EXHIBIT 10.38
PCTEL, INC.
EXECUTIVE DEFERRED STOCK PLAN
EFFECTIVE AS OF JANUARY 20, 2003
TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS............................................................ 1
ARTICLE 2 ELIGIBILITY .......................................................... 3
ARTICLE 3 STOCK OPTION GAIN DEFERRALS........................................... 4
ARTICLE 4 RESTRICTED STOCK DEFERRALS............................................ 5
ARTICLE 5 ACCOUNTS AND ALLOCATION OF FUNDS...................................... 6
ARTICLE 6 ENTITLEMENT TO BENEFITS............................................... 7
ARTICLE 7 DISTRIBUTION OF BENEFITS.............................................. 9
ARTICLE 8 BENEFICIARIES; PARTICIPANT DATA....................................... 10
ARTICLE 9 PLAN ADMINISTRATION................................................... 11
ARTICLE 10 AMENDMENT OR TERMINATION............................................. 14
ARTICLE 11 MISCELLANEOUS........................................................ 15
EXHIBIT A PARTICIPANT AGREEMENT AND ELECTION FORM
EXHIBIT B DESIGNATION OF BENEFICIARY
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PCTEL, INC.
EXECUTIVE DEFERRED STOCK PLAN
THIS PLAN is adopted as of the 20th day of January, 2003, by PCTEL, Inc.,
a Delaware corporation (the "Corporation"), as follows:
RECITALS
WHEREAS, the Corporation wishes to establish the PCTEL, Inc. "Executive
Deferred Stock Plan" (the "Plan") to provide additional retirement benefits and
income tax deferral opportunities for a select group of management or highly
compensated employees; and
WHEREAS, the Corporation intends that the Plan shall at all times be
administered and interpreted in such a manner as to constitute an unfunded
nonqualified deferred plan for a select group of management or highly
compensated employees and to qualify for all available exemptions from the
provisions of ERISA;
NOW, THEREFORE, the Corporation hereby adopts the following Executive
Deferred Stock Plan.
ARTICLE 1
DEFINITIONS
DEFINITION OF TERMS. Certain words and phrases are defined when first used
in later sections of this Plan. Whenever any words are used in the masculine,
they shall be construed as though they were in the feminine in all cases where
they would so apply; and whenever any words are used in the singular or in the
plural, they shall be construed as though they were used in the plural or the
singular, as the case may be, in all cases where they would so apply. In
addition, the following words and phrases when used, unless the context clearly
requires otherwise, shall have the following respective meanings:
1.1. ACCOUNTS. A Participant's Gain Share Account and Restricted Stock Account.
1.2. AFFILIATE. Any corporation, partnership, joint venture, association, or
similar organization or entity, which is a member of a controlled group of
companies which includes, or which is under common control with, the
Corporation under Section 414 of the Code.
1.3. BASE SALARY. The annual compensation (excluding bonuses, commissions,
overtime, incentive payments, non-monetary awards, directors fees and
other fees, stock options and grants, and car allowances) paid to a
Participant for services rendered to the Corporation, before reduction for
compensation deferred pursuant to all qualified, non-qualified and Code
Section 125 plans of the Corporation.
1.4. BENEFICIARY. The Beneficiary(ies) designated by a Participant under
Article 8, or, if the Participant has not designated a Beneficiary under
6.
1.5. CALENDAR YEAR. January 1 to December 31.
1.6. CODE. The Internal Revenue Code of 1986, as amended from time to time.
1.7. COMMON STOCK. The common stock of PCTEL, Inc.
1.8. CONSIDERATION SHARES. The shares of Common Stock owned by a Participant
for six months or longer.
1.9. DATE OF EXERCISE. The date on or after which Options designated in the
Election Form will be exercised and the elected percentage of the gain
derived therefrom will be deferred pursuant to Article 3 of this Plan;
provided that such date shall be at least six months from the election
date.
1.10. DEFERRAL PERIOD. The period after which distribution of the Gain Share
Account and Restricted Stock Account are to be made.
1.11. DISABILITY. Disability shall mean a Participant's eligibility to receive
benefits under the Corporation's group long-term disability plan, or, if
the Corporation ceases to maintain a long-term disability plan, the total
and permanent incapacity of the Participant, due to physical impairment or
legally established mental incompetence, to perform the usual duties of
his employment with the Corporation.
1.12. EFFECTIVE DATE. January 20, 2003.
1.13. ELECTION OF DEFERRAL. A written notice filed by the Participant with the
Plan Administrator of the Corporation in substantially the form attached
hereto as Exhibit A, and referred herein as the "ELECTION FORM,"
specifying the amount (if any) of Restricted Stock and/or Gain Shares to
be deferred.
1.14. ELIGIBLE EMPLOYEE. Any employee of the Corporation or an Affiliate who is
selected to participate in the Plan in accordance with the provisions of
Section 2.1 hereof, and one of a select group of management or highly
compensated employees, as defined by ERISA.
1.15. ERISA. The Employee Retirement Income Security Act of 1974, as amended
from time to time.
1.16. FAIR MARKET VALUE. With respect to a share of Common Stock as of any date,
(a) the closing sales price of Common Stock in the NASDAQ National Market
System or on any such other exchange on which the Common Stock is traded
on such date, or in the absence of sales on such date, the closing sales
price on the immediately preceding date on which sales were reported, or
(b) in the event there is no public market for the Common Stock on such
date, the Fair Market Value as determined in good faith by the Board of
Directors.
1.17. GAIN SHARES. The shares of Common Stock so determined under Section 3.5 as
resulting from the exercise of any Option pursuant to Article 3.
