Exhibit 10.60
Building Materials Holding Corporation
 
Executives’ Supplemental
Retirement Income Plan
 
(Amended and Restated 2007, Effective as of January 1, 2005)
 
 
TAX ADVICE DISCLAIMER: Any statements regarding tax matters made herein,
including any attachments, cannot be relied upon by any person to avoid tax
penalties and are not intended to be used or referred to in any marketing or
promotional materials. To the extent this communication contains a tax statement
or tax advice, Holme Roberts & Owen LLP does not and will not impose any
limitation on disclosure of the tax treatment or tax structure of any
transactions to which such tax statement or tax advice relates.

 

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Table of Contents

   
Page
     
 
ARTICLE 1. DEFINITIONS
 
1.1
Account
1
1.2
Base Salary
1
1.3
Beneficiary
2
1.4
Board of Directors
2
1.5
Change in Control
2
1.6
Code
2
1.7
Committee
2
1.8
Company
2
1.9
Company Contributions
2
1.10
Disability
3
1.11
Early Retirement Date
3
1.12
Effective Date
3
1.13
Executive
3
1.14
ERISA
3
1.15
Hardship
3
1.16
Interest Credit
4
1.17
Key Employee
4
1.18
Liquidation
4
1.19
Normal Retirement Date
4
1.20
Participant
4
1.21
Participant
4
1.22
Plan
4
1.23
Plan Year
4
1.24
Regulations
4
1.25
Separation from Service
4
1.26
Service
5
1.27
Trust or Trust Agreement
5
1.28
Trust Fund
5
1.29
Trustee
5
1.30
Year of Service
5
     
 
ARTICLE 2. ELIGIBILITY
 
2.1
Eligibility Requirements
5
2.2
Lapse of Eligibility
5
2.3
Non-Competition Requirement
5
   
 
 
ARTICLE 3. DEFERRED COMPENSATION
 
3.1
Company Contributions
6
3.2
Interest Credits
6

 
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ARTICLE 4. PAYMENT OF BENEFITS
 
4.1
Election of Method of Payment
8
4.2
Election of Timing of Payment
9
4.3
Subsequent Elections
10
4.4
Payment upon Hardship
10
4.5
Payment Following a Change in Control
11
4.6
Payment upon Death
11
4.7
Designation of Beneficiary
11
4.8
Administration of Payments
11
4.9
Permitted Acceleration of Payments
12
4.10
Permitted Delay of Payments
13
   
 
 
ARTICLE 5. TRUST
 
5.1
Accounts
13
5.2
Participants’ Rights Unsecured
13
5.3
Trust Agreement
13
   
 
 
ARTICLE 6. AMENDMENT AND TERMINATION
 
6.1
Amendment
14
6.2
Termination
14
   
 
 
ARTICLE 7. ADMINISTRATION
 
7.1
Administration
14
7.2
Applying for Benefits
14
7.3
Liability of Committee; Indemnification
16
7.4
Expenses
17
       
ARTICLE 8. GENERAL AND MISCELLANEOUS
 
8.1
Rights Against Company
17
8.2
Assignment or Transfer
17
8.3
Severability
17
8.4
Construction
17
8.5
Governing Law
17
8.6
Payment Due to Incompetence
18
8.7
Taxes
18
8.8
Insurance
18
8.9
Attorney’s Fees
18
8.10
Plan Binding on Successors and Assignees
18

 
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BUILDING MATERIALS HOLDING CORPORATION
EXECUTIVES’ SUPPLEMENTAL RETIREMENT INCOME PLAN
 
Building Materials Holding Corporation, a Delaware corporation (the “Company”)
hereby establishes an unfunded “supplemental executive retirement plan” (“SERP”)
for the purpose of providing deferred compensation for a select group of
management and highly compensated employees in compliance with Section 409A of
the Internal Revenue Code, as amended (the “Code”).
 
RECITALS
 
WHEREAS, the Participants identified by the Compensation Committee of the Board
of Directors of the Company, or any other committee designated by the Board of
Directors of the Company to administer the Plan in accordance with Article 8 of
the Plan (the “Committee”), as eligible to participate in the Plan (each a
“Participant,” or collectively the “Participants”) provide services to the
Company; and
 
WHEREAS, the Company desires to continue to maintain an unfunded deferred
compensation plan and the Participants desire the Company to pay certain
deferred compensation and/or related benefits to or for the benefit of the
Participants, or a designated Beneficiary, or both;
 
WHEREAS, the Company established this supplemental executive retirement plan to
take the place of the prior Executives’ Supplemental Retirement Income Plan to
provide for the deferral of compensation earned on or after January 1, 2005 in
compliance with Code Section 409A.
 
NOW, THEREFORE, the Company hereby amends and restates the Plan for the purpose
of complying with the final regulations promulgated under Code Section 409A,
which become effective January 1, 2008.
 
ARTICLE 1.  DEFINITIONS
 

1.1  
Account means the separate account established under the Plan and the Trust for
each participating Participant comprised of Company Contributions to the Plan
plus Interest Credits. Interest Credits are applied to the Account before adding
the Company Contributions for the current year. The Company shall furnish each
Participant with a Statement of his or her Account balance at least annually.

 

1.2  
Base Salary means a Participant’s regular annual compensation for a Plan Year,
determined as of the first day of that year, excluding bonuses, commissions,
overtime, incentive payments, non-monetary awards, and other special
compensation, before reduction for compensation deferred pursuant to all
qualified and non-qualified plans of the Company. For any Participant whose
compensation is composed of a Base Salary plus commissions, and whose Base
Salary is less than $50,000 (or such other amount set by the Committee), the
Participant’s Base Salary will be deemed to equal $50,000 (or such other amount
set by the Committee).

