EXHIBIT 4(e)
CORN PRODUCTS INTERNATIONAL, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
EFFECTIVE JANUARY 1, 1998
AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2001
FOREWORD
Effective as of January 1, 1998, Corn Products International, Inc. has adopted
the Corn Products International, Inc. Supplemental Executive Retirement Plan
(the "Plan") for the benefit of certain of its Key Executives.
The purposes of the Plan are (a) to permit certain Key Executives to defer
payment of a portion of current compensation, including short and long term
performance bonus payments, until a later year, and (b) to provide Participants
and their beneficiaries with the amount of retirement income that is not
provided under the Corn Products International, Inc. Cash Balance Plan for
Salaried Employees and the Corn Products International, Inc. Retirement Savings
Plan by reason of limits on recognized compensation required by Sections
401(a)(17), 402(g) and 415 of the Internal Revenue Code of 1986, as amended, and
by reason of elective compensation deferrals under this Plan.
It is intended that the Plan be a deferred compensation plan for "a select group
of management or highly compensated employees," as that term is used in the
Employee Retirement Income Security Act of 1974, as amended.
1
SECTION ONE
Definitions
1.1 Except to the extent otherwise indicated herein, and except to the
extent otherwise inappropriate in the context, the definitions
contained in the Cash Balance Plan or Savings Plan are applicable under
the Plan.
1.2 "Accounts" means the Cash Balance Plan Make-up Account, the Annual
Deferral Account, the Prior Plan Account, the Savings Plan Make-up
Account, the Performance Plan Account and the Annual Incentive Plan
(AIP) Account.
1.3 "AIP Account" means the bookkeeping Account established under Section
3.5 on behalf of a Participant, and includes any deemed investment
earnings credited thereon.
1.4 "Annual Deferral Account" means the bookkeeping Account established
under Section 3.1 established on behalf of a Participant, and includes
any deemed investment earnings credited thereon.
1.5 "Annual Deferred Compensation" means the amount of a Key Executive's
Compensation that such Key Executive has deferred until a later year
pursuant to an election under Section 2.2 of this Plan.
1.6 "Base Salary Threshold" means, as of November 15, 1997, $160,000. As of
each subsequent November 15, the Base Salary Threshold shall be
redetermined as the annual limit (as of such November 15) in effect
under Section 401(a)(17) of the Code.
1.7 "Board of Directors" means the Board of Directors of the Corporation.
1.8 "Cash Balance Plan" means the Corn Products International, Inc. Cash
Balance Plan for Salaried Employees.
1.9 "Cash Balance Plan Make-up Account" means the bookkeeping Account
established under Section 3.2 established on behalf of a Participant,
and includes any deemed investment earnings credited thereon.
1.10 "Code" means the Internal Revenue Code of 1986, as amended. Any
reference to any Code Section shall also mean any successor provision
thereto.
1.11 "Committee" means the Pension Committee established by the Board of
Directors.
1.12 "Common Stock" means common stock of Corn Products International, Inc.
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1.13 "Compensation" means a Participant's base pay plus short-term incentive
bonuses as paid, prior to reduction for (a) his or her Annual Deferred
Compensation election and Annual Incentive Plan deferral election under
this Plan, (b) pre-tax contributions under the Savings Plan and (c) any
pre-tax contributions to a cafeteria plan under Section 125 of the
Code, which is in excess of Limited Compensation.
1.14 "Corporation" means Corn Products International, Inc. and any successor
to such corporation by merger, purchase or otherwise.
1.15 "Employer" means the Corporation and any other corporation adopting the
Plan in accordance with Section 5.3 hereof.
1.16 "Fair Market Value" means the average of the high and low prices of
Common Stock on the New York Stock Exchange on the date of the
determination thereof, as reported in The Wall Street Journal as New
York Stock Exchange Composite Transactions.
1.17 "Key Executive" means an executive employed by the Corporation who is
designated by the Vice President of Human Resources of the Corporation
and approved for participation in the Annual Deferral Account, the
Performance Plan Account or the AIP Account by the Committee.
1.18 "Limited Compensation" is the smaller of the limit on pensionable
compensation specified by Section 401(a)(17) of Code (including
adjustments for changes in the cost of living as prescribed by the
Code), or Compensation earned prior to the time the Participant reaches
the limit on elective deferrals to the Savings Plan specified by
Section 402(g) of the Code (including adjustments for changes in the
cost of living as prescribed by the Code).
1.19 "Participant" means a Participant in the Plan who has satisfied the
eligibility requirements of and is participating in the Plan under
Section 2.1 of the Plan.
1.20 "Performance Plan Account" means the bookkeeping Account established
under Section 3.6 on behalf of a Participant and includes any deemed
investment earnings credited thereon.
1.21 "Plan" means the Corn Products International, Inc. Supplemental
Executive Retirement Plan as from time to time amended.
