U.S. BANCORP
DEFERRED COMPENSATION PLAN FOR DIRECTORS
(1998 RESTATEMENT)
First Effective January 1, 1988
As Amended and Restated Effective January 1, 1998
U.S. BANCORP
DEFERRED COMPENSATION PLAN FOR DIRECTORS
(1998 RESTATEMENT)
TABLE OF CONTENTS
PAGE
SECTION 1. INTRODUCTION 1
1.1. Restatement of Plan
1.2. Definitions
1.2.1. Account
1.2.2. Annual Valuation Date
1.2.3. Beneficiary
1.2.4. Director
1.2.5. Event of Maturity
1.2.6. Plan
1.2.7. Plan Statement
1.2.8. Plan Year
1.2.9. Prior Plan Statement
1.2.10. USB
1.2.11. Valuation Date
1.3. Rules of Interpretation
1.4. Additional Definitions
1.4.1. Acquiring Person
1.4.2. Affiliate
1.4.3. Associate
1.4.4. Beneficial Owner
1.4.5. Board of Directors
1.4.6. Company Entity
1.4.7. Continuing Director
1.4.8. Exchange Act
1.4.9. Full Change In Control
1.4.10. Partial Change in Control
1.4.11. Permitted Transaction
1.4.12. Person
1.4.13. Resulting Corporation
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SECTION 2. PARTICIPATION 5
2.1. Participation
2.2. Enrollment
2.3. Revocation
2.4. Prior Years' Enrollments
SECTION 3. ADDITIONS TO ACCOUNTS 6
SECTION 4. ESTABLISHMENT AND ADJUSTMENT OF ACCOUNTS 6
4.1. Establishment of Accounts
4.2. Payment of Accounts
4.2.1. Intermediate Distributions Adjustment
4.2.2. Investment Adjustment for Account
4.2.3. Contribution Adjustment
4.2.4. Final Distributions Adjustment
SECTION 5. VESTING OF ACCOUNT 7
SECTION 6. MATURITY 7
6.1. Events of Maturity
6.2. Determination of Account
6.3. Effect of Maturity upon Further Participation in Plan
SECTION 7. DISTRIBUTION 8
7.1. Time of Distribution
7.1.1. Form of Distribution
7.1.2. Time of Distribution
7.1.3. Substantially Equal
7.1.4. Default
7.1.5. Change In Control
7.2. Designation of Beneficiaries
7.2.1. Right To Designate
7.2.2. Failure of Designation
7.2.3. Disclaimers by Beneficiaries
7.2.4. Definitions
7.2.5. Special Rules
7.2.6. No Spousal Rights
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7.3. Death Prior to Full Distribution
7.4. Facility of Payment
SECTION 8. FUNDING OF PLAN 12
8.1. Unfunded Agreement
8.2. Spendthrift Provision
SECTION 9. AMENDMENT AND TERMINATION 13
SECTION 10. DETERMINATIONS -- RULES AND REGULATIONS 13
10.1. Determinations
10.2. Rules and Regulations
10.3. Method of Executing Instruments
10.4. Information Furnished by Directors
SECTION 11. PLAN ADMINISTRATION 14
11.1. USB
11.2. Conflict of Interest
SECTION 12. DISCLAIMERS 14
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U.S. BANCORP
DEFERRED COMPENSATION PLAN FOR DIRECTORS
(1998 RESTATEMENT)
SECTION 1
INTRODUCTION
1.1. RESTATEMENT OF PLAN. Effective January 1, 1988, FIRST BANK SYSTEM,
INC., a Delaware corporation (hereinafter sometimes referred to as "FBS")
authorized the creation of a nonqualified, unfunded, directors' deferral plan
for the purpose of allowing Directors who are not full-time salaried
employees of FBS to defer the receipt of directors' fees which would otherwise
be paid to the Director. FBS created and established a series of
substantially identical annual directors' deferral plans, effective as of
January 1, 1988. They were set forth in documents referred to collectively
as the "Prior Plan Statement." On August 1, 1997, following its merger with
U.S. Bancorp, an Oregon corporation, FBS changed its name to U.S. BANCORP
("USB"). USB has reserved the power to amend and terminate the Prior Plan
Statement from time to time. USB now desires to exercise that reserved power
of amendment by the adoption of this Plan Statement effective as of January
1, 1998.
