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Exhibit 10.5
DIEBOLD, INCORPORATED
SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN
AMENDED AND RESTATED EFFECTIVE JANUARY 1, 1994
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DIEBOLD, INCORPORATED
SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN
ARTICLE I
PLAN
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The "Diebold, Incorporated Supplemental Employee Retirement Plan" originally
adopted effective January 1, 1990 is hereby amended and restated, effective as
of January 1, 1994. This Amended and Restated Plan applies to any Participant
who retires, is disabled or is deceased on or after January 1, 1994. Any
Participant who reaches any one of these events prior to January 1, 1994 would
be governed by the terms of the plan then in effect.
ARTICLE II
PURPOSE OF THE PLAN
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This Plan was created for the principal purpose of providing retirement income
for certain executive and highly compensated management employees of Diebold,
Incorporated, and its subsidiary organizations and InterBold. It is intended
to supplement benefits payable under the Diebold, Incorporated Salaried
Employees Pension Plan and the Retirement Plan for Employees of InterBold, as
well as benefits payable under the Federal Social Security Act and certain
other deferred compensation arrangements.
ARTICLE III
DEFINITIONS
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(a) The following definitions shall apply with respect to this Plan:
(1) "Annual Compensation" shall mean a Participant's W-2
compensation from the Employer for any Plan Year,
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excluding, however, Bonus payments received within the year
but paid with respect to the prior Plan Year and including any
Bonus payments received in the following year, but paid with
respect to the current Plan Year. Annual compensation shall
also exclude any amount included in the W-2 compensation that
is imputed income for the value of non-cash compensation, stock
options and any type of expense reimbursement and related tax
allowance (including but not limited to moving, automobile and
business expenses), but including deferrals under the Diebold,
Incorporated 401(k) Savings Plan, and including any deferrals
under any established compensation plan or plans adopted by the
Company. Annual compensation shall also include amounts paid
to individuals who are citizens or residents of the United
States and who are employees of, or provide services to, a
foreign affiliate of the Company to which an agreement entered
into by the Company under Code Section 3121(l) applies. If any
deferred compensation is recognized and is included in a
Participant's Annual Compensation for any period of his
participation in this Plan, the same compensation may not also
be included as compensation in any subsequent year in which it
is actually paid or deemed to be received. This applies to
both deferrals under the 401(k) Savings Plan and any Deferred
Compensation Plans.
(2) "Beneficiary" shall mean a person or entity selected by the
Participant or an eligible surviving Spouse that may receive
death benefits under this Plan, as are outlined in Article XI.
A Beneficiary so designated will not generally be a Spouse.
(3) "Board" shall mean the Board of Directors of Diebold,
Incorporated.
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(4) "Change in Control" shall have the meaning assigned to such
term in Article X.
(5) "Change in Control Benefit" shall mean the benefit determined
in accordance with Article X.
(6) "Committee" shall mean the Compensation Committee of the Board,
as such Committee may be constituted from time to time.
(7) "Company" shall mean Diebold, Incorporated.
(8) "Company Service" shall mean years of employment (measured in
years and completed months) with an Employer.
(9) "Disability Benefit" shall mean the benefit determined in
accordance with Article IX hereof.
(10) "Early Retirement Age" shall mean the 60th birthday of a
Participant.
(11) "Early Retirement Date" shall mean the first day of the month
coinciding with or next following the 60th birthday of a
Participant.
(12) "Early Retirement Benefit" shall mean the benefit determined
in accordance with Article VI hereof.
(13) "Employer" shall mean (a) the Company or its successors, (b) any
affiliated corporation or other entity which may specifically
adopt this Plan with the consent of the Company, or its
successors, and (c) InterBold.
(14) "15-Year Service Benefit" shall mean the benefit determined in
accordance with Article VIII hereof.
(15) "Final Average Monthly Compensation" shall mean one-twelfth of
the average of the Participant's Annual Compensation for the
five complete consecutive calendar years during his last 10
calendar years of employment with the Employer during which
his compensation was the highest. In the event a Participant
has been employed for a period of less than five consecutive
calendar years, the Participant's
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Final Average Monthly Compensation shall be the average of his
monthly compensation amounts in effect for all of the complete
calendar months during which he was employed by the Employer.
(16) "Involuntary Termination Benefit" shall mean the benefit
determined in accordance with Article VII.
(17) "Normal Retirement Benefit" shall mean the benefit determined in
accordance with Article V.
(18) "Normal Retirement Date" shall mean the first day of the month
coinciding with or next following the 62nd birthday of a
Participant.
(19) "Participant" shall mean any executive highly paid or
management employee of an Employer who is selected to
participate in this Plan pursuant to the provisions of Article
IV.
(20) "Plan" shall mean this Diebold, Incorporated Supplemental
Employee Retirement Plan, as in effect from time to time.
(21) "Post-Retirement Death Benefit" shall mean the benefit
determined in accordance with Section (b) of Article XI.
(22) "Pre-Retirement Death Benefit" shall mean the benefit
determined in accordance with Section (a) of Article XI.
(23) "Qualified Retirement Plan" shall mean the Diebold,
Incorporated Retirement Plan for Salaried Employees or the
Retirement Plan for Employees of InterBold, as presently set
forth and as they may subsequently be amended, or their
successor.