1.22 "Prime Rate" means the prime rate as published in the Wall Street
Journal Midwest edition showing such rate in effect as of the first
business day of each calendar quarter.
1.23 "Prior Plan Account" means the bookkeeping Account established under
Section 3.4 on behalf of a Participant to reflect the amounts accrued
by such Participant under the Prior Savings Plan as of December 31,
1997, and includes any deemed investment earnings credited thereon.
"Prior Plan Deferred Account" means the portion of the Prior Plan
Account attributable to the Participant's deferrals plus deemed
investment earnings thereon; and "Prior Plan Company
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Account" means the portion of the Prior Plan Account attributable to
company credits plus deemed investment earnings thereon.
1.24 "Prior Savings Plan" means the CPC International Inc. Excess Savings
Plan.
1.25 "Prior SERP" means the CPC International Inc. Excess Benefit Plan.
1.26 "Savings Plan" means the Corn Products International, Inc. Retirement
Savings Plan.
1.27 "Savings Plan Make-up Account" means the bookkeeping Account
established under Section 3.3 established on behalf of a Participant,
and includes any deemed investment earnings credited thereon.
1.28 "Stock Unit" means a phantom unit corresponding to one share of Common
Stock in which a Participant's Account is deemed invested.
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SECTION TWO
ELIGIBILITY AND PARTICIPATION
2.1 Eligibility and Participation
Participation in the Annual Deferral Account portion of the Plan shall
be limited to Key Executives. For purposes of participation as of
January 1, 1998, the group of eligible Key Executives is limited to
employees of the Corporation whose 1997 base pay plus 1997-paid short
term bonuses from CPC International Inc. equaled at least the Base
Salary Threshold as of November 15, 1997.
If first employed by the Corporation after January 1, 1998, a Key
Executive shall be eligible to participate in the Annual Deferral
Account portion of the Plan as of the first of the month following one
full calendar month of employment if his or her annual base salary as
of date of employment is at least the annual limit (as of such date of
employment) under Section 401(a)(17) of the Code, subject to approval
of the Vice President of Human Resources of the Corporation.
Key Executives who have never participated under the Plan but whose
base pay plus short term bonus paid in any calendar year equals at
least the Base Salary Threshold for such year shall be eligible to
participate in the Annual Deferral Account as of the following January
1.
Key Executives who elect to participate in the Annual Deferral Account
shall continue to be eligible to make deferral elections in future
years, notwithstanding their base salary as of a November 15 falling
below the Base Salary Threshold for Key Executives who have never
participated in the Plan.
Active participation in the Cash Balance Plan Make-up Account for any
calendar year shall be limited to Key Executives who make deferral
elections for such year, or employees whose benefits under the Cash
Balance Plan are reduced by the limits on compensation or benefits
imposed by Sections 401(a)(17) or 415 of the Code.
Active participation in the Savings Plan Make-up Account for any
calendar year shall be limited to Key Executives who make deferral
elections for such year and whose benefits under the Savings Plan are
reduced by the limits on compensation imposed by Section 401(a)(17) of
the Code, or by a deferral election made under Section 2.2 of this
Plan.
Persons who have amounts transferred from the Prior Savings Plan to
this Plan, as provided in Section 3.4, shall be eligible for
participation with respect to amounts held in their Prior Plan Accounts
hereunder.
5
Active participation in the Performance Plan Account portion of the
Plan shall be limited to Key Executives who elect to defer payment of
Performance Plan Awards for which they are eligible under the Corn
Products International, Inc. Performance Plan. Designation as a Key
Executive for purposes of participation in the Performance Plan Account
in a given year does not ensure or otherwise entitle a Participant to
such a designation in subsequent years.
Active participation in the AIP Account portion of the Plan shall be
limited to Key Executives who elect to defer payment of Annual
Incentive Payments for which they are eligible under the Corn Products
International, Inc. Annual Incentive Plan. Designation as a Key
Executive for purposes of participation in the AIP Account in a given
year does not ensure or otherwise entitle a Participant to such a
designation in subsequent years
2.2 Deferral Election
Annual Deferred Compensation elections shall be made only by Key
Executives and shall be on forms furnished by the Committee. An Annual
Deferred Compensation election shall apply only to Compensation paid in
the particular year specified in the election. Key Executives shall
specify the percentage of such Compensation to be deferred under the
election, which percentage may not exceed 20%.
An Annual Deferred Compensation election with respect to Compensation
for a particular calendar year (a) must be made before January 1 of
such calendar year (or prior to participation in the Plan if the Key
Executive becomes eligible to participate during the calendar year),
(b) must specify (from the available alternatives, which shall include
a lump sum option) the date such Annual Deferred Compensation, plus
deemed investment earnings, is to be paid (or commence to be paid) and,
if such date is at termination of employment, the number of annual
installments (not to exceed 10 years) in which such Annual Deferred
Compensation, plus deemed investment earnings, is to be paid, and (c)
once made, cannot be changed or revoked.
