Exhibit 10.15
INTERNATIONAL LOGISTICS LIMITED
DEFERRED COMPENSATION PLAN
TABLE OF CONTENTS
SECTION TITLE PAGE NO.
1 Name. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -1-
2 Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -2-
3 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . -3-
4 Operation and Administration of the Plan. . . . . . . . . . . . . -10-
5 Eligibility for Participation . . . . . . . . . . . . . . . . . . -13-
6 Participant Allocations . . . . . . . . . . . . . . . . . . . . . -15-
7 Company Allocations . . . . . . . . . . . . . . . . . . . . . . . -18-
8 Establishment of Accounts . . . . . . . . . . . . . . . . . . . . -19-
9 Maintenance, Investment and Valuation of Accounts . . . . . . . . -20-
10 Funding Limitations . . . . . . . . . . . . . . . . . . . . . . . -22-
11 Vesting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -23-
12 Regulations Governing Distribution of Benefits. . . . . . . . . . -25-
13 Beneficiary Designation . . . . . . . . . . . . . . . . . . . . . -36-
14 Amendment and Termination . . . . . . . . . . . . . . . . . . . . -37-
15 General Provisions. . . . . . . . . . . . . . . . . . . . . . . . -38-
INTERNATIONAL LOGISTICS LIMITED
DEFERRED COMPENSATION PLAN
SECTION 1
NAME
The plan set forth herein shall be known as the International Logistics Limited
Deferred Compensation Plan.
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SECTION 2
PURPOSE
The Plan is intended to constitute a nonqualified deferred retirement plan
which, in accordance with ERISA Sections 201(2), 301(a)(3) and 401(a)(1), is
"unfunded and maintained by an employer primarily for the purpose of providing
deferred compensation for a select group of management or highly compensated
employees."
The purpose of the Plan is to acknowledge and reward certain key employees of
the Company for their efforts on behalf of the Company by maximizing their
ability to save on a tax-deferred basis and providing such key employees with
benefits that shall not be restricted by any qualified plan limitations and/or
requirements. Such limitations and requirements shall include, but not be
limited to, the following:
2.1 ELECTIVE DEFERRAL CONTRIBUTION LIMITATION
The $9,500 (1996 limit) limitation placed on elective employee
contributions in accordance with Sections 402(g) of the Internal Revenue
Code (the "Code"), which limitation shall be adjusted annually for
increases in the cost-of-living in accordance with Section 415(d) of the
Code.
2.2 COMPENSATION LIMITATION
The $150,000 (1996 limit) maximum on compensation taken into account for
all purposes under a qualified plan in accordance with Section 401(a)(17)
of the Code, which limitation shall be adjusted for increases in the
cost-of-living in accordance with Section 401(a)(17)(B) of the Code.
2.3 LIMITATION ON ANNUAL ADDITIONS
The limitation on annual additions to qualified retirement plans in
accordance with Section 415(c) of the Code, which limitation shall be
adjusted annually for increases in the cost-of-living in accordance with
Section 415(d) of the Code.
2.4 NONDISCRIMINATION REQUIREMENTS
The nondiscrimination testing requirements under Sections 401(k) and (m) of
the Code.
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SECTION 3
DEFINITIONS
For purposes of the Plan, the following words and phrases shall have the
following meanings unless a different meaning is plainly required by the
context. Wherever used, the masculine pronoun shall include the feminine
pronoun and the feminine pronoun shall include the masculine and the singular
shall include the plural and the plural shall include the singular.
3.1 "ACCOUNT" shall mean a recordkeeping source from which Plan benefits are
provided. The specific Accounts under this Plan are listed in Section 8.1
and described more fully in Section 12.
3.2 "BENEFICIARY" shall mean the person or persons designated in accordance
with Section 13 to receive any benefits under the Plan in the event of a
Participant's death.
3.3 "BENEFIT COMMENCEMENT DATE" shall mean the date as of which the
Participant's benefit commences. Such commencement shall occur as soon as
administratively possible following the Participant's Determination Date.
3.4 "BOARD OF DIRECTORS" shall mean the full Board of Directors of the Company.
3.5 "BONUS COMPENSATION" shall mean any cash remuneration paid to a
Participant, excluding Regular Compensation, as a specific incentive bonus
or award, including Voluntary Deferral Allocations made hereunder, the
source of which is Bonus Compensation.
3.6 "BONUS DEFERRAL RATE" shall have the meaning set forth in Section 6.1.
3.7 "BUSINESS DAY" means a day other than Saturday, Sunday or any other day on
which banks located in the State of Illinois are authorized or obligated to
close.
3.8 "COMMISSION" means the United States Securities and Exchange Commission.
3.9 "COMMITTEE" shall mean the Board of Directors or the person or persons
appointed by the Board of Directors to administer the Plan.
3.10 "COMPANY" shall mean International Logistics Limited, a Delaware
corporation, or any affiliate, subsidiary or associate company of
International Logistics Limited which
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shall adopt the Plan for its employees with the approval of International
Logistics Limited, including any successor to International Logistics
Limited as a result of a statutory merger, purchase of assets or any other
form of reorganization of the business of the Company.
3.11 "DESIGNATED EMPLOYEE" shall have the meaning set forth in Section 4.8.
3.12 "DETERMINATION DATE" shall mean, with respect to:
(a) the Participant's Retirement Account, the date on which the
Participant's termination of employment for any reason occurs;
(b) the Participant's Education Account(s), the January 1 of the calendar
year in which an Eligible Dependent attains age 18 or the date the
Participant terminates employment as a result of his Retirement during
or after such time period; and
(c) the Participant's Fixed Period Account(s), the January 1 of the
payment year specified by the Participant.
3.13 "DISABILITY" or "DISABLED" shall mean any physical or mental condition
which meets the definition and provisions described in the Company's group
long-term disability contract covering the Participants in this Plan.
3.14 "DISABILITY TERMINATION DATE" shall mean one year following the date on
which a Participant is Disabled if the Participant remains Disabled on such
date.
3.15 "DISCRETIONARY ALLOCATIONS" shall have the meaning set forth in Section
7.1.
3.16 "EDUCATION ACCOUNT" shall have the meaning set forth in Section 8.1.
3.17 "EFFECTIVE DATE" shall mean July 1, 1996, the date as of which the Plan was
established.
3.18 "EMPLOYEE" shall mean a person who is employed by the Company and falls
under the usual common law rules applicable in determining the
employer-employee relationship.
3.19 "FIXED PERIOD ACCOUNT" shall have the meaning set forth in Section 8.1.
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3.20 "INITIAL PUBLIC OFFERING" means the first underwritten public offering of
Company common stock pursuant to a registration of shares under the
Securities Act, on a Form S-1 Registration Statement (or equivalent or
successor form).
3.21 "KEY EMPLOYEE" shall mean an Employee who is designated for eligibility in
the Plan by the Committee in accordance with Section 4.2.
3.22 "LEAVE OF ABSENCE" shall have the meaning set forth in the Company's
employee handbook.
3.23 "PARTICIPANT" shall mean any Employee who is participating in the Plan in
accordance with the provisions herein set forth.