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1.3  
Beneficiary means the beneficiary designated by the Participant to receive the
Participant’s deferred compensation benefits in the event of his or her death.

 

1.4  
Board of Directors means the Board of Directors of the Company.

 

1.5  
Change in Control means the occurrence of any of the following, limited to the
extent any such occurrence is consistent with the definition of a “change in
ownership,” “change in effective control,” “change in the ownership of a
substantial portion of a corporation’s assets” or similar event described in
Code Section 409A or the Regulations:

 

(a)  
when any “person,” as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 as amended (“Exchange Act”) (other than the
Company, a Subsidiary or a Company benefit plan, including any trustee of such
plan acting as trustee) is or becomes the “beneficial owner” (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company representing fifty percent (50%) or more of the combined voting power of
the Company’s then outstanding securities, where such person’s beneficial
ownership of the Company’s securities was not initiated by the Company or
approved by the Board of Directors; or

 

(b)  
the occurrence of a transaction requiring shareholder approval, and involving
the sale of all or substantially all of the assets of the Company or the merger
of the Company with or into another corporation, where such merger was not
initiated by the Company and in which the Company is not the surviving parent
entity; or

 

(c)  
a change in the composition of the Board of Directors in any 12-month period, as
a result of which fewer than a majority of the directors are Incumbent
Directors. “Incumbent Directors” means directors who are elected, or nominated
for election, to the Board of Directors with the affirmative votes of at least a
majority of the Incumbent Directors at the time of such election or nomination
(but shall not include an individual whose election or nomination is in
connection with an actual or threatened proxy contest relating to the election
of directors to the Company).

 

1.6  
Code means the Internal Revenue Code of 1986, as amended from time to time.
Reference to any Code section shall include any successor or comparable
provision of the Code or application Regulations.

 

1.7  
Committee means the Compensation Committee of the Board of Directors or any
other committee designated by the Board of Directors to administer the Plan in
accordance with Article 8.

 

1.8  
Company means Building Materials Holding Corporation, a Delaware Corporation,
any successor organization thereto, and any corporation or other entity that
must be aggregated with Building Materials Holding Corporation pursuant to the
Code or Regulations.

 

1.9  
Company Contributions means the Company’s contribution to a Participant’s
Account as determined in accordance with Section 3.1.

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1.10  
Disability means—

 

 
the condition of being unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than 12 months, or

 

 
by reason of suffering from any medically determinable physical or mental
impairment that is expected to result in death or can be expected to last for a
continuous period of not less than 12 months, receiving income replacement
benefits for a period of not less than 3 months under an accident and health
plan covering employees of the Company.

 

1.11  
Early Retirement Date means the date on which a Participant (who has not yet
attained age 65) incurs a Separation from Service, having completed 25 Years of
Service and has attained age 55 or older, or completes 15 Years of Service and
has attained age 60 or older.

 

1.12  
Effective Date of this amendment and restatement means January 1, 2005, except
as otherwise specified.

 

1.13  
Executive means an executive or highly compensated individual of the Company or
of any division, subsidiary or affiliate of the Company who is eligible to
become a Participant in the Plan under Section 3.1.

 

1.14  
ERISA means the Employee Retirement Income Security Act of 1974, as amended.

 

1.15  
Hardship refers to a payment made on account of an unforeseeable immediate and
heavy financial need of the Participant and that is necessary to satisfy that
financial need in accordance with the following:

 

(a)  
Amount. The amounts distributed with respect to an emergency cannot exceed the
amounts necessary to satisfy such emergency plus amounts necessary to pay taxes
reasonably anticipated as a result of the payment, after taking into account the
extent to which such hardship is or may be relieved through reimbursement or
compensation by insurance or otherwise or by liquidation of the Participant’s
assets (to the extent the liquidation of such assets would not itself cause
severe financial hardship).

 

(b)  
Circumstances. Whether a Participant has an immediate and heavy financial need
shall be determined by the Committee based on all relevant facts and
circumstances, and shall refer to a severe financial hardship to the Participant
resulting from an illness or accident of the Participant, the Participant’s
spouse, or a dependent (as defined in Code Section 152(a)) of the Participant;
loss of the Participant’s property due to casualty; or other similar
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the Participant.

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1.16  
Interest Credit means earnings credited to a Participant’s Account as determined
in accordance with Section 3.2.

 

1.17  
Key Employee means an employee of the Company, who is, as determined under Code
Section 416(i)—

 

(a)  
an officer of the Company having an annual compensation greater than $130,000
(as adjusted),

 

(b)  
a 5% owner of the Company, or

 

(c)  
a 1% owner of the Company having annual compensation from the Company of more
than $150,000,

 
or as otherwise defined for purposes of Code Section 409A(a)(2)(B), to be
effective as of the effective date of such change. For purposes of subsection
(a), no more than 50 employees (or, if lesser, the greater of 3 employees or 10%
of the employees) shall be treated as officers. The Key Employee identification
date shall be January 1 of each Plan Year, and the Key Employee effective date
shall be the following May 1.
 

1.18  
Liquidation means any liquidation or dissolution of the Company taxed under Code
Section 331 or with approval of a bankruptcy court pursuant to United States
Code Title 11, Section 503(b)(1)(A).

 

1.19  
Normal Retirement Date means the date on which a Participant has both incurred a
Separation from Service and attained age 65, or such other date as specified in
his or her Participation Agreement.

 

1.20  
Participant means, as of the date specified by the Committee, a person who is
selected to participate in the Plan and has satisfied the conditions of Section
2.1 and has not become subject to the terms of Section 2.2, or a person who
previously satisfied the conditions of this section and has an Account under the
Plan. The term “Participant” includes a Participant’s Beneficiary where the
context so requires.

