EXHIBIT 10(k)
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HARSCO CORPORATION
SUPPLEMENTAL RETIREMENT BENEFIT PLAN
AS AMENDED AND RESTATED OCTOBER 4, 2002
ARTICLE I
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ESTABLISHMENT OF PLAN
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1.1 PURPOSE. The Harsco Corporation Supplemental Retirement Plan
("Plan") was established by Harsco Corporation ("Corporation") to provide
supplemental retirement benefits to designated corporate and division officers
and to compensate them for government-imposed reductions in benefits from and/or
contributions to the tax-qualified plans in which they participate.
1.2 TAX/ERISA. The Corporation intends that the Plan shall at all times
be maintained on an unfunded basis for federal income tax purposes under the
Internal Revenue Code of 1986, as amended ("Code"), and administered as a
"top-hat" plan exempt from the substantive requirements of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
1.3 EFFECTIVE DATE. This Plan, as amended and restated herein, shall
apply to participating employees whose retirement or other termination date
occurs on or after January 1, 2003. Benefits for Participants who retired or
whose participation terminated prior to January 1, 2003, will be determined by
the Plan provisions in effect upon such Participant's retirement or termination.
ARTICLE II
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DEFINITIONS
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2.1 ACCRUED BENEFIT. The Supplemental Pension Benefit and the
Supplemental Savings Benefit earned by a Participant under this Plan in
accordance with the provisions of Article IV.
2.2 ANCILLARY AGREEMENT. An instrument by which special arrangements
for specific Participants are incorporated into this Plan.
2.3 BENEFICIARY. Any person designated by a Participant to receive
benefits which may be due, or become due, under this Plan. If a Participant made
no such designation, or if the designated person predeceases the Participant,
the Beneficiary shall be the Participant's estate.
2.4 BOARD. The Board of Directors of the Corporation.
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2.5 CHANGE IN CONTROL. The first to occur of any one of the events
described below:
(a) STOCK ACQUISITION. Any "person" (as such term is used in
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934 ["the 1934
Act"], other than the Company or a corporation, a majority of whose outstanding
stock entitled to vote is owned, directly or indirectly, by the Company, who is
or becomes, other than by purchase from the Company or such a corporation, the
"beneficial owner" (as such term is defined in Rule 13(d)-3 under the 1934 Act),
directly or indirectly, of securities of the Company representing 20 percent or
more of the combined voting power of the Company's then outstanding voting
securities. Such a Change in Control shall be deemed to have occurred on the
first to occur of the date securities are first purchased by a tender or
exchange offer, or the date on which the Company first learns of acquisition of
20 percent of such securities, or the later of the effective date of an
agreement for the merger, consolidation or other reorganization of the Company
or Company shareholder approval thereof, as the case may be.
(b) The date that a tender or exchange offer by any Person
(other than the Company or Subsidiary) is first published or sent or given
within the meaning of Rule 14e-2(a) of the General Rules and Regulations under
the Exchange Act as may be amended, supplemented or superseded from time to
time, if upon consummation thereof, such Person would be the Beneficial Owner of
20% or more of the combined voting power of the Company's outstanding voting
securities.
(c) CHANGE IN BOARD. During any period of two consecutive
years, individuals who at the beginning of such period were members of the Board
of Directors ceases for any reason to constitute at least a majority of the
Board of Directors, unless the election or nomination for election by the
Company's shareholders of each new director was approved by a vote of at least
two-thirds of the directors then still in office who were directors at the
beginning of the period. Such a Change in Control shall be deemed to have
occurred on the date upon which the requisite majority of directors fails to be
elected by the shareholders of the Company.
(d) OTHER EVENTS. Any other event or series of events which,
notwithstanding any other provision of this definition, is determined by a
majority of the outside members of the Board of Directors of the Company to
constitute a Change in Control of the Company for purposes of this Supplemental
Plan. Such a Change in Control shall be deemed to have occurred on the date of
such determination or on such other date as such majority of outside members of
the Board shall specify.