(a) "GROUP I PARTICIPANT" shall mean a Participant who is so designated by
the Committee.
(b) "GROUP II PARTICIPANT" shall mean a Participant who is so designated
by the Committee.
3.24 "PER SHARE AGGREGATE VALUE" shall mean:
(i) if prior to an Initial Public Offering, the amount obtained by
dividing (A) (EBITDA X 5) - (Debt - CA) by (B) the number of
shares of common stock outstanding and the number of shares
subject to options and warrants (to the extent such options and
warrants are in the money) on the Valuation Date, where:
(a) EBITDA means the Company's consolidated earnings before interest,
taxes, depreciation and amortization for the four fiscal quarters
of the Company ending on the Valuation Date immediately preceding
the Determination Date, computed in accordance with generally
accepted accounting principles.
(b) Debt means any current or long-term indebtedness of the Company
as of the Valuation Date immediately preceding the Determination
Date (including capitalized lease obligations and accrued but
unpaid interest), as set forth on the Company's consolidated
balance sheet (prepared in accordance with generally accepted
accounting principles); and
(c) CA means the Company's consolidated cash and cash equivalents on
hand as of the Valuation Date
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immediately preceding the Determination Date, including, without
limitation payments that have been received or will be received
upon the exercise of options and warrants to the extent such
options and warrants are "in the money" as set forth on its
consolidated balance sheet (prepared in accordance with generally
accepted accounting principles).
(ii) if subsequent to an Initial Public Offering, the per share
trading price for each trading day:
(A) if the Company common stock is traded on a national securities
exchange, its last reported sale price on the preceding Business
Day on such national securities exchange or, if there was no sale
on that day, the last reported sale price on such national
securities exchange on the next preceding Business Day on which
there was a sale, all as made available over the Consolidated
Last Sale Reporting System of the CTA Plan (the "CLSRS") or, if
the Company common stock is not then eligible for reporting over
the CLSRS, its last reported sale price on the preceding Business
Day on such national securities exchange or, if there was no sale
on that day, on the next preceding Business Day on which there
was a sale on such exchange; or
(B) if the principal market for the Company common stock is the
over-the-counter market, but the Company common stock is not then
eligible for reporting over the CLSRS, but the common stock is
quoted on the National Association of Securities Dealers
Automated Quotations System ("NASDAQ"), the last sale price
reported on NASDAQ on the preceding Business Day or, if the
Company common stock is an issue for which last sale prices are
not reported on NASDAQ, the closing bid quotation on such day,
but in each of the next preceding two cases, if the relevant
NASDAQ price or quotation did not exist on such day, then the
price or quotation on the next preceding Business Day in which
there was such a price or quotation.
3.25 "PLAN" shall mean the International Logistics Limited Deferred Compensation
Plan as it may be amended from time to time.
3.26 "PLAN CONTRIBUTIONS" shall mean the total of the Participant's Voluntary
Deferral Allocations made in
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accordance with Section 6.1 and the Company's Discretionary Allocations
made in accordance with Section 7.1 for the Plan Year of reference.
3.27 "PLAN SHARES" shall have the meaning set forth in Section 4.8.
3.28 "PLAN YEAR" shall mean a period of six consecutive months commencing on the
Effective Date and ending on December 31, 1996. Thereafter, "Plan Year"
shall mean a period of 12 consecutive months commencing on January 1, 1997
and each January 1 thereafter.
3.29 "QUALIFIED PLAN" shall mean the Bekins 401(k) Profit Sharing Plan.
3.30 "REGULAR COMPENSATION" shall mean the Participant's wages for the Plan Year
paid by the Company of the type reported in box 1 of Form W-2. Such wages
shall include amounts within the meaning of Section 3401(a) of the Code
plus any other amounts paid to the Participant by the Company for which the
Company is required to furnish a written statement under Sections 6041(d),
6051(a)(3) and 6052 of the Code, determined without regard to any rules
that limit the amount required to be reported based on the nature or
location of the employment or services performed,
(a) exclusive of
(i) Bonus Compensation;
(ii) severance pay on a non payroll basis;
(iii) nonqualified plan payments; and
(iv) welfare benefits, fringe benefits (cash and non-cash),
reimbursements of other expense allowances and moving
expenses.
(b) inclusive of
(i) any amounts deferred under any nonqualified plan, including
the Plan; and
(ii) the amount of any contributions made by the Company under
any salary reduction or similar arrangement to a qualified
deferred compensation, pension or cafeteria plan, or
contributions to a simplified employee pension plan
described in Section 408(k) of the Code.
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3.31 "REGULAR DEFERRAL RATE" shall have the meaning set forth in Section 6.1.
3.32 "RETIREMENT" shall mean the termination of employment of a Participant for
any reason other than Disability or death on or following his Retirement
Date.
3.33 "RETIREMENT ACCOUNT" shall have the meaning set forth in Section 8.1.
3.34 "RETIREMENT DATE" shall mean first date coincident with or following the
date on which a Participant attains age 55, provided he has completed at
least five Years of Service as of such date.
3.35 "SECURITIES ACT" means the Securities Act of 1933, as amended.
3.36 "SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
3.37 "TRUST AGREEMENT" shall mean the instrument executed by the Company and the
Trustee fixing the rights and liabilities of each with respect to holding
and administering the Trust Fund.
3.38 "TRUSTEE" shall mean the Trustee or any successor Trustee, appointed by the
Board of Directors, acting in accordance with the terms of the Trust
Agreement.
3.39 "TRUST FUND" shall mean all assets held by the Trustee for the purposes of
the Plan in accordance with the terms of the Trust Agreement. The Board of
Directors shall, subject to the provisions of Section 10, establish such a
Trust Fund (known as a "rabbi trust") for the purpose of accumulating funds
to satisfy the obligations incurred by the Company under the Plan.
3.40 "VALUATION DATE" shall mean the last day of each March, June, September and
December and such other dates as the Committee may determine from time to
time.
3.41 "VOLUNTARY DEFERRAL ALLOCATIONS" shall have the meaning set forth in
Section 6.1.
3.42 "YEAR OF SERVICE" shall mean the 12-month period beginning as of the date a
person was first hired by the Company and each anniversary thereof during
which such person remains in the employ of the Company.
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SECTION 4
OPERATION AND ADMINISTRATION OF THE PLAN
4.1 ORGANIZATION OF THE COMMITTEE
(a) The Board of Directors shall serve as the Committee to administer the
Plan or shall appoint a Committee to administer the Plan, who, upon
acceptance of such appointment, shall serve at the pleasure of the
Board of Directors. Any member may resign by delivering his written
resignation to the Board of Directors and to the Committee. Vacancies
in the Committee arising from resignation, death, or removal shall be
filled by the Board of Directors.
(b) The Committee shall act by a majority of its members unless unanimous
consent is required by the Plan or by unanimous approval of its
members if there are two or less members in office at the time. In
the event of a Committee deadlock, the Committee shall determine the
method for resolving such deadlock. No Committee member shall act
upon any question pertaining solely to himself, and the other member
or members shall make any determination required by the Plan in
respect to such member.