In the case of a Key Executive who is eligible to participate in this
Plan under Section 2.1 as of one month following the date on which his
or her employment with the Corporation commences, any Annual Deferred
Compensation election must be made within 30 days of employment and
will apply to Compensation earned from the date of such election
through the end of that calendar year.
Elections to defer payment of Performance Plan Awards earned under the
Corn Products International, Inc. Performance Plan shall only be made
by Key Executives and shall be on forms furnished by the Committee. A
Performance Plan Award deferral election shall apply only to the
Performance Plan Award Cycle specified in the election. Key Executives
shall specify the amount of the Performance Plan Award they elect to
defer in 10% increments (minimum 10%). The deferral election must be
made no later than the end of the second year of the Performance Plan
Award Cycle for which the election is being made. The deferral election
must include a selection from the available distribution alternatives
of a date and form of distribution of the deferred Performance Plan
Award plus deemed investment earnings. One
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form of distribution shall be a lump sum. If the distribution date
selected is termination of employment and the form of distribution
selected is annual installments, the number of annual installments (not
to exceed 10 years) must be designated. Once the form of distribution
is selected, it cannot be changed or revoked.
Elections to defer payment of Annual Incentive Plan Awards earned under
the Corn Products International, Inc. Annual Incentive Plan shall only
be made by Key Executives and shall be on forms furnished by the
Committee. An Annual Incentive Plan Award deferral election shall apply
only to the Plan Year specified in the election. Key Executives shall
specify the amount of the Annual Incentive Plan Award they elect to
defer in 10% increments (minimum 10%). The deferral election must be
made no later than 30 days after approval by the Board of Directors of
the Annual Incentive Plan for the Plan Year for which the election is
being made. The deferral election must include a selection from the
available distribution alternatives of a date and form of distribution
of the deferred Annual Incentive Plan Award plus deemed investment
earnings. One form of distribution shall be a lump sum. If the
distribution date selected is termination of employment and the form of
distribution selected is annual installments, the number of annual
installments (not to exceed 10 years) must be designated. Once the form
of distribution is selected, it cannot be changed or revoked.
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SECTION THREE
Accounts
3.1 Annual Deferral Account
The aggregate of the amounts of Annual Deferred Compensation and deemed
investment earnings on such amounts shall be paid to the Participant or
his or her beneficiary, as applicable, from the general assets of the
Corporation in accordance with this Plan and related election forms.
Deemed investment earnings with respect to Annual Deferred Compensation
shall be credited monthly at the monthly compound equivalent of the
Prime Rate or other deemed investment earnings measurements, including,
but not limited to, the increase or decrease in the Fair Market Value
of Stock Units in a Corn Products International, Inc. Phantom Stock
Unit investment option administered according to Section 4, as the
Committee, in its sole discretion, permits and as is elected by each
Participant to be the deemed investment measurement to be used for this
bookkeeping Account. Such election of the deemed investment earnings
measurement shall be made at times and according to administrative
procedures established by the Committee. A bookkeeping Account shall be
maintained for each Participant to record the amount of such Annual
Deferred Compensation and deemed investment earnings thereon.
Participants shall be 100 percent vested in all of their Annual
Deferral Accounts.
Separate bookkeeping Accounts may be maintained for Annual Deferred
Compensation for each Participant for each calendar year, plus deemed
investment earnings with respect to such Annual Deferred Compensation,
as may be necessary in order to facilitate calculation upon
distribution.
3.2 Cash Balance Plan Make-up Account
A bookkeeping Account shall be established on behalf of each
Participant in the Plan which, at any time, shall yield a benefit equal
to the benefit as of such date that would have accrued under the Cash
Balance Plan had (a) the Participant not elected to defer Compensation
under Section 2.2 of this Plan, and (b) limits on benefits or
Compensation imposed by Sections 415 or 401(a)(17) of the Code not
applied to the Participant under the Cash Balance Plan.
In addition, the following employees shall receive an additional annual
pay credit as indicated below, applied to their total eligible
Compensation as such is defined in the Cash Balance Plan, but without
reflecting the limits of Section 401(a)(17) of the Code:
<Table>
<Caption>
EMPLOYEE ADDITIONAL PERCENTAGE
-------- ---------------------
Beebe, C. 1.37%
Doane, M. 6.67%
Fortnam, J. 2.11%
Hirchak, J.C. 0.81%
Kocun, F.J. 7.71%
Kuske, E.A. 3.56%
Northacker, E. 4.18%
Pyatt, M.R. 3.59%
Ripley, J. 4.72%
Scott III, S. 7.39%
Vandervoort, R. 5.03%
</Table>
8
The beginning balance as of January 1, 1998 under this Account, if any,
shall be determined in accordance with the Opening Balance under the
Cash Balance Plan as if the earned benefit under the Prior SERP as of
December 31, 1997 were the "Accrued Benefit as of December 31, 1997
under the Prior Plan" as such is defined in the Cash Balance Plan.