1.18. GAIN SHARE ACCOUNT. The account maintained by the Plan Administrator for
the Participant of the number of Phantom Share Units related to Gain
Shares, adjusted for hypothetical gains, earnings, dividends, losses,
distributions, withdrawals and other similar activities.
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1.19. OPTION. A nonqualified stock option to purchase shares of Common Stock.
1.20. PARTICIPANT. An Eligible Employee designated as a participant by the Plan
Administrator who has completed and submitted an Election Form,
substantially in the form of Exhibit A attached hereto.
1.21. PHANTOM SHARE UNITS. Units of deemed investment in shares of Common Stock
so determined under Sections 3.6 and 5.1(b).
1.22. PLAN. This Plan, together with any and all amendments or supplements
thereto.
1.23. PLAN ADMINISTRATOR. The Compensation Committee of the Board of Directors
of PCTEL, Inc., or as otherwise designated by the Board of Directors.
1.24. PLAN RETIREMENT DATE. The date selected by a Participant, however, no
earlier than the date he or she attains 55 years of age.
1.25. PLAN YEAR. The Calendar Year.
1.26. RESTRICTED STOCK. The shares of Common Stock so determined under Section
4.4.
1.27. RESTRICTED STOCK ACCOUNT. The account maintained by the Plan Administrator
for the Participant of the number of Phantom Share Units related to
Restricted Stock shares, adjusted for hypothetical gains, earnings,
dividends, losses, distributions, withdrawals and other similar
activities.
1.28. RETIREMENT. The termination of a Participant's employment with the
Corporation and all Affiliates on or after the Participant has reached his
or her Plan Retirement Date.
1.29. VALUATION DATE. The last day of each quarter during a Plan Year, or such
other dates as the Plan Administrator may establish in its discretion.
1.30. YEAR OF PARTICIPATION. Twelve months of continuous employment with the
Corporation measured from the Participant's date of entry into this Plan.
ARTICLE 2
ELIGIBILITY
2.1 ELIGIBILITY.
(a) An Eligible Employee shall become a Participant in the Plan
following written notice from the Corporation to that effect, and
submittal of a completed Participant Election Form, substantially in
the form of Exhibit A attached hereto.
(b) Once an Eligible Employee becomes a Participant, he or she shall
remain a Participant until his or her termination of employment with
the Corporation or an Affiliate, and thereafter until all benefits
to which he or she (or his or her Beneficiaries) is entitled under
the Plan have been paid.
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ARTICLE 3
STOCK OPTION GAIN DEFERRALS
3.1 GENERAL. Subject to provisions of this Article 3, Participants may elect
to defer receipt and distribution of the gain related to the exercise of
Options and resulting Gain Shares until the end of the Deferral Period by
completing the appropriate portion of the Election Form and timely filing
such form with the Plan Administrator.
3.2 TIMING OF FILING STOCK OPTION GAIN DEFERRAL ELECTION. The Election Form
must be filed at least six months prior to the Date of Exercise and no
later than the day before the first day of the six month period ending on
the Option expiration date. An Option with respect to which an Election
Form has been filed may not be exercised prior to the dates specified in
the preceding sentence.
3.3 CONTENTS OF STOCK OPTION GAIN DEFERRAL ELECTION. Each stock option gain
deferral election shall set forth: (i) the number of Options to be
exercised in connection with the deferrals hereunder; (ii) the date of
grant of the Options; (iii) the Deferral Period; and (iv) any other item
determined to be appropriate by the Plan Administrator. A Participant may
elect to defer gain in increments of 25%, 50%, 75% or 100% of the number
of Gain Shares resulting from Options exercised on any one Date of
Exercise.
3.4 MANNER OF EXERCISING OPTION SHARES. A Participant who desires to exercise
an Option and to defer current receipt and distribution of the related
Gain Shares must follow the procedures and requirements that are
applicable to the Option pursuant to the PCTEL, Inc. 1997 Stock Plan (as
amended and restated April 13, 1998) or, if applicable, the PCTEL, Inc.
2001 Nonstatutory Stock Option Plan, including the procedures and
requirements relating to the exercise of an Option; provided, however,
that in the case of a deferral of Gain Shares under this Plan, the
Participant shall only be permitted to tender Consideration Shares to pay
the entire exercise price for any such Option exercised. Notwithstanding
the foregoing, the Plan Administrator may in its discretion accept the
Participant's attestation that he or she owns the number of Consideration
Shares necessary to effectuate the stock swap contemplated hereunder.
3.5 DETERMINATION OF GAIN SHARES. Upon exercise of an Option, the Gain Shares
from which the Participant has elected to defer hereunder shall be
determined as follows: (i) the aggregate exercise price for all exercised
Option shares shall be determined; (ii) the number of Consideration Shares
needed to pay the exercise price for such Option shares shall be
determined; (iii) the difference between the number of exercised Option
shares and the number of Consideration Shares shall be the number of Gain
Shares resulting from such exercise. Any fractional Gain Share that
results from the computations hereunder shall be rounded up to the nearest
whole number.
3.6 CONVERSION OF GAIN SHARES TO PHANTOM SHARE UNITS. As of the Date of
Exercise, Gain Shares shall be converted to Phantom Share Units by
dividing the amount of the aggregate Fair Market Value of the Gain Shares
as of the Date of Exercise by the Fair Market Value of one share of Common
Stock as of the Date of Exercise. The resulting number of Phantom Share
Units shall be credited to the Participant's Gain Share Account.
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Any fractional Phantom Share Unit that results from the computations
hereunder shall be rounded up to the nearest 1/100.
