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Exhibit 10.7
DYNATECH CORPORATION
SUPPLEMENTAL 401(K) SAVINGS PLAN
WHEREAS, Dynatech Corporation (the "Company") heretofore adopted the Dynatech
Corporation Supplemental 401(k) Savings Plan (the "Plan"); and
WHEREAS, the Company reserved the right to amend the Plan; and
WHEREAS, the Company desires to amend the Plan;
NOW, THEREFORE, the Plan is amended, effective as of April 1, 1997, to read in
its entirety as follows:
SECTION 1. PURPOSE OF PLAN
The purpose of the Dynatech Corporation Supplemental 401(k) Savings Plan (the
"Plan") is to permit certain executives of Dynatech Corporation (the "Company")
to elect to defer receipt of a portion of their annual compensation in
supplement to their pre-tax contributions made to the Dynatech Corporation
401(k) Savings Plan (the "401(k) Plan").
The Plan is intended to qualify as an unfunded, deferred compensation plan for a
select group of management or highly compensated employees under the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
The obligation of the Company to make payments under the Plan constitutes solely
an unsecured (but legally enforceable) promise of the Company to make such
payments, and no person, including any employee, shall have any lien, prior
claim or other security interest in any property of the Company as a result of
this Plan. Rather, any employee participating in the Plan shall have the status
of a general unsecured creditor of the Company. It is the intention of the
parties hereunder that the Plan be unfunded for tax purposes and for purposes of
Title I of ERISA. The Company shall be the sole owner and beneficiary of any
account provided for hereinbelow and any property used to measure such account
shall remain the sole and exclusive property of the Company.
SECTION 2. ELIGIBLE EMPLOYEES
All employees currently eligible to participate in the Plan shall continue to be
eligible, subject to the following provisions of the Plan. The Company's 401(k)
Advisory Committee shall designate the employees of the Company eligible to
participate in the Plan for any subsequent year.
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SECTION 3. ACCOUNTS
The Company shall establish and maintain on its books with respect to each
Participant a separate account which shall record (a) amounts of income deferred
by the Participant under the Plan pursuant to the Participant's election, (b)
any Company matching contributions made on his or her behalf pursuant to Section
7, and (c) the allocation of investment experience.
SECTION 4. ELECTION TO DEFER COMPENSATION
Any participant enumerated under Schedule A may elect to defer a specified
percentage of his or her "Compensation" (as hereinafter defined) for a calendar
year. Any election so made shall be binding for the next following calendar
year, and must be renewed or revised on or before November 30 for the next
succeeding calendar year.
The amount of Compensation to be deferred by any such Participant under the Plan
shall be equal to the difference between (a) the percentage of the Participant's
Compensation elected hereunder (not to exceed fifteen (15) percent) and (b) the
lesser of the amount of Compensation allowed as an employee deferral under the
401(k) Plan as a result of Internal Revenue Code (the "Code") imposed
limitations for the year, or as a result of limitations imposed under the 401(k)
Plan for such year.
Notwithstanding the foregoing provisions of this Section 4, any Participant
enumerated under Schedule B may elect to defer receipt of all or any portion of
any bonus paid by the Company on his behalf for any calendar year. Any election
so made shall be binding for the next following calendar year, and must be
renewed or revised on or before November 30 for the next succeeding calendar
year.
SECTION 5. COMPENSATION
Compensation shall mean the compensation paid to a Participant by the Company
for the calendar year, as reflected in the Participant's Form W-2, but exclusive
of any noncash compensation, stock options and any compensation received prior
to becoming a Participant in the Plan. Compensation shall include any amounts
deferred under a salary reduction agreement pursuant to the 401(k) Plan or under
a "cafeteria plan" (within the meaning of Section 125 of the Code) maintained by
the Company.
SECTION 6. MANNER OF ELECTION
Any election made by a Participant pursuant to this Plan shall be made in
writing by executing such form(s) as the Company shall from time to time
prescribe.