A Participant shall be vested in his or her Cash Balance Plan Make-up
Account to the extent that such Participant is vested in his or her
Cash Balance Plan Account balance.
3.3 Savings Plan Make-up Account
A bookkeeping Account shall be established on behalf of each
Participant in the Plan, which shall be credited with the excess, if
any, of (a) the amount of employer matching and profit sharing
contributions which would have been made on behalf of such Participant
had the Participant's Deferred Compensation been contributed to the
Savings Plan (without regard to any refunds of Participant
contributions required under the Code, or the effects of Sections
401(a)(17), 402(g) or 415 of the Code), over (b) actual employer
matching and profit sharing contributions to the Savings Plan on behalf
of such Participant.
The Savings Plan Make-up Account shall be credited monthly with deemed
investment earnings at the monthly compound equivalent of the Prime
Rate or other deemed investment earnings measurements, including, but
not limited to, the increase or decrease in the Fair Market Value of
Stock Units in a Corn Products International, Inc. Phantom Stock Unit
investment option administered according to Section 4, as the
Committee, in its sole discretion, permits and as is elected by each
Participant to be the deemed investment measurement to be used for this
bookkeeping Account. Such election of the deemed investment earnings
measurement shall be made at times and according to administrative
procedures established by the Committee. A Participant is vested in his
or her Savings Plan Make-up Account to the extent that such Participant
is vested in his or her Savings Plan matching and profit sharing
contributions.
3.4 Prior Plan Account
A Prior Plan Deferred Account shall be established for each Participant
in the Prior Savings Plan who becomes a Participant on January 1, 1998,
equal in initial value to the amounts held under the Prior Savings Plan
as of December 31, 1997 attributable to employee deferrals under the
Prior Savings Plan plus deemed investment earnings thereon through
December 31, 1997. The Prior Plan Deferred Account shall be credited
monthly with deemed investment earnings at
9
the monthly compound equivalent of the Prime Rate or other deemed
investment earnings measurements, including, but not limited to, the
increase or decrease in the Fair Market Value of Stock Units in a Corn
Products International, Inc. Phantom Stock Unit investment option
administered according to Section 4, as the Committee, in its sole
discretion, permits and as is elected by each Participant to be the
deemed investment measurement to be used for this bookkeeping Account.
Such election of the deemed investment earnings measurement shall be
made at times and according to administrative procedures established by
the Committee. Participants shall be 100 percent vested in any Prior
Plan Deferred Account.
A Prior Plan Company Account shall be established for each Participant
in the Prior Savings Plan who becomes a Participant on January 1, 1998,
equal in initial value to the amounts held under the Prior Savings Plan
as of December 31, 1997 attributable to company credits under the Prior
Savings Plan plus deemed investment earnings thereon through December
31, 1997. The Prior Plan Company Account shall be credited monthly with
deemed investment earnings at the monthly compound equivalent of the
Prime Rate or other deemed investment earnings measurements, including,
but not limited to, the increase or decrease in the Fair Market Value
of Stock Units in a Corn Products International, Inc. Phantom Stock
Unit investment option administered according to Section 4, as the
Committee, in its sole discretion, permits and as is elected by each
Participant to be the deemed investment measurement to be used for this
bookkeeping Account. Such election of the deemed investment earnings
measurement shall be made at times and according to administrative
procedures established by the Committee. Participants shall be 100
percent vested in any Prior Plan Company Account.
3.5 AIP Account
A bookkeeping Account shall be established on behalf of each
Participant who has made an election to defer payment of Annual
Incentive Plan Awards in accordance with this Plan and related election
forms to record the amount of such deferred Annual Incentive Plan
Awards and deemed investment earnings thereon. The aggregate of the
amounts of deferred Annual Incentive Plan awards and deemed investment
earnings on such amounts shall be paid to the Participant or his or her
beneficiary, as applicable, from the general assets of the Corporation
in accordance with this Plan and related election forms. The Annual
Incentive Plan Account shall be credited monthly with deemed investment
earnings at the monthly compound equivalent of the Prime Rate or other
deemed investment earnings measurements, including, but not limited to,
the increase or decrease in the Fair Market Value of Stock Units in a
Corn Products International, Inc. Phantom Stock Unit investment option
administered according to Section 4, as the Committee, in its sole
discretion, permits and as is elected by each Participant to be the
deemed investment measurement to be used for this bookkeeping Account.
Such election of the deemed investment earnings measurement shall be
made at times and according to administrative procedures established by
the Committee. Participants shall be 100 percent vested in their AIP
Account.