3.7 CHANGES TO THE STOCK OPTION GAIN DEFERRAL ELECTION. The Election Form
relating to a particular stock option gain deferral may not be amended or
revoked after the day on which it is filed with the Plan Administrator,
except that the Deferral Period identified by the Participant in the
Election Form may be extended if an amended Election Form is filed with
the Plan Administrator at least one year before the Deferral Period (as in
effect before such amendment) ends.
3.8 FAILURE TO PROPERLY EXERCISE. If a Participant makes a valid election
under this Article 3 to defer Gain Shares and if the Option expires
without a proper exercise of the Option by the Participant or if the
Participant fails to properly tender or attest to the Consideration Shares
by the last day of the Option term, the Participant shall forfeit any
opportunity to exercise the Option and the Option shall be canceled as of
the end of the last business day of the Option term, according to the
terms of the PCTEL, Inc. 1997 Stock Plan (as amended and restated April
13, 1998) or, if applicable, the PCTEL, Inc. 2001 Nonstatutory Stock
Option Plan.
3.9 DELIVERY OF GAIN SHARES. The Gain Shares shall be physically delivered to
the person or entity designated by the Plan Administrator for safekeeping.
ARTICLE 4
RESTRICTED STOCK DEFERRALS
4.1 GENERAL. Subject to provisions of this Article 4, Participants may elect
to defer receipt of Restricted Stock until the end of the Deferral Period
by completing the appropriate portion of the Election Form and filing such
Election Form with the Plan Administrator.
4.2 TIMING OF FILING RESTRICTED STOCK DEFERRAL ELECTION. The Election Form
must be filed at least six months prior to the vesting of such Restricted
Stock grant, except for the first Plan Year in which case the deferral
must be completed prior to the vesting date.
4.3 CONTENTS OF RESTRICTED STOCK DEFERRAL AGREEMENT. Each Restricted Stock
deferral election shall set forth: (i) the number of shares to be deferred
hereunder; (ii) the Deferral Period, which is not to be less than one
year; and (iii) any other item determined to be appropriate by the Plan
Administrator.
4.4 CONVERSION OF RESTRICTED STOCK TO PHANTOM SHARE UNITS. As of the date
immediately prior to the date the applicable restriction period expired,
the Restricted Stock shall be converted to Phantom Share Units by dividing
the amount of the aggregate Fair Market Value of the Restricted Stock as
of the date of vesting by the Fair Market Value of one share of Common
Stock as of the date of deferral. The resulting number of Phantom Share
Units shall be credited to the Participant's Restricted Stock Account. Any
fractional Phantom Share Unit that results from the computations hereunder
shall be rounded up to the nearest whole number.
4.5 CHANGES TO THE RESTRICTED STOCK DEFERRAL ELECTION. The Election Form
relating to a particular Restricted Stock deferral may not be amended or
revoked after the day on
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which it is filed with the Plan Administrator, except that the Deferral
Period identified by the Participant in the Election Form may be extended
if an amended Election Form is filed with the Plan Administrator at least
one year before the Deferral Period (as in effect before such amendment)
ends.
4.6 DELIVERY OF RESTRICTED STOCK SHARES. The Restricted Stock Shares shall be
physically delivered to the person or entity as designated by the Plan
Administrator for safekeeping.
ARTICLE 5
ACCOUNTS AND ALLOCATION OF FUNDS
5.1 INVESTMENT ELECTION AND DECLARED RATES.
(a) Investment elections for Gain Share Accounts and Restricted Stock
Accounts are deemed investments in shares of Common Stock. These
deemed investment amounts shall be converted into Phantom Share
Units based upon the Fair Market Value of the Common Stock as of the
date(s) the amounts are to be credited to a Restricted Stock Account
or Gain Shares Account. Dividends paid on Common Stock will be
deemed to be immediately reinvested in Common Stock. When a
distribution of all or a portion of the Gain Share Account or
Restricted Stock Account that is invested hereunder is to be made,
the balance in such Account shall be determined by multiplying the
Fair Market Value of one share of Common Stock on the most recent
Valuation Date preceding the date of such distribution by the number
of Phantom Share Units to be distributed. The amount shall be
distributed in the form of actual shares of Common Stock. In the
event of a stock dividend, split-up or combination of the Common
Stock, merger, consolidation, reorganization, recapitalization, or
other change in the corporate structure or capitalization affecting
the Common Stock, such that an adjustment is determined by the Plan
Administrator to be appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be
made available under this Plan, then the Plan Administrator may make
appropriate adjustments to the number of deemed shares credited to
the applicable Gain Share Account or Restricted Stock Account. The
determination of the Plan Administrator as to such adjustments, if
any, to be made shall be conclusive. Notwithstanding any other
provision of this Plan, the Plan Administrator shall adopt such
procedures as it may determine are necessary to ensure that with
respect to any Participant who is actually or potentially subject to
Section 16(b) of the Securities Exchange Act of 1934, as amended,
the crediting of deemed shares to his or her Gain Share Account or
Restricted Stock Account is not deemed to be a non-exempt purchase
for purposes of such Section 16(b), including without limitation
requiring that no shares of Common Stock or cash relating to such
deemed shares may be distributed for six months after being credited
to such Gain Share Account or Restricted Stock Account.
(b) At the end of each calendar quarter (or such shorter period as the
Plan Administrator may determine), the Corporation shall provide
Participant with a report indicating the number of shares in the
Participants' Gain Share and Restricted Stock Accounts.
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5.2 DETERMINATION OF ACCOUNTS. A Participant's benefit as of each Valuation
Date shall consist of the value of the Participant's Gain Share Account
and Restricted Stock Account.
ARTICLE 6
ENTITLEMENT TO BENEFITS
6.1 VESTING OF BENEFITS. A Participant shall be fully vested in his or her
Gain Share Account and Restricted Stock Account.