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SECTION 7. COMPANY MATCHING CONTRIBUTIONS
For the 1997 calendar year, the Company shall allocate to the account of each
Participant who is employed by the Company as of March 31, 1997 an amount equal
to the difference between (i) fifty percent (50%) of the first six percent (6%)
of the Participant's Compensation deferred under both this Plan and the 401(k)
Plan from January 1, 1997 to March 31, 1997 and (ii) the Company matching
contribution made on his behalf under the 401(k) Plan for such period. In
addition, the Company shall allocate to the account of each Participant who is
employed by the Company as of the last day of such calendar year (December 31,
1997) an amount equal to the difference between (i) one hundred percent (100%)
of the first five percent (5%) of the Participant's Compensation deferred under
both this Plan and the 401(k) Plan from April 1, 1997 to December 31, 1997 and
(ii) the Company matching contribution made on his behalf under the 401(k) Plan
for such period.
As of the last day of any subsequent calendar year, the Company shall allocate
to the account of each Participant who is employed by the Company as of that
date an amount equal to the difference between (a) one hundred percent (100%) of
the first five percent (5%) of the Participant's Compensation deferred under
both this Plan and the 401(k) Plan for the applicable year and (b) the Company
matching contribution made on his behalf under the 401(k) Plan for such year.
SECTION 8. INVESTMENT OF ACCOUNTS
Each Participant's account shall be invested in the mutual fund or funds from
time to time designated by the Company. Such funds shall be identified on
Schedule C attached hereto. The investment of a Participant's account hereunder
shall, to the extent practicable, coincide with the investment of the
Participant's account under the 401(k) Plan.
The fair market value of each Participant's account under the Plan shall be
established as of the close of each business day, using the closing share price
of the mutual fund or funds in which the Participant's account is so invested.
SECTION 9. PAYMENT OF A PARTICIPANT'S ACCOUNT
If a Participant terminates employment with the Company for any reason on or
after attaining age sixty-five (65), or prior to that date as a result of the
Participant's "permanent and total disability" or the Participants death, such
Participant (or, in the event of the Participant's death, his or her beneficiary
(as determined pursuant to Section 10)), shall have a nonforfeitable (vested)
right to the fair market value of the Participant's account. For this purpose,
"permanent and total disability" shall mean suffering from
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a physical or mental condition that, in the opinion of the Company's 401(k)
Advisory Committee and based upon appropriate medical advice and examination,
can be expected to result in death or can be expected to last for a continuous
period of no less than twelve (12) months. The condition must have existed for a
period of at least three (3) months and, in accordance with uniform and
consistent rules, must be determined by the Company's 401(k) Advisory Committee
to prevent a Participant from engaging in substantial gainful activity. Receipt
of a Social Security disability award shall be deemed proof of disability.
If a Participant terminates employment for any other reason, such Participant
shall be entitled to receive the vested value of his account. For this purpose,
each Participant shall at all times have a nonforfeitable (vested) right to his
account derived from any Compensation deferred pursuant to Section 4. However,
with respect to any Company matching contributions made on the Participant's
behalf pursuant to Section 7, the Participant shall have a nonforfeitable
(vested) right to a percentage of the fair market value of such portion of his
or her account as follows:
YEARS OF SERVICE VESTED PERCENTAGE
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Less than 1 year 0%
1 year and thereafter 100%
For this purpose, effective January 1, 1997, an Employee shall be credited with
a Year of Service for vesting purposes for each twelve (12)-month period
commencing on his employment date (or reemployment date) and the twelve
(12)-month consecutive anniversaries of that date and ending on the date a Break
in Service begins. An Employee shall also receive credit for any break in
service of less than twelve (12)-consecutive months. Fractional period of a year
shall be expressed in terms of days, with three hundred and sixty-five (365)
days being equal to one (1) year.
Notwithstanding the foregoing paragraph, with respect to any Employee who was a
Participant in the Plan prior to January 1, 1997, the following shall apply in
determining such Employee's Year(s) of Service for vesting purposes: (i) such
Employee's employment date for purposes of the preceding paragraph shall be
deemed to be January 1, 1997, (b) any such Employee shall be credited with a
year of service for each Plan Year commencing prior to January 1, 1997 during
which he completed at least one-thousand (1,000) Hours of Service with the
Employer, and (c) any such Employee who terminates employment with the Employer
in the 1997 Plan Year and who has completed at least one-thousand (1,000) hours
of service shall be credited with a year of service for vesting purposes.
The fair market value of a Participant's account (or the vested portion thereof,
as the case may be) shall be distributed to the Participant (or to the
Participant's beneficiary in
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the event of the Participant's death) in a lump sum within thirty (30) days
following the earliest of (1) Participant's termination of employment with the
Company and any "affiliate" thereof (within the meaning of Sections 414(b), (c)
and (m) of the Code), (2) the Participant's death or (3), if applicable, the
date specified in the Participant's distribution election form.