 

1.21  
Participation Agreement means the election to participate in the Plan under
certain terms as completed by a Participant.

 

1.22  
Plan means the Executives’ Supplemental Retirement Income Plan of Building
Materials Holding Corporation, as amended from time to time.

 

1.23  
Plan Year means the year beginning January 1 and ending December 31.

 

1.24  
Regulations means the rules, regulations, interpretations and procedures
promulgated under Code Section 409A, as amended from time to time.

 

1.25  
Separation from Service of a director, employee or independent contractor of the
Company has occurred when the Company and the individual reasonably anticipate
that no services (as a director, independent contractor or employee) in excess
of 49% of the average level of services performed over the immediately preceding
12 months will be performed after that date, regardless of the reason (other
than death) for the reduction in services; provided that a “Separation from
Service” shall not occur if a Participant is on bona fide leave of absence of up
to 6 months and, if longer, has a contractually or statutorily protected right
of reemployment.

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1.26  
Service means the Participant’s service with the Company that is not interrupted
or terminated based on the facts and circumstances.

 

1.27  
Trust or Trust Agreement means the Trust Agreement applicable to the Plan, as
amended from time to time, entered into between the Company and the Trustee to
carry out the provisions of the Plan.

 

1.28  
Trust Fund means the cash and other assets and/or properties held and
administered by Trustee pursuant to the Trust to carry out the provisions of the
Plan.

 

1.29  
Trustee means the designated Trustee acting at any time under the Trust.

 

1.30  
Year of Service means any 12-consecutive-month period in which a Participant is
in Service, commencing with the Participant’s date of hire, as determined by the
Committee in its sole discretion.

 
ARTICLE 2.  ELIGIBILITY
 

2.1  
Eligibility Requirements. The date that an Executive is first eligible to
participate in the Plan shall be the date of notification to the Executive by
the Company. In order to participate in the Plan, the Executives of the Company
selected to participate by the Company must—

 

 
belong to a select group of highly compensated or management employees within
the meaning of ERISA and the Regulations;

 

 
execute a Participation Agreement in the form provided by the Committee; and

 

 
if the Company desires to purchase key man life insurance on the Participant’s
life for its sole benefit, cooperate so that the Company may obtain a valid
insurance contract.

 

2.2  
Lapse of Eligibility. In the event the Committee determines, in its sole
discretion, that any Participant shall no longer be eligible to participate in
the Plan, or no longer qualifies as a member of a select group of management or
highly compensated employees of the Company, then the Participant shall cease
active participation in the Plan and all contributions made on the Participant’s
behalf shall cease as of the date determined by the Committee.

 

2.3  
Non-Competition Requirement. If a Participant has a Separation from Service with
the Company and, without the specific written consent of the Company, accepts a
position of employment or service with a competitor of the Company within 12
months of Separation from Service, Plan benefits will be limited to the lesser
of (a) the Retirement Account Balance at the date of termination, and (b) the
sum of Company Contributions attributable to the Participant without interest or
other appreciation. If, in the sole discretion of the Committee, conditions
warrant, the Committee may grant permission in the form of a general waiver
rather than applied to a specific position.

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ARTICLE 3.  DEFERRED COMPENSATION
 

3.1  
Company Contributions.

 

(a)  
Allocation to Plan. The Company Contributions allocated to the Plan shall be
determined as follows:

 

(1)  
Subject to subsection (b), the Company shall allocate a portion of a percentage
of after-tax earnings of the Company, as determined from time to time by the
Board of Directors in its sole discretion. As of the Effective Date, this amount
is 65% of 5.5% of after-tax earnings.

 

(2)  
The amounts to be allocated to the Plan may be changed by the Board of Directors
at any time. The method of allocation of the funds among Participant Accounts
may be changed as deemed necessary to maintain equity among Participants, as
determined by the Committee with the approval of the Board of Directors.
Participants will be notified of changes as soon as practicable after the change
is adopted.

 

(b)  
Allocation Among Participants. The benefit allocation shall be made to each
Participant’s Account in accordance with the following calculation:

 

(1)  
The portion of the Base Salary of each Participant that is in excess of $40,000
will be added to obtain the total of all Participants’ Base Salaries, each only
with respect to the portion in excess of $40,000, which shall be the
denominator.

 

(2)  
The portion of the Base Salary of each Participant that is in excess of $40,000
will be divided by the denominator calculated in subsection (b)(1) to obtain a
percentage, calculated to the nearest one-hundredth (0.0x%).

 

(3)  
A Participant’s allocation to the Plan shall equal the percentage obtained in
subsection (b)(2) multiplied by the Company Contributions determined in Section
3.1, up to a maximum of 30% of the Participant’s Base Salary or such other
percentage as determined by the Committee from time to time.

 

3.2  
Interest Credits . Subject to Article 4, Interest Credits shall be determined
according to the Participant’s Years of Service and the applicable method of
payment, as determined under this section.

 

(a)  
Prior to Commencement of Payment. The Company shall credit each Participant’s
Account with a simple interest rate, expressed as an annual rate, as of January
1 of each year, which rate may be changed by the Committee from time to time. As
of the Effective Date, with respect to Accounts that have not yet commenced
payment under Article 4, the rates applicable to Account accruals are as
follows:

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Participant
Classification 
 
Years of Service 
 
Interest Credit Rate 
Active Employees
 
—
 
7.0%
Inactive Employees
 
Fewer than 5
 
0.0% 
 
 
At least 5, but fewer than 10 
 
1.5% 
 
 
At least 10, but fewer than 15
 
3.0% 
 
 
 At least 15, but fewer than 20
 
4.0%
 
 
 At least 20, but fewer than 25 
 
5.0% 
 
 
 25 or more 
 
6.0%

The rates will be reviewed by the Committee each February. Any changes will be
effective for the January 1 balance of the same year.
 