6.2 RETIREMENT BENEFIT. After the Retirement of the Participant, the
Corporation shall pay to the Participant his or her Accounts. Such
benefits shall be payable in a single in-kind distribution of Common
Stock. Such distribution shall commence on or about the first day of the
first month following the Participant's Retirement or Disability.
6.3 FIXED PAYMENT DATE BENEFIT FOR IN-SERVICE DISTRIBUTION PRIOR TO
RETIREMENT.
(a) A Participant may select a fixed payment date for the payment of his
or her Accounts. A payment made under this election will be payable
in a single in-kind distribution of Common Stock. A Participant may
extend a fixed payment date by written notice to the Plan
Administrator, provided that the Participant gives such written
notice at least one (1) year prior to the fixed payment date before
such extension. Such fixed payment dates may not be accelerated.
(b) Any fixed payment date elected by a Participant as provided under
Section 6.3(a) above must be no earlier than the January 1 of the
third Calendar Year after the Calendar Year in which the election is
made, or in which the Participant gives a written notice of
extension.
6.4 DISABILITY RETIREMENT BENEFIT. The Participant shall be entitled to
receive payment prior to his or her Plan Retirement Date if he or she is
disabled. If the Participant's employment is terminated due to Disability,
the benefit payable hereunder shall be the same amount as would have been
payable as a Retirement Benefit under Section 6.2 above had the
Participant attained his or her Plan Retirement Date on the date of the
Disability.
6.5 DEATH BENEFITS. In the event of the Participant's death while in the
employment of the Corporation or an Affiliate and prior to distribution of
his or her Accounts, the Corporation shall pay a death benefit equal to
Gain Share Account and Restricted Stock Account. The death benefit payable
under this Section shall be distributed to the Participant's Beneficiary
in a lump sum on or about the first day of the third month following the
Participant's death. The distribution shall be made in accordance with the
last beneficiary designation received by the Plan Administrator from the
Participant prior to his or her death. If no such designation has been
received by the Corporation, such payments shall be made to the
Participant's surviving legal spouse. If the Participant is not survived
by a legal spouse, or if such spouse shall fail to so appoint, the said
payments shall be made to the then living children of the Participant, if
any, in equal shares. If there are no surviving children, the payments
will be made to the estate of the later to die of the Participant and his
or her legal spouse, if any.
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6.6 TERMINATION OF BENEFITS. In the event of the Participant's termination of
employment with the Corporation or an Affiliate for any reason, the
Corporation shall pay to the Participant the value of the Participant's
Accounts. Such termination benefit shall be payable on or about the first
day of the third month following the date of termination with shares of
Common Stock.
6.7 HARDSHIP DISTRIBUTION.
(a) HARDSHIP WITHDRAWAL. In the event that the Plan Administrator, under
written request of a Participant, determines, in its sole
discretion, that a Participant has suffered an unforeseeable
financial emergency, the Corporation shall distribute to the
Participant, as soon as practicable following such determination,
Common Stock necessary to meet the emergency (the "Hardship
Withdrawal"), but not exceeding the balance of such Participant's
Accounts as of the date of such payment. For purposes of Section
6.7(a), an "unforeseeable financial emergency" shall mean an event
that the Plan Administrator determines to give rise to an unexpected
need for cash arising from an illness, casualty loss, sudden
financial reversal or other such unforeseeable occurrence. Amounts
of Hardship Withdrawal may not exceed the amount the Plan
Administrator reasonably determines to be necessary to meet such
emergency needs (including taxes incurred by reason of a taxable
distribution). The amount of the deferral benefit otherwise payable
under the Plan to such Participant shall be adjusted to reflect the
early payment of the Hardship Withdrawal.
(b) RULES ADOPTED BY PLAN ADMINISTRATOR. The Plan Administrator shall
have the authority to adopt additional rules relating to Hardship
Withdrawals. In administering these rules, the Plan Administrator
shall act in accordance with the principle that the primary purpose
of this Plan is to provide additional retirement income, not
additional funds for current consumption.
(c) LIMIT ON NUMBER OF HARDSHIP WITHDRAWALS. No Participant may receive
more than one Hardship Withdrawal in any Calendar Year.
6.8 TERMINATION BASED ON CORPORATE PERFORMANCE. If the amount of the
Corporation's net worth, as reported on any of its quarterly filed
financial statements, at any time declines below $ 50,000,000.00, this
Plan shall terminate and each Participant shall receive a termination
benefit as provided for under Section 6.6 above.
6.9 ADVERSE ACTION ON PARTICIPANT OR PLAN.
(a) Notwithstanding any other provision hereof, in the event there is a
determination by the U.S. Internal Revenue Service ("IRS"), or in
the event of a final determination by a court of competent
jurisdiction, that amounts credited to Participants' Accounts
hereunder are includable in the gross incomes of such Participants
or their respective Beneficiaries, the Plan Administrator may, in
its sole discretion, distribute the entire amount credited to the
Participants' Accounts to the Participants or their respective
Beneficiaries and cause the termination of future deferrals by the
Participants.
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(b) In the event that there is a determination by the U.S. Department of
Labor, or a final determination of a court of competent
jurisdiction, that the Plan is subject to Part 2, 3 or 4 of Title I
of ERISA, the Plan Administrator may, in its sole discretion,
distribute the entire amount credited to the Participants' Accounts
to the Participants or their respective Beneficiaries and cause the
termination of future deferrals by the Participants.