2.6 COMMITTEE. The Management Development and Compensation Committee of
the Board or such other committee as may be designated by the Board.
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2.7 COMPENSATION. Total base salary plus 100% of nondiscretionary
incentive compensation, (including the value of the awards made under the 1995
Executive Incentive Compensation Plan in common stock as of the date of the
award, or in cash, and regardless of whether any such stock award is later
forfeited) all calculated on a paid basis and payable according to the
provisions of a regular written plan covering officers as approved by the Board
or a Committee thereof. Effective January 1, 2003, the definition of
Compensation is modified to include 50% of nondiscretionary incentive
compensation paid on or after January 1, 2003.
2.8 CREDITED SERVICE. Service with Harsco and with any predecessor
company acquired by or merged into Harsco if such service with the predecessor
company is granted by the Board of Directors or a Committee thereof. In
computing Credited Service hereunder, the Corporation shall act in accordance
with (a) rules applicable to the Related Harsco Plan or (b) if different, rules
established by the Board of Directors or a Committee thereof.
2.9 EARLY RETIREMENT DATE. The first date of the month following the
Participant's attainment of 55 years of age and 15 years of Credited Service.
2.10 FINAL AVERAGE COMPENSATION. A Participant's average annual
Compensation for the 60 highest consecutive out of the last 120 months prior to
the date of retirement or termination of employment for any reason prior to
Normal Retirement Date. If, due to absence because of disability or temporary
layoff, a Participant's Compensation during any 12 month period in any of said
120 months falls below 75% of what it would have been had it not been for such
absence, such period or periods shall be excluded and contiguous periods of
months shall be used in determining the 60 highest consecutive months.
2.11 NORMAL RETIREMENT DATE. The first day of the month following the
Participant's 65th birthday.
2.12 PARTICIPANT. An officer or other employee of the Corporation who
has been approved for participation in the Plan pursuant to Article III.
2.13 PENSION COMMITTEE. The Committee appointed by the Board of
Directors or a Committee thereof to administer qualified and nonqualified
pension plans.
2.14 RELATED HARSCO PLAN. The relevant tax-qualified plan, the benefit
under which is offset against an amount determined under this Plan to comprise
all or part of the Participant's Accrued Benefit. In most cases, the Related
Harsco Plan shall be, with respect to the Supplemental Pension Benefit, the
Harsco Employees Pension Plan and, with respect to the Supplemental Savings
Benefit, the Harsco Corporation Savings Plan.
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2.15 SOCIAL SECURITY COVERED COMPENSATION. As defined by Social
Security Integration Table I - (see attached Exhibit A). This table is subject
to change as Social Security covered compensation maximums are changed.
2.16 SUPPLEMENTAL PENSION FORMULA. 0.8% of Final Average Compensation,
up to the Social Security Covered Compensation plus 1.5% of Final Average
Compensation in excess of the Social Security Covered Compensation, multiplied
by Credited Service to a maximum of 33 years and divided by 12.
No Participant's Supplemental Pension benefit taken on or after January 1, 2003
shall be less than their Accrued Benefit as of December 31, 2002 under the prior
formula (0.8% of Final Average Compensation, up to the Social Security Covered
Compensation plus 1.6% of Final Average Compensation in excess of the Social
Security Covered Compensation, multiplied by Credited Service to a maximum of 33
years and divided by 12).
ARTICLE III
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ELIGIBILITY AND VESTING
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3.1 ELIGIBILITY TO PARTICIPATE IN THE PLAN. All officers of the
Corporation, and division officers elected by the Board of Directors shall be
eligible to participate in this Plan. Also eligible to participate will be
Nonofficer Key Employees designated by the Chief Executive Officer (to be listed
on the attached Schedule A) from time to time effective for retirements on or
after January 1, 1999. Such designated Nonofficer Key Employees will be eligible
for a Supplemental Retirement Benefit based on 1.5% per year of Credited Service
up to a maximum of 33 years times Final Average Compensation as defined by the
Plan offset by the monthly retirement benefit payable to the Participant from
the Related Harsco Pension Plan or Plans, both calculated on a 10 year certain
and continuous basis. All other provisions of the Supplemental Plan are to apply
to these designated Nonofficer Key Employees, except that Vesting as defined in
the first sentence of Section 3.2 will not apply but such designated Nonofficer
Key Employees' Supplemental benefit will be subject to 100% vesting at the
earlier of the attainment of age 58 with 25 years Credited Service or age 60
with 15 years of Credited Service, or at age 65 with 10 years of Credited
Service.