(b)  
After Commencement of Payment. After the payment of installments has commenced
in accordance with Participant’s election under Section 3.3, the Company shall
continue to credit each affected Participant’s Account with a simple interest
rate, expressed as an annual rate, as of January 1 of each year. As of the
Effective Date, the rates applicable to the method of payment elected are as
follows:

 

(1)  
General Rule. Subject to subsection (b)(2), the Interest Credit rate applicable
to each method of payment shall be determined by the number of Years of Service
completed by the Participant prior to his or her Separation from Service and the
method of payment elected by the Participant, as follows:

 
Participant Classification or Event
 
Monthly
Installment
Period
Available
 
Corresponding
Interest Credit
Rate
Participants having a Separation from Service—
- - after completing at least 25 Years of Service, or
- - after the Participant’s Normal Retirement Date
 
15 years
 
9.0%
- - after completing at least 25 Years of Service
 
10 years
 
8.0%
   
5 years
 
7.0%
- - prior to completing 25 Years of Service
 
15 years
 
6.0%
   
10 years
 
5.0%
   
5 years
 
4.0%

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(2)  
Disability or Death. In the event of the Participant’s Disability or death prior
to the commencement of Plan payments, the Participant’s Account shall be payable
in monthly installments over 5 years, and the applicable Interest Credit rate
shall be determined as follows:

 
Participant Classification or Event
 
Monthly
Installment
Period
Available
 
Corresponding
Interest Credit
Rate
Participant’s Disability or death—
-  while in Service, or
-  after completing at least 25 Years of Service
 
5 years
 
9.0%
-    prior to completing 25 Years of Service
5 years
6.0%

 

(c)  
Interest Calculations. The computations of future values, present values or
installment payments shall use the “end of period” assumption for the first
payment.

 

(d)  
Conditions on Inclusion of Interest Credits. No Interest Credits shall be
payable under the Plan if (i) the Participant has a Separation from Service
prior to his Normal Retirement Date by reason of fraudulent or dishonest
conduct, or (ii) the Participant has violated the non-compete provisions of
Section 2.3, each as determined according to the Committee in its sole
discretion.

 
ARTICLE 4.  PAYMENT OF BENEFITS
 

4.1  
Election of Method of Payment.

 

(a)  
Affirmative Election. No later than 30 days after first becoming eligible for
the Plan, each Participant shall submit an election of the method of payment
applicable to the Participant’s entire Account. Participants may choose among
the following methods of payment in accordance with the form provided by the
Committee:

 

(1)  
a single lump sum payment, or

 

(2)  
monthly installments over a designated period of 5, 10 or 15 years, which
election shall affect the Interest Credits that may be credited to the
Participant’s Account in accordance with Section 3.2, and which installments
shall each be treated as a separate payment for purposes of subsequent
elections.

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(b)  
Transition Period Elections. Prior to January 1, 2008, a Participant shall be
permitted to revoke or revise the designated method of payment applicable to the
Participant’s entire Account (including amounts earned before and after
January 1, 2008). The revised election shall designate a time of payment
described in subsection (b) according to procedures established by the
Committee, provided that no change in the timing of payment shall result in
acceleration of any payment to the year in which the revised election is made or
delay of any payment otherwise payable in the year in which the election is
made.

 

(c)  
Default Election. In the event the Participant fails properly to designate the
method of payment, subject to a subsequent election made under Section 4.3, such
amounts shall be payable in the form of monthly installments over 5 years. After
the commencement of payments, Interest Credits shall apply to the Account
according to the rate applicable to the 5-year monthly installment period.

 

4.2  
Election of Timing of Payment.

 

(a)  
Affirmative Election. By the later of the date that is 30 days after first
becoming eligible for the Plan and January 1, 2008, each Participant shall
submit an election of the timing of payment applicable to his or her entire
Account.

 
Prior to January 1, 2008, a Participant shall be permitted to revoke or revise
the designated timing of payment applicable to his or her Account. The revised
election shall designate a time of payment in accordance with subsection (b),
provided that no change in the timing of payment shall result in acceleration of
any payment to the year in which the revised election is made or delay of any
payment otherwise payable in the year in which the election is made.
 

(b)  
Timing. Participants may choose among the following times for payment in
accordance with the procedures established by the Committee:

 

(1)  
the Participant’s Separation from Service following his or her Early Retirement
Date (if eligible) or Normal Retirement Date (if not eligible for an Early
Retirement Date);

 

(2)  
a specified age of the Participant, as elected by the Participant, that is on or
after his or her Early Retirement Date (if eligible) or Normal Retirement Date
(if not eligible for an Early Retirement Date);

 

(3)  
upon one of, as elected by the Participant—

 

(A)  
the earlier to occur of the events in subsections (b)(1) and (b)(2), or

 

(B)  
the later to occur of the events in subsections (b)(1) and (b)(2).

 
In the event payment is made due to Separation from Service, in the case of a
Key Employee, payment shall commence no earlier than the date that is 6 months
after the date of Separation from Service. The initial payment shall be equal to
the payments that would have been paid to the Key Employee had no 6-month delay
applied, together with any Interest Credits as applied in the sole discretion of
the Committee.

