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Exhibit 10p
Exhibit (10)(p)* to Report
on Form 10-K for Fiscal
Year Ended June 30, 1999
by Parker-Hannifin Corporation
Parker-Hannifin Corporation Savings Restoration Plan, as amended
*Numbered in accordance with Item 601 of Regulation S-K.
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PARKER-HANNIFIN CORPORATION
SAVINGS RESTORATION PLAN
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PARKER-HANNIFIN CORPORATION
SAVINGS RESTORATION PLAN
Parker-Hannifin Corporation, an Ohio corporation, (the "Company"),
established this Savings Restoration Plan (the "Plan"), effective October 1,
1994, for the purpose of attracting high quality executives and promoting in its
executives increased efficiency and an interest in the successful operation of
the Company by restoring some of the deferral opportunities and
employer-provided benefits that are lost under The Parker Retirement Savings
Plan due to legislative limits. The benefits provided under the Plan shall be
provided in consideration for services to be performed after the effective date
of the Plan, but prior to the executive's retirement. The Plan is hereby amended
and restated as of January 1, 1998, except as otherwise specifically set forth
hereinafter.
ARTICLE 1
Definitions
1.1 ADMINISTRATOR shall mean the Company or, if applicable, the committee
appointed by the Board of Directors of the Company to administer the Plan
pursuant to Article 13 of the Plan.
1.2 ANNUAL DEFERRAL shall mean the amount of Compensation which the
Participant elects to defer for a Plan Year pursuant to Articles 2 and 3 of the
Plan.
1.3 BENEFICIARY shall mean the person or persons or entity designated as
such in accordance with Article 14 of the Plan.
1.4 CHANGE IN CONTROL means the occurrence of one of the following events:
(i) any "person" (as such term is defined in Section 3(a)(9) of the
Securities Exchange Act of 1934 (the "Exchange Act") and as used in Sections
13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 20% or more of the combined voting power
of the Company's then outstanding securities eligible to vote for the election
of the Board of Directors of the Company (the "Board") (the "Company Voting
Securities"); provided, however, that the event described in this paragraph
shall not be deemed to be a Change in Control by virtue of any of the following
situations: (A) an acquisition by the Company or any corporation or entity in
which the Company has a direct or indirect ownership interest of 50% or more of
the total combined voting power of the then outstanding securities of such
corporation or other entity (a "Subsidiary"); (B) an acquisition by any employee
benefit plan sponsored
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or maintained by the Company or any Subsidiary; (C) an acquisition by any
underwriter temporarily holding securities pursuant to an offering of such
securities; (D) a Non-Control Transaction (as defined in paragraph (iii)); (E)
as pertains to a Participant, any acquisition by the Participant or any group of
persons (within the meaning of Sections 13(d)(3) and 14(d)(2) of the Exchange
Act) including the Participant (or any entity in which the Participant or a
group of persons including the Participant, directly or indirectly, holds a
majority of the voting power of such entity's outstanding voting interests); or
(F) the acquisition of Company Voting Securities from the Company, if a majority
of the Board approves a resolution providing expressly that the acquisition
pursuant to this clause (F) does not constitute a Change in Control under this
paragraph (i);
(ii) individuals who, at the beginning of any period of twenty-four
(24) consecutive months, constitute the Board (the "Incumbent Board") cease for
any reason to constitute at least a majority thereof; provided, that (A) any
person becoming a director subsequent to the beginning of such twenty-four (24)
month period, whose election, or nomination for election, by the Company's
shareholders was approved by a vote of at least two-thirds of the directors
comprising the Incumbent Board who are then on the Board (either by a specific
vote or by approval of the proxy statement of the Company in which such person
is named as a nominee for director, without objection to such nomination) shall
be, for purposes of this paragraph (ii), considered as though such person were a
member of the Incumbent Board; provided, however, that no individual initially
elected or nominated as a director of the Company as a result of an actual or
threatened election contest with respect to directors or any other actual or
threatened solicitation of proxies or consents by or on behalf of any person
other than the Board shall be deemed to be a member of the Incumbent Board;
(iii) the consummation of a merger, consolidation, share exchange or
similar form of corporate reorganization of the Company or any Subsidiary that
requires the approval of the Company's stockholders, whether for such
transaction or the issuance of securities in connection with the transaction or
otherwise (a "Business Combination"), unless (A) immediately following such
Business Combination: (1) more than 50% of the total voting power of the
corporation resulting from such Business Combination (the "Surviving
Corporation") or, if applicable, the ultimate parent corporation which directly