(24) "Service Fraction" shall mean, for any Participant, a fraction,
the numerator of which is the lesser of (A) the Participant's
years of Company Service, or (B) 15, and the denominator of
which is 15.
(25) "Social Security Benefit" shall mean the Primary Insurance
Amount under the Federal Social Security Act to which a
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Participant would be entitled as of the later of his Normal
Retirement Date or the date of his actual retirement, computed
on the basis of the Participant's average wage history
(estimated or actual) for years before the date of
determination and, in the case of a Participant who terminates
employment with the Employer prior to his Normal Retirement
Date, by assuming that the Participant will earn wages after
his termination of employment and prior to his Normal
Retirement Date at a rate equal to the Participant's wage rate
at the time of his termination of employment. If a Participant
in this Plan is not eligible for full Social Security Benefits
(for example, an individual who has previously worked in the
military), for purposes of determining benefits under this
Plan, such Social Security Benefits would be imputed as if he
had been so eligible and had been covered by Social Security
for his entire working career.
(26) "Spouse" shall mean the surviving spouse of a Participant at
the time of his death, but only if the Participant and such
spouse were married at least one year prior to the earlier of
the Participant's death, retirement or other termination of
employment with the Employer.
(27) "Supplemental Retirement Benefit" shall mean the Change in
Control Benefit, Disability Benefit, Early Retirement Benefit,
15-Year Service Benefit, Involuntary Termination Benefit,
Normal Retirement Benefit, Pre-Retirement Death Benefit or
Post-Retirement Death Benefit for which a Participant or his
Spouse may qualify.
(28) "Terminated For Cause" shall have the meaning assigned to such
term in Article IV.
(29) "Total Disability" shall mean a condition in which a
Participant is unable, by reason of sickness or accident,
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to fulfill the duties of his employment by the Employer. The
determination of Total Disability shall be made by the
Committee in accordance with the provisions of Article IX.
(b) Throughout this Plan, and whenever appropriate, the masculine gender
shall be deemed to include the feminine and neuter, the singular shall
be deemed to include the plural and vice versa.
ARTICLE IV
ELIGIBILITY AND PARTICIPATION
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(a) ELIGIBILITY FOR PLAN; DISQUALIFICATION. The Committee, acting in its
sole discretion, shall make recommendations to the Board as to which
executive or highly paid management employees of the Employer shall
become Participants in the Plan. The Board shall make the final
decision as to those executive or highly paid management employees who
shall become Participants in the Plan and at which time such employees
become Participants; provided, however, that in the absence of a Change
in Control or a finding of Total Disability, a Participant's
participation shall cease and no benefits under this Plan shall be
payable:
(1) to a Participant if the Participant:
(A) voluntarily terminates employment before attaining age
60 with less than 15 years of Company Service; or
(B) fails to give an Employer six months written advance
notice of his pending termination of employment; or
(C) is Terminated for Cause; or
(2) to a Participant's Spouse, if the Participant:
(A) dies prior to satisfying the requirements for a Spouse's
Pre-Retirement or Post-Retirement Death Benefit under
Article XI; or
(B) is Terminated for Cause; or
(C) when an eligible Spouse remarries.
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(3) to a Participant's Beneficiary or Estate, if the Participant:
(A) dies prior to satisfying the requirements for a Pre-
Retirement or Post-Retirement Spouse's Death Benefit
under Article XI; or
(B) is Terminated for Cause.
(b) TERMINATED FOR CAUSE. As used in this Plan, "Terminated for Cause"
shall mean termination of a Participant's Employment by an Employer due
to the Participant's:
(1) intentional act of fraud, embezzlement or theft in connection
with his duties or in the course of his employment with the
Employer;
(2) intentional wrongful damage to property of the Employer;
(3) intentional wrongful disclosure of secret processes or
confidential information of the Employer; or
(4) intentional wrongful engagement in any competitive activity
which would constitute a material breach of the duty of loyalty
to the Employer;
and any such act shall have been materially harmful to the Employer.
For purposes of the Plan, no act, or failure to act, on the part of the
Participant shall be deemed "intentional" if it was due primarily to
an error in judgement or negligence, but shall be deemed "intentional"
only if done, or omitted to be done, by the Participant not in good
faith and without reasonable belief that his action or omission was not
in or opposed to the best interest of the Employer. Notwithstanding the
foregoing, a Participant shall not be deemed to have been Terminated
for Cause hereunder unless and until there shall have been delivered to
the Participant a copy of a resolution duly adopted by the affirmative
vote of not less than three-quarters of the Board then in office at a
meeting of the Board called and held for such purpose, finding that,
in the good faith opinion of the Board,
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the Participant had committed an act set forth above and specifying the
particulars thereof in detail. The Participant shall receive
reasonable notice and an opportunity for the Participant, together with
his counsel, to be heard before the Board. Nothing herein shall limit
the right of the Participant or his Beneficiaries to contest the
validity or propriety of any such determination.
(c) ELIGIBILITY FOR BENEFITS. A Participant shall be entitled to receive
a Supplemental Retirement Benefit (or have a Supplemental Retirement
Benefit provided for his surviving Spouse) only if he satisfies the
foregoing conditions of this Article IV and satisfies the requirements
of one of the succeeding Articles of the Plan.