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(c)  
Default Election. In the event the Participant fails properly to designate the
timing of payment, subject to a subsequent election made under Section 4.3, his
or her Account shall be payable upon Separation from Service after Early
Retirement Date, if the Participant is eligible, or if not, the Participant’s
Normal Retirement Date.

 

(d)  
Other Payment Events. Notwithstanding the Participant’s elected timing of
payment, the Company shall commence payment upon the earliest to occur of the
following events:

 

(1)  
the Participant’s Hardship as provided in Section 4.4;

 

(2)  
a Change in Control of the Company as provided in Section 4.5;

 

(3)  
the Participant’s Disability, as determined by the Committee in its sole
discretion, according to the Participant’s elected method of payment; or

 

(4)  
the Participant’s death, according to the Participant’s elected method of
payment.

 

4.3  
Subsequent Elections. Subject to Sections 4.1, 4.2, 4.9 and 4.10, a Participant
may not accelerate the method or timing of any payment under the Plan, except as
provided in the Regulations. Any change to an election regarding the timing or
method of payment must satisfy the following conditions:

 

(a)  
the subsequent election to delay a payment must be made no later than 12 months
prior to the date of the first scheduled payment; and

 

(b)  
the first payment must be deferred for a period of at least 5 years from the
date the payment would otherwise have been made.

 
In the case of a subsequent election to change the timing of monthly
installments, each subsequent election will apply to the installments to be made
over a 12-month period, starting with the first installment designated by the
Participant’s subsequent election.
 
If such subsequent election does not satisfy the conditions specified in this
section, the prior election shall be used to determine the method and timing of
payment. The last effective election accepted and acknowledged by the Committee
shall govern the payment of the Participant’s Account. Elections under this
subsection will not affect the method or timing of payments made on account of
Hardship, Disability or death except as otherwise provided in this article.
 

4.4  
Payment upon Hardship. A Participant may apply for payment from his or her
Account to the extent that the Participant demonstrates to the reasonable
satisfaction of the Committee that he or she needs the specified funds due to
Hardship. The Committee may deny or approve all or any portion of a payment upon
Hardship upon terms permitted under the Code and Regulations, as determined in
its sole discretion.

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4.5  
Payment Following a Change in Control.

 

(a)  
Separation from Status Following a Change in Control. In the event a Participant
has a Separation from Service for any reason at the time of or within a 2-year
period following a Change in Control, then the Participant shall be entitled to
receive payment of his or her Account balance in a lump sum payment.

 

(b)  
Payments Commenced. Following a Change in Control, any Participant (or
Beneficiary thereof) already receiving payments under the Plan shall continue to
receive the balance of the Participant’s Account, paid according to the method
elected by the Participant, subject to the acceleration of payment pursuant to a
termination and liquidation of the Plan pursuant to Section 4.9(e).

 

(c)  
Payment Delayed. In the case of a Key Employee, any payment made on account of a
Separation from Service following a Change in Control shall not be made until a
date that is 6 months after the date of such Separation from Service. The
initial payment shall be equal to the payments that would have been paid to the
Key Employee had no 6-month delay applied, together with any earnings on such
amount as applied in the sole discretion of the Committee.

 

4.6  
Payment upon Death. Upon a Participant’s death, the Participant’s Beneficiary
will be entitled to receive the balance of the future payments of the
Participant’s Account according to the method of payment elected by the
Participant. If the Participant has received all of the scheduled payments prior
to his or her death, no further benefits shall be due under the Plan.

 

4.7  
Designation of Beneficiary. The Participant may designate a Beneficiary or
Beneficiaries to receive any amount due hereunder by the Participant by written
notice thereof to the Company at any time prior to his or her death and may
revoke or change the Beneficiary so designated without the Beneficiary’s consent
by written notice delivered to the Company at any time and from time to time
prior to the Participant’s death. If the Participant is married and a resident
of a community property state, one half of any amount due under the Plan which
is the result of an amount contributed to the Plan during the Participant’s
marriage is the community property of the Participant’s spouse and the
Participant may designate a Beneficiary or Beneficiaries to receive only the
Participant’s one-half interest. If the Participant shall have failed to
designate a Beneficiary, or if no such Beneficiary shall survive him or her,
then such amount shall be paid to his or her estate. To be effective,
Beneficiary designations must be completed according to procedures established
by the Committee.

 

4.8  
Administration of Payments. Payment of the lump sum or the first of a series of
installments shall be made or commence within 90 days following the date of the
payment event or identification of the Beneficiary, if later, as applicable, but
in no event later than the end of the 2½ month period following the Plan Year in
which occurs the payment event. Subsequent installments, if any, shall be made
on the first day of each month following the first installment as determined by
the Company. The amount of each installment shall be calculated by dividing the
Account balance as of the date of the payment by the number of installments
remaining pursuant to the Participant’s payment election. Each such installment,
if any, shall take into account Interest Credits credited to the balance of the
Account remaining unpaid.