or indirectly has beneficial ownership of 100% of the voting securities eligible
to elect directors of the Surviving Corporation (the "Parent Corporation"), is
represented by Company Voting Securities that were outstanding immediately prior
to the Business Combination (or, if applicable, shares into which such Company
Voting Securities were converted pursuant to such Business Combination), and
such voting power among the holders thereof is in substantially the same
proportion as the voting power of such Company Voting Securities among the
holders thereof immediately prior to the Business Combination, (2) no person
(other than any employee benefit plan sponsored or maintained by the Surviving
Corporation or the Parent Corporation) is or becomes the beneficial owner,
directly or indirectly, of 20% or more of the total voting power of the
outstanding voting securities eligible to elect directors of the Parent
Corporation (or, if there is no Parent Corporation, the Surviving Corporation),
and (3) at least a majority of the members of the board of
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directors of the Parent Corporation (or, if there is no Parent Corporation, the
Surviving Corporation), following the Business Combination, were members of the
Incumbent Board at the time of the Board's approval of the execution of the
initial agreement providing for such Business Combination (a "Non-Control
Transaction") or (B) the Business Combination is effected by means of the
acquisition of Company Voting Securities from the Company, and a majority of the
Board approves a resolution providing expressly that such Business Combination
does not constitute a Change in Control under this paragraph (iii); or
(iv) the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company or the sale or other disposition of
all or substantially all of the assets of the Company and its Subsidiaries.
Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur solely because any person acquires beneficial ownership of more than
20% of the Company Voting Securities as a result of the acquisition of Company
Voting Securities by the Company which, by reducing the number of Company Voting
Securities outstanding, increases the percentage of shares beneficially owned by
such person; provided, that if a Change in Control would occur as a result of
such an acquisition by the Company (if not for the operation of this sentence),
and after the Company's acquisition such person becomes the beneficial owner of
additional Company Voting Securities that increases the percentage of
outstanding Company Voting Securities beneficially owned by such person, a
Change in Control shall then occur.
Notwithstanding anything in this Plan to the contrary, if the
Participant's employment is terminated prior to a Change in Control, and the
Participant reasonably demonstrates that such termination was at the request of
a third party who has indicated an intention or taken steps reasonably
calculated to effect a Change in Control (a "Third Party"), then for all
purposes of this Plan, the date immediately prior to the date of such
termination of employment shall be deemed to be the date of a Change in Control
for such Participant.
1.5 COMPENSATION shall mean the sum of the Participant's base salary and
regular bonuses (including profit-sharing, RONA, and executive compensation, but
excluding payments under any long term incentive plan, volume incentive plan, or
other extraordinary bonus or incentive plan) for a Plan Year before reductions
for deferrals under the Plan, or the Executive Deferral Plan, or the Savings
Plan, or the Parker Select program.
1.6 CREDITING RATE shall mean: (i) the amount described in Section 1.6.1 to
the extent the Restoration Account Balance represents either Annual Deferrals
under Article 3 or earnings previously credited on such deferrals under Section
5.2; or (ii) the amount described in Section 1.6.2 to the extent the Restoration
Account balance represents either Matching Credits under Article 4 or interest
previously credited on such Matching Credits under Section 5.2:
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1.6.1 CREDITING RATE FOR ANNUAL DEFERRALS shall mean any notional
gains or losses equal to those generated as if the Restoration Account
balance attributable to Annual Deferrals under Article 3 had been invested
in one or more of the investment portfolios designated as available by the
Administrator, less separate account fees and less applicable
administrative charges determined annually by the Administrator.
A Participant may elect to allocate his Restoration Account among the
available portfolios. The gains or losses shall be credited based upon the
daily unit values for the portfolio(s) selected by the Participant. The
rules and procedures for allocating the Restoration Account balance among
the portfolios shall be determined by the Administrator. The Participant's
allocation is solely for the purpose of calculating the Crediting Rate.
Notwithstanding the method of calculating the Crediting Rate, the Company
shall be under no obligation to purchase any investments designated by the
Participant.
1.6.2 CREDITING RATE FOR MATCHING CREDITS shall mean any notional
gains or losses equal to those generated as if the Restoration Account
balance attributable to Matching Credits under Article 4 had been invested
in the Common Stock of the Company, including reinvestment of dividends.