(c) The Committee may, by unanimous consent, delegate specific authority
and responsibilities to one or more of its members. The member or
members so designated shall be solely liable, jointly and severally,
for their acts or omissions with respect to such delegated authority
and responsibilities. Committee members not so designated shall be
relieved from liability for any act or omission resulting from such
delegation.
4.2 COMMITTEE DISCRETION
The Committee shall, by written action, designate those Employees, if any,
who are to be Key Employees for purposes of Section 5. Such designation
shall remain in effect for all future Plan Years unless and until removed
by the Committee. Such removal must be made in writing and communicated to
the applicable Key Employee prior to the Plan Year for which such action
shall take effect.
No such change of status shall become effective during a Plan Year in which
a Key Employee is currently participating unless the provisions of
Subsection 5.4(c) apply.
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4.3 AUTHORITY AND RESPONSIBILITY
The Committee shall have full authority and responsibility to interpret and
construe the Plan and determine all questions of the status and rights of
the Participants and the amounts of their allocations. Its interpretation,
construction or determination, as the case may be, shall be final and
conclusive on both the Company and the Participants and their respective
successors, assigns, personal representatives and Beneficiaries. Such
authority and responsibility shall include, but shall not be limited to,
the following:
(a) appointment of qualified accountants, consultants, administrators,
counsel, appraisers, or other persons it deems necessary or advisable,
who shall serve the Committee as advisors only and shall not exercise
any discretionary authority, responsibility or control with respect to
the management or administration of the Plan;
(b) determination of all benefits, and resolution of all questions arising
from the administration, interpretation and application of the Plan;
(c) adoption of forms and regulations for the administration of the Plan;
(d) remedy of all inequity resulting from incorrect information received
or communicated, or of administrative error;
(e) settlement or compromise of any claims or debts arising from the
operation of the Plan and the commencement of any legal actions or
administrative proceeding.
4.4 RECORDS AND REPORTS
The Committee shall keep a record of its proceedings and acts and shall
keep books of account, records and other data necessary for the proper
administration of the Plan.
Following each Valuation Date, the Committee shall provide each Participant
with a detailed statement of his Account, including all transactions
affecting his Account during the calendar quarter of reference, and
reflecting the most recent valuation of his Account.
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4.5 REQUIRED INFORMATION
The Company, Participants or Beneficiaries entitled to benefits shall
furnish forms and any information or evidence as requested by the Committee
for the proper administration of the Plan. Failure on the part of any
Participant or Beneficiary to comply with such request within a reasonable
period of time shall be sufficient grounds for delay in the payment of
benefits until the information or evidence requested is received.
4.6 PAYMENT OF EXPENSES OF PLAN
The expenses of the Committee in connection with the administration of the
Plan shall be the responsibility of the Company.
4.7 INDEMNIFICATION
The Company shall indemnify the members of the Committee and advance
expenses as provided in the by-laws of the Company.
4.8 COMMITTEE COMMON STOCK ALLOCATION
The Committee may from time to time, in its sole discretion, direct the
Trustee to purchase shares of the Company's common stock (the "PLAN
SHARES"). The Committee may, by written action, designate (i) which Key
Employees (a "DESIGNATED EMPLOYEE"), if any, shall be entitled to receive
Plan Shares and (ii) the number of Plan Shares that may be distributed to a
Designated Employee pursuant to Sections 12.1(b)(i)(B) and (iii)(B). The
Committee may, in its sole discretion, redesignate to any other Key
Employee, consistent with the preceding sentence, any Plan Shares that are
not distributed to a Designated Employee pursuant to Sections 12.1(b)(i)(B)
and (iii)(B).
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SECTION 5
ELIGIBILITY FOR PARTICIPATION
5.1 INITIAL ELIGIBILITY
(a) Each Key Employee on the Effective Date will be eligible to
participate in the Plan as of such date.
(b) Each other Key Employee will be eligible to participate in the Plan as
of the first day of the month following the attainment of his status
as a Key Employee in accordance with Section 4.2.
5.2 VOLUNTARY PARTICIPATION
Participation in the Plan by Key Employees is entirely voluntary. As
further specified in Section 6.2, a Key Employee must sign an election form
and submit the signed form to the Committee before the date he elects to
become a Participant of the Plan.
5.3 COMMITTEE RULES AND REGULATIONS
The Committee shall, through the adoption of a set of rules and
regulations, provide for methods used in advising a Key Employee of his
eligibility in the Plan, and all forms necessary for the Key Employee to
elect to participate.
5.4 CESSATION OF PARTICIPATION
(a) For purposes of Articles 6, 7 and 11, an individual shall cease to be
a Participant on the earliest of:
(i) the date on which he ceases to be a Key Employee;
(ii) the date on which he terminates employment with the Company
for any reason; and
(iii) the date on which the Plan terminates.
(b) For all other Plan purposes, an individual shall cease to be a
Participant on the date the total vested value of his Account has been
paid.
(c) Notwithstanding the foregoing Subsections (a) and (b), in the event
that the Department of Labor ("DOL") issues regulations or other
official notice specifically defining the group of employees that may
participate in a plan of this type and any Participants
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at that time do not meet the criteria set forth in the DOL regulations
or notice, such Participants shall be deemed to be individuals
described under Subsection (a)(i) as of the later of the effective
date or publication date of the notice or regulations, provided such
notice or regulations include a grandfather provision for such
Participants with respect to their account balances on such date. In
the event no such grandfather provision is provided, the accounts of
such Participants shall be distributed in accordance with the second
paragraph of Subsection 12.1(a).
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SECTION 6
PARTICIPANT ALLOCATIONS
6.1 VOLUNTARY DEFERRAL ALLOCATIONS
(a) Until the date of his cessation of participation in accordance with
Subsection 5.4(a), by filing the applicable forms in accordance with
Section 6.2, a
(i) Group I Participant may, as of the Effective Date or, if
later, when first eligible or any January 1 thereafter elect
to reduce his
(A) Regular Compensation by any fixed percentage ("REGULAR
DEFERRAL RATE") for a current Plan Year up to a maximum
of 25% of such Regular Compensation, and/or
(B) Bonus Compensation by any fixed percentage ("BONUS
DEFERRAL RATE") for a current Plan Year up to a maximum
of 100% of such Bonus Compensation.
(ii) Group II Participant who shall contribute at less than the
maximum allowable level to the Qualified Plan for such Plan
Year may, as of the Effective Date or, if later, when first
eligible or any January 1 thereafter elect to reduce his
Regular Compensation by any Regular Deferral Rate for a
current Plan Year up to a maximum of 9% of such
Participant's Regular Compensation for the Plan Year.
(iii) Group II Participant who shall contribute at the maximum
allowable level to the Qualified Plan for such Plan Year
may, as of the Effective Date or, if later, when first
eligible or any January 1 thereafter elect to reduce his
Regular Compensation by any Regular Deferral Rate for a
current Plan Year up to a maximum of the difference between
(A) 15% of such Participant's Regular Compensation for the
Plan Year and (B) the anticipated amount, as determined by
the Committee, that the Participant is eligible to
contribute on a before tax basis to the Qualified Plan
during the Plan Year.