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4.9  
Permitted Acceleration of Payments. To the extent permitted by Code Section 409A
and the Regulations, the Company shall commence or accelerate payment to
Participant, Participant’s Beneficiary or other appropriate payee the portion of
Participant’s Account authorized for payment in accordance with Code Section
409A and the Regulations, including the following:

 

(a)  
amounts payable to an individual other than the Participant to the extent
necessary to fulfill a domestic relations order approved by the Committee in its
sole discretion;

 

(b)  
de minimis cashout payments that result in the termination of the entirety of a
Participant’s interest in the Plan, a Deferred Compensation Plan maintained by
the Company and any other arrangement that is aggregated with the Plan under the
Regulations, if the payment is not greater than the dollar amount applicable
under Code Section 402(g)(1)(B) ($15,500 in 2007);

 

(c)  
payment to Participant to pay the Federal Insurance Contributions Act tax
imposed under Code Section 3101 and 3121(v)(2) on Eligible Compensation deferred
under the Plan, grossed up as permitted under the Regulations;

 

(d)  
in the event the Plan with respect to that Participant fails to meet the
requirements of Code Section 409A and the Regulations, payment to Participant in
an amount not to exceed the amount required to be included in income as a result
of the failure to comply with the requirements of Code Section 409A and the
Regulations;

 

(e)  
payment upon termination and liquidation of the Plan within 12 months following
a Liquidation, provided that payment is included in the Participant’s income in
the tax year in which occurs the latest of the Plan termination, lapse of any
substantial risk of forfeiture, or payment becomes administratively practicable;

 

(f)  
payment upon termination and liquidation of the Plan pursuant to irrevocable
action taken by the Company within 30 days preceding or 12 months following a
Change in Control, provided that any other arrangement that is aggregated with
the Plan under the Regulations is also terminated and liquidated with respect to
each Participant that experienced the Change in Control; and

 

(g)  
payment upon termination and liquidation of the Plan, provided that (i) Plan
termination and liquidation does not occur proximate to a downturn in the
Company’s financial health, (ii) any other arrangement that is aggregated with
the Plan under the Regulations is also terminated and liquidated with respect to
each Participant that experienced the Change in Control, (iii) no Plan
liquidation payments are made within 12 months following the date the Company
takes all necessary irrevocable action to terminate and liquidate the Plan (the
“termination date”) (other than payments payable for reasons other than Plan
liquidation), (iv) all payments are made within 24 months of the termination
date; and (v) the Company does not adopt a new plan that would be aggregated
with any terminated and liquidated plan if the same Participant participated in
both plans, at any time within 3 years following the termination date.

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4.10  
Permitted Delay of Payments. To the extent permitted by Code Section 409A and
the Regulations, the Company shall delay payment to Participant, Participant’s
Beneficiary or other appropriate payee the portion of Participant’s vested Plan
Benefit authorized for payment—

 

(a)  
to the extent that the Committee reasonably anticipates that the Company’s
deduction with respect to such payment otherwise would be limited or eliminated
by application of Code Section 162(m);

 

(b)  
to the extent that the Committee reasonably anticipates that the making of the
payment will violate federal securities laws or other applicable law; or

 

(c)  
upon such other events and conditions as may be permitted under the Code and the
Regulations;

 
provided that the payment shall be made at the earliest date at which the
Committee reasonably anticipates that the applicable circumstance specified
above is of no further force or effect.
 
ARTICLE 5. TRUST
 

5.1  
Accounts. The Company shall establish separate Accounts for each Participant who
participates in the Plan. No special fund shall be established nor shall any
note or security be issued by the Company with respect to a Participant’s
Accounts.

 

5.2  
Participants’ Rights Unsecured. The right of the Participant or his or her
Beneficiary to receive a payment hereunder shall be an unsecured claim against
the general assets of the Company, and neither the Participant nor his or her
Beneficiary shall have any rights in or against any amount credited to his or
her Account or any other specific assets of the Company, except as otherwise
provided in the Trust. Nothing contained in the Plan, and no action taken
pursuant to its provisions, shall create or be construed to create a trust of
any kind or a fiduciary relationship between the Plan and the Company or any
other person. 

 

5.3  
Trust Agreement. The Company may establish the Trust for the purpose of
retaining assets set aside by the Company pursuant to the Trust Agreement for
payment of all or a portion of the amounts payable pursuant to the Plan. Any
benefits not paid from the Trust shall be paid solely from the Company’s general
funds, and any benefits paid from the Trust shall be credited against and
reduced by a corresponding amount the Company’s liability to the Participants
under the Plan. No special or separate fund, other than the Trust Agreement,
shall be established and no other segregation of assets shall be made to assure
the payment of any benefits hereunder. All Trust Funds shall be subject to the
claims of general creditors of the Company in the event the Company is insolvent
(as that term is defined in the Trust Agreement). The obligations of the Company
to pay benefits under the Plan constitute an unfunded, unsecured promise to pay
and Participants shall have no greater rights than general creditors of the
Company. Trust assets shall not, at any time, be located outside of the United
States or be transferred outside of the United States, whether or not such
assets are available to satisfy claims of general creditors.

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ARTICLE 6. AMENDMENT AND TERMINATION
 

6.1  
Amendment. The Committee shall have the right to amend the Plan at any time and
from time to time, including by retroactive amendment. Any such amendment shall
become effective upon the date stated therein, and shall be binding on all
Participants, except as otherwise provided in such amendment; provided, however,
that said amendment shall not affect adversely the previously accrued benefits
of the affected Participant without the Participant’s written approval. Benefits
accruing to a Participant pursuant to any employment agreement in effect between
the Company and the Participant that entitles the Participant to participate in
and to certain rights under the Plan shall not be affected by an amendment of
the Plan except as required by Code Section 409A and the Regulations.

 

6.2  
Termination. The Committee shall have the right to terminate and liquidate the
Plan to the fullest extent permitted by Code Section 409A, including (a)
termination of the Plan within 12 months following a Liquidation, or (b) within
30 days preceding or 12 months following a Change in Control, provided that such
termination following a Change in Control shall not result in a diminution of
benefits accrued under the Plan, or (c) the termination covers all arrangements
sponsored by the Company that would be aggregated with the Plan and cover any
Participant of the Plan, the termination does not occur proximate to a downturn
in the financial health of the Company, and payments are made after 12 months,
but within 24 months, following the termination.

