EXHIBIT 10.6
FIRST AMENDMENT TO CALLAWAY GOLF COMPANY
RESTATED EXECUTIVE DEFERRED COMPENSATION PLAN
This First Amendment (this "Amendment") to Callaway Golf Company Restated
Executive Deferred Compensation Plan (the "Plan") is made effective as of the
first day of January 1999 by Callaway Golf Company ("Callaway Golf").
A. Callaway Golf established the Plan to provide deferred compensation to
a select group of management or highly compensated employees through an unfunded
"top hat" arrangement exempt from the fiduciary, funding, vesting and plan
termination insurance provisions of Title I and Title IV of the Employee
Retirement Income Security Act; and
B. The Board of Directors has approved the amendment of the Plan to (i)
clarify the date on which an expression of investment preferences takes effect
for purpose of determining assets allocable to a participant's hypothetical
account under the Plan, (ii) provide generally that communication occurs only
when the Company or its designee receives the investment instructions, (iii)
clarify that the Company retains ultimate control over investment decisions (as
required under Internal Revenue procedures or regulations) even where the
participants have direct access to investment assets, and (iv) modify the timing
of the distributions from the Plan upon an employee's termination of employment.
NOW, THEREFORE, the Plan is amended as follows:
1. Section 5.2, captioned "Investment Elections," is hereby deleted in its
entirety and replaced as follows:
"In accordance with rules, procedures and options established by
the Committee, a Participant shall have the right to express preferences
with respect to the investment of his or her Account, except for any
period of time during which the Company limits Account earnings to
interest accruals under Section 5.4 below. In accordance with procedures
established by the Plan Administrator, a Participant may change his or
her investment preferences twice each Plan Year. Such changes may be
made, if at all, during the three-week period immediately following the
quarterly distribution of individual account statements. As a general
rule, an investment preference expressed by a Participant shall take
effect on the first business day of the month following the Participant's
communication of such preference. Ordinarily, a participant's
communication occurs only when the Committee, the Company, the Plan
Administrator, the trustee of the Trust (or any person designated by any
of them to process or implement investment instructions) receives actual
notice of a
Participant's investment preference. A Participant may transmit such
notice by any means of communication which the Company may permit under
the Plan, such as hand delivery, U.S. Mail, commercial courier,
telephone, facsimile or Internet. The Participant assumes any risk posed
by the means of communication which he or she selects.
Although the Company shall have the hypothetical obligation to
follow the Participant's investment preferences, the Company, in its sole
discretion, may satisfy its hypothetical obligation from time to time in
one or both of the following ways. First, the Company may invest assets
hypothetically allocable to the Participant's Accounts in the specific
investments, in the specific amounts and for the specific periods
requested by the Participant; and the Company must credit or charge the
Participant's Accounts with the earnings, gains or losses resulting from
such investments. Second, the Company reserves the right -- exercisable
in its sole discretion at any time and from time to time, without notice
or Plan amendment -- to add, modify, suspend, terminate or override (i)
any investment preference communicated by a Participant, (ii) any
investment option made available to a Participant, or (iii) any means of
communicating investment preferences and other information under the
Plan; provided, however, the Company must credit or charge the
Participant's Accounts with the same earnings, gains or losses that the
Participant would have incurred if the Company had invested the assets
hypothetically allocable to the Participant's Accounts in the specific
investments, in the specific amounts and for the specific periods
requested by the Participant.
If this Plan is determined to be subject to the fiduciary provisions
of Part 4 of Title I of ERISA, this Plan shall be treated as a Plan
described in Section 404(c) of ERISA and Title 29 of the Code of Federal
Regulations Section 2550.404c-1, in which Plan fiduciaries may be
relieved of liability for any losses which are the direct and necessary
result of investment instructions given by a Participant or Beneficiary."
2. Section 7.3, starting at page 12, of the Plan, captioned "Termination
of Employment" is deleted in its entirety and replaced as follows:
"Upon Termination of the Employment of a Participant or Inactive
Participant, the Company shall distribute his or her Account under the
Plan, as elected by the Participant or Inactive Participant (at the time
of his or her deferral of Compensation) in a lump sum or in five, ten or
fifteen substantially equal annual installments. For terminations prior
to January, 1, 1999, the payment from the account shall occur or commence
within 30 days after the first day of the calendar year immediately
following the calendar year in which the Termination of
Employment occurs. For terminations after December 31, 1998, the payment
from the Account shall occur or commence within the 30-day period
immediately following the Termination of Employment."
3. After the effective date of this Amendment, each reference in the Plan
to the "Plan" shall mean and refer to the Plan as amended hereby. Except as
provided in this Amendment, the Plan and all related documents shall remain in
full force and effect and are ratified and confirmed.
IN WITNESS WHEREOF, this First Amendment to the Plan has been executed as
of the date set forth above.
CALLAWAY GOLF COMPANY
By: /s/ DAVID A. RANE
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Name: David A. Rane
Title: Executive Vice President,
Administration and Planning,
and Chief Financial Officer