The election made by the Participant in accordance with Subsection (i)
or (ii) shall result in a corresponding
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amount being credited to his Accounts in accordance with Section 8.1.
In the case of Group I Participants, the deferral shall be made from
Regular or Bonus Compensation as the Participant shall specify;
however, to the extent the deferral is to be made from Bonus
Compensation and either no Bonus is paid or the Bonus which is paid
does not meet the minimum described in Subsection (e), no deferral
shall occur with respect to such Bonus Compensation.
(b) A Participant's Voluntary Deferral Allocations made in accordance with
Subsection (a) shall take the form of before tax deferrals to the
Participant's Voluntary Deferral Allocation Subaccount.
(c) Notwithstanding the foregoing, a Participant may not make
contributions to this Plan during any period for which contributions
must be suspended in accordance with regulation
section 1.401(k)-1(d)(2)(iii)(B)(3) of the Code, as a condition of the
Participant's receipt of a hardship withdrawal from any plan of the
Company which includes a qualified cash or deferred arrangement under
section 401(k) of the Code.
(d) The amount of Regular and Bonus Compensation that a Participant elects
to defer shall be credited to the Participant's Accounts as soon as
practicable, but no longer than 30 days following the date on which
the Participant is paid the nondeferred portion of the compensation
which is the source of the deferral.
(e) The minimum amount a Participant may defer for any Plan Year is
$1,000.
6.2 FORMS REQUIRED
A Participant shall elect to contribute on forms and in the manner
prescribed by the Committee. A new election must be made prior to each
Plan Year for which the Participant is eligible to participate in the Plan,
even if the Participant does not elect to contribute for such Plan Year.
6.3 IRREVOCABLE ELECTION
A Participant may not modify or discontinue his allocations for a Plan Year
after the first day thereof unless such discontinuance is necessary to
comply with the provisions of Subsection 6.1(c).
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SECTION 7
COMPANY ALLOCATIONS
7.1 DISCRETIONARY ALLOCATIONS
(a) The Company may, in its sole discretion, make an allocation on behalf
of each Participant who meets the requirements specified in Section 6.
The Company shall have the option of allocating a different designated
percentage or flat dollar amount to each Participant.
Such percentage or flat dollar amount shall be determined by the
Company and announced to the Participants as soon as practicable
following the Company's determination of such amount.
(b) A Participant shall share in the Discretionary Allocations made for
the Plan Year of reference in accordance with Section 6.1, provided he
is in the employ of the Company on the last business day of such Plan
Year.
Notwithstanding the foregoing provision, a Participant shall be
entitled to a share of the Company's Discretionary Allocations for the
Plan Year of (i) his Retirement or death, (ii) the commencement or end
of a Leave of Absence authorized by the Company or (iii) his transfer
to another business entity to which such Participant had been
transferred by the Company, even if the Participant is not in the
employ of the Company on the last business day of such Plan Year.
A Participant shall not share in the allocation of the Company's
Discretionary Allocations for any Plan Year during which he terminated
his employment for reasons other than specified in (b)(i), (ii) or
(iii) above.
(c) The amount of Discretionary Allocations that the Company, in its sole
discretion, allocates to a Participant shall be credited to such
Participant's Account as soon as practicable, but no longer than 45
days following the date on which the Company determines to make such
allocation.
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SECTION 8
ESTABLISHMENT OF ACCOUNTS
8.1 ESTABLISHMENT OF ACCOUNTS
The following Accounts shall be established with respect to each
Participant:
(a) Retirement Account,
(b) Education Account and
(c) Fixed Period Account.
8.2 ACCOUNT AND SUBACCOUNT ALLOCATION
(a) Each Participant shall submit to the Committee before the beginning of
the Plan Year of reference a written statement specifying the
respective percentages of the Plan Contributions which are to be
allocated to the Accounts listed in Subsection 8.1 and described more
fully in Section 12.
(b) In the event that the Participant elects to establish subaccounts
under his Education and/or Fixed Period Accounts, all allocations to
such Account(s) shall be equally divided among such subaccounts.
(c) The minimum amount which may be allocated to each Account and, if
applicable, to each subaccount, is $1,000.
8.3 IRREVOCABLE ALLOCATION
A Key Employee may not amend or revoke an allocation made for or during a
Plan Year.
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SECTION 9
MAINTENANCE, INVESTMENT AND VALUATION OF ACCOUNTS
9.1 MAINTENANCE OF ACCOUNTS
The Committee shall establish and maintain a separate accounting in the
name of each Participant, to which it shall credit all amounts allocated in
accordance with Sections 6 and 7 and all investment experience as
determined in accordance with Sections 9.2 and 9.3.
9.2 DEEMED INVESTMENT FUND ELECTION
(a) INITIAL ELECTION - Each Participant shall designate, in multiples of
1%, one or more of the funds referenced in Section 9.3 for the purpose
of attributing investment experience to his Accounts.
If the Participant fails to designate such funds, the entire Account
shall be deemed to be invested under the most conservative of the
funds selected by the Committee in accordance with Section 9.3 (e.g. a
money market fund or a fixed income fund).
(b) SUBSEQUENT ELECTION - A Participant may, by written election prior to
the date as of which an election is to be effective, change his fund
election with respect to subsequent allocations but, until changed, a
fund election shall remain in effect for all subsequent Plan Years.
(c) TRANSFER ELECTION - A Participant may, by written election change his
fund election with respect to his then existing Account, provided the
transfers from fund to fund are in multiples of 1%. Such change shall
become effective as soon as administratively possible.
(d) Such elections shall be the basis for the valuation of a Participant's
Account in accordance with Section 9.4 but shall not require the
Company to actually place assets in such funds or purchase any
specific assets for purposes of the Plan.
9.3 FUNDS
The Committee shall choose investment vehicles on which to base the imputed
investment experience of Participant Accounts.
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Prior to the beginning of each Plan Year, the Committee, in its sole
discretion, shall determine the general fund categories and the specific
investment vehicles to be offered to Participants and shall notify the
Participants of its decisions. Notwithstanding the foregoing sentence, the
Committee may, at any time during the Plan Year, choose the Company's
common stock as an investment vehicle on which to base the imputed
investment experience of Participant Accounts; PROVIDED, HOWEVER, that only
Designated Employees shall be entitled to make such an investment election
and such Designated Employees shall only be entitled to make an election in
an amount equal to the value of the Plan Shares allocated to such
Designated Employee pursuant to Section 4.8.
9.4 ALLOCATION OF INVESTMENT EXPERIENCE
(a) Each Participant's Account shall be valued based upon the performance
of the deemed investment fund or funds selected by the Participant.
(b) The fair market value of any fund or funds shall be determined by the
Committee.
(c) Notwithstanding the foregoing, in the event the Committee decides to
offer the common stock of the Company as a deemed investment option,
the value of such deemed investment shall be equal to the Per Share
Aggregate Value multiplied by the number of shares deemed credited to
such individual's account.
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SECTION 10
FUNDING LIMITATIONS
10.1 BENEFIT STATUS
(a) All benefits under the Plan are unfunded obligations of the Company.
(b) At no time shall a Participant or the Participant's Beneficiary have
any right, title or interest in or to any specific fund or assets of
the Company.