 
ARTICLE 7. ADMINISTRATION
 

7.1  
Administration. The Committee shall administer and interpret the Plan in
accordance with the provisions of the Plan and the Trust Agreement. Any
determination or decision by the Committee shall be conclusive and binding on
all persons who at any time have or claim to have any interest whatever under
the Plan. To the extent required to avoid penalties, the Committee intends to
interpret and operate the Plan in all respects in compliance with Code Section
409A and the Regulations.

 

7.2  
Applying for Benefits. The following claims procedures are generally applicable
to claims filed under the Plan. To the extent required by law and to the extent
the Committee is ruling on a claim for benefits on account of a disability, the
Plan will follow, with respect to that claim, claims procedures required by law
for plans providing disability benefits.

 

(a)  
General Procedures. Subject to the provisions of subsection (b), the following
procedures shall apply in the determination of claims under the Plan.

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(1)  
Filing a Claim. All applications and claims for benefits shall be filed in
writing by the Participant, his or her Beneficiary, or the authorized
representative of the claimant, by completing the procedures required by the
Committee. The procedures shall be reasonable and may include the completion of
forms and the submission of documents and additional information.

 

(2)  
Review of Claim. The Committee shall review all applications and claims for
benefits and shall decide whether to approve or deny the claim in whole or in
part. If a claim is denied in whole or in part, the Committee shall provide
written notice of denial to the claimant within a reasonable period of time no
later than 90 days after the Committee receives the claim, unless special
circumstances require an extension of time for processing the claim. If an
extension is required, the Committee shall notify the claimant in writing
(including by electronic media) by the end of the initial 90-day period and
indicate the special circumstances requiring an extension of time and the date
by which the Committee expects to render a decision on the claim. The extension
shall not exceed an additional 90 days. The notice of denial shall be written
(including in electronic media) in a manner calculated to be understood by the
claimant and shall include the following:

 

(A)  
specific reasons for the denial;

 

(B)  
specific references to pertinent Plan provisions;

 

(C)  
description of any additional material or information necessary for the claimant
to perfect his or her claim and an explanation of why such material or
information is necessary; and

 

(D)  
appropriate information as to the steps the claimant should take if he or she
wishes to submit the denied claim for review, including any applicable time
limits and including a statement of the claimant’s right to bring a civil action
under ERISA Section 502(a) following a denied claim on review.

 

(3)  
Appealing a Claims Denial. If the claimant wishes a review of the denied claim,
he or she shall notify the Committee in writing within 60 days of the claimant’s
receipt of notification of the denied claim. The claimant or the claimant’s
representative may review pertinent Plan documents and may submit issues or
comments to the Committee in writing. The claimant or the claimant’s
representative may provide the Committee with a written statement of the
claimant’s position and with written materials in support of his or her
position, including documents, records and other information relating to the
claim. The claimant or the claimant’s representative may have, upon request and
free of charge, reasonable access to, and copies of, all documents, records and
other information relevant to the claim. A document, record or other information
shall be considered relevant to the claim if such document, record or other
information (A) was relied upon in making the benefit determination, (B) was
submitted, considered or generated in the course of making the benefit
determination, without regard to whether such document, record or other
information was relied upon in making the benefit determination, or (C)
demonstrates compliance with the administrative processes and safeguards
designed to ensure and verify that benefit claim determinations are made in
accordance with the Plan and that, where appropriate, the Plan provisions have
been applied consistently with respect to similarly situated claimants.

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(4)  
Review of Appeal. The Committee shall forward all requests for review of a
denied claim together with all associated documents to the Chairman of the
Committee promptly after receipt. The Committee shall make its decision on
review solely on the basis of the written record, including documents and
written materials submitted by the claimant and/or the claimant’s
representative. The Committee shall make a decision on review within a
reasonable period of time, not later than 60 days after the Committee receives
the claimant’s written request for review unless special circumstances require
additional time for review of the claim. If the Committee needs an extension of
time to review the claim, it shall notify the claimant in writing before the end
of the initial 60-day period, and shall indicate the special circumstances
requiring an extension of time and the date by which the Committee expects to
render the determination on review. The extension shall not be longer than an
additional 60 days. The decision on review will be written in a manner
calculated to be understood by the claimant. If the claim is denied, the written
noticed shall include specific reasons for the decision as well as specific
references to pertinent Plan provisions on which the decision is based, a
statement of the claimant’s right to bring an action under ERISA § 502(a) and a
statement that the claimant is entitled to receive, upon request and free of
charge, reasonable access to, and copies of, all documents, records and other
information relevant to the claimant’s claim for benefits, with “relevant”
defined as provided in the previous subsection.

 

(b)  
Determination of Disability. To the extent the Committee is determining a claims
for benefits under the Plan on account of a Disability, the above procedures
shall be modified as necessary to comply with ERISA Section 503 and Department
of Labor Regulations Section 2560.503-1(d).

 

7.3  
Liability of Committee; Indemnification. To the extent permitted by law, the
Committee shall not be liable to any person for any action taken or omitted in
connection with the interpretation and administration of the Plan unless
attributable to his or her own bad faith or willful misconduct. The Committee
may employ legal counsel, consultants, actuaries and agents as they may deem
desirable in the administration of the Plan and may rely on the opinion of such
counsel or the computations of such consultant or other agent. The Committee
shall provide for the keeping of detailed written minutes of its actions
hereunder, which shall be reviewed by the legal counsel or the consultant
engaged by the Committee prior to their finalization.

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7.4  
Expenses. The costs of the establishment of the Plan and the adoption of the
Plan by the Company, including but not limited to legal and accounting fees,
shall be borne by the Company. The expenses of administering the Plan shall be
borne by the Trust; provided, however, that the Company shall bear, and shall
not be reimbursed by, the Trust for any tax liability of the Company associated
with the investment of assets by the Trust. All taxes associated with
participation in the Plan, including any tax liability under Code Section 409A,
shall be borne by the Participant.