The rules and procedures for determining the value of the Common Stock of
the Company shall be determined by the Administrator. The rules and
procedures for re-allocating the Restoration Account balance attributable
to the Matching Credits among the other portfolios offered under the Plan
shall be determined by the Administrator.
1.7 DISABILITY shall mean any long term disability as defined under the
Company's long term disability plan. The Administrator, in its complete and sole
discretion, shall determine a Participant's Disability. The Administrator may
require that the Participant submit to an examination on an annual basis, at the
expense of the Company, by a competent physician or medical clinic selected by
the Administrator to confirm Disability. On the basis of such medical evidence,
the determination of the Administrator as to whether or not a condition of
Disability exists or continues shall be conclusive.
1.8 EARLY RETIREMENT DATE shall mean age 55 with ten or more years of
employment with the Company.
1.9 ELIGIBLE EXECUTIVE shall mean a key employee of the Company or any of
its subsidiaries who: (i) is designated by the Administrator as eligible to
participate in the Plan (subject to the restriction in Sections 10.2, 11.2 and
12.2 of the Plan); and (ii) qualifies as a member of the "select group of
management or highly compensated employees" under ERISA.
1.10 ERISA shall mean the Employee Retirement Income Security Act of 1974,
as amended.
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1.11 EXECUTIVE DEFERRAL PLAN shall mean the Parker-Hannifin Corporation
Executive Deferral Plan as it currently exists and as it may subsequently be
amended.
1.12 FINANCIAL HARDSHIP shall mean an unexpected need for cash arising from
an illness, casualty loss, sudden financial reversal, or other such
unforeseeable occurrence as determined by the Administrator. Cash needs arising
from foreseeable events such as the purchase of a residence or education
expenses for children shall not, alone, be considered a Financial Hardship.
1.13 FIXED CREDITING RATE shall mean an effective annual yield equal to
ninety percent (90%) of the sixty (60) month rolling average of the Ten-Year
United States Treasury Note as determined by the Administrator on September 30
of the preceding year. The Fixed Crediting Rate in effect as of the
Participant's Termination of Employment or death shall be held constant for the
remainder of the period for which benefits are paid.
1.14 MATCHING CREDIT shall mean the Company's credit to the Participant's
Restoration Account under Article 4.
1.15 NORMAL RETIREMENT DATE shall mean the date on which a Participant
attains age 65.
1.16 PARTICIPANT shall mean an Eligible Executive who has elected to
participate and has completed a Participation Agreement pursuant to Article 2 of
the Plan.
1.17 PARTICIPATION AGREEMENT shall mean the Participant's written election
to participate in the Plan.
1.18 PLAN YEAR shall mean the calendar year.
1.19 RESTORATION ACCOUNT shall mean the notional account established for
record keeping purposes for a Participant pursuant to Article 5 of the Plan.
1.20 RETIREMENT shall mean a termination of employment following Normal or
Early Retirement Date.
1.21 SAVINGS PLAN shall mean the Parker Retirement Savings Plan, formerly
known as The Parker-Hannifin Employees' Savings Plus Stock Ownership Plan, as it
currently exists and as it may subsequently be amended.
1.22 STATUTORY LIMIT shall mean any statutory or regulatory limit on salary
reduction contributions to savings plans, or on compensation taken into account
in calculating employer or employee contributions to savings plans. The impact
of such limits on the Participants shall be determined by the Company prior to
the beginning of each Plan Year based upon its best estimates and according to
procedures determined by the Administrator. Once the Company has determined the
impact of the Statutory Limits, no
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adjustment shall be made to increase deferrals or matching credits under this
Plan notwithstanding any adjustments ultimately required under the Savings Plan
due to actual employee contributions or other factors.
1.23 TERMINATION OF EMPLOYMENT shall mean the Participant's employment with
the Company ceases for any reason whatsoever, whether voluntary or involuntary,
other than Retirement or death.
1.24 UNSCHEDULED WITHDRAWAL shall mean a distribution of all or a portion
of the entire amount credited to the Participant's Restoration Account requested
by the Participant pursuant to the provisions of Article 11 of the Plan.
1.25 VALUATION DATE shall mean the end of the month in which Retirement,
Termination of Employment, or death occurs, except in the event of an election
to delay retirement benefits under Article 6, in which case the Valuation Date
shall mean the November 30 of the year preceding commencement of benefit
payments.