3.2 VESTING. A Participant's right to an Accrued Benefit under this
Plan shall vest and become nonforfeitable only if, and to the extent that, the
Participant is vested in the Related Harsco Plan. Notwithstanding any provision
to the contrary, all Participants shall become fully vested in their Accrued
Benefit following or in connection with a Change in Control.
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ARTICLE IV
SUPPLEMENTAL BENEFITS
4.1 SUPPLEMENTAL PENSION BENEFIT. The Supplemental Pension Benefit
shall be the greater of the monthly amounts calculated under (a) or (b) as set
forth below:
(a) The Supplemental Pension Formula offset by the monthly
retirement benefit payable to the Participant from the Related Harsco Plan, both
calculated on a 10-year certain and continuous basis; and
(b) The difference between (i) the monthly pension benefit
which the Participant would have been entitled to under the Related Harsco Plan,
calculated without regard to the limitation on benefits imposed by Code section
415, the ceiling on covered compensation imposed by Code section 401(a)(17) and
any similar limitation or restriction imposed by the Code or ERISA, and (ii) the
monthly pension benefit actually payable to the Participant under the Related
Harsco Plan.
4.2 SUPPLEMENTAL SAVINGS BENEFIT. Effective January 1, 2003, no further
Supplemental Savings Plan Benefit (e.g. Phantom Shares) shall be earned.
However, quarterly dividend income will continue to accrue on existing Phantom
Shares.
For years prior to January 1, 2003, the Supplemental Savings Plan Benefit shall
be determined as follows: If the amount of a Participant's contributions to the
Harsco Corporation Savings Plan is limited as a result of the Code or ERISA such
that the Participant is unable to contribute the maximum amount of Matched
After-Tax Contributions and/or Matched Tax Saver Contributions permitted by the
Savings Plan, then the Participant shall be entitled to receive the difference
between (a) and (b) as set forth below:
(a) The amount of Corporation's matching contributions to the
Saving Plan that would have been made for the account of such Participant, but
for the Code or ERISA limitations, and
(b) The amount of Corporation's matching contributions
actually made to the Savings Plan for the account of such Participant.
The amount payable pursuant to the provisions of this paragraph shall include
adjustments for changes in the market value of the Corporation stock that would
have been purchased by the Corporation's matching contributions that would have
been made to the Savings Plan for the account of a Participant, but for the
ERISA limitations including dividends that would have been payable on such
stock.
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4.3 PROVISION FOR HECKETT MULTISERV - EAST DIVISION OFFICERS. The
Supplemental Plan also provides that officers of the Heckett MultiServ - East
Division will receive supplemental payments to make up any reduction in
qualified plan payments to the extent the value of the Company common stock
award under the provisions of the Executive Incentive Compensation Plan is not
includable in the qualified Plan's definition of pensionable earnings.
ARTICLE V
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SUPPLEMENTAL PENSION BENEFIT DISTRIBUTION
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5.1 FORM OF PAYMENT. The Supplemental Pension Benefit shall be paid in
a form selected by the Participant within 60 days after the Participant's Early,
Normal or Postponed Retirement Date or termination of employment with a vested
Accrued Benefit. The normal form of payment for the Supplemental Pension Benefit
shall be determined on a 10-year certain and continuous basis; however, a
Participant may select an optional form of payment, provided such optional form
is (a) the same as that selected by the Participant under the Related Harsco
Plan and (b) not a lump sum.