1.2. DEFINITIONS. When the following terms are used herein with initial
capital letters, they shall have the following meanings:
1.2.1. ACCOUNT -- the separate bookkeeping account representing the
unfunded and unsecured general obligation of USB established with respect to
each Director to which is credited the dollar amounts specified in Section 3 and
Section 4 and from which are subtracted payments made pursuant to Section 5 and
Section 7. To the extent necessary to accommodate different distribution
elections made pursuant to Section 2, the Account shall be maintained as
separate sub-accounts in sufficient number to accommodate each such distribution
election.
1.2.2. ANNUAL VALUATION DATE -- each December 31.
1.2.3. BENEFICIARY -- a person designated by a Director (or
automatically by operation of this Plan Statement) to receive all or a part of
the Director's Account in the event of the Director's death prior to full
distribution thereof. A person so designated shall not be considered a
Beneficiary until the death of the Director.
1.2.4. DIRECTOR -- an individual serving on the Board of Directors
of USB who is not at the same time a common law employee of USB or any of its
subsidiary corporations.
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1.2.5. EVENT OF MATURITY -- any of the occurrences described in
Section 6 by reason of which a Director or Beneficiary may become entitled to a
distribution from the Plan.
1.2.6. PLAN -- the income deferral program maintained by USB
established for the benefit of Directors eligible to participate therein, as
first set forth in the Prior Plan Statement and as amended and restated in
this Plan Statement. (As used herein, "Plan" does not refer to the documents
pursuant to which the Plan is maintained. Those documents are referred to
herein as the "Prior Plan Statement" and the "Plan Statement"). The Plan shall
be referred to as the "U.S. BANCORP DEFERRED COMPENSATION PLAN FOR DIRECTORS."
1.2.7. PLAN STATEMENT -- this document entitled "U.S. BANCORP
DEFERRED COMPENSATION PLAN FOR DIRECTORS (1998 Restatement)" as adopted by the
Board of Directors of U.S. BANCORP effective as of January 1, 1998, as the
same may be amended from time to time thereafter.
1.2.8. PLAN YEAR -- the twelve (12) consecutive month period ending
on any Annual Valuation Date.
1.2.9. PRIOR PLAN STATEMENT -- the series of documents pursuant to
which the Plan was established effective as of January 1, 1988, and operated
thereafter until January 1, 1998.
1.2.10. USB -- U.S. BANCORP (formerly known as FIRST BANK SYSTEM,
INC.), a Delaware corporation, or any successor thereto.
1.2.11. VALUATION DATE -- the last day of each calendar month of the
Plan Year.
1.3. RULES OF INTERPRETATION. Whenever appropriate, words used herein
in the singular may be read in the plural, or words used herein in the plural
may be read in the singular; the masculine may include the feminine; and the
words "hereof," "herein" or "hereunder" or other similar compounds of the
word "here" shall mean and refer to this entire Plan Statement and not to any
particular paragraph or section of this Plan Statement unless the context
clearly indicates to the contrary. The titles given to the various sections
of this Plan Statement are inserted for convenience of reference only and are
not part of this Plan Statement, and they shall not be considered in
determining the purpose, meaning or intent of any provision hereof. Any
reference in this Plan Statement to a statute or regulation shall be
considered also to mean and refer to any subsequent amendment or replacement
of that statute or regulation. This document has been executed and delivered
in the State of MINNESOTA and has been drawn in conformity to the laws of
that State and shall be construed and enforced in accordance with the laws of
the State of MINNESOTA.
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1.4. ADDITIONAL DEFINITIONS. When the following terms are used herein with
initial capital letters, they shall have the following meanings:
1.4.1. ACQUIRING PERSON -- any Person who or which, together
with all Affiliates and Associates of such person, is the Beneficial Owner,
directly or indirectly, of securities of USB representing 20% or more of the
combined voting power of USB's then outstanding securities, but shall not
include any Company Entity.
1.4.2. AFFILIATE -- shall have the meaning ascribed to the term
"Affiliate" in Rule 12b-2 promulgated under the Exchange Act.
1.4.3. ASSOCIATE -- shall have the meaning ascribed to such term in
Rule 12b-2 promulgated under the Exchange Act.