ARTICLE V
NORMAL RETIREMENT BENEFITS
--------------------------
(a) QUALIFICATION FOR BENEFIT. Subject to the provisions of Article IV, a
Participant who attains age 62 while employed by an Employer shall be
eligible, at any time after his said attainment of age 62, to retire
and receive a Normal Retirement Benefit commencing at the time set
forth in Section (b) of this Article.
(b) COMPUTATION OF AMOUNT OF NORMAL RETIREMENT BENEFIT. A Participant who
retires on or after his Normal Retirement Date shall be entitled to
receive, commencing on the first day of the month coincident with or
following the later of his retirement or his application therefor, a
monthly Supplemental Retirement Benefit equal to (1) 65% of the
Participant's Final Average Monthly Compensation multiplied by his
Service Fraction, reduced by (2) the sum of:
(A) 50% of the monthly Social Security Benefit payable to the
Participant commencing on the first day of the month
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coincident with or following his retirement or his application
for benefits, if later; and
(B) the monthly benefit (expressed as a single life annuity, but
not including any temporary supplements) payable to the
Participant under the terms of the Qualified Retirement Plan
commencing on the first day of the month coincident with or
following his retirement or his application for benefits, if
later, assuming (i) for purposes of determining whether the
Participant had a vested benefit under the Qualified Retirement
Plan and when the Participant could elect commencement of his
benefit under the Qualified Retirement Plan (but not for
purposes of determining the amount thereof), that the
Participant had sufficient service under the Qualified
Retirement Plan to have a vested benefit under the Qualified
Retirement Plan and a right to commence receiving such benefit
on the first day of the month following his retirement or his
application for benefits hereunder, if later, and (ii) that the
Participant elected commencement of such benefit on such date.
(c) FORM AND DURATION OF PAYMENT. The form of a Participant's benefit
under this Article shall be an annuity payable monthly for the
Participant's lifetime (except as may be provided in Sections (b) or
(c) of Article XI).
ARTICLE VI
EARLY RETIREMENT BENEFIT
------------------------
(a) QUALIFICATION FOR BENEFIT. Subject to the provisions of Article IV, a
Participant who attains his Early Retirement Age while employed by an
Employer shall be eligible, from the time he has reached his Early
Retirement Age up to the time he reaches
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age 62, to retire and receive an Early Retirement Benefit commencing at
the time set forth in Section (b) of this Article.
(b) COMPUTATION OF AMOUNT OF EARLY RETIREMENT BENEFIT. A Participant who
retires on or after his Early Retirement Date and before his Normal
Retirement Date shall be entitled to receive, commencing on the later
of his Normal Retirement Date or the first day of the month after his
application therefor, a monthly Early Retirement Benefit equal to (1)
65% of the Participant's Final Average Monthly Compensation multiplied
by his Service Fraction reduced by (2) the sum of:
(A) 50% of the monthly Social Security Benefit payable to the
Participant commencing on this Normal Retirement Date; and
(B) the monthly benefit (expressed as a single life annuity, but
not including any temporary supplements) payable to the
Participant under the terms of the Qualified Retirement Plan
commencing on his Normal Retirement Date (as defined herein),
assuming (i) for purposes of determining whether the
Participant had a vested benefit under the Qualified Retirement
Plan and when the Participant could elect commencement of his
benefit under the Qualified Retirement Plan (but not for
purposes of determining the amount thereof), that the
Participant had sufficient service under the Qualified
Retirement Plan to have a vested benefit under the Qualified
Retirement Plan and a right to commence receiving such benefit
at his Normal Retirement Date, and (ii) that the Participant
elected commencement of such benefit at his Normal Retirement
Date.
The Participant, at his election, may commence his benefits under this
Article on the first day of any month after his date of retirement and
before his Normal Retirement Date, but in that case his monthly benefit
computed under the preceding sentence shall be reduced by .7% for each
full month (up to 12) by which
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the date of commencement precedes the Participant's Normal Retirement
Date, and .6833% for each additional full month (if any) by which the
date of commencement precedes the Participant's Normal Retirement Date.
FORM AND DURATION OF PAYMENT. The form of a Participant's benefit
under this Article shall be an annuity payable monthly for the
Participant's lifetime (except as may be provided in Sections (b) or
(c) of Article XI).
ARTICLE VII
INVOLUNTARY TERMINATION BENEFIT
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(a) QUALIFICATION FOR BENEFIT. Subject to the provisions of Article IV, a
Participant whose employment with the Employer is involuntarily
terminated before he reaches his Early Retirement Age shall be eligible
to receive an Involuntary Termination Benefit commencing at the time
set forth in Section (b) of this Article. The Committee, or its duly
appointed representative for this purpose, shall have full discretion
to determine whether the termination of a Participant's employment with
the Employer is involuntary.
(b) COMPUTATION OF AMOUNT OF INVOLUNTARY TERMINATION BENEFIT. A
Participant who is eligible for an Involuntary Termination Benefit
shall be entitled to receive, commencing on the later of his Normal
Retirement Date or the first day of the month after his application
therefor, a monthly Supplemental Retirement Benefit equal to (1) 65% of
the Participant's Final Average Monthly Compensation multiplied by his
Service Fraction, reduced by (2) the sum of:
(A) 50% of the monthly Social Security Benefit payable to the
Participant commencing on his Normal Retirement Date; and
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(B) the monthly benefit (expressed as a single life annuity, but
not including any temporary supplements) payable to the
Participant under the terms of the Qualified Retirement Plan
commencing on his Normal Retirement Date (as herein defined),
assuming (i) for purposes of determining whether the
Participant had a vested benefit under the Qualified Retirement
Plan and when the Participant could elect commencement of his
benefit under the Qualified Retirement Plan (but not for
purposes of determining the amount thereof), that the
Participant had sufficient service under the Qualified
Retirement Plan to have a vested benefit under the Qualified
Retirement Plan and a right to commence receiving such benefit
at his Normal Retirement Date, and (ii) that the Participant
elected commencement of such benefit at his Normal Retirement
Date.