(c) As to any claim for benefits under the Plan, the Participant or the
Participant's Beneficiary shall be a creditor of the Company in the
same manner as any other creditor having a general claim for unpaid
compensation.
10.2 INVESTMENT AND BENEFIT PAYMENT OBLIGATION OF THE COMPANY
(a) Nothing contained herein shall require the Company to set aside or
earmark any monies or other assets specifically for payments under the
Plan.
(b) Neither the Company nor any Trustee shall be obligated to purchase or
maintain any asset, and any reference to investments is solely for the
purpose of computing the value of benefits.
(c) Neither this Plan nor any action taken pursuant to the terms of this
Plan shall be considered to create a fiduciary relationship between
the Company and the Plan Participants or any other persons, or to
establish a trust in which the assets are beyond the claims of any
unsecured creditor of the Company.
(d) Benefits are payable as they become due irrespective of any actual
investments the Company may make to meet its obligations.
-21-
SECTION 11
VESTING
11.1 UPON RETIREMENT OR THE ATTAINMENT OF HIS DISABILITY TERMINATION DATE
Upon eligibility for Retirement or the attainment of his Disability
Termination Date, a Participant shall have a 100% vested interest in his
Account.
11.2 UPON DEATH
Upon the death of a Participant, such Participant's Beneficiary shall be
entitled to a 100% vested interest in the Participant's Account.
11.3 UPON OTHER TERMINATION OF EMPLOYMENT
Upon termination of a Participant's employment prior to his Retirement,
Disability Termination Date or death, the vested interest to which he shall
be entitled with respect to
(a) that portion of his Account attributable to his Voluntary Deferral
Allocations and any applicable investment experience credited to such
allocations shall be 100%;
(b) that portion of his Account attributable to his Company Discretionary
Allocations and any applicable investment experience credited to such
allocations shall be determined in accordance with the following
vesting schedules:
(i) For Employees who are designated as Key Employees as of the
Effective Date:
Years of Service
After Effective Date Vested Percentage
-------------------- -----------------
Less than 1 full year 0%
1 full year 33-1/3%
2 full years 66-2/3%
3 or more full years 100%
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(ii) For Employees who are designated as Key Employees after the
Effective Date:
"Years of Plan
Participation" Vested Percentage
-------------------- -----------------
Less than 1 full year 0%
1 full year 33-1/3%
2 full years 66-2/3%
3 or more full years 100%
For purposes of this Subparagraph, a "Year of Plan
Participation" shall mean each calendar year during which a
Participant elects to make Voluntary Deferral Allocations in
accordance with Section 6.
(c) Notwithstanding the foregoing, the Committee, in its sole discretion,
may, by written action, accelerate the vesting periods set forth in
Section 11.3(b) above.
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SECTION 12
REGULATIONS GOVERNING DISTRIBUTION OF BENEFITS
12.1 RETIREMENT ACCOUNT.
(a) COMMENCEMENT OF BENEFIT.
If a Participant terminates employment for any reason, including
death, the Company shall pay such Participant or his Beneficiary, if
applicable, a benefit in the form determined under Subsection (b),
which shall be distributed commencing on his Benefit Commencement
Date.
Notwithstanding the foregoing paragraph, if an individual ceases to be
a Participant in accordance with Subsection 5.4(c) and the
circumstances described in the last sentence of such Subsection apply,
the total value of his Retirement Account (whether or not vested)
shall be distributed as soon as administratively practicable following
the later of the effective date or publication date of the DOL notice
or regulations.
(b) METHOD OF DISTRIBUTION
(i) UPON RETIREMENT
Distribution of the Participant's Retirement Account as a result
of the Participant's Retirement shall be in one of the following
forms at the Participant's election, subject to the rules set
forth in Subsection (d):
(A) a single lump sum in cash;
(B) by combination of a single lump sum in cash and of a number
of Plan Shares of the Company not to exceed the number of
shares of common stock of the Company designated by the
Committee for allocation to the Participant pursuant to
Section 4.8 valued at the Per Share Aggregate Value; or
(C) substantially equal annual installments of cash over a
period of not less than two nor more than 15 full years.
Notwithstanding the foregoing, if the Participant's Retirement
Account has a value less
-24-
than $10,000 at the time benefits are to commence, then the
Committee shall determine (subject to the rules set forth in
Subsection (d) below), in its sole discretion, whether the
Participant's benefit shall be paid as (i) a single lump sum in
cash or (ii) by combination of a single lump sum in cash and of a
number of Plan Shares of the Company not to exceed the number of
shares of common stock of the Company designated by the Committee
for allocation to the Participant pursuant to Section 4.8 valued
at the Per Share Aggregate Value.
(ii) UPON DEATH OR DISABILITY TERMINATION
Distribution of the Participant's Retirement Account, as a result
of the Participant's death or his attainment of the Disability
Termination Date, shall be in a single lump sum in cash.
(iii) UPON TERMINATION OF EMPLOYMENT (OTHER THAN RETIREMENT, DEATH
OR DISABILITY)
Distribution of the Participant's Retirement Account as a result
of the Participant's termination of employment (other than
Retirement, death or Disability) shall be in one of the following
forms at the Participant's election, subject to the rules set
forth in Subsection (d):
(A) a single lump sum in cash; or
(B) by combination of a single lump sum in cash and of a number
of Plan Shares of the Company not to exceed the number of
shares of common stock of the Company designated by the
Committee for allocation to the Participant pursuant to
Section 4.8 valued at the Per Share Aggregate Value;
Notwithstanding the foregoing, if the Participant's Retirement
Account has a value less than $10,000 at the time benefits are to
commence, then the Committee shall determine (subject to the
rules set forth in Subsection (d) below), in its sole discretion,
whether the Participant's benefit shall be paid as (i) a single
lump sum in cash or (ii) by combination of a single lump sum in
cash and of a number of Plan Shares of the Company not to exceed
the number of shares of common stock of the Company designated by
the Committee for
-25-
allocation to the Participant pursuant to Section 4.8 valued at
the Per Share Aggregate Value.
(c) DETERMINATION OF BENEFITS
(i) In the event that the Participant elects to have his
benefits distributed in accordance with
Subsection (b)(i)(A), (b)(ii) or his benefits are
distributed in accordance with (b)(iii)(A), he shall receive
a single lump sum in cash equal to the total vested value of
his Account determined as of the Valuation Date immediately
preceding his Determination Date.
(ii) In the event that the Participant elects to have his
benefits distributed in accordance with Subsection (b)(i)(B)
or (b)(iii)(B), he shall receive (A) a combination of a
single lump sum in cash and (B) the number of Plan Shares
designated by the Committee pursuant to Section 4.8 for
allocation to the Participant (valued at the Per Share
Aggregate Value) equal to the total vested value of his
Account determined as of the Valuation Date immediately
preceding his Determination Date.
(iii) In the event that the Participant elects to have his
benefits distributed in accordance with
Subsection (b)(i)(C), the
(A) amount of the first payment shall be determined by
multiplying the vested value of the Participant's
Account as of the Valuation Date immediately preceding
his Determination Date, by a fraction
(1) the denominator of which equals the number of
years over which the benefits are to be paid; and
(2) the numerator of which is one.