1.4.4. BENEFICIAL OWNER -- shall have the meaning ascribed to such
term in Rule 13d-3 promulgated under the Exchange Act.
1.4.5. BOARD OF DIRECTORS -- the board of directors of USB.
1.4.6. COMPANY ENTITY -- USB, any subsidiary of USB or any employee
benefit plan of USB or of any subsidiary of USB or any entity holding shares of
the voting capital stock of USB organized, appointed or established for, or
pursuant to the terms of, any such plan.
1.4.7. CONTINUING DIRECTOR -- any person who is a member of the
Board of Directors, while such person is a member of the Board of Directors,
who is not an Acquiring Person or an Affiliate or Associate of an Acquiring
Person, or a representative of an Acquiring Person or of any such Affiliate
or Associate, and who (x) was a member of the Board of Directors as of July 17,
1996 or (y) subsequently becomes a member of the Board of Directors, if
such person's initial nomination for election or initial election to the Board
of Directors has been approved in advance by the Continuing Directors;
provided that any director designated by or on behalf of a Person who has
entered into an agreement with USB (or who is contemplating entering into
such an agreement) to effect a consolidation or merger of USB or a Company
Entity, or other reorganization, with or into one or more entities which are
not Company Entities, and any director that serves in connection with the act
of the Board of Directors of increasing the number of directors and filling
vacancies in connection with, or in contemplation of, any such transaction,
shall not be deemed to have received such advance approval for initial
nomination or election, and any such director shall not be deemed to be a
Continuing Director; provided, further, that any such director shall
subsequently become a Continuing Director at such time as a new term of
office as a director is approved by USB's shareholders at an annual meeting of
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shareholders occurring subsequent to the completion of any such transaction (and
excluding any annual meeting at which the shareholders approve any such
transaction); and, provided, further, that in the case of a Permitted
Transaction, any such director shall not become a Continuing Director until the
later of (i) the end of the three-year period following consummation of such
Permitted Transaction or (ii) such time as a new term of office as a director is
approved by USB's shareholders at an annual meeting of shareholders occurring
subsequent to the completion of such Permitted Transaction.
1.4.8. EXCHANGE ACT -- the Securities Exchange Act of 1934, as
amended.
1.4.9. FULL CHANGE IN CONTROL -- shall mean:
(a) the public announcement (which, for purposes of this
definition, shall include, without limitation, a report
filed pursuant to Section 13(d) of the Exchange Act) by USB
or any Person that a Person (other than a Company Entity)
has become the Beneficial Owner, directly or indirectly, of
securities of USB (x) representing 20% or more, but not more
than 50%, of the combined voting power of USB's then
outstanding securities unless the transaction resulting in
such ownership has been approved in advance by the
Continuing Directors or (y) representing more than 50% of
the combined voting power of USB's then outstanding
securities (regardless of any approval by the Continuing
Directors); or
(b) the Continuing Directors cease to constitute a majority of
the Board of Directors of USB or the Resulting Corporation,
except in accordance with the terms of a Permitted
Transaction and except as a result of the death, retirement
or disability of one or more Continuing Directors (unless
any such death, retirement or disability occurs following a
Permitted Transaction and any vacancies created thereby are
not filled in accordance with the terms of the written
agreement governing such Permitted Transaction); or
(c) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or
substantially all of the consolidated assets of USB and its
subsidiaries or the adoption of any plan of liquidation or
dissolution of USB.
1.4.10. PARTIAL CHANGE IN CONTROL -- shall mean:
(a) a consolidation or merger of USB or a Company Entity, or
other reorganization, with or into one or more entities
which are not Company
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Entities, as a result of which less than 60% of the
outstanding voting securities of the Resulting Corporation
are, or are to be, owned by former shareholders of USB as
determined immediately prior to consummation of such
transaction (excluding voting securities of the Resulting
Corporation owned, or to be owned, by such shareholders by
reason of their ownership prior to such transaction of
securities of any entity other than USB) and as a result of
which the Continuing Directors constitute (i) more than 50%
of the Board of Directors of the Resulting Corporation or
(ii) exactly 50% of the Board of Directors of the Resulting
Corporation if the transaction resulting in such event is a
Permitted Transaction; or
(b) the public announcement (which, for purposes of this
definition, shall include, without limitation, a report
filed pursuant to Section 13(d) of the Exchange Act) by USB
or any Person that a Person (other than a Company Entity)
has become the Beneficial Owner, directly or indirectly, of
securities of USB representing 20% or more, but not more
than 50%, of the combined voting power of USB's then
outstanding securities if the transaction resulting in such
ownership has been approved in advance by the Continuing
Directors.