The nonvested portion of a Participant's account, as determined above, shall be
forfeited as of the Participant's termination of employment. The amount
forfeited shall be used to reduce future Company matching contributions under
the Plan for the remaining eligible Participants.
SECTION 10. BENEFICIARY DESIGNATION
A Participant may designate the person or persons to whom the Participant's
account under the Plan shall be paid in the event of the Participant's death. In
the absence of any such designation, any amounts payable shall be paid to the
estate of the Participant.
SECTION 11. DISTRIBUTION IN THE EVENT OF UNFORESEEABLE EMERGENCY
In the event of an "unforeseeable emergency", a Participant may, by filing a
written election with the Company's 401(k) Advisory Committee, elect to receive
a distribution from the Plan in an amount not to exceed the lesser of (i) the
fair market value of the Participant's vested account determined as of the
valuation immediately preceding the filing of such written election or (ii) the
amount necessary to satisfy the unforeseeable emergency. For purposes hereof, an
"unforeseeable emergency" shall mean a severe financial hardship to the
Participant resulting from a sudden and unexpected illness or accident of the
Participant or of a dependent (as defined in Section 152(a) of the Code) of the
Participant, loss of the Participant's property due to casualty, or other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant. The circumstances that will
constitute an unforeseeable emergency shall depend upon the facts of each case,
but, in any case, payment may not be made to the extent that such emergency is
or may be relieved:
(i) through reimbursement or compensation by insurance or
otherwise;
(ii) by liquidation of the Participant's assets, to the extent the
liquidation of such assets would not itself cause severe
financial hardship; or
(iii) by cessation of deferrals under the Plan.
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SECTION 12. AMENDMENT
The Company, by resolution of its Board of Directors, shall have the right to
amend, suspend or terminate the Plan at any time.
SECTION 13. NO LIABILITY
No member of the Board of Directors of the Company and no officer or employee of
the Company shall be liable to any person for any action taken or omitted in
connection with the administration of the Plan unless attributable to his own
fraud or willful misconduct; nor shall the Company be liable to any person for
any such action unless attributable to fraud or willful misconduct on the part
of a director, officer or employee of the Company.
SECTION 14. NO ASSIGNMENT
A Participant's right to the amount credited to his account under the Plan shall
not be 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.
SECTION 15. SUCCESSORS AND ASSIGNS
The provisions of this Plan shall be binding upon and inure to the benefit of
the Company, its successors and assigns, and the Participant his/her
beneficiaries, heirs, legal representatives and assigns.
SECTION 16. NO CONTRACT OF EMPLOYMENT
Nothing contained herein shall be construed as a contract of employment between
a Participant and the Company, or as a right of the Participant to continue in
employment with the Company, or as a limitation of the right of the Company to
discharge the Participant at any time, with or without cause.
SECTION 17. GOVERNING LAW
This Plan shall be subject to and construed in accordance with the provisions of
ERISA, where applicable, and otherwise by the laws of the Commonwealth of
Massachusetts.
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IN WITNESS WHEREOF, the Company, by its duly authorized officer, has caused this
Plan to be executed as of the 1st day of April, 1997.
DYNATECH CORPORATION
By
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Authorized Officer
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AMENDMENT TO THE
DYNATECH CORPORATION
SUPPLEMENTAL 401(K) SAVINGS PLAN
WHEREAS, Dynatech Corporation (the "Employer") heretofore adopted the Dynatech
Corporation Supplemental 401(k) Savings Plan (the "Plan"); and
WHEREAS, the Employer reserved the right to amend the Plan; and
WHEREAS, the Employer desires to amend the Plan;
NOW, THEREFORE, the Plan is hereby amended, effective as of January 1, 1996, as
follows:
1. Section 9 of the Plan shall be amended by adding the following
paragraph to the conclusion of said Section:
The nonvested portion of a Participant's account, as determined above,
shall be forfeited as of the Participant's termination of employment.
The amount forfeited shall be used to reduce future Company matching
contributions under the Plan for the remaining eligible Participants.
2. Except as hereinabove amended, the provisions of the Plan shall
continue in full force and effect.
IN WITNESS WHEREOF, the Employer, by its duly authorized officer, has caused
this Amendment to be executed on the _____ day of _________ 1996.
DYNATECH CORPORATION
By:
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