due diligence, then, in its sole
discretion, the Administrator may presume that the
Participant or beneficiary is deceased for purposes of this
Plan and all unpaid amounts (net of due diligence expenses)
owed to the Participant or beneficiary shall be paid
accordingly or, if a beneficiary cannot be so located, then
such amounts may be forfeited. Any such presumption of death
shall be final, conclusive and binding on all parties.
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7. Funding
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(a) Prohibition Against Funding. Should any investment be acquired in
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connection with the liabilities assumed under this Plan, it is
expressly understood and agreed that the Participants and
beneficiaries shall not have any right with respect to, or claim
against, such assets nor shall any such purchase be construed to
create a trust of any kind or a fiduciary relationship between the
Company and the Participants, their beneficiaries or any other
person. Any such assets (including any amounts deferred by a
Participant) shall be and remain a part of the general, unpledged,
unrestricted assets of the Company, subject to the claims of its
general creditors. It is the express intention of the parties hereto
that this arrangement shall be unfunded. Each Participant and
beneficiary shall be required to look to the provisions of this Plan
and to the Company for enforcement of any and all benefits due under
this Plan, and to the extent any such person acquires a right to
receive payment under this Plan, such right shall be no greater than
the right of any unsecured general creditor of the Company. The
Company shall be designated the owner and beneficiary of any
investment acquired in connection with its obligation under this
Plan.
8. Administration of the Plan
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(a) Committee as Administrator. The Compensation Committee (or any other
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committee designated by the Board of Directors) shall be the
Administrator. The committee shall consist of such individuals,
corporations or other entities as the Company shall from time to
time appoint.
(b) Actions Taken by the Committee. All resolutions or other actions
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taken by the committee at a meeting shall be by the affirmative vote
of a majority of those present at the meeting. More than half of the
members must be present to constitute a quorum for a meeting. Any
member of the committee may sign any document or instrument
requiring the signature of the committee or otherwise act on behalf
of the committee, unless otherwise directed by the committee. The
committee may adopt such additional rules of procedures and conduct
as it deems appropriate.
(c) Duties of the Committee. The committee shall undertake all duties
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assigned to it under the Plan and shall undertake all actions,
express or implied, necessary for the proper administration of the
Plan. All actions and decisions of the committee shall be made in
its sole discretion, unless expressly otherwise provided in the
Plan. The committee's duties and responsibilities include, but are
not limited to, the following:
(i) adopting and enforcing such rules and regulations that it
deems necessary or appropriate for the administration of the
Plan in accordance with applicable law;
(ii) interpreting the Plan, in its sole discretion, with its good
faith interpretation thereof to be final and conclusive on
any Participant, former Participant, beneficiary or other
party;
(iii) deciding all questions concerning the Plan, including the
eligibility of any person to participate in the Plan in
accordance with the Plan provisions;
(iv) computing the amounts to be distributed to any Participant,
former Participant or beneficiary in accordance with the
provisions of the Plan, determining the person or persons to
whom such amounts will be distributed and determining when
such amounts will be distributed;
(v) authorizing the payment of distributions;
(vi) keeping such records and submitting such filings, elections,
applications, returns or other documents or forms as may be
required under the Code and applicable regulations, or under
other federal, state or local law and regulations; and
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(vii) appointing such agents, counsel, accountants and consultants
as may be required to assist in administering the Plan.
(d) Expenses. All expenses of Plan administration and operation,
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including the fees of any agents or counsel employed and including
any expenses attributable to a termination of the Plan, shall be
paid by the Company. To the extent that the Company may be liable
for withholding tax, the Administrator, in its sole discretion, may
charge such expenses to the benefits due to the applicable
Participant or beneficiary.
9. General Provisions
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(a) No Assignment. Benefits or payments under this Plan shall not be
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subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by
creditors of the Participant or the Participant's beneficiary,
whether voluntary or involuntary, and any attempt to so anticipate,
alienate, sell, transfer, assign, pledge, encumber, attach or
garnish the same shall not be valid, nor shall any such benefit or
payment be in any way liable for or subject to the debts, contracts,
liabilities, engagement or torts of any Participant or beneficiary,
or any other person entitled to such benefit or payment pursuant to
the terms of this Plan, except to such extent as may be required by
law. If any Participant or beneficiary or any other person entitled
to a benefit or payment pursuant to the terms of this Plan becomes
bankrupt or attempts to anticipate, alienate, sell, transfer,
assign, pledge, encumber, attach or garnish any benefit or payment
under this Plan, in whole or in part, or if any attempt is made to
subject any such benefit or payment, in whole or in part, to the
debts, contracts, liabilities, engagements or torts of the
Participant or beneficiary or any other person entitled to any such
benefit or payment pursuant to the terms of this Plan, then such
benefit or payment, in the discretion of the Administrator, shall
cease and terminate with respect to such Participant or beneficiary,
or any other such person.
(b) Amendment and Termination.
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(i) Except as otherwise provided in this Section 9(b), the
Company shall have the sole authority to modify, amend or
terminate this Plan; provided, however, that any modification
or termination of this Plan shall not reduce, alter or
impair, without the consent of a Participant, a Participant's
right to any amounts already credited to his or her Account
on the day before the effective date of such modification or
termination. Following such termination, payment of such
credited amounts may be made in a single-sum payment if the
Company so designates. Any such decision to pay in a single
sum shall apply to all Participants.
(ii) Any funds remaining in the Plan after termination of this
Plan and satisfaction of all liabilities to Participants and
others shall be returned to the Company.
(c) Construction. All questions of interpretation, construction or
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application arising under or concerning the terms of this Plan shall
be decided by the Administrator, in its sole and final discretion,
whose decision shall be final, binding and conclusive upon all
persons.
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UNITED RENTALS, INC. DEFERRED COMPENSATION PLAN FOR DIRECTORS
FEE DEFERRAL ELECTION
Name: ___________________________ Social Security Number:_______________
1. Deferral of Fees. I hereby elect to participate in the United Rentals, Inc.
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Deferred Compensation Plan for Directors (the "Plan") by deferring receipt
of _______% of my directors fees received from the Company beginning
_________________ (date) and continuing until further notice.
2. I acknowledge that I have received a copy of the Plan and that I understand
the risks of making this deferral election. I further understand that such
deferred amounts will be tracked in a bookkeeping account and will remain
subject to the claims of the Company's creditors until such amounts are
distributed to me. I also make the representation referred to in Section
5(b) of the Plan.
3. Deemed Investments. I hereby request that the Plan Administrator credit my
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deferred amounts as follows. I understand that the Administrator is under
no obligation to follow these investment instructions:
(i) Money Market Account: _____________%
(ii) Company Stock: _____________%
(iii) Restricted Stock: _____________%
4. Distributions. Amounts deemed invested in a money market account shall be
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paid in cash and amounts deemed invested in restricted or nonrestricted
Company stock shall be paid in stock. I understand that I will receive the
vested amounts deferred under the Plan in a lump sum when I terminate my
service as a director unless I specify a different date. I understand the
restrictions on transferability set forth in the Plan.
5. Death Benefits. I hereby designate the following person(s) to receive any
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death benefits under the Plan:
Beneficiary Name:________________________________ Relationship:_____________
Address:______________________________________________________________________
Telephone Number:_____________________________________________________________
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Date Signature of Director