6.10 BENEFITS NOT TRANSFERABLE. No Participant or Beneficiary under this Plan
shall have any power or right to transfer, assign, anticipate, hypothecate
or otherwise encumber all or any part of the amounts payable hereunder. No
part of the amounts payable shall, prior to actual payment, be subject to
seizure or sequestration for the payment of any debts, judgments, alimony
or separate maintenance owed by a Participant or any other person, nor be
transferable by operation of law in the event of a Participant's or any
other person's bankruptcy or insolvency, or dissolution of marriage. Any
such attempted assignment shall be void.
6.11 NO TRUST CREATED. Nothing contained in this Plan, and no action taken
pursuant to its provisions by any person shall create, or be construed to
create, a trust of any kind, or a fiduciary relationship between the
Corporation and any other person.
6.12 UNCLAIMED BENEFITS. In the case of a benefit payable on behalf of a
Participant, if the Plan Administrator is unable to locate the Participant
or Beneficiary to whom such benefit is payable, such Plan benefit may be
forfeited to the Corporation upon the Plan Administrator's determination.
Notwithstanding the foregoing, if, subsequent to any such forfeiture, the
Participant or Beneficiary to whom such Plan benefit is payable makes a
valid claim for such Plan benefit, such forfeited Plan benefit shall be
paid by the Plan Administrator to the Participant or Beneficiary, without
interest on the Accounts from the date it would have otherwise been paid.
ARTICLE 7
DISTRIBUTION OF BENEFITS
7.1 BENEFITS PAYABLE ONLY FROM GENERAL CORPORATE ASSETS: UNSECURED GENERAL
CREDITOR STATUS OF PARTICIPANT.
Payment to a Participant or any Beneficiary hereunder shall be made from
assets which shall continue, for all purposes, to be part of the general,
unrestricted assets of the Corporation; no person shall have any interest
in any such asset by virtue of any provision of this Plan. The
Corporation's obligation hereunder shall be an unfunded and unsecured
promise to pay money in the future. To the extent that any person acquires
a right to receive payments from the Corporation under the provisions
hereof, such right shall be no greater than the right of any unsecured
general creditor of the Corporation; no such person shall have or acquire
any legal or equitable right, interest or claim in or to any property or
assets of the Corporation.
7.2 NO CONTRACT OF EMPLOYMENT. Nothing contained herein shall be construed to
be a contract of employment for any term of years, or as conferring upon
the Participant the
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right to continue to be employed by the Corporation in his or her present
capacity or in any capacity
7.3 FACILITY OF PAYMENT. If a distribution is to be made to a minor, or to a
person who is otherwise incompetent, then the Plan Administrator may, in
its discretion, make such distribution (i) to the legal guardian, or if
none, to a parent of a minor payee with whom the payee maintains his or
her residence, or (ii) to the conservator or committee or, if none, to the
person having custody of an incompetent payee. Any such distribution shall
fully discharge the Plan Administrator, the Corporation and Plan from
further liability on account thereof.
7.4 WITHHOLDING. Any and all payments to be made to a Participant or a
Participant's Beneficiaries pursuant to this Plan shall be subject to all
federal, state and local income and employment taxes and such taxes may be
withheld accordingly by the Corporation from benefits under this Plan or
from Base Salary, bonuses or other amounts due to the Participant, as
determined by the Plan Administrator. The Corporation may, in its
discretion, accept payment by the Participant or Beneficiary of the amount
of any applicable taxes in lieu of deducting such amount from the
Participant's Accounts, Base Salary, bonuses or other amounts due to the
Participant.
ARTICLE 8
BENEFICIARIES; PARTICIPANT DATA
8.1 BENEFICIARY DESIGNATION. The Participant shall have the right, at any
time, to submit in substantially the form attached hereto as Exhibit B, a
written designation of primary and secondary Beneficiaries to whom payment
under this Plan shall be made in the event of his or her death prior to
distribution of the Accounts. . Each beneficiary designation shall become
effective only when receipt thereof is acknowledged in writing by the
Corporation. The Corporation shall have the right, in its sole discretion,
to reject any beneficiary designation which is not in substantially the
form attached hereto as Exhibit B. Any attempt to designate a Beneficiary,
otherwise than as provided in this Section 8.1, shall be ineffective.
8.2 SPOUSE'S INTEREST. A Participant's beneficiary designation shall be deemed
automatically revoked if the Participant names a spouse as Beneficiary and
the marriage is later dissolved or the spouse dies. Without limiting the
generality of the foregoing, the interest in the benefits hereunder of a
spouse of a Participant who has predeceased the Participant or whose
marriage with the Participant has been dissolved shall automatically pass
to the Participant and shall not be transferable by such spouse in any
manner, including but not limited to such spouse's will, nor shall such
interest pass under the laws of intestate succession.
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ARTICLE 9
PLAN ADMINISTRATION
9.1 RESPONSIBILITY OF ADMINISTRATION OF THE PLAN.
(a) The Plan Administrator shall be responsible for the management,
operation and administration of the Plan. The Plan Administrator may
employ others to render advice with regard to its responsibilities
under this Plan. It may also allocate its responsibilities to others
and may exercise any other powers necessary for the discharge of its
duties. The Plan Administrator shall be entitled to rely
conclusively upon all tables, valuations, certifications, opinions
and reports furnished by any actuary, accountant, controller,
counsel or other person employed or engaged by the Plan
Administrator with respect to the Plan.
(b) The primary responsibility of the Plan Administrator is to
administer the Plan for the benefit of the Participants and their
respective Beneficiaries, subject to the specific terms of the Plan.