(B) amounts of the payments for each succeeding year shall
be determined by multiplying the vested value of the
Participant's Account as of the Valuation Date
immediately preceding the
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applicable anniversary of his Determination Date by a
fraction,
(1) the denominator of which equals the number of
remaining years over which the benefits are to be
paid; and
(2) the numerator of which is one.
(d) ELECTION OF FORM OF BENEFIT PAYMENT.
(i) A Participant shall elect the form in which his benefits are
payable upon Retirement in accordance with Subsection (b).
Such election must be made when the Participant makes his
initial election to participate in the Plan in accordance
with Section 5.
(ii) Notwithstanding the foregoing, the Participant may elect to
change the form(s) elected in accordance with Subparagraph
(i), provided such new election is made at least one full
calendar year prior to the Participant's Determination Date.
If the Participant's Determination Date occurs prior to one
full calendar year following the new election, such election
shall not be honored and the Participant's prior election
shall remain in effect.
(iii) Notwithstanding any provision contained herein to the
contrary, before being required to issue any Plan Shares to
a Participant in accordance with this Section 12, the
Committee may require the Participant at the Participant's
expense to provide an opinion of counsel satisfactory to the
Committee that any such issuance is exempt from registration
or qualification under the federal and state securities laws
and the securities and other applicable laws of the
jurisdiction of residence of the Participant. If the
Participant is unable for any reason to provide an opinion
of counsel satisfactory to the Committee within 30 days
after the Determination Date, the Participant shall forfeit
his right to receive any Plan Shares pursuant to this Plan
and, notwithstanding
-27-
Paragraph (d)(ii) above, shall promptly submit a new
distribution election form consistent with the elections
available under Sections 12.1(b)(i)(A) or (C) or Section
12.1(iii)(A), as applicable.
(iv) Any election made pursuant to this Section shall be made on
forms and in the manner prescribed by the Committee and
shall be irrevocable, except as provided in
Paragraphs (d)(ii) and (d)(iii) above.
12.2 EDUCATION ACCOUNT.
(a) If a Participant (i) remains continuously employed by the Company
until January 1 of the calendar year in which an Eligible Dependent
attains age 18 or (ii) terminates employment as a result of his
Retirement during or after such time period, the Company shall pay to
the Participant a portion of his benefit in cash on each Benefit
Commencement Date as determined in accordance with the following
schedule. The amount of the first payment shall be determined by
multiplying the value of the Participant's Education Account as of the
Valuation Date immediately preceding his Determination Date by the
percentage designated below for year 1. The amounts of the payments
for each succeeding year shall be determined by multiplying the value
of the Participant's Education Account as of the applicable
anniversary of the Valuation Date immediately preceding his
Determination Date by the percentage designated below for each
succeeding year.
January 1st Percentage of Eligible
Year Dependent's Subaccount
------------ ----------------------
1 25%
2 33-1/3%
3 50%
4 100%
(b) Subject to the requirements of Section 9.2, a Participant may
establish subaccounts under his Education Account by designating
Eligible Dependents. A Participant may have a maximum of three such
subaccounts at any time. A Participant's election pursuant to Section
8.2 shall apply uniformly to each subaccount.
(c) If a Participant terminates his employment for any reason other than
Retirement with a balance in his
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Education Account, the balance shall be transferred to his Retirement
Account and distributed in accordance with Subsections 12.1(a) and
(b); but no later than he would have received his benefit as provided
in Subsection 12.2(a) above; provided, however, that any such transfer
effected pursuant to this Subsection 12.2(c) shall only entitle the
Participant to receive a payment distribution with respect to his
Education Account under Subsection 12.1(b)(i)(A).
(d) Notwithstanding any provision to the contrary, if on the January 1 of
the calendar year in which an Eligible Dependent of a Participant
attains age 18, the Eligible Dependent's subaccount has a balance of
less than $10,000, then the Committee shall direct that the balance be
paid to the Participant in one lump sum in cash.
(e) If an Eligible Dependent dies prior to the payment of the full amount
credited to his subaccount, the balance shall be transferred to the
Participant's Retirement Account as soon as administratively
practicable following the Valuation Date coinciding with or
immediately following the Eligible Dependent's death.
(f) For purposes of this Section, "Eligible Dependent" means an individual
who is a child, stepchild, grandchild, niece or nephew, or who is
otherwise identified as a dependent of a Participant for purposes of
the Code who is living at any time throughout the Enrollment Period
and who is either younger than age 14 or younger than age 18 but for
whom a subaccount was initially established pursuant to Subsection (b)
prior to his attaining age 14.
12.3 FIXED PERIOD ACCOUNT.
(a) On his Benefit Commencement Date, the Participant shall receive a
benefit equal to the lump sum value in cash of the Participant's Fixed
Period Account determined as of the Valuation Date immediately
preceding the Determination Date.
(b) A Participant shall designate the payment year in the written
statement by which the Fixed Period Account is established. Such
payment year must not be less than four full calendar years subsequent
to the date the Fixed Period Account of reference is established.
Subject to the requirements of Section 8.2, a Participant may
establish subaccounts under his Fixed
-29-
Period Account, with separate payment years for each. A Participant
may have a maximum of two such subaccounts at any time. A
Participant's election pursuant to Section 8.2 shall apply uniformly
to each subaccount.
(c) If a Participant's employment terminates for any reason and the
Participant has a balance in his Fixed Period Account, the balance
shall be transferred to his Retirement Account and be distributed in
accordance with Subsections 12.1(a) and (b); but no later than he
would have received his benefit as provided in Subsection 12.3(a)
above; provided, however that any such transfer effected pursuant to
this Subsection 12.3(c) shall only entitle the Participant to receive
a payment distribution with respect to his Fixed Period Account under
Subsection 12.1(b)(i)(A).
12.4 CLAIM PROCEDURE FOR BENEFITS
(a) Any request for specific information with respect to benefits under
the Plan must be made to the Committee in writing by a Participant or
his Beneficiary. Oral communications will not be recognized as a
formal request or claim for benefits.
(b) The Committee shall provide adequate notice in writing to any
Participant or Beneficiary whose claim for benefits under the Plan has
been denied, (i) setting forth the specific reasons for such denial;
specific references to pertinent plan provisions; a description of any
material and information which had been requested but not received by
the Committee; and, (ii) advising such Participant or Beneficiary that
any appeal of such adverse determination must be in writing to the
Committee, within such period of time designated by the Committee but,
until changed, not more than 60 days after receipt of such
notification, and must include a full description of the pertinent
issues and basis of such claim.
(c) If the Participant or Beneficiary fails to appeal such action to the
Committee in writing within the prescribed period of time, the
Committee's adverse determination shall be final.
(d) If an appeal is filed with the Committee, the Participant or
Beneficiary shall submit such issues he feels are pertinent and the
Committee shall reexamine all facts, make a final determination as to
whether the denial of benefits is justified under the
-30-
circumstances, and advise the Participant or Beneficiary in writing of
its decision and the specific reasons on which such decision was
based, within 60 days of receipt of such written request, unless
special circumstances require a reasonable extension of such 60-day
period.