5.2 EARLY RETIREMENT BENEFIT. Subject to the form of payment
restrictions in Section 5.1, a Participant who retires after his Early
Retirement Date and prior to his Normal Retirement Date shall be entitled to a
Supplemental Pension Benefit which shall be adjusted actuarially in accordance
with Tables B and C attached hereto.
5.3 POSTPONED RETIREMENT. The Supplemental Pension Benefit payable to a
Participant who continues employment after his Normal Retirement Date will be
calculated as of his Normal Retirement Date and will be paid upon his actual
retirement. If the Participant dies after his Normal Retirement Date, but prior
to actual retirement, his Supplemental Pension Benefit shall be payable to his
Beneficiary in the form of a life only annuity actuarially adjusted for the age
of the Beneficiary.
5.4 DISABILITY BENEFIT. In case of permanent disability, the
Supplemental Pension Benefit will be determined using the eligibility
requirements for disability retirement benefits under the Related Harsco Plan.
5.5 DEATH BENEFIT. Except as provided under Section 5.3, if a
Participant dies on or after qualifying for benefits under the Related Harsco
Plan but before actual retirement, there shall be payable to the Beneficiary of
such Participant a monthly benefit equal to the Supplemental Pension Benefit
actuarially adjusted to provide a life annuity payable for the life of the
Beneficiary.
5.6 SMALL AMOUNTS. If the present value of the Supplemental Pension
Benefit is less than $25,000, such value may be paid to the Participant or
Beneficiary in a lump sum at the discretion of the CEO.
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5.7 CHANGE IN CONTROL. Not later than ten (10) business days after the
date on which a Change in Control occurs, the Company shall be obligated to the
Participants to contribute an amount equal to the cumulative Accrued Benefits
for all Participants and Beneficiaries under this Plan (together with an
additional amount to cover all estimated administration expenses associated with
the payment of such Benefits) into the trust established as of July 1, 1987 by
and between the Company and Dauphin Deposit Bank and Trust Company (Trustee)
(the "Rabbi Trust"), for future distribution by the Trustee, or any successor
Trustee, in accordance with the terms of this Plan, and the Rabbi Trust.
Contemporaneous with such contribution, the Company shall also provide to the
Trustee or successor Trustee all instructions regarding the Participants,
Beneficiaries, and their benefits necessary for the Trustee to carry out its
duties under the Trust. Nothing in this Plan shall preclude the Company from
funding the Rabbi Trust prior to a Change in Control.
5.8 DOCUMENTATION OF RETIREMENT BENEFIT. Upon a Participant's Early,
Normal, or Postponed Retirement Date or termination of employment with a vested
Accrued Benefit, the Company shall execute and deliver to the Participant, or if
deceased, to the Beneficiary, an Agreement confirming the Company's legal duty
to pay the Supplemental Pension Plan Benefit in accordance with the form of
payment selected by the Participant or Beneficiary, and summarizing such payment
terms.
ARTICLE VI
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SUPPLEMENTAL SAVINGS BENEFIT DISTRIBUTIONS
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6.1 TERMINATION OF EMPLOYMENT. If a Participant terminates employment
with the Corporation, the Supplemental Savings Benefit shall be payable to him
in a lump sum within 60 days following his termination of employment.
6.2 PAYMENT OF BENEFITS TO BENEFICIARY. If the Participants dies while
an employee of the Corporation or prior to receiving payment under Section 6.1,
his Supplemental Savings Benefit, shall be payable to his Beneficiary within 60
days of his death.
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ARTICLE VII
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ADMINISTRATION
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7.1 ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
Committee, referred to herein as the Administrator. Members of the Committee, if
otherwise eligible, shall be eligible to participate in the Plan, but no such
member shall be entitled to make decisions solely with respect to his
participation. The Administrator shall be vested with full authority to make,
administer and interpret such rules and regulations as it deems necessary to
administer the Plan. Any determination, decision or action of the Administrator
in connection with the construction, interpretation, administration or
application of the Plan shall be final, conclusive and binding upon all
Participants and any and all person claiming under or through any Participant.