1.4.11. PERMITTED TRANSACTION -- a transaction in which, pursuant
to a written agreement between USB and all Persons who have entered into an
agreement with USB to effect a transaction described in paragraph (a) of the
definition of Partial Change in Control, it is agreed that (w) the Chief
Executive Officer of USB immediately prior to the consummation of such
transaction shall be the Chief Executive Officer of the Resulting Corporation
for not less than three years following consummation of such transaction, (x)
upon termination of service of any Continuing Director for any reason,
including upon death, disability or retirement, prior to the expiration of
such director's term during such three-year period, the vacancy thereby
created shall be filled by a nominee selected solely by the Continuing
Directors, (y) upon expiration of the term of any such director during such
three-year period, the nominee to succeed such director shall be selected
solely by the Continuing Directors and (z) the parties will take other
appropriate steps to ensure that the Board of Directors of the Resulting
Corporation will be evenly divided between Continuing Directors and all
directors designated by other parties to the transaction during such
three-year period.
1.4.12. PERSON -- shall have the meaning ascribed to such term as
such term is used in Sections 13(d) and 14(d) of the Exchange Act.
1.4.13. RESULTING CORPORATION -- the surviving corporation in any
consolidation, merger or other reorganization to which USB is a party; provided,
however, that if the surviving corporation in any such transaction is a
subsidiary of another corporation, then the Resulting
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Corporation is the ultimate parent corporation of such surviving corporation;
and provided, further, that in the event of a consolidation, merger or other
reorganization to which a Company Entity (other than USB) is a party, then USB
shall be deemed the Resulting Corporation.
SECTION 2
PARTICIPATION
2.1. PARTICIPATION. Each Director of USB shall be a participant in the
Plan as of the first day the Director first becomes a Director.
2.2. ENROLLMENT. Prior to the first day of participation, the Director may
enroll in the Plan for the remainder of that Plan Year. Prior to the first day
of any subsequent Plan Year, a Director may make a new enrollment for that Plan
Year. Once made, the enrollment shall be irrevocable for the remainder of the
Plan Year with respect to which it is made. Each such enrollment, whether for
the initial Plan Year or for a subsequent Plan Year, shall designate in writing:
(a) the amount or portion of the Director's annual retainer and
meeting fees which shall not be paid to the Director but
instead shall be accumulated in this Plan under Section 3
and Section 4 and distributed from this Plan under Section 6
and Section 7; and
(b) the time and form in which the Account or portion of Account
attributable to such Plan Year's accumulation shall be paid
to the Director in accordance with Section 7.
2.3. REVOCATION. A Director's written enrollment for the 1998 Plan Year or
any later Plan Year shall continue in effect after the Plan Year with respect to
which it is made until an Event of Maturity occurs as to the Director or until
the last day of the Plan Year in which the Director files a written revocation
of the Director's enrollment, whichever occurs first.
2.4. PRIOR YEARS' ENROLLMENTS. Notwithstanding the forgoing, elections
made by Directors about the payment of benefits under the Prior Plan Statement
attributable to accumulations for Plan Years ending before January 1, 1998,
shall not be modified by the adoption of this Plan Statement.
SECTION 3
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ADDITIONS TO ACCOUNTS
USB shall credit monthly to the Account of each Director such amount as the
Director in his or her sole discretion shall have determined in accordance with
Section 2.2. The amount shall be separately determined by each Director and
need not be equal or bear a uniform relationship to the deferrals of other
Directors. The amount so allocated to a Director shall be credited to such
Director's Account as of the Valuation Date in the month for which it is made.
SECTION 4
ESTABLISHMENT AND ADJUSTMENT OF ACCOUNTS
4.1. ESTABLISHMENT OF ACCOUNTS. There shall be established for each
Director an unfunded bookkeeping Account which shall be adjusted each Valuation
Date.