10
Separate bookkeeping Accounts may be maintained for Annual Incentive
Plan Award deferrals for each Participant for each calendar year plus
deemed investment earnings with respect to each such deferral, as may
be necessary in order to facilitate calculation upon distribution.
3.6 Performance Plan Account
A bookkeeping Account shall be established on behalf of each
Participant who has made an election to defer payment of Performance
Plan Awards in accordance with this Plan and related election forms to
record the amount of such deferred Performance Plan Awards and deemed
investment earnings thereon. The aggregate of the amounts of deferred
Performance Plan Awards and deemed investment earnings on such amounts
shall be paid to the Participant or his or her beneficiary, as
applicable, from the general assets of the Corporation in accordance
with this Plan and related election forms. The Performance Plan Account
shall be credited monthly with deemed investment earnings at the
monthly compound equivalent of the Prime Rate or other deemed
investment earnings measurements, including, but not limited to, the
increase or decrease in the Fair Market Value of Stock Units in a Corn
Products International, Inc. Phantom Stock Unit investment option
administered according to Section 4, as the Committee, in its sole
discretion, permits and as is elected by each Participant to be the
deemed investment measurement to be used for this bookkeeping Account.
Such election of the deemed investment earnings measurement shall be
made at times and according to administrative procedures established by
the Committee. Participants shall be 100 percent vested in their
Performance Plan Account.
Separate bookkeeping Accounts may be maintained for Performance Plan
Award deferrals for each Participant for each Performance Plan Award
Cycle plus deemed investment earnings with respect to each such
deferral, as may be necessary in order to facilitate calculation upon
distribution.
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SECTION FOUR
DEEMED INVESTMENT OPTIONS
4.1 Corn Products International, Inc. Phantom Stock Unit Option
Participants may elect to participate in the Corn Products
International, Inc. Phantom Stock Unit Option at any time, using the
forms and procedures established by the Committee. Any portion or all
of any of the balances of the bookkeeping Accounts maintained on behalf
of Participants pursuant to this Plan or any portion or all of any new
deferrals may be "invested" in this option. Deemed balances or
deferrals "invested" in this option will maintain their separate
Account character with respect to distribution selections regarding the
timing and form of the distribution. All distributions from this option
will be in whole shares of Common Stock as determined by the whole
number of Stock Units credited to the Participant at the time of
distribution. Fractional Stock Units will be converted to a cash
equivalent by multiplying the fractional Stock Units by the Fair Market
Value on the particular distribution date and will be distributed as a
cash payment.
All elections to "invest" existing Account balances or deferrals into
this option are irrevocable. Balances may not be transferred out of
this option.
All amounts transferred into or deferred directly into this option
shall be deemed to be invested in Common Stock in the form of Stock
Units. The number of Stock Units which shall be credited to a
Participant's Account in respect of amounts transferred or deferred
shall be equal to the amount transferred or deferred divided by the
Fair Market Value of a share of Common Stock on the effective date of
the transfer or deferral or, if such is date is not a trading day for
the New York Stock Exchange, then on the first trading day after such
date of transfer or deferral.
As of the date on which dividends are paid on the shares of Common
Stock, the Company shall credit to each Participant with a balance
"invested" in this option additional Stock Units, the number of which
shall be determined by multiplying the amount of such dividends per
share of Common Stock by the number of Stock Units credited to the
Participant and dividing the product thereof by the Fair Market Value
of a share of Common Stock on the applicable dividend payment date.
12
SECTION FIVE
Payment of Benefits
5.1 No In-Service Withdrawals
No withdrawals, including loans, may be allowed from the Plan for any
reason while the Participant is still employed by the Corporation;
however, reemployment of a Participant shall not suspend the payment of
any benefits hereunder.
5.2 Payment of Annual Deferral Account
Except as provided in Section 5.8 below, payment of benefits from a
Participant's Annual Deferral Account shall be made in accordance with
the Annual Deferred Compensation deferral elections made at the time
the Participant elects to defer Compensation hereunder. A separate
Annual Deferred Compensation election shall govern each year's Annual
Deferred Compensation deferral and deemed investment earnings on such
Annual Deferred Compensation attributable to any year. The terms of
these Annual Deferred Compensation elections dealing with the timing
and form of payment may be changed prospectively from year to year by
the Committee, but once a selection is made by a Participant as to the
timing and form of a distribution from the Annual Deferral Account with
respect to a particular year, such selection is irrevocable. Until the
distribution of the full value of a Participant's Annual Deferral
Account, the undistributed portion of such Account will continue to be
credited with deemed investment earnings pursuant to Section 3.1 of the
Plan.
5.3 Payment of Cash Balance Plan Make-up Account
Except as provided in Section 5.8 below, distributions from the Cash
Balance Plan Make-up Account shall be made in the same form and at the
same time as benefit payments made under the Cash Balance Plan. Until
the distribution of the full value of a Participant's Cash Balance
Make-up Account, the undistributed portion of such Account will
continue to be credited with deemed investment earnings pursuant to
Section 3.2 of the Plan.