The Administrator shall have the authority to:
(i) Employ agents to perform services on behalf of the
Administrator and to authorize the payment of reasonable compensation for the
performance of such services.
(ii) Delegate to the Pension Committee the authority to
perform administrative duties otherwise reserved to the Administrator herein.
7.2 COST OF ADMINISTERING THE PLAN. The Corporation shall bear the
costs of administration of the Plan.
ARTICLE VIII
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AMENDMENT AND TERMINATION
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8.1 AMENDMENT. The Corporation, acting through the Board or a Committee
thereof, may at any time amend this Plan, in whole or in part, by an instrument
in writing, executed by the Board or a Committee thereof; provided, however,
that no amendment shall be made which would have the effect of decreasing any
Participant's Accrued Benefit determined just prior to the amendment.
8.2 TERMINATION. The Corporation, acting through its Board or a
Committee thereof, may at any time terminate this Plan by an instrument in
writing executed by the Board or its designee; provided, however,
(a) no such termination shall be made which would have the
effect of decreasing any Participant's Accrued Benefit determined just prior to
the amendment.
(b) the Corporation, by action of its Board or a Committee
thereof, may elect to accelerate all distributions at the time it elects to
terminate the Plan.
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ARTICLE IX
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MISCELLANEOUS
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9.1 NO RIGHT OF EMPLOYMENT. Nothing in the Plan shall be deemed to
grant a Participant any rights other than those specifically outlined in the
Plan. Nothing in the Plan shall be deemed to create any right of, or contract
for, employment between a Participant and the Corporation.
9.2 WITHHOLDING. The Corporation may deduct, with respect to any
payments due or benefits accrued under this Plan, any taxes required to be
withheld by Federal, state or local governments.
9.3 NON-ASSIGNABILITY OF BENEFITS. Neither the Participant nor any
Beneficiary shall have the power to transfer, assign, anticipate, modify or
otherwise encumber in advance any of the payments that may become due hereunder;
nor shall any such payments be subject to attachment, garnishment or execution,
or be transferable by operation of law in event of bankruptcy, insolvency or
otherwise.
9.4 NO FUNDING. Any provision for payments hereunder shall be by means
of bookkeeping entries on the books of the Corporation and shall not create in
the Participant or his Beneficiary any right to, or claim against any specific
assets of the Corporation, nor result in the creation of any trust or escrow
account for the Participant or Beneficiary. A Participant or Beneficiary
entitled to any payment of benefits hereunder shall be a general creditor of the
Corporation.
9.5 FORFEITURE ON TERMINATION FOR CAUSE. Notwithstanding any provision
to the contrary (including the acceleration of vesting and payment provisions
relating to Change in Control), if any Participant is terminated for cause, all
benefits hereunder shall be forfeited and the Corporation shall have no further
obligation to the Participant (or his Beneficiary) hereunder. For purposes of
this Plan, "cause" means (i) an act or acts of personal dishonesty taken by the
Participant and intended to result in substantial personal enrichment of the
Participant at the expense of the Company, (ii) repeated violations by the
Participant of the Participant's obligations under the Participant's employment
agreement where applicable which are demonstrably willful and deliberate on the
Participant's part and which are not remedied in a reasonable period of time
after receipt of written notice from the Company or (iii) the conviction of the
Participant of a felony.
9.6 GENDER AND NUMBER. As used herein the masculine pronoun shall
include the feminine and neuter genders, the singular shall include the plural,
and the plural the singular, unless the context clearly indicates a different
meaning.
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9.7 CONTROLLING LAW. This Plan and the respective rights and
obligations of the Corporation and the Participants and Beneficiaries, except to
the extent otherwise provided by Federal law, shall be construed under the law
of the Commonwealth of Pennsylvania.
/s/ P. C. Coppock /s/ D. C. Hathaway
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P. C. Coppock, Sr. Vice President, D. C. Hathaway, Chairman,
Chief Administrative Officer, President and Chief Executive
General Counsel and Secretary Officer
March 3, 2003 March 3, 2003
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Date Date