4.2. ADJUSTMENT OF ACCOUNTS. As of each Valuation Date (the "current
Valuation Date"), the value of each Account determined as of the immediately
preceding Valuation Date (the "initial Account value") shall be increased (or
decreased) by the following adjustments made in the following sequence:
4.2.1. INTERMEDIATE DISTRIBUTIONS ADJUSTMENT. The initial Account
value shall be reduced by the total amount distributed in fact to (or with
respect to) the Director from such Account as of a date subsequent to the
immediately preceding Valuation Date but prior to the current Valuation Date.
4.2.2. INVESTMENT ADJUSTMENT FOR ACCOUNT. The initial Account
value of each Director's Account (as adjusted above) shall be increased by
interest. The rate shall be determined from time to time by USB. The rate may
be changed by USB without amendment of the Plan Statement and without notice to
or the consent of any Director, former Director or any Beneficiary. Beginning
January 1, 1998, the rate for each month in a Plan Year shall be equal to the
monthly equivalent of one hundred percent (100%) of the 120 month rolling
average of the 10-year Treasury Note, determined as of September 30 of the
immediately preceding Plan Year. This percentage shall be uniform for all
Directors for the same Valuation Date but may change from Valuation Date to
Valuation Date.
4.2.3. CONTRIBUTION ADJUSTMENT. The initial Account value (as
adjusted above) shall be increased by the total amount, if any, credited to such
Account under Section 3 as of the current Valuation Date.
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4.2.4. FINAL DISTRIBUTIONS ADJUSTMENT. The initial Account value
(as adjusted above) shall be reduced by the total amount distributed in fact to
(or with respect to) the Director from such Account as of the current Valuation
Date.
SECTION 5
VESTING OF ACCOUNT
The Account of each Director shall be fully (100%) vested at all times.
SECTION 6
MATURITY
6.1. EVENTS OF MATURITY. A Director's Account shall mature and shall
become distributable in accordance with Section 7 upon the earliest
occurrence of any of the following events while in the employment of USB or
an Affiliate:
(a) his or her death, or
(b) his or her removal or resignation from the Board of
Directors of USB, whether voluntary or involuntary, or
(c) his or her Disability, or
(d) termination of the Plan.
6.2. DETERMINATION OF ACCOUNT. Upon the occurrence of an Event of Maturity
effective as to a Director, the value of such Director's Account as of the
Valuation Date coincident with or next following the Event of Maturity shall be
determined.
6.3. EFFECT OF MATURITY UPON FURTHER PARTICIPATION IN PLAN. On the
occurrence of an Event of Maturity, a Director shall cease to have any interest
in the Plan other than the right to receive payment of his or her Account as
provided in Section 7 hereof, adjusted from time to time as provided in Section
4.
SECTION 7
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DISTRIBUTION
7.1. TIME OF DISTRIBUTION. Upon the occurrence of an Event of Maturity
effective as to a Director, USB shall commence payment of such Director's
Account in the manner designated by the Director in his or her enrollment.
7.1.1. FORM OF DISTRIBUTION. Distribution shall be made in
whichever of the following forms as the Director shall have designated in
writing:
(a) In a series of substantially equal annual installments
payable over ten (10) years.
(b) In a single, lump sum payment.
7.1.2. TIME OF DISTRIBUTION. Distribution shall be made (in the
case of a single lump sum) or commenced (in the case of installments) as of the
first business day of January after the Director's Event of Maturity.
7.1.3. SUBSTANTIALLY EQUAL. Distributions shall be considered
to be substantially equal if the amount of the distribution required to be
made for each calendar year (the "distribution year") is determined by
dividing the amount of the Account as of the last Valuation Date in the
calendar year immediately preceding the distribution year (such preceding
calendar year being the "valuation year") by the number of remaining
installment payments to be made (including the distribution being
determined). The amount of the Account as of such Valuation Date shall be
decreased by the amount of any distributions made in the valuation year and
after such Valuation Date.
7.1.4. DEFAULT. If for any reason a Director shall have failed to
make a written designation of form and time for distribution (including reasons
entirely beyond the control of the Director), the distribution shall be made in
a single lump sum during the January following the date the Director shall have
had an Event of Maturity. No spouse, former spouse, Beneficiary or other person
shall have any right to participate in the Director's selection of a form of
benefit.