The Participant, at his election, may commence his benefits under this
Article on the first day of any month after he attains age 60 and
before his Normal Retirement Date, but in that case his benefit
computed under the preceding sentence shall be reduced by .7% for each
full month (up to 12) by which the date of commencement precedes the
Participant's Normal Retirement Date, and .6833% for each additional
full month (if any) by which the date of commencement precedes the
Participant's Normal Retirement Date.
(c) FORM AND DURATION OF PAYMENT. The form of a Participant's benefit
under this Article shall be an annuity payable monthly for the
Participant's lifetime (except as may be provided in Sections (b) or
(c) of Article XI).
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ARTICLE VIII
15-YEAR SERVICE BENEFIT
-----------------------
(a) QUALIFICATION FOR BENEFIT. Subject to the provisions of Article IV, a
Participant who terminates employment with the Employer with 15 or more
years of Company Service but who is not then eligible for other
benefits under this Plan shall be eligible to receive a 15-Year Service
Benefit commencing at the time set forth in Section (b) of this
Article.
(b) COMPUTATION OF AMOUNT OF 15-YEAR SERVICE BENEFIT. A Participant who is
eligible for a 15-Year Service Benefit shall be entitled to receive,
commencing on the later of his Normal Retirement Date or the first day
of the month after his application therefor, a monthly Supplemental
Retirement Benefit equal to (1) 55% of his Final Average Monthly
Compensation, reduced by (2) the sum of:
(A) 50% of the monthly Social Security Benefit payable to the
Participant commencing on his Normal Retirement Date; and
(B) the monthly benefit (expressed as a single life annuity, but
not including any temporary supplements) payable to the
Participant under the terms of the Qualified Retirement Plan
at his Normal Retirement Date (as defined herein), assuming
(i) for purposes of determining when the Participant could
elect commencement of his benefit under the Qualified
Retirement Plan (but not for purposes of determining the amount
thereof) that the Participant had sufficient service under the
Qualified Retirement Plan to have a right to commence his
benefit under the Qualified Retirement Plan at his Normal
Retirement Date, and (ii) that the Participant elected
commencement of such benefit at his Normal Retirement Date.
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The Participant, at his election, may commence his benefits under this
Article on the first day of any month after he attains age 60 and
before his Normal Retirement Date, but in that case his benefit
computed under the preceding sentence shall be reduced by .7% for each
full month (up to 12) by which the date of commencement precedes the
Participant's Normal Retirement Date, and .6833% for each additional
full month (if any) by which the date of commencement precedes the
Participant's Normal Retirement Date.
(c) FORM AND DURATION OF PAYMENT. The form of a Participant's benefit
under this Article shall be an annuity payable monthly for the
Participant's lifetime (except as may be provided in Sections (b) or
(c) of Article XI).
ARTICLE IX
DISABILITY BENEFIT
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(a) QUALIFIED FOR BENEFIT. Subject to the provisions of Article IV, if a
Participant's employment with the Employer is terminated before he
reaches his Early Retirement Age by reason of his Total Disability (to
be determined solely in the discretion of the Committee based upon
satisfactory medical evidence submitted to the Committee, including
recognition of the Participant's receipt of disability benefits under
the Social Security Act), such Participant shall be eligible to receive
a Disability Benefit commencing at the time set forth in Section (b) of
this Article.
(b) COMPUTATION OF AMOUNT OF DISABILITY BENEFIT. A Participant who is
eligible for a Disability Benefit shall be entitled to receive,
commencing on the first day of the month following the later of the
date of the Participant's termination of employment on account of total
Disability or his application therefor, a monthly Supplemental
Retirement Benefit equal to (1) 65% of the
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Participant's Final Average Monthly Compensation multiplied by his
Service Fraction, reduced by (2) the sum of:
(A) 50% of the monthly Social Security Benefit that would be
payable to the Participant on account of his Total Disability
if he was determined to be entitled to receive a Social
Security Benefit as a result of his Total Disability (whether
or not the Participant in fact qualifies for such Social
Security Benefit); and
(B) the monthly benefit (expressed as a single life annuity, but
not including any temporary supplements) that would be payable
to the Participant under the terms of the Qualified Retirement
Plan on account of his Total Disability if he was determined to
be entitled to receive a monthly disability benefit under the
Qualified Retirement Plan as a result of his Total Disability
(whether or not the Participant in fact qualifies for such
monthly disability benefit), assuming, for purposes of
determining the Participant's eligibility for a disability
pension under the Qualified Retirement Plan (but not for
purposes of determining the amount thereof), that the
Participant had sufficient service under the Qualified
Retirement Plan to be eligible for a disability pension
thereunder; the difference of (1) minus (2) then being
multiplied by 83.4%.