ARTICLE 2
PARTICIPATION
2.1 PARTICIPATION AGREEMENT/ANNUAL DEFERRAL. An Eligible Executive shall
become a Participant in the Plan on the first day of the Plan Year coincident
with or next following the date the individual becomes an Eligible Executive,
provided such Eligible Executive has submitted to the Administrator a
Participation Agreement. To be effective, the Eligible Executive must submit the
Participation Agreement to the Administrator during the enrollment period
designated by the Administrator. In the Participation Agreement, and subject to
the restrictions in Article 3, the Eligible Executive shall designate the Annual
Deferral for the covered Plan Year.
2.2 CONTINUATION OF PARTICIPATION. An Eligible Executive who has elected to
participate in the Plan by making an Annual Deferral shall continue as a
Participant in the Plan for purposes of such Annual Deferral even though such
executive ceases to be an Eligible Executive. However, a Participant shall not
be eligible to elect a new Annual Deferral unless the Participant is an Eligible
Executive for the Plan Year for which the election is made.
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ARTICLE 3
EXECUTIVE DEFERRALS
3.1 DEFERRAL ELECTION. A Participant may elect an Annual Deferral under
this Plan to defer all or a portion of the Compensation that he or she cannot
defer under the Savings Plan due to the Statutory Limit. Such election shall
designate a specified percentage of Compensation to be deferred. Annual
Deferrals under this Plan shall be irrevocable.
3.2 MAXIMUM ANNUAL DEFERRAL. The Annual Deferral for a Plan Year shall be
determined as:
(i) For a Participant who is not eligible to participate in the
Executive Deferral Plan, any whole percentage between 1 and 9% of Compensation
up to $15,000.
(ii) For a Participant who is eligible to participate in the Executive
Deferral Plan, any whole percentage between 1 and 5% of Compensation up to
$7,600.
3.3 VESTING. The Participant's right to receive Compensation deferred (and
gains or losses thereon) under this Article 3 shall be 100% vested at all times.
ARTICLE 4
COMPANY MATCHING CREDITS
4.1 AMOUNT. The Company's Matching Credit in each Plan Year shall equal one
hundred percent (100%) of the first three percent (3%) of Compensation deferred
and twenty-five percent (25%) of the next two (2%) of Compensation deferred,
reduced by the maximum matching contributions that would have been credited to
the Participant's account under the Savings Plan if he had elected to make the
maximum permitted deferral to the Savings Plan, whether or not he actually does
so. Notwithstanding the foregoing, the maximum Matching Credit allocated to any
Participant's Restoration Account in a Plan Year shall be $15,000, less the
maximum matching contributions that would have been credited to the
Participant's account under the Savings Plan if he had elected to make the
maximum permitted deferral to the Savings Plan.
4.2 VESTING. Subject to Section 12.4, the Participant's right to receive
Matching Credits (and gains or losses thereon) credited to the Participant's
Restoration Account shall be one hundred percent (100%) vested.
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ARTICLE 5
RESTORATION ACCOUNTS
5.1 RESTORATION ACCOUNTS. Solely for record keeping purposes, the Company
shall maintain a Restoration Account for each Participant.
5.2 THE TIMING OF CREDITS.
(i) Annual Deferrals made under Article 3 shall be credited to the
Restoration Account at the time the deferrals would otherwise have been paid to
the Participant but for the deferral election;
(ii) Matching Credits under Article 4 shall be credited to the
Restoration Account quarterly as of the first day of the following quarter; and
(iii) gains or losses shall be credited to the Restoration Account each
calendar quarter, as of the Valuation Date, using the Crediting Rate in effect
under Section 1.6.
5.3 TERMINATIONS. Following a Participant's Termination of Employment,
gains or losses shall be credited to the Restoration Account through the
Valuation Date.
5.4 STATEMENT OF ACCOUNTS. The Administrator shall provide periodically to
each Participant a statement setting forth the balance of the Restoration
Account maintained for such Participant.
ARTICLE 6
RETIREMENT BENEFITS
6.1 AMOUNT. Upon Retirement, the Company shall pay to the Participant a
retirement benefit in the form provided in Section 6.2 of the Plan, based on the
balance of the Restoration Account as of the Valuation Date. If paid as a lump
sum, the retirement benefit shall be equal to such balance. If paid in
installments, the installments shall be paid in amounts that will annually
amortize such balance with earnings and losses credited at the Crediting Rate
over the period of time benefits are to be paid.