12.5 SUBSTITUTE PAYEE
If a Participant or Beneficiary entitled to receive any benefits hereunder
is in his minority, or is, in the judgment of the Committee, legally,
physically, or mentally incapable of personally receiving and receipting
any distribution, the Committee may make distributions to a legally
appointed guardian or to such other person or institution as, in the
judgment of the Committee, is then maintaining or has custody of the payee.
12.6 SATISFACTION OF LIABILITY
After all benefits have been distributed in full to a Participant or to his
Beneficiary, all liability to such Participant or to his Beneficiary under
the Plan shall cease.
12.7 NONASSIGNABILITY
No benefit under the Plan shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or charge, and
any such action shall be void for all purposes of the Plan. No benefit
shall in any manner be subject to the debts, contracts, liabilities,
engagements or torts of any person, nor shall it be subject to attachments
or other legal process for or against any person, except to such extent as
may be required by law.
12.8 REPURCHASE PROVISIONS APPLICABLE TO PLAN SHARES
(a) REPURCHASE RIGHT IN CASE OF TERMINATION.
Notwithstanding any other provision of the Plan, if at any time prior to an
Initial Public Offering, a Participant's employment with the Company or any
of its subsidiaries is terminated for any reason whatsoever, including,
without limitation, death, disability, resignation, retirement or
termination with or without cause, the Company or its designee(s) (which
designee(s) may be any person or entity that shall have been approved by
the Committee) shall have the exclusive and irrevocable option (a "call"),
exercisable in its sole discretion, to repurchase, in whole or in part, the
Plan Shares that are then owned (or will be
-31-
owned pursuant to an election made under Section 12.1(b)) by such
Participant or any transferee of the Plan Shares. The Company or its
designee(s) may exercise the call for all or any portion of the Plan Shares
subject to such repurchase hereunder by delivering written notice (a
"REPURCHASE NOTICE") to the holder or holders of such Plan Shares within 60
days of the Participant's Determination Date. The Repurchase Notice will
set forth the number of Plan Shares to be acquired from each holder, the
aggregate consideration to be paid for such shares and the time and place
for the closing of the transaction. Each terminated Participant and any
transferee shall be obligated to resell the Plan Shares as provided in this
Section 12.8 in response to an exercise by the Company of its call under
this Section.
The number of Plan Shares to be repurchased by the Company shall first be
satisfied to the extent possible from the Plan Shares held by the
terminated Participant. If the number of Plan Shares then held by such
Participant is less than the total number of Plan Shares the Company has
elected to call, the Company shall purchase the remaining Plan Shares
elected to be purchased from such Participant's transferees, PRO RATA
according to the number of Plan Shares held by such other transferees as of
the Determination Date (determined as nearly as practicable to the nearest
share).
The consummation of the purchase or purchases of such Plan Shares pursuant
to the Company's exercise of its call shall take place on the date and in
the manner designated by the Company in the Repurchase Notice, which date
shall not be more than 30 days after the delivery of Repurchase Notice;
PROVIDED, HOWEVER, that the Company may consummate its purchase of such
Plan Shares pursuant to its exercise of its call by delivering payment for
such Plan Shares being repurchased by it along with the Repurchase Notice.
The Company will pay for the Plan Shares to be purchased by it pursuant to
the exercise of a call by delivery of a check in an amount equal to the
applicable repurchase price for the Plan Shares being repurchased. The
Company will, in connection with such repurchase, be entitled to receive
customary representations and warranties from the sellers regarding such
sale and to require that all sellers' signatures be guaranteed.
Notwithstanding anything to the contrary contained in this Plan, all
repurchases of Plan Shares by the Company shall be subject to applicable
restrictions contained in the Delaware General Corporation Law and in the
Company's debt and equity financing agreements. If any such restrictions
-32-
prohibit the repurchase of Plan Shares hereunder which the Company is
otherwise entitled to make, the Company may make such repurchases as soon
as it is permitted to do so under such restrictions and the time periods
for exercise of its rights hereunder shall be tolled during any such period
of disability. The Company shall pay interest on any portion of the Plan
Shares being repurchased subject to the restrictions set forth in this
paragraph, which interest shall accrue at an annual rate of 10% and be paid
on the date such restricted portion of the Plan Shares are repurchased.
(b) PURCHASE PRICE.
The purchase price per share for any Plan Shares purchased pursuant to
Section 12.8(a) shall be equal to the Per Share Aggregate Value determined
as of the Valuation Date immediately preceding the delivery date of the
Repurchase Notice. The Committee (excepting any director who is a
Participant) shall determine the purchase price per share in the manner set
forth in this Section; PROVIDED, HOWEVER, that the Participant or his
transferee, as applicable, may in good faith challenge the Committee's
determination and require that the purchase price per share be determined
by the Company's independent auditors in the manner set forth in this
section. The result of such determination shall be binding on the Company
and the Participant or his transferee, as the case may be. The expenses of
such determination shall be borne by the Company.
12.9 TRANSFER RESTRICTIONS.
Each Participant electing to receive Plan Shares shall hold those shares
subject to the terms of the Second Amended and Restated Stockholders
Agreement dated as of November 7, 1996, as the same shall be amended from
time to time (the "Stockholders Agreement"), and the Second Amended and
Restated Registration Rights Agreement dated as of November 7, 1996, as the
same shall be amended from time to time (the "Registration Rights
Agreement") and the terms of the subscription agreement executed by such
Participant. As provided in the Stockholders Agreement, the Plan Shares
may be transferred in certain limited circumstances. Any transferee of any
Plan Shares shall take those shares subject to the terms of the Plan,
including, without limitation, the repurchase rights set forth in this
Article XII, the subscription agreement executed by the transferor
Participant, the Stockholders Agreement and the Registration Rights
Agreement. Any such transferee must, upon the request of the Company,
execute an agreement agreeing to be bound by the Plan and such restrictions
and
-33-
must agree to such other waivers, limitations and restrictions as the
Company may reasonably require. The Company shall not, and shall not
permit any transfer agent or registrar for any shares of the Company's
capital stock to, transfer upon the books of the Company any shares of the
Company's capital stock originally issued under or pursuant to the Plan in
any manner except in accordance with this provision, and any purported
transfer not in compliance herewith shall be void.
-34-
SECTION 13
BENEFICIARY DESIGNATION
13.1 Each Participant, upon becoming eligible for participation in the
Plan, may designate a Beneficiary to receive the benefits payable in
the event of his death, and designate a successor Beneficiary to
receive any benefits payable in the event of the death of any other
Beneficiary.
13.2 A Participant may change his Beneficiary at any time. All Beneficiary
designations and changes shall be made on an appropriate form as
designated by the Committee and filed with the Committee.
13.3 If no person shall be designated by the Participant, or if the
designated Beneficiary shall not survive the Participant, payment of
the Participant's Account shall be made to the Participant's estate.
-35-
SECTION 14
AMENDMENT AND TERMINATION
14.1 AMENDMENT
The Company may amend or otherwise modify the Plan by resolution of its
Board of Directors, in whole or in part, either retroactively or
prospectively, provided that no amendment or modification shall, with
respect to allocations already credited or investment experience accrued,
change the amount of allocations under Section 6 or Section 7 or investment
experience under Section 9 or increase the vesting requirements under
Section 11.