(c) FORM AND DURATION OF PAYMENT. The form of a Participant's benefit
under this Article shall be an annuity payable monthly until the
earlier of the first day of the month for which the committee
determines that the Participant no longer has a Total Disability, or
the first day of the month in which occurs the Participant's death
(except as may be provided in Sections (b) or (c) of Article XI). The
Committee may, in its discretion, take such steps as it deems necessary
to determine the continued existence of a Participant's Total
Disability and may cease or
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reduce the Disability Benefit payable hereunder if it is established to
the Committee's satisfaction (as determined under the same standards
recognized at the time the Committee initially deemed the Participant
as suffering a Total Disability) that such Total Disability no longer
exists or Social Security Disability Benefits are no longer being paid.
ARTICLE X
BENEFIT UPON CHANGE IN CONTROL
------------------------------
(a) QUALIFICATION FOR BENEFIT. A Participant who (1) terminates employment
with the Employer following a Change in Control and (2) is not at the
time of such termination of employment eligible for a Normal Retirement
Benefit, an Early Retirement Benefit, an Involuntary Termination
Benefit or a Disability Benefit, shall be eligible for a Change in
Control Benefit commencing at the time set forth in Section (c) of this
Article.
(b) CHANGE IN CONTROL. For purposes of the Plan, a "change in control"
shall have occurred if any of the events described in the following
paragraphs (1) through (5) of this Section (b) occur and if none of the
circumstances described in the succeeding unnumbered paragraphs of this
Section (b) also exist or subsequently come into existence:
(1) The Company is merged or consolidated or reorganized into or
with another corporation or other legal person, and as a result
of such merger, consolidation or reorganization less than a
majority of the combined voting power of the then-outstanding
securities of such corporation or person immediately after such
transaction is held in the aggregate by the holders of Voting
Stock (as that term is hereafter
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defined) of the Company immediately prior to such transaction;
or (2) The Company sells or otherwise transfers all or
substantially all of its assets to any other corporation or
other legal person, and as a result of such sale or transfer
less than a majority of the combined voting power of the
then-outstanding securities of such corporation or person
immediately after such sale or transfer is held in the
aggregate by the holders of Voting Stock of the Company
immediately prior to such sale or transfer; or
(3) There is a report filed on Schedule 13D or Schedule 14D-1 (or
any successor schedule, form or report), each as promulgated
pursuant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), disclosing that any person (as the term
"person" is used in Section 13(d)(3) or Section 14(d)(2) of
the Exchange Act) has become the beneficial owner (as the term
"beneficial owner" is defined under Rule 13d-3 or any successor
rule or regulation promulgated under the Exchange Act) of
securities representing 20% or more of the combined voting
power of the then-outstanding securities entitled to vote
generally in the election of directors of the Company ("Voting
Stock"); or
(4) The Company files a report or proxy statement with the
Securities and Exchange Commission pursuant to the Exchange Act
disclosing in response to Form 8-K or Schedule 14A (or any
successor schedule, form or report or item therein) that a
change in control of the Company has or may have occurred or
will or may occur in the future pursuant to any then-existing
contract or transaction; or
(5) If during any period of two consecutive years individuals who,
at the beginning of any such period, constitute the
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Board cease for any reason to constitute at least a majority
thereof, unless the election, or the nomination for election
by the Company's stockholders, of each director of the Company
first elected during such period was approved by a vote of at
least two-thirds of the Board then still in office who were
directors of the Company at the beginning of any such period.
Notwithstanding the foregoing provisions of paragraph (3) or (4) of this
Section (b), a "Change in Control" shall not be deemed to have occurred
for purposes of the Plan either (i) solely because (A) the Company (B)
an entity in which the Company directly or indirectly beneficially owns
50% or more of the voting securities, or (C) any Company-sponsored
employee stock ownership plan or any other employee benefit plan of the
Company, either files or becomes obligated to file a report or a proxy
statement under or in response to Schedule 13D, Schedule 14D-1, Form
8-K or Schedule 14A (or any successor schedule, form or report or item
therein) under the Exchange Act, disclosing beneficial ownership by it
of shares of Voting Stock whether in excess of 20% or otherwise, or
because the Company reports that a change in control of the Company has
or may have occurred or will or may occur in the future by reason of
such beneficial ownership or (ii) solely because of a change in
control of any Subsidiary by which a Participant may be employed.
Notwithstanding the foregoing provisions of paragraphs (1) through (4)
of this Section (b), if, prior to any event described in paragraphs (1)
through (4) of this Section (b) instituted by any person not an officer
or director of the Company, or prior to any disclosed proposal
instituted by any person not an officer or director of the Company
which could lead to any such event, the management of the Company
proposes any restructuring of the Company which ultimately leads to an
event described in paragraphs (1) through
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(4) of this Section (b) pursuant to such management proposal, then
a "Change in Control" shall not be deemed to have occurred for
purposes of this Plan.