7.1.5. CHANGE IN CONTROL. Notwithstanding the foregoing provisions
of this Section or any designation made by a Director, in the event of a Full
Change in Control the Plan shall be automatically terminated and every Account
shall be paid in a single lump sum distribution within thirty (30) days after
the Full Change in Control.
7.2. DESIGNATION OF BENEFICIARIES.
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7.2.1. RIGHT TO DESIGNATE. Each Director may designate, upon forms
to be furnished by and filed with USB, one or more primary Beneficiaries or
alternative Beneficiaries to receive all or a specified part of such Director's
Account in the event of such Director's death. The Director may change or
revoke any such designation from time to time without notice to or consent from
any Beneficiary. No such designation, change or revocation shall be effective
unless executed by the Director and received by USB during the Director's
lifetime.
7.2.2. FAILURE OF DESIGNATION. If a Director:
(a) fails to designate a Beneficiary,
(b) designates a Beneficiary and thereafter revokes such
designation without naming another Beneficiary, or
(c) designates one or more Beneficiaries and all such
Beneficiaries so designated fail to survive the Director,
such Director's Account, or the part thereof as to which such Director's
designation fails, as the case may be, shall be payable to the first class of
the following classes of automatic Beneficiaries with a member surviving the
Director and (except in the case of surviving issue) in equal shares if there is
more than one member in such class surviving the Director:
Director's surviving spouse
Director's surviving issue per stirpes and not per capita
Director's surviving parents
Director's surviving brothers and sisters
Representative of Director's estate.
7.2.3. DISCLAIMERS BY BENEFICIARIES. A Beneficiary entitled to a
distribution of all or a portion of a deceased Director's Account may disclaim
an interest therein subject to the following requirements. To be eligible to
disclaim, a Beneficiary must be a natural person, must not have received a
distribution of all or any portion of the Account at the time such disclaimer is
executed and delivered, and must have attained at least age twenty-one (21)
years as of the date of the Director's death. Any disclaimer must be in writing
and must be executed personally by the Beneficiary before a notary public. A
disclaimer shall state that the Beneficiary's entire interest in the
undistributed Account is disclaimed or shall specify what portion thereof is
disclaimed. To be effective, duplicate original executed copies of the
disclaimer must be both executed and actually delivered to USB after the date of
the Director's death but not later than one hundred eighty (180) days after the
date of the Director's death. A disclaimer shall be irrevocable when delivered
to USB. A disclaimer shall be considered to be delivered to USB only when
actually received by USB. USB shall be the sole judge of the content,
interpretation and
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validity of a purported disclaimer. Upon the filing of a valid disclaimer, the
Beneficiary shall be considered not to have survived the Director as to the
interest disclaimed. A disclaimer by a Beneficiary shall not be considered to
be a transfer of an interest in violation of the provisions of Section 8. No
other form of attempted disclaimer shall be recognized by USB.
7.2.4. DEFINITIONS. When used herein and, unless the Director
has otherwise specified in the Director's Beneficiary designation, when used
in a Beneficiary designation, "issue" means all persons who are lineal
descendants of the person whose issue are referred to, including legally
adopted descendants and their descendants but not including illegitimate
descendants and their descendants; "child" means an issue of the first
generation; "per stirpes" means in equal shares among living children of the
person whose issue are referred to and the issue (taken collectively) of each
deceased child of such person, with such issue taking by right of
representation of such deceased child; and "survive" and "surviving" mean
living after the death of the Director.
7.2.5. SPECIAL RULES. Unless the Director has otherwise specified
in the Director's Beneficiary designation, the following rules shall apply:
(a) If there is not sufficient evidence that a Beneficiary was
living at the time of the death of the Director, it shall be
deemed that the Beneficiary was not living at the time of
the death of the Director.
(b) The automatic Beneficiaries specified in Section 7.2.2 and
the Beneficiaries designated by the Director shall become
fixed at the time of the Director's death so that, if a
Beneficiary survives the Director but dies before the
receipt of all payments due such Beneficiary hereunder, such
remaining payments shall be payable to the representative of
such Beneficiary's estate.