The Plan Administrator shall administer the Plan in accordance with
its terms and shall have the power to determine all questions
arising in connection with the administration, interpretation, and
application of the Plan. Any such determination shall be conclusive
and binding upon all persons and their heirs, executors,
beneficiaries, successors and assigns. The Plan Administrator shall
have all powers necessary or appropriate to accomplish its duties
under the Plan. The Plan Administrator shall also have the
discretion and authority to make, amend, interpret, and enforce all
appropriate rules and regulations for the administration of this
Plan and decide or resolve any and all questions, including but not
limited to, interpretations of this Plan and entitlement to or
amount of benefits under this Plan, as may arise in connection with
the Plan.
9.2 CLAIMS PROCEDURE.
(a) CLAIM. A person who believes that he or she is being denied a
benefit to which he or she is entitled under the Plan (hereinafter
referred to as a "Claimant") may file a written request for such
benefit with the Plan Administrator, setting forth his or her claim.
The request must be addressed to the Plan Administrator at its then
principal place of business. Notwithstanding anything to the
contrary, pending a determination under this Section 9.2, the
undisputed portion of a benefit due to Claimant shall be timely
distributed pursuant to the terms of the Plan.
(b) CLAIM DECISION. Upon receipt of a claim, the Plan Administrator
shall advise the Claimant that a reply will be forthcoming within 45
days. The Plan Administrator may, however, extend the reply period
for an additional 30 days for reasonable cause. If the claim is
denied in whole or in part, the Plan Administrator shall adopt a
written opinion, using language calculated to be understood by the
Claimant, setting forth to the extent applicable:
(i) The specific reasons for such denial;
(ii) Specific reference to pertinent provisions of this Plan on
which such denial is based;
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(i) A description of any additional material or information
necessary for the Claimant to perfect his or her claim and an
explanation why such material or such information is
necessary;
(ii) Appropriate information as to the steps to be taken if the
Claimant wishes to submit the claim for review, and
(iii) The time limits for requesting a review under subsection (c)
hereof.
(c) REQUEST FOR REVIEW. Within 60 days after receipt by the Claimant of
the written opinion described above, the Claimant may request in
writing that the Corporation through its Board of Directors review
the Plan Administrator's determination. Such request must be
addressed to the Plan Administrator of the Corporation at its then
principal place of business. The Claimant or his or her duly
authorized representative may, but need not, review the pertinent
documents and submit issues and comments in writing for
consideration by the Corporation. If the Claimant does not request a
review of the determination within such 60-day period, he or she
shall be barred and estopped from challenging the determination.
(d) REVIEW OF DECISION. Within 30 days after the Corporation's receipt
of a request for review by a Claimant pursuant to 9.2 (c) above, the
Corporation will review the Plan Administrator's determination.
After considering all materials presented by the Claimant, the
Corporation, through its Board of Directors, will render a written
opinion, written in a manner calculated to be understood by the
Claimant, setting forth the specific reasons for the decision and
containing specific references to the pertinent provisions of this
Plan on which the decision is based. If special circumstances
require that the 30 day time period be extended, the Corporation
will so notify the Claimant and will render the decision as soon as
possible, but in no event later than 60 days after receipt of the
request for review.
9.3 ARBITRATION. Any claim or controversy between the parties which the
parties are unable to resolve themselves, and which is not resolved
through the claims procedure set forth in Section 9.2, including any claim
arising out of, connected with, or related to the interpretation,
performance or breach of any provision of this Plan, and any claim or
dispute as to whether a claim is subject to arbitration, shall be
submitted to and resolved exclusively by expedited arbitration by a single
arbitrator in accordance with the following procedures:
(a) In the event of a claim or controversy subject to this arbitration
provision, the complaining party shall promptly send written notice
to the other party identifying the matter in dispute and the
proposed remedy. Following such notice, the parties shall meet and
attempt in good faith to resolve the matter. In the event the
parties are unable to resolve the matter within 21 days, the parties
shall meet and attempt in good faith to select a single arbitrator
acceptable to both parties. If a single arbitrator is not selected
by mutual consent within 10 business days following the expiration
of the 21 day period, an arbitrator shall be selected from a list of
nine persons each of whom shall be an attorney who is either engaged
in the active practice of law or a recognized arbitrator and who, in
either event, is experienced in serving as an arbitrator in disputes
between employers and employees, which
12
list shall be provided by the office of the American Arbitration
Association ("AAA") or of the Federal Mediation and Conciliation
Service. If, within three business days of the parties' receipt of
such list, the parties are unable to agree upon an arbitrator from
the list, then the parties shall each strike names alternatively
from the list, with the first to strike being determined by the flip
of a coin. After each party has had four strikes, the remaining name
on the list shall be the arbitrator. If such person is unable to
serve for any reason, the parties shall repeat this process until an
arbitrator is selected.
(b) Unless the parties agree otherwise, within 60 days of the selection
of the arbitrator, a hearing shall be conducted before such
arbitrator at a time and a place agreed upon by the parties. In the
event the parties are unable to agree upon the time or place of the
arbitration, the time and place shall be designated by the
arbitrator after consultation with the parties. Within 30 days of
the conclusion of the arbitration hearing, the arbitrator shall
issue an award, accompanied by a written decision explaining the
basis for the arbitrator's award. The arbitrator's award may not
include a provision for punitive damages.
(c) In any arbitration hereunder, the Corporation shall pay all
administrative fees of the arbitration, all fees of the arbitrator
and each party's reasonable attorneys' fees, costs, and expenses.
The arbitrator shall have no authority to add to or to modify the
Plan, shall apply all applicable law, and shall have no lesser and
no greater remedial authority than would a court of law resolving
the same claim or controversy. The arbitrator shall, upon an
appropriate motion, dismiss any claim without an evidentiary hearing
if the party bringing the motion establishes that it would be
entitled to summary judgment if the matter had been pursued in court
litigation. The parties shall be entitled to reasonable discovery
subject to the discretion of the arbitrator.