6.2 FORM OF RETIREMENT BENEFITS. The retirement benefit shall be paid
monthly over a period of fifteen (15) years or the number of whole years
required to result in a monthly benefit of at least one thousand dollars
($1,000.00), if less; provided, however, that the Participant may elect in
writing at least 13 months before Retirement to have payment made in one of the
following options:
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(i) a single lump sum payment in cash; or
(ii) monthly installments over 5, 10 or 15 years; provided, that if a
monthly benefit is less than $1,000, the Administrator shall shorten the payout
period in whole year increments to assure that each monthly payment is at least
$1,000.
Payments shall be made or shall begin as of the first day of the calendar
quarter next following the date sixty (60) days after the Participant's
Retirement unless the Participant elects for payments to begin as of January l
of a later year. However, in no event shall payments commence later than the
January 1 occurring five (5) years after Retirement or, if earlier, the date the
Participant attains age seventy (70). Except as provided in Section 10.2, if the
Participant files an election of an alternative form of payment less than
thirteen (13) months prior to Retirement, the election shall be ineffective
unless the Participant agrees to take a ten percent (10%) reduction in the value
of his Restoration Account.
6.3 SMALL BENEFIT EXCEPTION. Notwithstanding any of the foregoing, if the
sum of all benefits payable to the Participant is less than or equal to ten
thousand dollars ($10,000.00), the Company shall pay such benefits in a single
lump sum.
ARTICLE 7
TERMINATION BENEFITS
7.1 AMOUNT. As of the first day of the calendar quarter beginning at least
sixty (60) days after Termination of Employment, the Company shall pay to the
Participant a termination benefit equal to the balance of the Restoration
Account as of the Valuation Date.
7.2 FORM OF TERMINATION BENEFITS. The Company shall pay the termination
benefits in a single lump sum; provided, however, that except following a Change
in Control the Company may, in its sole discretion, elect to pay the termination
benefits over a period of three (3) years in monthly installments, in which
event the Restoration Account shall continue to be credited with gains or losses
at the Fixed Crediting Rate in effect at the time of Termination of Employment.
ARTICLE 8
SURVIVOR BENEFITS
8.1 PRE-COMMENCEMENT SURVIVOR BENEFIT. If the Participant dies prior to the
time installment payments have commenced, the Company shall pay to the
Participant's Beneficiary within ninety (90) days after the Participant's death
a benefit equal to the balance of the Participant's Restoration Account as of
the Valuation Date.
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8.2 POST-COMMENCEMENT SURVIVOR BENEFIT. If the Participant dies after the
time installment payments have commenced, the Company shall pay to the
Participant's Beneficiary an amount equal to the remaining benefits payable to
the Participant under the Plan over the same period such benefits would have
been paid to the Participant, in which event the unpaid balance of the
Restoration Account shall be credited with interest at the Fixed Crediting Rate
in effect on the date of the Participant's death.
8.3 SMALL BENEFIT PAYMENT. Notwithstanding any of the foregoing, in the
event the sum of all benefits payable to the Beneficiary is less than or equal
to ten thousand dollars ($10,000.00), the Company shall pay such benefits in a
single lump sum.
ARTICLE 9
DISABILITY
If a Participant suffers a Disability, the Company shall pay the benefit
described in Article 6 to the Participant as if the date of the Participant's
Termination of Employment for Disability were the Participant's Normal
Retirement Date.
ARTICLE 10
CHANGE IN CONTROL
10.1 ELECTION. At the time the Participant is completing his initial
Participation Agreement, the Participant may elect that, if a Change in Control
occurs, the Participant (or after the Participant's death the Participant's
Beneficiary) shall receive a lump sum payment of the balance of the Restoration
Account within thirty (30) days after the Change of Control. Such balance shall
be determined as of the end of the month sixty (60) days prior to the month in
which the Change in Control occurs.