14.2 TERMINATION
The Plan may be terminated at any time at the discretion of the Company by
resolution of its Board of Directors. Written notification of such action
shall be given to each Participant, the Trustee and the Committee.
Thereafter, no further allocations or credits shall be made to the Plan.
As soon as administratively feasible following termination of the Plan, the
Committee shall distribute the amount in each Account (whether or not
vested) to or on behalf of the Participant or, if following the
Participant's death, the Beneficiary entitled thereto.
-36-
SECTION 15
GENERAL PROVISIONS
15.1 LIMITATION OF RIGHTS
Neither the establishment of the Plan or the Trust Agreement, nor any
modification thereof, nor the creation of an account, nor the payment of
any benefits shall be construed as giving any Participant, Beneficiary, or
any other person whomsoever, any legal or equitable right against the
Company, the Trustee or the Committee unless such right shall be
specifically provided for in the Plan or the Trust Agreement or conferred
by affirmative action of the Committee in accordance with the terms and
provisions of the Plan; or as giving any Participant the right to be
retained in the service of the Company, and all Participants and other
employees shall remain subject to discharge to the same extent as if the
Plan had never been adopted.
15.2 CONSTRUCTION OF AGREEMENT
The Plan shall be construed according to the laws of the State of Illinois,
and all provisions hereof shall be administered according to, and its
validity shall be determined under, the laws of Illinois unless preempted
by Federal law.
15.3 SEVERABILITY
Should any provision of the Plan or any regulations adopted thereunder be
deemed or held to be unlawful or invalid for any reason, such fact shall
not adversely affect the other provisions or regulations unless such
invalidity shall render impossible or impractical the functioning of the
Plan and, in such case, the appropriate parties shall immediately adopt a
new provision or regulation to take the place of the one held illegal or
invalid.
15.4 TITLES AND HEADINGS
The titles and headings of the Sections in this instrument are for
convenience of reference only and, in the event of any conflict, the text
rather than such titles or headings shall control.
-37-
15.5 BINDING UPON SUCCESSORS
The liabilities under the Plan shall be binding upon any successor or
assign of the Company and any purchaser of the Company or substantially all
of the assets of the Company.
15.6 NOTICES. All notices, requests, consents and other communications required
or permitted hereunder shall be in writing and shall be deemed to have been
duly given and made and served either by personal delivery to the person
for whom it is intended or if deposited, postage prepaid, registered or
certified mail, return receipt requested, in the United States mail or if
by facsimile transmission to the facsimile numbers below:
If to the Company, addressed to:
International Logistics Limited
330 South Mannheim Road
Hillside, Illinois 60162
Attention: Roger E. Payton
Facsimile No.: (708) 547-4524
With copies to:
Milbank, Tweed, Hadley & McCloy
601 South Figueroa Street
Suite 3100
Los Angeles, California 90017
Attention: Eric H. Schunk, Esq.
Facsimile No.: (213) 629-5063
If to any Participant, addressed to:
such Participant at its address shown on the stock records of the
Company, or at such other address as such Participant may specify
by written notice to the Company
15.7 SECURITIES LAWS RESTRICTIONS AND ADDITIONAL RESTRICTIONS ON TRANSFER OF
OFFERED SHARES.
(a) Each Participant electing to receive Plan Shares will be required to
represent to the Company in a subscription agreement that such
Participant is purchasing Plan Shares for his or her own account for
investment and not on behalf of others or otherwise with a view toward
distributing them. Each Participant is advised that federal and state
securities laws govern and restrict each Participant's right to offer,
sell or otherwise dispose of any Plan Shares unless
-38-
such Participant's offer, sale or other disposition thereof is
registered under the Securities Act, and state securities laws, or in
the opinion of the Company's counsel, such offer, sale or other
disposition is exempt from registration or qualification thereunder.
Any Participant electing to receive Plan Shares will be required to
agree that such Participant will not offer, sell or otherwise dispose
of any such Plan Shares in any manner which would: (i) require the
Company to file any registration statement with the Commission (or any
similar filing under state law) or to amend or supplement any such
filing or (ii) violate or cause the Company to violate the Securities
Act, the rules and regulations promulgated thereunder or any other
state or federal law. The certificates for any Plan Shares will bear
such legends as the Company deems necessary or desirable in connection
with the Securities Act or other rules, regulations or laws.
(b) The certificates representing the Plan Shares will bear the following
legend:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY
STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED
OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE REGISTERED AND QUALIFIED
IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS,
OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY
SUCH REGISTRATION AND QUALIFICATION ARE NOT REQUIRED."
"THE SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO THAT CERTAIN
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT, DATED AS OF
NOVEMBER 7, 1996, A SUBSCRIPTION AGREEMENT, DATED ____________, 1997,
A SECOND AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT DATED AS
OF NOVEMBER 7, 1996, AND A DEFERRED COMPENSATION PLAN DATED AS OF JULY
1, 1996, COPIES OF WHICH ARE ON FILE AT THE PRINCIPAL OFFICE OF THE
COMPANY AND WILL BE FURNISHED TO THE HOLDER ON REQUEST TO THE
SECRETARY OF THE COMPANY. SUCH STOCKHOLDERS AGREEMENT, SUBSCRIPTION
AGREEMENT AND REGISTRATION RIGHTS AGREEMENT PROVIDE, AMONG OTHER
THINGS, FOR CERTAIN RESTRICTIONS ON VOTING, SALE, TRANSFER, PLEDGE,
HYPOTHECATION OR OTHER DISPOSITION OF THE SECURITIES EVIDENCED BY THIS
CERTIFICATE AND THAT SUCH SECURITIES MAY BE SUBJECT TO PURCHASE BY THE
COMPANY AS WELL AS CERTAIN OTHER PERSONS UPON THE OCCURRENCE OF
CERTAIN EVENTS. ANY ISSUANCE, SALE, ASSIGNMENT, TRANSFER OR
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OTHER DISPOSITION OF THE SECURITIES EVIDENCED BY THIS CERTIFICATE TO
PERSONS WHO ARE NOT A PARTY TO SUCH STOCKHOLDERS AGREEMENT SHALL BE
NULL AND VOID."
(c) Notwithstanding any other provision of this Plan, the Company may
refuse to register any transfer of Plan Shares if the registration of
such transfer would require the Company to register any class of
equity securities with the Commission under the Securities Exchange
Act (except in connection with an effective registration statement
under the Securities Act).
(d) Unless otherwise provided in the Stockholders Agreement or the
Registration Rights Agreement, each Participant electing to receive
Plan Shares agrees, by his acceptance of such Plan Shares, not to
effect any public sale or distribution of any Plan Shares or other
equity securities of the Company, or any securities convertible into
or exchangeable or exercisable for any of the Company's equity
securities, during the ten days prior to and the 120 days after the
effectiveness of any underwritten public offering of any class of the
Company's equity securities, except as part of such underwritten
public offering or if otherwise consented to by the Company in writing
prior to such sale or distribution.
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