(c) If the Director designates as a Beneficiary the person who
is the Director's spouse on the date of the designation,
either by name or by relationship, or both, the dissolution,
annulment or other legal termination of the marriage between
the Director and such person shall automatically revoke such
designation. (The foregoing shall not prevent the Director
from designating a former spouse as a Beneficiary on a form
executed by the Director and received by USB after the date
of the legal termination of the marriage between the
Director and such former spouse, and during the Director's
lifetime.)
(d) Any designation of a nonspouse Beneficiary by name that is
accompanied by a description of relationship to the Director
shall be given effect
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without regard to whether the relationship to the Director
exists either then or at the Director's death.
(e) Any designation of a Beneficiary only by statement of
relationship to the Director shall be effective only to
designate the person or persons standing in such
relationship to the Director at the Director's death.
USB shall be the sole judge of the content, interpretation and validity of a
purported Beneficiary designation.
7.2.6. NO SPOUSAL RIGHTS. No spouse or surviving spouse of a
Director and no person designated to be a Beneficiary shall have any rights or
interest in the benefits accumulated under this Plan including, but not limited
to, the right to be the sole Beneficiary or to consent to the designation of
Beneficiaries (or the changing of designated Beneficiaries) by the Director.
7.3. DEATH PRIOR TO FULL DISTRIBUTION. If a Director dies after an Event
of Maturity but before distribution of such Director's Account has been
completed, the remaining undistributed Account shall be distributed in the same
manner as hereinbefore provided in Section 7.1. If, at the death of the
Director, any payment to the Director was due or otherwise pending but not
actually paid, the amount of such payment shall be included in the Account which
are payable to the Beneficiary (and shall not be paid to the Director's estate).
7.4. FACILITY OF PAYMENT. In case of the legal disability of a Director or
Beneficiary entitled to receive any distribution under the Plan, payment shall
be made, if USB shall be advised of the existence of such condition:
(a) to the duly appointed guardian, conservator or other legal
representative of such Director or Beneficiary, or
(b) to a person or institution entrusted with the care or
maintenance of the incompetent or disabled Director or
Beneficiary, provided such person or institution has
satisfied USB that the payment will be used for the best
interest and assist in the care of such Director or
Beneficiary, and provided further, that no prior claim for
said payment has been made by a duly appointed guardian,
conservator or other legal representative of such Director
or Beneficiary.
Any payment made in accordance with the foregoing provisions of this section
shall constitute a complete discharge of any liability or obligation of USB
therefor.
SECTION 8
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FUNDING OF PLAN
8.1. UNFUNDED AGREEMENT. The obligations of USB to make payments under
this Plan constitute only the unsecured (but legally enforceable) promise of USB
to make such payments. The Director shall have no lien, prior claim or other
security interest in any property of USB. USB is not required to establish or
maintain any fund, trust or account (other than a bookkeeping account or
reserve) for the purpose of funding or paying the benefits promised under this
Plan. If such a fund is established, the property therein shall remain the sole
and exclusive property of USB. USB will pay the cost of this Plan out of its
general assets. All references to accounts, accruals, gains, losses, income,
expenses, payments, custodial funds and the like are included merely for the
purpose of measuring USB's obligation to Directors in this Plan and shall not be
construed to impose on USB the obligation to create any separate fund for
purposes of this Plan.
8.2. SPENDTHRIFT PROVISION. No Director or Beneficiary shall have any
transmissible interest in any Account nor shall any Director or Beneficiary have
any power to anticipate, alienate, dispose of, pledge or encumber the same while
in the possession or control of USB, nor shall USB recognize any assignment
thereof, either in whole or in part, nor shall any Account be subject to
attachment, garnishment, execution following judgment or other legal process
while in the possession or control of USB.
The power to designate Beneficiaries to receive the Account of a Director in the
event of such Director's death shall not permit or be construed to permit such
power or right to be exercised by the Director so as thereby to anticipate,
pledge, mortgage or encumber such Director's Account or any part thereof, and
any attempt of a Director so to exercise said power in violation of this
provision shall be of no force and effect and shall be disregarded by USB.
This section shall not prevent USB from exercising, in its discretion, any of
the applicable powers and options granted to it upon the occurrence of an Event
of Maturity, as such powers may be conferred upon it by any applicable provision
hereof.