10.2 BENEFIT REDUCTION ON WITHDRAWAL. If a Participant has not made the
election described in Section 10.1 above and, within thirty (30) days after a
Change of Control, the Participant (or Beneficiary) elects to receive a
distribution of the balance of the Restoration Account (determined as described
in Section 10.1), the lump sum payment shall be reduced by an amount equal to
five percent (5%) of the total balance of the Restoration Account (instead of
the ten percent (10%) reduction otherwise provided for in Section 11.2). If a
Participant elects such a withdrawal, any on-going Annual Deferral shall cease,
and the Participant may not again be designated as an Eligible Executive until
one entire Plan Year following the Plan Year in which such withdrawal was made
has elapsed.
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ARTICLE 11
UNSCHEDULED WITHDRAWALS
11.1 ELECTION. A Participant (or Beneficiary if the Participant is
deceased) may request an Unscheduled Withdrawal of all or a portion of the
entire amount credited to the Participant's Restoration Account, which shall be
paid in a single lump sum; provided, however, that (i) the minimum withdrawal
shall be twenty-five percent (25%) of the Restoration Account balance, and (ii)
an election to withdraw seventy-five percent (75%) or more of the balance shall
be deemed to be an election to withdraw the entire balance.
11.2 WITHDRAWAL PENALTY. There shall be a penalty deducted from the
Restoration Account prior to an Unscheduled Withdrawal equal to ten percent
(10%) of the Unscheduled Withdrawal. If a Participant elects such a withdrawal,
any on-going Annual Deferral shall cease, and the Participant may not again be
designated as an Eligible Executive until one entire Plan Year following the
Plan Year in which such withdrawal was made has elapsed.
11.3 SMALL BENEFIT EXCEPTION. Notwithstanding any of the foregoing, if the
sum of all benefits payable to the Participant or Beneficiary who has requested
the Unscheduled Withdrawal is less than or equal to ten thousand dollars
($10,000.00), the Company shall pay out the entire Restoration Account balance
(reduced by the ten percent (10%) penalty) in a single lump sum.
ARTICLE 12
CONDITIONS RELATED TO BENEFITS
12.1 NONASSIGNABILITY. The benefits provided under the Plan may not be
alienated, assigned, transferred, pledged or hypothecated by or to any person or
entity, at any time or any manner whatsoever. These benefits shall be exempt
from the claims of creditors of any Participant or other claimants and from all
orders, decrees, levies, garnishment or executions against any Participant to
the fullest extent allowed by law.
12.2 FINANCIAL HARDSHIP DISTRIBUTION. Upon a finding that the Participant
or the Beneficiary has suffered a Financial Hardship, the Administrator may in
its sole discretion, permit the Participant to cease any on-going deferrals and
accelerate distributions of benefits under the Plan in the amount reasonably
necessary to alleviate such Financial Hardship. If a distribution is to be made
to a Participant on account of Financial Hardship, the Participant may not make
deferrals under the Plan until one entire Plan Year following the Plan Year in
which a distribution based on Financial Hardship was made has elapsed.
12.3 NO RIGHT TO COMPANY ASSETS. The benefits paid under the Plan shall be
paid from the general funds of the Company, and the Participant and any
Beneficiary shall
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be no more than unsecured general creditors of the Company with no special or
prior right to any assets of the Company for payment of any obligations
hereunder.
12.4 PROTECTIVE PROVISIONS. The Participant shall cooperate with the
Company by furnishing any and all information requested by the Administrator, in
order to facilitate the payment of benefits hereunder, taking such physical
examinations as the Administrator may deem necessary and taking such other
actions as may be requested by the Administrator. If the Participant refuses to
cooperate, the Company shall have no further obligation to the Participant under
the Plan. In the event of a Participant's suicide during the first two (2) years
of participation in the Plan, or if the Participant makes any material
misstatement of information or nondisclosure of medical history, then no
benefits shall be payable to the Participant or the Participant's Beneficiary or
estate under the Plan beyond the sum of the Participant's Annual Deferrals.
12.5 WITHHOLDING. The Participant or the Beneficiary shall make appropriate
arrangements with the Company for satisfaction of any federal, state or local
income tax withholding requirements and Social Security or other employee tax
requirements applicable to the payment of benefits under the Plan. If no other
arrangements are made, the Company may provide, at its discretion, for such
withholding and tax payments as may be required.
ARTICLE 13
ADMINISTRATION OF PLAN
The Company shall administer the Plan, provided, however, that the Company
may elect by action of its Board of Directors to appoint a committee of three
(3) or more individuals to administer the Plan. All references to the
Administrator herein shall refer to the Company or, if such committee has been
appointed, the committee.