 
ARTICLE 8. GENERAL AND MISCELLANEOUS
 

8.1  
Rights Against the Company. Except as expressly provided by the Plan, the
establishment of the Plan shall not be construed as giving to any Participant or
to any person whomsoever, any legal, equitable or other rights against the
Company, or against its officers, directors, agents or shareholders, or as
giving to any Participant or Beneficiary any equity or other interest in the
assets, business or shares of the Company or giving any Participant the right to
be retained in the employment of the Company. The services of any Participant
shall be subject to termination (with or without cause) to the same extent they
would have been if the Plan had never been adopted. The rights of a Participant
hereunder shall be solely those of an unsecured general creditor of the Company.
Neither the Plan nor any action taken hereunder shall be construed as giving to
any Participant the right to continue rendering services to or for the benefit
of the Company or as affecting the right of the Company to dismiss any
Participant. Any benefit payable under the Plan shall not be deemed salary or
other compensation for the purpose of computing benefits under any Participant
benefit plan or other arrangement of the Company for the benefit of its
Participants.

 

8.2  
Assignment or Transfer. No right, title or interest of any kind in the Plan
shall be transferable or assignable by any Participant or Beneficiary or be
subject to alienation, anticipation, encumbrance, garnishment, attachment,
execution or levy of any kind, whether voluntary or involuntary, nor subject to
the debts, contracts, liabilities, engagements, or torts of the Participant or
Beneficiary. Any attempt to alienate, anticipate, encumber, sell, transfer,
assign, pledge, garnish, attach or otherwise subject to legal or equitable
process or encumber or dispose of any interest in the Plan shall be void.

 

8.3  
Severability. If any provision of the Plan shall be declared illegal or invalid
for any reason, said illegality or invalidity shall not affect the remaining
provisions of the Plan but shall be fully severable, and the Plan shall be
construed and enforced as if said illegal or invalid provision had never been
inserted herein.

 

8.4  
Construction. The article and section headings and numbers are included only for
convenience of reference and are not to be taken as limiting or extending the
meaning of any of the terms and provisions of the Plan. Whenever appropriate,
words used in the singular shall include the plural or the plural may be read as
the singular. When used herein, the masculine gender includes the feminine
gender.

 

8.5  
Governing Law. The validity and effect of the Plan and the rights and
obligations of all persons affected hereby shall be construed and determined in
accordance with the laws of the State of Delaware unless superseded by federal
law, which shall govern correspondingly.

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8.6  
Payment Due to Incompetence. If the Committee receives evidence that a
Participant or Beneficiary entitled to receive any payment under the Plan is
physically or mentally incompetent to receive such payment, the Committee may,
in its sole and absolute discretion, direct the payment to any other person or
trust which has been legally appointed by the courts or to any other person
determined by the Company to be a proper recipient on behalf of such person
otherwise entitled to payment, or any of them, in such manner and proportion as
the Company may deem proper. Any such payment shall be in complete discharge of
the Company’s obligations under the Plan.

 

8.7  
Taxes. All amounts payable hereunder shall be reduced by any and all federal,
state, and local taxes imposed upon Participant or his or her Beneficiary, which
are required to be paid or withheld by the Company. The determination of the
Company regarding applicable income and employment tax withholding requirements
shall be final and binding on Participant.

 

8.8  
Insurance. In the event that any Participant elects, in his or her discretion,
to independently purchase an insurance policy covering the inability of the Plan
or the Trust to make any payments to which Participant is entitled under the
Plan or the Trust, the Company shall use its best efforts to facilitate the
payment by Participant of any applicable excise taxes which become due as the
result of the payment of premiums under such policy. Nothing contained herein
shall be construed as an endorsement by the Company of the purchase of such a
policy or a recommendation by the Company that the purchase of such a policy is
necessary or desirable as the result of Participant’s participation in the Plan.
In the event that such insurance would result in adverse tax consequences to the
Participant, the Participant shall terminate such insurance.

 

8.9  
Attorney’s Fees. The Company shall pay the reasonable attorney’s fees incurred
by any Participant in an action brought against the Company to enforce
Participant’s rights under the Plan, provided that such fees shall only be
payable in the event that the Participant prevails in such action.

 

8.10  
Plan Binding on Successors and Assignees. The Plan shall be binding upon and
inure to the benefit of the Company and its successor and assigns and the
Participant and the Participant’s designee and estate.

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ACKNOWLEDGMENT
 
The undersigned Executive hereby acknowledges that Employer has selected him or
her as a participant in the Building Materials Holding Corporation 2005
Supplemental Retirement Income Plan as amended (the “Plan”), subject to all
terms and conditions of the Plan, a copy of which has been received, read, and
understood by Executive in conjunction with executing this Acknowledgment.
Executive acknowledges that he or she has had satisfactory opportunity to ask
questions regarding his or her participation in the Plan and has received
satisfactory answers to any questions asked. Executive also acknowledges that he
or she has sufficient knowledge and experience in financial and business matters
to be capable of evaluating the merits and risks of participation in the Plan.
Executive understands that his or her participation in the Plan shall not begin
until this Acknowledgment has been signed by Executive and returned to BMHC.
 
Dated: _______________________________________________
 
Print Name: ___________________________________________

Signed: ______________________________________________
           Executive
 
Dated: _______________________________________________
          Building Materials Holding Corporation
 
Signed: ______________________________________________
              Officer

Executive SERP
1/1/2005

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