If (i) any agreement to merge, consolidate, reorganize or sell or
otherwise transfer assets referred to in paragraph (1) or (2) of
this Section (b) is terminated without such merger, consolidation,
reorganization or sale or transfer having been consummated, (ii) the
person filing a Schedule 13D or Schedule 14D-1 referred to in paragraph
(3) of this Section (b) files an amendment to any such Schedule
disclosing that it no longer is the beneficial owner of securities
representing 20% or more of the Voting Stock of the Company, or (iii)
the Company reports that the change of control which it reported in the
filing referred to in paragraph (4) of this Section (b) will not in
fact occur, the Board may, by notice to Participants, declare that a
Change in Control has not occurred for purposes of the Plan
(notwithstanding the occurrence of the previous events referred to in
paragraph (1), (2), (3) or (4) of this Section (b)), provided that such
declaration shall be without prejudice to any exercise by Participants
of rights under this Article XII that may have occurred prior to such
declaration.
As used in this Article XII, the term "Subsidiary" means a corporation,
company, partnership, or other entity (i) more than 50% of the
outstanding shares or securities (representing the right to vote
for the election of directors or other managing authority) of which
are, or (ii) which does not have outstanding shares or securities (as
may be the case in a partnership, joint venture or unincorporated
association), but more than 50 percent of whose ownership interest
representing the right generally to make decisions for such other
entity is, owned or controlled,
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directly or indirectly, by the Company, but such corporation, company,
or other entity shall be deemed to be a Subsidiary only so long as such
ownership or control exists.
(c) COMPUTATION OF AMOUNT OF CHANGE IN CONTROL BENEFIT. A Participant who
is eligible for a Change in Control Benefit shall be entitled to
receive, commencing at the later of his Normal Retirement Date or the
first day of the month after his application therefor, a monthly
Supplemental Retirement Benefit equal to (1) 65% of the Participant's
Final Average Monthly Compensation multiplied by his Service Fraction,
reduced by (2) the sum of:
(A) 50% of the monthly Social Security Benefit payable to the
Participant commencing on his Normal Retirement Date; and
(B) the monthly benefit (expressed as a single life annuity not
including any temporary supplements) payable to the Participant
under the terms of the Qualified Retirement Plan commencing on
his Normal Retirement Date (as herein defined), assuming (i)
for purposes of determining whether the Participant had a vested
benefit under the Qualified Retirement Plan and when the
Participant could elect commencement of his benefit under the
Qualified Retirement Plan (but not for purposes of determining
the amount thereof), that the Participant had sufficient
service under the Qualified Retirement Plan to have a vested
benefit under the Qualified Retirement Plan and a right to
commence receiving such benefit at his Normal Retirement Date,
and (ii) that the Participant elected commencement of such
benefit at his Normal Retirement Date.
The Participant, at his election, may commence his benefits under this
Article on the first day of any month after he attains age 60 and before his
Normal Retirement Date, but in that case his benefit computed under the
preceding sentence shall be reduced by
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.7% for each full month (up to 12) by which the date of commencement
precedes the Participant's Normal Retirement Date, and .6833% for each
additional full month (if any) by which the date of commencement
precedes the Participant's Normal Retirement Date.
(d) FORM AND DURATION OF PAYMENT. The form of a Participant's benefit
under this Article shall be an annuity payable monthly for the
Participant's lifetime (except as may be provided in Sections (b) or
(c) of Article XI).
ARTICLE XI
DEATH BENEFIT
-------------
(a) PRE-RETIREMENT
(1) QUALIFICATION FOR BENEFIT. Subject to the provisions of
Article IV, if a Participant dies after having satisfied the
eligibility requirements for a Supplemental Retirement Benefit
(other than a Disability Benefit) but before commencing to
receive payment of such benefit, the surviving Spouse of such
deceased Participant shall be eligible for a Pre-Retirement
Death Benefit commencing at the time set forth in paragraph
(2) of this Section.
(2) COMPUTATION OF AMOUNT OF PRE-RETIREMENT DEATH BENEFIT. The
Pre-Retirement Death Benefit shall be a monthly benefit,
commencing on the later of the Participant's Normal Retirement
Date (or, in the case of a Participant who dies after his
Normal Retirement Date, on the first day of the month following
the Participant's death) or the first day of the month after
the surviving Spouse's application therefor, equal in amount to
the monthly Supplemental Retirement Benefit to which the
deceased Participant would have been entitled commencing on his
Normal Retirement Date (or, in
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the case of a Participant who dies after his Normal Retirement
Date, on the first day of the month following his death).
In the case of the surviving Spouse of a Participant who dies
before his Normal Retirement Date, the surviving Spouse, at the
surviving Spouse's election, may commence the Pre-Retirement
Death Benefit on the first day of any month after the later of
the date on which the Participant would have reached age 60 had
he not died or the date of the Participant's death and before
the Participant's Normal Retirement Date, but in that case the
Pre-Retirement Death Benefit shall be reduced by .7% for each
full month (up to 12) by which the date of commencement
precedes the Participant's Normal Retirement Date, and .6833%
for each additional full month (if any) by which the date of
commencement precedes the Participant's Normal Retirement Date.
(3) FORM AND DURATION OF PAYMENT. The Pre-Retirement Death Benefit
shall be a monthly benefit payable from the time of
commencement set forth in paragraph (2) of this Section (a)
until the first day of the month in which occurs the earlier of
the surviving Spouse's death or remarriage.
(b) POST-RETIREMENT DEATH BENEFIT
(1) QUALIFICATION FOR BENEFIT. Upon the death of a Participant who
is receiving Supplemental Retirement Benefits or who has
qualified for a Disability Benefit, but who has not yet
commenced receiving such benefits, the surviving Spouse of
such deceased Participant shall be eligible for the Post-
Retirement Death Benefit described in paragraph (2) of this
Section.