SECTION 9
AMENDMENT AND TERMINATION
USB reserves the power to amend or terminate the Plan prior to a Full Change
in Control. No amendment or termination of the Plan, however, shall reduce a
Director's Account earned as of the date of such amendment unless the
Director so affected consents thereto in writing. A Director's Account
earned as of the date of an amendment or termination shall be determined as
if the Director had an Event of Maturity on that date. After a Full Change
in Control, the Plan
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cannot be amended or terminated (as applied to Directors who are Directors on
the date of the Full Change in Control) unless:
(a) all Accounts of all Directors as of the date of the Full
Change in Control have been paid, or
(b) eighty percent (80%) of all the Directors as of the date of
the Full Change in Control give written consent to such
amendment or termination.
SECTION 10
DETERMINATIONS -- RULES AND REGULATIONS
10.1. DETERMINATIONS. USB shall make such determinations as may be required
from time to time in the administration of the Plan. USB, in its sole
discretion, shall have the authority and responsibility to interpret and
construe the Plan Statement and to determine all factual and legal questions
under the Plan, including but not limited to the entitlement of Directors and
Beneficiaries, and the amounts of their respective interests. Each interested
party may act and rely upon all information reported to them hereunder and need
not inquire into the accuracy thereof, nor be charged with any notice to the
contrary.
10.2. RULES AND REGULATIONS. Any rule not in conflict or at variance with
the provisions hereof may be adopted by USB.
10.3. METHOD OF EXECUTING INSTRUMENTS. Information to be supplied or
written notices to be made or consents to be given by USB pursuant to any
provision of this Plan Statement may be signed in the name of USB by any officer
or director thereof who has been authorized to make such certification or to
give such notices or consents.
10.4. INFORMATION FURNISHED BY DIRECTORS. USB shall not be liable or
responsible for any error in the computation of the Account of a Director
resulting from any misstatement of fact made by the Director, directly or
indirectly, to USB, and used by it in determining the Director's Account. USB
shall not be obligated or required to increase the Account of such Director
which, on discovery of the misstatement, is found to be understated as a result
of such misstatement of the Director. However, the Account of any Director
which are overstated by reason of any such misstatement shall be reduced to the
amount appropriate in view of the truth.
SECTION 11
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PLAN ADMINISTRATION
11.1. USB. Except as hereinafter provided, functions generally assigned to
USB shall be discharged by the Compensation and Human Resources Committee of the
Board of Directors or delegated and allocated as provided herein.
11.2. CONFLICT OF INTEREST. If any member of the Board of Directors of USB
to whom authority has been delegated or redelegated hereunder shall have an
Account in the Plan, such Director shall have no authority as such Director with
respect to any matter specially affecting such Directors individual interest
hereunder (as distinguished from the interests of all Director's and
Beneficiaries or a broad class of Directors and Beneficiaries), all such
authority being reserved exclusively to the other Directors, to the exclusion of
such Director, and such Director shall act only in such Director's individual
capacity in connection with any such matter.
SECTION 12
DISCLAIMERS
Neither the terms of this Plan Statement nor the benefits hereunder nor the
continuance thereof shall be an obligation of any Director. USB shall not be
obliged to continue the Plan. The terms of this Plan Statement shall not give
any Director the right to be retained on the Board of Directors of USB. Neither
USB nor any of its officers nor any member of its Board of Directors in any way
secure or guarantee the payment of any benefit or amount which may become due
and payable hereunder to any Director or to any Beneficiary or to any creditor
of a Director or a Beneficiary. Each Director, Beneficiary or other person
entitled at any time to payments hereunder shall look solely to the assets of
USB for such payments or to the Account distributed to any Director or
Beneficiary, as the case may be, for such payments. In each case where an
Account shall have been distributed to a former Director or a Beneficiary or to
the person or any one of a group of persons entitled jointly to the receipt
thereof and which purports to cover in full the benefit hereunder, such former
Director or Beneficiary, or such person or persons, as the case may be, shall
have no further right or interest in the other assets of USB. Neither USB nor
any of its officers nor any member of its Board of Directors shall be under any
liability or responsibility for failure to effect any of the objectives or
purposes of the Plan by reason of the insolvency of USB. USB and its officers
and the members of its Board of Directors shall not be liable for an act or
omission of another person with regard to a responsibility that has been
allocated to or delegated to such other person pursuant to the terms of this
Plan Statement or pursuant to procedures set forth in this Plan Statement.
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