The Administrator shall administer the Plan and shall have discretionary
authority to interpret, construe and apply its provisions in accordance with its
terms. The Administrator shall further establish, adopt or revise such rules and
regulations as it may deem necessary or advisable for the administration of the
Plan. All decisions of the Administrator shall be final and binding. The
individuals serving on the committee shall, except as prohibited by law, be
indemnified and held harmless by the Company from any and all liabilities,
costs, and expenses (including legal fees), to the extent not covered by
liability insurance arising out of any action taken by any member of the
committee with respect to the Plan, unless such liability arises from the
individual's own gross negligence or willful misconduct.
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ARTICLE 14
BENEFICIARY DESIGNATION
The Participant shall have the right, at any time, to designate any person
or persons as Beneficiary (both primary and contingent) to whom payment under
the Plan shall be made in the event of the Participant's death. The Beneficiary
designation shall be effective when it is submitted in writing to the
Administrator during the Participant's lifetime on a form prescribed by the
Administrator.
The submission of a new Beneficiary designation shall cancel all prior
Beneficiary designations. Any finalized divorce or marriage of a Participant
subsequent to the date of a Beneficiary designation shall revoke such
designation, unless in the case of divorce the previous spouse was not
designated as Beneficiary and unless in the case of marriage the Participant's
new spouse has previously been designated as Beneficiary. The spouse of a
married Participant shall consent to any designation of a Beneficiary other than
the spouse, and the spouse's consent shall be witnessed by a notary public.
If a Participant fails to designate a Beneficiary as provided above, or if
the Beneficiary designation is revoked by marriage, divorce, or otherwise
without execution of a new designation, or if every person designated as
Beneficiary predeceases the Participant or dies prior to complete distribution
of the Participant's benefits, then the Administrator shall direct the
distribution of such benefits to the Participant's estate.
ARTICLE 15
AMENDMENT AND TERMINATION OF PLAN
15.1 AMENDMENT OF PLAN. Except as provided in Section 15.3, the Company may
at any time amend the Plan in whole or in part, provided, however, that such
amendment: (i) shall not decrease the balance of the Participant's Restoration
Account at the time of such amendment; and (ii) shall not retroactively decrease
the applicable Crediting Rate of the Plan prior to the time of such amendment.
The Company may amend the Crediting Rate or Fixed Crediting Rate of the Plan
prospectively, in which case the Company shall notify the Participant of such
amendment in writing within thirty (30) days after such amendment.
15.2 TERMINATION OF PLAN. Except as provided in Section 15.3, the Company
may at any time terminate the Plan. If the Company terminates the Plan, the date
of such termination shall be treated as the date of Retirement or Termination of
Employment for the purpose of calculating Plan benefits, and the Company shall
pay to the Participant the benefits the Participant is entitled to receive under
the Plan in monthly installments over a thirty-six (36) month period. Interest
at the Fixed Crediting Rate will be credited to the
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Participant's Restoration Account commencing as of the date of the Plan's
termination and continuing until distribution under this Section is completed.
15.3 AMENDMENT OR TERMINATION AFTER CHANGE IN CONTROL. Notwithstanding the
foregoing, the Company shall not amend or terminate the Plan without the prior
written consent of affected Participants for a period of two calendar years
following a Change in Control and shall not thereafter amend or terminate the
Plan in any manner which affects any Participant (or Beneficiary of a deceased
Participant) who commences receiving payment of benefits under the Plan prior to
the end of such two year period following a Change in Control.
15.4 COMPANY ACTION. Except as provided in Section 15.3 or 15.5, the
Company's power to amend or terminate the Plan shall be exercisable by the
Company's Board of Directors or by the committee or individual authorized by the
Company's Board of Directors to exercise such powers.
15.5 CONSTRUCTIVE RECEIPT TERMINATION. In the event the Administrator
determines that amounts deferred under the Plan have been constructively
received by Participants and must be recognized as income for federal income tax
purposes, the Plan shall terminate and distributions shall be made to
Participants in accordance with the Provisions of Section 15.2 or as may be
determined by the Administrator. The determination of the Administrator under
this Section 15.5 shall be binding and conclusive.
ARTICLE 16
MISCELLANEOUS
16.1 SUCCESSORS OF THE COMPANY. The rights and obligations of the Company
under the Plan shall inure to the benefit of, and shall be binding upon, the
successors and assigns of the Company.