5.4 Payment of Savings Plan Make-up Account
Except as provided in Section 5.8 below, distributions from the Savings
Plan Make-up Account shall be made in the same form and at the same
time as benefit payments made under the Savings Plan after termination
of employment. However, if the Participant elects an annuity
distribution under the Savings Plan, he or she shall receive his
Savings Plan Make-up Account in a single sum. Until the distribution of
the full value of a Participant's Savings Plan Make-up Account, the
undistributed portion of such Account will continue to be credited with
deemed investment earnings pursuant to Section 3.3 of the Plan.
13
5.5 Payment of Prior Plan Account
Except as provided in Section 5.8 below, distributions from the Prior
Plan Account shall be payable pursuant to the selection made in writing
by the Participant no later than the Participant's termination date.
Such selection shall be irrevocable and made on forms and pursuant to
procedures specified by the Committee. The Participant shall have the
option to select to receive the value of the Prior Plan Account in one
cash lump sum or payable in essentially equal annual installments over
a specified number of years; provided, however, (i) that no
distribution may commence sooner than the first anniversary of the
Participant's termination date; (ii) distribution must commence no
later than the fifth anniversary of the Participant's termination date;
and (iii) full distribution of the Participant's Prior Plan Account
must be completed no later than the tenth anniversary of such
termination date. If a Participant dies prior to receiving a complete
distribution of the balance of the Prior Plan Account, the
undistributed portion of such Account will be paid in one cash lump sum
as soon as is practicable to the named beneficiary under the Plan.
Until the distribution of the full value of a Participant's Prior Plan
Account, the undistributed portion of such Account will continue to be
credited with deemed investment earnings pursuant to Section 3.4 of the
Plan.
5.6 Payment of AIP Account
Except as provided in Section 5.8 below, distributions from the AIP
Account will be made in accordance with the selections the Participant
made at the time the Annual Incentive Plan Award was deferred. A
separate deferral election form shall govern each Annual Incentive Plan
year and deemed investment earnings thereon. The terms of these
deferral election agreements dealing with the timing and form of
payment may be changed prospectively from year to year by the
Committee, but once a selection is made by a Participant as to the
timing and form of a distribution from the AIP Account with respect to
a particular year, such selection is irrevocable. Until the
distribution of the full value of a Participant's AIP Account, the
undistributed portion of such Account will continue to be credited with
deemed investment earnings pursuant to Section 3.5 of the Plan.
5.7 Payment of Performance Plan Account
Except as provided in Section 5.8 below, distributions from the
Performance Plan Account will be made in accordance with the selections
the Participant made at the time the Performance Plan Award was
deferred. A separate deferral election form shall govern each
Performance Plan Award Cycle and deemed investment earnings thereon.
The terms of these deferral election agreements dealing with the timing
and form of payment may be changed prospectively from Cycle to Cycle by
the Committee, but once a selection is made by a Participant as to the
timing and form of a distribution from the Performance Plan Account
with respect to a particular Cycle, such selection is irrevocable.
Until the distribution of the full value of a Participant's Performance
Plan Account, the undistributed portion of such Account will continue
to be credited with deemed investment earnings pursuant to Section 3.6
of the Plan.
14
5.8 Lump Sum Distributions of Smaller Benefits
Notwithstanding anything herein to the contrary:
(a) If the aggregate value of a Participant's Cash Balance Plan
Make-up Account, Savings Plan Make-up Account, and Prior Plan
Account is less than $10,000, the Participant or his or her
beneficiary shall receive benefits from such Accounts under
this Plan in the form of a single lump sum payment as soon as
practicable after the Participant's termination of employment,
without regard to distribution selections made under the Cash
Balance Plan or Savings Plan.
(b) If the aggregate value of a Participant's Annual Deferral
Account, AIP Account and Performance Plan Account is less than
$10,000, the Participant or his or her beneficiary shall
receive benefits from such Account under this Plan in the form
of a single lump sum payment as soon as practicable after
termination of employment, without regard to distribution
selections made under such Accounts.
5.9 Beneficiaries
The Participant's beneficiary under this Plan with respect to his or
her Accounts shall be the person or persons designated as beneficiary
by the Participant by filing with the Committee a written beneficiary
designation on a form provided by, and acceptable to, such Committee.
In the event the Participant does not make an effective designation of
a beneficiary with respect to his or her Accounts (or any one of them),
the Participant's beneficiary with respect to his or her Accounts shall
be such Participant's beneficiary under the Savings Plan.
5.10 Termination of the Cash Balance Plan or Savings Plan
In the event that the Cash Balance Plan is terminated, payments from
the Cash Balance Plan Make-up Account shall continue to be paid
directly by the Corporation but only to the same extent and for the
same duration as the payee's benefit from the Cash Balance Plan, which
is directly related to such Cash Balance Plan Make-up Account, is
continued to be provided by the assets of the Cash Balance Plan.