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(2) COMPUTATION OF AMOUNT OF ANNUAL BENEFIT. The Post-Retirement
Death Benefit shall be a monthly benefit in an amount equal to
the amount of the Supplemental Retirement Benefit the deceased
Participant was receiving at the time of his death (or, in the
case of the death of a Participant entitled to a Disability
Benefit, would have been receiving had he commenced receiving
the benefit at the time of his death).
(3) COMMENCEMENT, FORM AND DURATION OF PAYMENT. The Post-
Retirement Death Benefit shall commence as of the first day of
the month immediately following the date of the Participant's
death, and shall continue to be paid as of the first day of
each month thereafter until the first day of the month in which
occurs the earlier of the surviving Spouse's death or
remarriage.
(c) MINIMUM DEATH BENEFIT
(1) PRE-RETIREMENT SURVIVING SPOUSE BENEFIT. As provided in
Section (a) hereof, at the death of a Participant who satisfies
the requirements, monthly death benefits are payable to an
eligible surviving Spouse for her remaining lifetime or
remarriage, if earlier. If the surviving Spouse is not
remarried at her death and has not received at least five years
of monthly benefit payments, the remainder of the five years of
monthly benefit payments, if any, will be made monthly to the
Beneficiary named by the surviving Spouse. If no Beneficiary
is so named, the remaining payments, if any, will be made to
the Spouse's estate. If Benefits under Section (a) cease or
are not payable because the surviving Spouse is remarried, the
five years' minimum number of payments shall also cease and no
longer apply. If it is determined by the Board of Directors (in
its sole discretion) that the remaining benefits shall be paid
in a
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single sum, this amount will be computed as noted in
subsection (4) below.
(2) POST-RETIREMENT SURVIVING SPOUSE BENEFIT. As provided in
Section (b) hereof, at the death of a Participant who is
receiving benefits, satisfies the requirements and has an
eligible surviving Spouse, monthly death benefits are payable
to this eligible surviving Spouse for her remaining lifetime,
or remarriage, if earlier. If, at the death of the Participant
and the surviving Spouse, five years of benefit payments have
not been paid to them totally, the remainder, if any of the
five year period, will be paid monthly to the named Beneficiary
of the last to survive. If no such Beneficiary is named, the
remaining payments, if any, will be made to the Estate of the
Participant or last survivor, as the case may be. If the
Spouse is the last survivor and is remarried, the benefits
under this five year minimum payment of benefits shall also
cease and no longer apply. If it is determined by the Board of
Directors (in its sole discretion) that the remaining benefits
shall be paid in a single sum, this amount will be computed as
noted in subsection (4) below.
(3) PRE-RETIREMENT AND POST-RETIREMENT DEATH BENEFIT WITH NO
SPOUSE. Notwithstanding the other sections of Article XI, a
death benefit will be payable at the death of a Participant who
is otherwise eligible under Sections (a) and (b) above, but has
no surviving Spouse (or has no eligible surviving Spouse) at
his death. The monthly death benefit will be determined and
start as if the Participant has a surviving Spouse and will be
paid to a Beneficiary, named by the Participant, as provided in
Sections (a) and (b) above. A minimum of five years of monthly
payments will be made to the Participant and/or the named
Beneficiary under this
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provision. If no Beneficiary is named at the death of the
Participant, any payments under this Section will be payable to
the Participant's estate. The Board of Directors (in its sole
discretion) shall determine if the remaining payments shall be
payable in a single sum amount. This amount would be computed
as noted in subsection (4) below.
(4) DETERMINATION OF SINGLE SUM DEATH BENEFIT VALUE. If decided by
the Board of Directors (in its sole discretion) that a single
sum amount shall be payable under the five year minimum
payments provisions of (c)(1), (c)(2) or (c)(3) above, it will
have the single sum amount determined actuarially, based on the
circumstances of the benefits. Where appropriate, the GAM83
Mortality Table, 7-1/2% interest, ages of the Participant
and/or Spouse, and the timing of the payment of benefits will
be used. The single sum value will be equal to the present
value of the immediate or deferred payment recognizing the
remainder of any five year number of payments due. The Board
of Directors (in its sole discretion) does have the option of
changing these assumptions, if they are deemed inappropriate
and unreasonable at the time the single sum amount is
determined.
ARTICLE XII
PLAN ADMINISTRATION
-------------------
The Company shall be responsible for the general administration of the Plan and
for carrying out the provisions hereof. The Company shall have any and all
power and authority (including discretion with respect to the exercise of that
power and authority) which shall be necessary, advisable, desirable or
convenient to enable it to carry out its duties under the Plan, including the
powers: to resolve all
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questions arising under the Plan, such as questions of construction and
interpretation; to adopt such rules and regulations as the Company may deem
necessary or appropriate to provide for the administration of the Plan; to
delegate such of its responsibilities and authorities hereunder to such
individuals, committees or entities as the Company shall deem appropriate; and
to take such further actions as the Company shall deem advisable in the
administration of the Plan. The decision of the Company on any question
concerning the interpretation or administration of this Plan shall be final and
conclusive and nothing in the Plan shall be deemed to give a Participant, his
surviving Spouse or other beneficiaries, or his or their legal representatives,
any right to payments except to such extent, if any, as the Company may have
determined subject to all the terms and conditions of the Plan. No member of
the Board or the Committee, nor any individual, committee or entity to which
any of the responsibilities or authority of the Committee or the Company
hereunder are delegated, shall be liable for any act or determination made, in
good faith, in regard to this Plan.