(d) The decision of the arbitrator shall be final, binding, and
non-appealable, and may be enforced as a final judgment in any court
of competent jurisdiction.
(e) This Section 9.3 shall extend to claims against any parent,
subsidiary, or Affiliate of each party, and, when acting within such
capacity, any officer, director, shareholder, Participant,
Beneficiary, or agent of each party, or of any of the above, and
shall apply as well to claims arising out of state and federal
statutes and local ordinances as well as to claims arising under the
common law or under this Plan.
(f) Notwithstanding the foregoing, and unless otherwise agreed between
the parties, either party may, in an appropriate manner, apply to a
court for provisional relief, including a temporary restraining
order or preliminary injunction, on the ground that the arbitration
award to which the applicant may be entitled may be rendered
ineffectual without provisional relief.
(g) Any arbitration hereunder shall be conducted in accordance with the
employee benefit plan claims rules and procedures of the AAA then in
effect; provided, however, that, (i) all evidence presented to the
arbitrator shall be in strict conformity with the legal rules of
evidence, and (ii) in the event of any
13
inconsistency between the employee benefit plan claims rules and
procedures of the AAA and the terms of this Plan, the terms of this
Plan shall prevail.
(h) If any of the provisions of this Section 9.3 are determined to be
unlawful or otherwise unenforceable, in whole or in part, such
determination shall not affect the validity of the remainder of this
Section 9.3, and this Section 9.3 shall be reformed to the extent
necessary to carry out its provisions to the greatest extent
possible and to insure that the resolution of all conflicts between
the parties, including those arising out of statutory claims, shall
be resolved by neutral, binding arbitration. If a court should find
that the provisions of this Section 9.3 are not absolutely binding,
then the parties intend any arbitration decision and award to be
fully admissible in evidence in any subsequent action, given great
weight by any finder of fact, and treated as determinative to the
maximum extent permitted by law.
9.4 NOTICE. Any notice, consent or demand required or permitted to be given
under the provisions of this Plan shall be in writing and shall be signed
by the party giving or making the same. If such notice, consent or demand
is mailed, it shall be sent by United States certified mail, postage
prepaid, return receipt requested, addressed to the addressee's last known
address as shown on the records of the Corporation. The date of receipt,
or the date of refusal by addressee upon presentation, shall be deemed the
date of such notice, consent or demand. Any person may change the address
to which notice is to be sent by giving written notice of the change of
address in the manner aforesaid.
ARTICLE 10
AMENDMENT OR TERMINATION
10.1 AMENDMENT OR TERMINATION.
(a) This Plan may be amended or terminated by the Corporation at any
time, without notice to or consent of any person, pursuant to
resolutions adopted by its Board of Directors. Any such amendment or
termination shall take effect as of the date specified therein and,
to the extent permitted by law. However, no such amendment or
termination shall reduce the amount then credited to the
Participant's Accounts. If the Plan is terminated, the Participant's
Accounts will be distributed in a single in-kind distribution of
Common Stock.
(b) Any other provision of this Plan to the contrary notwithstanding,
the Plan may be amended by the Corporation at any time, to the
extent that, in the opinion of the Corporation, such amendment shall
be necessary in order to ensure that the Plan will be characterized
as a plan maintained for a select group of management or highly
compensated employees, as described in sections 201(2), 301(a)(3)
and 401(a)(1) of ERISA, or to conform the Plan to the requirements
of any applicable law, including ERISA and the Code. No such
amendment shall be considered prejudicial to any interest of a
Participant or Beneficiary hereunder.
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ARTICLE 11
MISCELLANEOUS
11.1 ENTIRE AGREEMENT. The Plan and the executed Election Form and Beneficiary
Designation Form, and other administrative forms shall constitute the
total understanding between the Corporation and the Participant. No oral
statement regarding the Plan may be relied upon by the Participant. In the
event that there is a discrepancy between forms, this Plan will control.
11.2 INVALIDITY OF PROVISIONS. If any provision of this Plan shall, for any
reason, be held to be invalid or unenforceable, the remaining provisions
shall nevertheless be carried into effect.
11.3 GOVERNING LAW. The Plan and the rights and obligations of all persons
hereunder shall be governed by and construed in accordance with the laws
of the State of Illinois, other than its laws regarding choice of law, to
the extent that such state law is not preempted by federal law.
IN WITNESS WHEREOF, the Corporation has executed this Plan as of the day
and year above first written.
ATTEST: PCTEL, INC.
By: /s/ Martin H. Singer
---------------------------------
/s/ John W. Schoen, Secretary Title: Chief Executive Officer
- ------------------
15
PCTEL, INC.
EXECUTIVE DEFERRED STOCK PLAN
PARTICIPATION AGREEMENT
ELECTION FORM
EXHIBIT A
THIS PARTICIPATION AGREEMENT is entered into this ____day of ___________,
20___ between PCTEL, INC., hereinafter referred to as the "Corporation", and
_______________________, hereinafter referred to as the "Participant".
PART I STOCK OPTION GAIN DEFERRAL ELECTION
| | I hereby elect to defer stock option gains. I understand that this
election must be made at least 6 months prior to my Date of Exercise.
a) Number of Options to be exercised is ___________________.
b) Date of grant of the Option is ___________________.
c) ________% of my stock option gains to be deferred (in increments of
25%).
d) Date this election is being made: ___________________.
e) The Deferral Period for my election begins on my Date of Exercise
and ends on the date distribution commences pursuant to my election
in Part III below.