In the event that the Savings Plan is terminated, Savings Plan Make-up
Accounts and Prior Plan Accounts shall be distributed directly by the
Corporation in the same manner as the distribution of the Participant's
Accounts under the Savings Plan.
5.11 Tax Withholding The Company shall have the right to require, prior to
the issuance or delivery of any shares of Common Stock or the payment
of any cash pursuant to a distribution of benefits hereunder, payment
by the recipient of such distribution of any Federal, state, local or
other taxes which may be required to be withheld or paid in connection
with such distribution.
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With respect to the withholding obligation attributable to a
distribution of shares of Common Stock from the Phantom Stock Unit
Option, at the election of the recipient (i) the Company shall withhold
whole shares of Common Stock which would otherwise be delivered to a
recipient, having an aggregate Fair Market Value determined as of the
date the obligation to withhold or pay taxes arises in connection with
such distribution (the "Tax Date"), in the amount necessary to satisfy
such obligation or (ii) the recipient may satisfy such obligation by
any of the following means: (A) a cash payment to the Company, (B)
delivery (either actual delivery or by attestation procedures
established by the Company) to the Company of shares of
previously-acquired shares of Common Stock, for which the recipient has
good title, free and clear of all liens and encumbrances, having an
aggregate Fair Market Value, determined as of the Tax Date, equal to
the amount necessary to satisfy such obligation, (C) authorizing the
Company to withhold whole shares of Common Stock which would otherwise
be delivered having an aggregate Fair Market Value, determined as of
the Tax Date, or withhold an amount of cash which would otherwise be
payable to the recipient, equal to the amount necessary to satisfy any
such obligation, or (D) any combination of (A), (B) and (C). Shares of
Common Stock to be delivered or withheld may not have an aggregate Fair
Market Value in excess of the amount determined by applying the minimum
statutory withholding rate. Any fraction of a share of Common Stock
which would be required to satisfy such an obligation shall be
disregarded and the remaining amount due shall be paid in cash by the
recipient. With respect to the withholding obligation attributable to a
distribution of cash, the Company shall withhold an amount of cash
which would otherwise be payable to the recipient in the amount
necessary to satisfy such obligation.
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SECTION SIX
ADMINISTRATION AND GENERAL PROVISIONS
6.1 Plan Administrator
The Corporation shall be the "administrator" of the Plan within the
meaning of the Employee Retirement Income Security Act of 1974, as
amended.
6.2 Committee
Subject to the provisions of Section 6.1, the Committee shall be vested
with the general administration of the Plan. The Committee shall have
the exclusive right to interpret the Plan provisions and to exercise
discretion where necessary or appropriate in the interpretation and
administration of the Plan and to decide any and all matters arising
thereunder or in connection with the administration of the Plan. The
decisions, actions and records of the Committee shall be conclusive and
binding upon the Corporation and all persons having or claiming to have
any right or interest in or under the Plan.
The Committee may delegate to such officers, employees or departments
of the Corporation such authority, duties, and responsibilities of the
Committee as it, in its sole discretion, considers necessary or
appropriate for the proper and efficient operation of the Plan,
including, without limitation, (a) interpretation of the Plan, (b)
approval and payment of claims, and (c) establishment of procedures for
administration of the Plan.
6.3 Participation by Other Employers
(a) Adoption of Plan.
With the consent of the Corporation, any corporation may
become a participating Employer under the Plan by (i) taking
such action as shall be necessary to adopt the Plan, (ii)
filing with the Corporation a duly certified copy of the
resolution of the board of directors of such corporation
adopting the Plan, and (iii) executing and delivering such
instruments and taking such other actions as may be necessary
or desirable to put the Plan into effect with respect to such
corporation.
(b) Withdrawal from Participation
Any Employer may withdraw from participation in the Plan at
any time by filing with the Corporation a duly certified copy
of a resolution of its board of directors to that effect and
giving notice of its intended withdrawal to the Corporation
prior to the effective date of withdrawal.
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(c) Corporation as Agent for Employers
Each corporation which shall become a participating Employer
pursuant to Section 6.3(a) by so doing shall be deemed to have
appointed the Corporation its agent to exercise on its behalf
all of the powers and authorities hereby conferred upon the
Corporation by the terms of the Plan, including, but not by
way of limitation, the power to amend and terminate the Plan.
6.4 General Provisions
(a) The Corporation shall make no provision for the funding of any
benefits payable hereunder that (i) would cause the Plan to be
a funded plan for purposes of Section 404(a)(5) of the Code,
or Title I of the Employee Retirement Income Security Act of
1974, as amended, or (ii) would cause the Plan to be other
than an "unfunded and unsecured promise to pay money or other
property in the future" under Treasury Regulations section
1.83-3(e); and shall have no obligation to make any
arrangement for the accumulation of funds to pay any amounts
under this Plan.