16.2 ERISA PLAN. The Plan is intended to be an unfunded plan maintained
primarily to provide deferred compensation benefits for "a select group of
management or highly compensated employees" within the meaning of Sections 201,
301 and 401 of ERISA and therefore to be exempt from Parts 2, 3 and 4 of Title I
of ERISA.
16.3 TRUST. The Company shall be responsible for the payment of all
benefits under the Plan. At its discretion, the Company may establish one or
more grantor trusts for the purpose of providing for payment of benefits under
the Plan. Such trust or trusts may be irrevocable, but the assets thereof shall
be subject to the claims of the Company's creditors. Benefits paid to the
Participant from any such trust shall be considered paid by the Company for
purposes of meeting the obligations of the Company under the Plan.
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16.4 EMPLOYMENT NOT GUARANTEED. Nothing contained in the Plan nor any
action taken hereunder shall be construed as a contract of employment or as
giving any Participant any right to continued employment with the Company.
16.5 GENDER, SINGULAR AND PLURAL. All pronouns and variations thereof shall
be deemed to refer to the masculine, feminine, or neuter, as the identity of the
person or persons may require. As the context may require, the singular may be
read as the plural and the plural as the singular.
16.6 CAPTIONS. The captions of the articles and sections of the Plan are
for convenience only and shall not control or affect the meaning or construction
of any of its provisions.
16.7 VALIDITY. If any provision of the Plan is held invalid, void or
unenforceable, the same shall not affect, in any respect whatsoever, the
validity of any other provisions of the Plan.
16.8 WAIVER OF BREACH. The waiver by the Company of any breach of any
provision of the Plan by the Participant shall not operate or be construed as a
waiver of any subsequent breach by the Participant.
16.9 APPLICABLE LAW. The Plan shall be governed and construed in accordance
with the laws of Ohio except where the laws of Ohio are preempted by ERISA.
16.10 NOTICE. Any notice or filing required or permitted to be given to the
Company under the Plan shall be sufficient if in writing and hand-delivered, or
sent by first class mail, facsimile, or electronic mail to the principal office
of the Company, directed to the attention of the Administrator. Such notice
shall be deemed given as of the date of delivery, or, if delivery is made by
mail, as of the date shown on the postmark.
ARTICLE 17
CLAIMS AND REVIEW PROCEDURES
17.1 CLAIMS PROCEDURE. The Company shall notify a Participant in writing,
within ninety (90) days after his or her written application for benefits, of
his or her eligibility or noneligibility for benefits under the Plan. If the
Company determines that a Participant is not eligible for benefits or full
benefits, the notice shall set forth: (i) the specific reasons for such denial;
(ii) a specific reference to the provisions of the Plan on which the denial is
based; (iii) a description of any additional information or material necessary
for the claimant to perfect his or her claim, and a description of why it is
needed; and (iv) an explanation of the Plan's claims review procedure and other
appropriate information as to the steps to be taken if the Participant wishes to
have the claim reviewed. If the Company determines that there are special
circumstances requiring
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additional time to make a decision, the Company shall notify the Participant of
the special circumstances and the date by which a decision is expected to be
made, and may extend the time for up to an additional ninety-day period.
17.2 REVIEW PROCEDURE. If a Participant is determined by the Company not to
be eligible for benefits, or if the Participant believes that he or she is
entitled to greater or different benefits, the Participant shall have the
opportunity to have such claim reviewed by the Company by filing a petition for
review with the Company within sixty (60) days after receipt of the notice
issued by the Company. Said petition shall state the specific reasons which the
Participant believes entitle him or her to benefits or to greater or different
benefits. Within sixty (60) days after receipt by the Company of the petition,
the Company shall afford the Participant (and counsel, if any) an opportunity to
present his or her position to the Company orally or in writing, and the
Participant (or counsel) shall have the right to review the pertinent documents.
The Company shall notify the Participant of its decision in writing within the
sixty-day period, stating specifically the basis of its decision, written in a
manner calculated to be understood by the Participant and the specific
provisions of the Plan on which the decision is based. If, because of the need
for a hearing, the sixty-day period is not sufficient, the decision may be
deferred for up to another sixty-day period at the election of the Company, but
notice of this deferral shall be given to the Participant. In the event of the
death of the Participant, the same procedures shall apply to the Participant's
beneficiaries.
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