ARTICLE XIII
MISCELLANEOUS
-------------
(a) FUNDING. The entire cost of the Plan shall be paid from the general
assets of one or more of the Employers. It is the intent of the
Employers to so pay benefits under the Plan as they become due.
Nothing contained herein shall be deemed to create a lien in favor of
any Participant or Spouse on the assets of the Company or any other
Employer. With respect to the Supplemental Retirement Benefits
provided hereunder, each Participant and Spouse shall have the status
of a general unsecured creditor of the Company and any other Employer.
No liability for the payment of benefits under the Plan shall be
imposed upon any officer,
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director, employee, or stockholder of the Company or any other
Employer, or upon the Board, the Committee or any member thereof.
(b) NO GUARANTY OF BENEFITS. Nothing contained in this Plan shall
constitute a guaranty by any Employer, the Committee or the Board that
the assets of any Employer will be sufficient to pay any benefit
hereunder.
(c) ASSIGNMENTS AND RESTRICTIONS. To the extent permitted by law, and
except as otherwise provided in this Section (c), no right or interest
of a Participant or Spouse under this Plan shall be transferable or
assignable (either at law or in equity), nor shall any such right or
interest be subject to alienation, anticipation, encumbrance,
attachment, garnishment, levy, execution or other legal or equitable
process of any kind, voluntary or involuntary, or in any manner be
liable for or subject to the debts of any Participant or Spouse. If a
Participant shall attempt to or shall transfer, assign, alienate,
anticipate, sell, pledge or otherwise encumber his benefits hereunder
or any part thereof, or if by reason of his bankruptcy or other event
happening at any time such benefits would devolve upon anyone else or
would not be enjoyed by him, then the Company, in its discretion, may
terminate his interest in any such benefit to the extent the Company
considers necessary or advisable to prevent or limit the effects of
such occurrence. Termination shall be effected by filing a
"termination declaration" with the Committee and making reasonable
efforts to deliver a copy to the Participant (the "Terminated
Participant") whose interest is affected thereby. As long as the
Terminated Participant is alive, any benefits affected by the
termination shall be retained by the Company and, in the Company's sole
and absolute judgement, may be paid to or expended for the benefit of
the Terminated Participant, his spouse, his children or any other
person or persons in fact dependent upon him in such a manner as
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the Company shall deem proper. Upon the death of the Terminated
Participant, all benefits withheld from him and not paid to others in
accordance with the preceding sentence shall be paid to the Terminated
Participant's surviving Spouse or, if none, to the Terminated
Participant's then living descendants, including adopted children, per
stirpes.
Notwithstanding the foregoing, amounts payable under this Plan may be
withheld by the Company as they become due to the extent necessary to
cover any debts or other obligations owed to the Company by the
Participant, but only if such debts or other obligations are
acknowledged as such in writing by the Participant or are confirmed as
such by a final, nonappealable order of a court of competent
jurisdiction.
(d) HEADINGS. The various headings used in this Plan are for convenience
only and shall not be used in interpreting the text of the Article,
Section, paragraph or subparagraph in which they appear.
(e) EMPLOYMENT. The establishment of this Plan shall not be construed to
give any Participant the right to be retained in the service of the
Employer.
(f) APPLICABLE LAW. The validity, interpretation, construction and
performance of this Plan shall be governed by the internal substantive
laws of the State of Ohio, without giving effect to the principles of
conflict of laws of such State.
(g) BINDING EFFECT ON EMPLOYER, PARTICIPANTS, SPOUSES AND THEIR SUCCESSORS.
This Plan shall be binding and inure to the benefit of any Employer or
its successors and assigns, and the Participants, Spouses and their
heirs, legatees, distributees, executors, administrators or other legal
representatives.
(h) AMENDMENT AND DISCONTINUANCE. The Company reserves the right in its
sole discretion to amend or terminate this Plan at any time
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with regard to itself or any Employer, provided that no such amendment
or termination shall affect any benefits then being paid to
Participants or Spouses under the Plan as of the date of such
termination and the rights of or with respect to all other Participants
at the time of any such termination to immediate or deferred
Supplemental Retirement Benefits shall be determined as if the
employment of each such Participant had been involuntarily terminated,
but not Terminated for Cause, on the date of such termination. After
any termination of the Plan, each Employer shall remain obligated to
pay those benefits described in the preceding sentence in accordance
with the terms of the Plan in effect immediately before such
termination.
(i) PARTICIPANT INFORMATION. Each Participant shall keep the Committee
informed of his current address and the current address of his Spouse,
if applicable. The Participant shall furnish to the Committee any and
all information deemed by the Committee to be necessary or desirable
for the proper administration of the Plan.
IN WITNESS WHEREOF, this Diebold, Incorporated Supplemental Employee Retirement
Plan has been executed this 2nd day of May, 1994, effective as
of January 1, 1994.
DIEBOLD, INCORPORATED
By: Charles B. Scheurer
Title: Vice President,
Human Resources
By: Gerald F. Morris
Title: Executive Vice President
and Chief Financial Officer
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