(b) In the event that the Corporation shall decide to establish an
advance accrual reserve on its books against the future
expense of the Plan, such reserve shall not under any
circumstances be deemed to be an asset of this Plan but, at
all times, shall remain a general asset of the Corporation,
subject to the claims of the Corporation's creditors.
(c) A person entitled to any amount under this Plan shall be a
general unsecured creditor of the Corporation with respect to
such amount.
6.5 Claims Procedure
If any Participant or other person believes he is entitled to benefits
in an amount greater than those which he is receiving or has received,
he may file a written claim with the Secretary of the Committee. Such
claim shall state the nature of the claim, the facts supporting the
claim, the amount claimed, and the address of the claimant. The
Secretary of the Committee shall review the claim and shall, within 60
days after receipt of the claim, give written notice by registered or
certified mail to the claimant of the Committee's decision with respect
to the claim. The notice of the Committee's decision with respect to
the claim shall be written in a manner designed to be understood by the
claimant and, if the claim is wholly or partially denied, set forth the
specific reasons for the denial, specific references to the pertinent
Plan provisions on which the denial is based, a description of any
additional material or information necessary for the claimant to
perfect the claim and an explanation of why such material or
information is necessary, and an explanation of the claim review
procedure under the Plan.
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The Committee shall also advise the claimant that he or his duly
authorized representative may request a review of the denial by the
Chairperson of the Committee by filing with the Committee within 65
days after notice of the denial has been received by the claimant, a
written request for such review. The claimant shall be informed that he
may have reasonable access to pertinent documents and submit comments
in writing to the Chairperson within the same 65-day period. If a
request is so filed, review of the denial shall be made by the
Chairperson within 60 days after receipt of such request, and the
claimant shall be given written notice of the Chairperson's final
decision. The notice of the Chairperson's final decision shall include
specific reasons for the decision and specific references to the
pertinent Plan provisions on which the decision is based and shall be
written in a manner designed to be understood by the claimant.
6.6 Notices and Other Communications
All notices, reports and statements given, made, delivered or
transmitted to a Participant or any other person entitled to or
claiming benefits under the Plan shall be deemed to have been duly
given, made or transmitted when mailed by first class mail with postage
prepaid and addressed to the Participant or such other person at the
address last appearing on the records of the Corporation. A Participant
or other person may record any change of his address from time to time
by written notice filed with the Corporation.
Written directions, notices and other communications from Participants
or any other person entitled to or claiming benefits under the Plan to
the Employers or the Corporation shall be deemed to have been duly
given, made or transmitted either when delivered to such location as
shall be specified upon the forms prescribed by the Corporation for the
giving of such directions, notices and other communications or when
mailed by first class mail with postage prepaid and addressed as
specified upon such forms.
6.7 Records
The Committee shall keep a record of all its proceedings and shall keep
or cause to be kept all books of Account, records and other data as may
be necessary or advisable in its judgment for the administration of the
Plan.
6.8 Non-assignability
It is a condition of the Plan, and all rights of each Participant and
any other person entitled to benefits hereunder shall be subject
thereto, that no right or interest of any Participant or such other
person in the Plan shall be assignable or transferable in whole or in
part, either directly or by operation of law or otherwise, including,
but not by way of limitation, execution, levy, garnishment, attachment,
pledge or bankruptcy, but excluding rights or interests arising by
reason of death or mental incompetency, and no right or interest of any
Participant or other person in the Plan shall be liable for, or subject
to, any obligation or liability of such Participant or other person,
including claims for alimony or the support of any spouse or child.
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6.9 Employment Non-contractual
The Plan shall not be interpreted as conferring any right upon any
employee to continue in employment.
6.10 Employer's Option to Fund Benefits
Nothing in this Plan shall be interpreted as requiring any Employer to
set aside any of its assets for the purpose of funding its obligation
under this Plan. No person entitled to benefits under this Plan shall
have any right, title or claim in or to any specific assets of any
Employer, but shall have the right only as a general creditor of his
Employer to receive benefits from his Employer on the terms and
conditions herein provided. Notwithstanding the foregoing, any
obligation of an Employer under this Plan to a Participant or an other
person entitled to payments in respect of the Participant shall be
offset by any payments to the Participant or another person from any
trust or other funding medium established by the Employers for the
purpose of providing benefits of this Plan.
6.11 Governing Law
This Plan shall be construed and enforced under the laws of the State
of Illinois.
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SECTION SEVEN
AMENDMENT AND TERMINATION
7.1 Amendment of the Plan
The Plan may be wholly or partially amended or otherwise modified at
any time by the Committee.
7.2 Termination of the Plan
The Plan may be terminated at any time by the Board of Directors.
21