PART II. RESTRICTED STOCK DEFERRAL ELECTION
| | I hereby make a Restricted Stock deferral election. I understand that this
election must be made at least 6 months prior to the vesting of my
Restricted Stock (except with respect to the first Plan Year, in which
case this election must be made prior to the vesting date).
a) Number of shares to be deferred ___________________.
b) Date this election is being made ___________________.
c) The Deferral Period for my election begins on the date my Restricted
Stock deferral election is filed with the Plan Administrator and
ends on the date distribution commences pursuant to my election in
Part III below.
PART III. DISTRIBUTION OF BENEFITS ELECTION (ARTICLE 6 OF THE PLAN):
Please select A or B.
| | A. RETIREMENT BENEFITS. I hereby elect to have my Retirement or
Disability benefits distributed to me in a single in-kind
distribution of Common Stock.
NOTE: THIS ELECTION MAY BE CHANGED BY THE PARTICIPANT BY GIVING WRITTEN
NOTICE TO THE CORPORATION NOT LATER THAN ONE YEAR BEFORE RETIREMENT, OR
PROMPTLY FOLLOWING A DISABILITY. BY THE TERMS OF THE PLAN, THE RETIREMENT
AGE IS AGE 55 OR LATER.
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| | B. FIXED PAYMENT DATE BENEFITS. This Section applies if you wish to
elect an in-service distribution prior to retirement age. All
distributions under this section are made in a lump sum. I hereby
elect to have my fixed payment date benefits distributed to me at
the following date:
Date for fixed payments to commence (This date may be no earlier
than the January 1 of the third Calendar Year after the Calendar
Year in which this election is made.
NOTE: THIS ELECTION MAY BE CHANGED TO EXTEND THE FIXED PAYMENT DATE TO A
LATER DATE SO LONG AS (A) THE ELECTION TO SO EXTEND THE DATE IS AT LEAST
ONE YEAR BEFORE THE ORIGINAL DATE, AND (B) THE EXTENDED DATE IS NO EARLIER
THAN JANUARY 1 OF THE THIRD CALENDAR YEAR AFTER ISSUING THE ELECTION TO
EXTEND. SUCH DATES MAY NOT BE ACCELERATED.
PCTEL, INC. PARTICIPANT
- ------------------------ -----------------------------
<<First Name>> <<Last Name>>
17
PCTEL, INC.
EXECUTIVE DEFERRED STOCK PLAN
DESIGNATION OF BENEFICIARY
EXHIBIT B
TO: PCTEL, INC. (hereinafter referred to as the "Corporation"),
In accordance with the rights granted to me as a Participant in the PCTEL, Inc.
Executive Deferred Stock Plan, I hereby designate the following as primary and
1st contingent Beneficiary(ies) thereunder to receive payments in the event of
my death:
PRIMARY Beneficiary:
--------------------------
Relationship:
-------------------
1ST CONTINGENT Beneficiary:
--------------------
Relationship:
-------------------
I further reserve the privilege of changing the Beneficiary(ies) herein named at
any time or times without the consent of any such Beneficiary(ies).
This designation is made upon the following terms and conditions:
1. The word "Beneficiary" as used herein shall include the plural,
Beneficiaries, wherever the Plan permits.
2. For purposes of this Beneficiary Designation, no person shall be deemed to
have survived the Participant if that person dies within thirty (30) days of the
Participant's death.
3. Beneficiary shall mean the Primary Beneficiary if such Primary Beneficiary
survives the Participant by at least thirty (30) days, and shall mean the 1st
Contingent Beneficiary if the Primary Beneficiary does not survive the
Participant by at least thirty (30) days.
4. If the Primary Beneficiary shall be deceased on the date of distribution as
provided in the Plan the distribution shall be payable to the 1st Contingent
Beneficiary unless the executors or administrators of said deceased Beneficiary
are named as Primary Beneficiary hereinabove.
5. If more than one Beneficiary is named within the same class (i.e., Primary or
1st Contingent), then distribution shall be made equally to such Beneficiaries
unless otherwise provided hereinabove. If none of the Beneficiaries named
hereinabove are living on the date distribution is to be made, distribution
shall be made to my executors or administrators, or upon their written request,
to any person or persons so designated by them.
6. If any distribution shall be payable to any trust, the Corporation shall not
be liable to see to the application by the Trustee of any payment hereunder at
any time, and may rely upon the sole signature of the Trustee to any receipt,
release or waiver, or to any transfer or other instrument to whomsoever made
purporting to affect this nomination or any right hereunder.
7. A Participant's Beneficiary designation shall be deemed automatically revoked
if the Participant names a spouse as Beneficiary and the marriage is later
dissolved or the spouse dies. Without limiting the generality of the foregoing,
the interest in the benefits hereunder of a spouse of a Participant who has
predeceased the Participant or whose marriage with the Participant has been
dissolved shall automatically pass to the Participant and shall not be
transferable by such spouse in any manner, including but not limited to such
spouse's will, nor shall such interest pass under the laws of intestate
succession.
THIS DESIGNATION CANCELS AND SUPERSEDES ANY DESIGNATION OF BENEFICIARY
HERETOFORE MADE BY ME WITH RESPECT TO SAID PLAN AND THE RIGHT TO RECEIVE
PAYMENTS THEREUNDER.
Dated: __________________________ Executive: __________________________
I am the spouse of the Participant/Executive named above. I have read and
understood the foregoing Designation of Beneficiary, and especially paragraph 8
thereof. I understand that the Plan does not permit the assignment of the
Participant/Executive's benefits to me in the event of the dissolution of my
marriage. I also understand that, even if I am named as a Beneficiary, my rights
may be impaired in the event of the dissolution of my marriage or my death
before the Participant/Executive.
Dated: _____________________ _____________________________________
Spouse
Acknowledgment of receipt this _____ day of ______________, 20__
By:____________________________
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