Exhibit 10.40
PCTEL, INC.
BOARD OF DIRECTORS
DEFERRED STOCK PLAN
EFFECTIVE AS OF JANUARY 1, 2004
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TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS ................................... 1
ARTICLE 2 ELIGIBILITY ................................... 3
ARTICLE 3 STOCK OPTION GAIN DEFERRALS ................... 3
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 .......................... 10
ARTICLE 10 AMENDMENT OR TERMINATION .................... 14
ARTICLE 11 MISCELLANEOUS ............................... 14
</Table>
EXHIBIT A PARTICIPANT AGREEMENT AND ELECTION FORM
EXHIBIT B DESIGNATION OF BENEFICIARY
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PCTEL, INC.
BOARD OF DIRECTORS DEFERRED STOCK PLAN
THIS PLAN is adopted as of the 1st day of January, 2004, by PCTEL,
Inc., a Delaware corporation (the "Corporation"), as follows:
RECITALS
WHEREAS, the Corporation wishes to establish the PCTEL, Inc. "Board of
Directors 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 Board of
Directors 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. BENEFICIARY. The Beneficiary(ies) designated by a Participant under
Article 8, or, if the Participant has not designated a Beneficiary
under 6.
1.4. CALENDAR YEAR. January 1 to December 31.
1.5. CODE. The Internal Revenue Code of 1986, as amended from time to time.
1.6. COMMON STOCK. The common stock of PCTEL, Inc.
1.7 COMPENSATION. The amount(s) to which a Participant is entitled during a
Calendar Year.
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 is to be made.
1.11 DISABILITY. Disability shall mean the total and permanent incapacity of
the Participant, due to physical impairment or legally established
mental incompetence, to perform the usual duties of his/her service as
a Board Member with the Corporation.
1.12 EFFECTIVE DATE. January 1, 2004.
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 ERISA. The Employee Retirement Income Security Act of 1974, as amended
from time to time.
1.15 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.
1.16 GAIN SHARES. The shares of Common Stock so determined under Section 3.5
as resulting from the exercise
1.17 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.
1.18 OPTION. A nonqualified stock option to purchase shares of Common Stock.
1.19 PARTICIPANT. Any member of the Board of Directors who has completed and
submitted an Election Form, substantially in the form of Exhibit A
attached hereto.
1.20 PHANTOM SHARE UNITS. Units of deemed investment in shares of Common
Stock so determined under Sections 3.6 and 5.1(b).
1.21 PLAN. This Plan, together with any and all amendments or supplements
thereto.
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1.22 PLAN ADMINISTRATOR. A duly authorized officer of the Corporation
designated by the Board of Directors.
1.23 PLAN RETIREMENT DATE. The date selected by a Participant, however, no
earlier than the date he or she attains 55 years of age.
1.24 PLAN YEAR. The Calendar Year.
1.25 RESTRICTED STOCK. The shares of Common Stock so determined under
Section 4.4.
1.26 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.
1.27 RETIREMENT. The termination of a Participant's service on the Board of
Directors of the Corporation on or after the Participant has reached
his or her Plan Retirement Date.
1.28 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.
1.29 YEAR OF PARTICIPATION. Twelve months of continuous service on the Board
of Directors of the Corporation measured from the Participant's date of
entry into this Plan.
ARTICLE 2
ELIGIBILITY AND PARTICIPATION
2.1 A Board Member shall become a Participant in the Plan following
submittal of a completed Participant Election Form, substantially in
the form of Exhibit A attached hereto.
2.2 Once a Board Member becomes a Participant, he or she shall remain a
Participant until his or her termination of service on the Board of
Directors of the Corporation, and thereafter, until all benefits to
which he or she (or his or her Beneficiaries) is entitled under the
Plan have been paid.
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
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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. 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
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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 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.
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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.
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.
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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 is no longer providing services as a
member of the Board of Corporation 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 providing
services to the Corporation as a member of the Board of Directors 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.
6.6 TERMINATION OF BENEFITS. If, for any reason, Participant is no longer
providing services as a member of the Board of Directors of the
Corporation, the Corporation shall pay to the Participant the value of
the Participant's Accounts. Such termination benefit shall be
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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.
(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
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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 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
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fully discharge the Plan Administrator, the Corporation and Plan from
further liability on account thereof.
7.3 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 applicable federal, state and local income taxes and such taxes may
be withheld accordingly by the Corporation from benefits under this
Plan or from Compensation 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, Compensation 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 that 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.
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.
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(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;
(iii) 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;
(iv) Appropriate information as to the steps to be taken if the
Claimant wishes to submit the claim for review, and
(v) 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
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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 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
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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 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 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 inconsistency between the 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.
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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.
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.
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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: __________________________
____________________, Secretary Title: Chief Executive Officer
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PCTEL, INC.
BOARD OF DIRECTORS 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
_________________________ _________________________
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PCTEL, INC.
BOARD OF DIRECTORS 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.
Board of Directors 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: __________________________ Board Member:_________________________
I am the spouse of the Participant/Board Member 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/Board Member'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/Board Member.
Dated: _____________________ ______________________________________
Spouse
Acknowledgment of receipt this __ day of __________, 20__ By:__________________