Exhibit 10.9
(THE McGRAW-HILL COMPANIES LOGO) [y50265y5026501.gif]
THE McGRAW-HILL COMPANIES, INC.
KEY EXECUTIVE SHORT-TERM INCENTIVE
DEFERRED COMPENSATION PLAN
(Amended and restated effective as of January 1, 2008)

 

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THE McGRAW-HILL COMPANIES, INC.
KEY EXECUTIVE SHORT-TERM INCENTIVE
DEFERRED COMPENSATION PLAN
(Amended and restated effective as of January 1, 2008)
ARTICLE I
PURPOSE
     It is intended that the Plan will aid in retaining and attracting employees
by providing such employees with a means to defer receipt of Incentive
Compensation to a future date. The Plan is intended to satisfy the requirements
of Section 409A of the Code.
ARTICLE II
DEFINITIONS
     The following words and phrases as used herein shall have the following
meanings:
     SECTION 2.01 “Beneficiary” means the person, persons or entity designated
by the Participant to receive any benefits payable under the Plan. Any
Participant’s Beneficiary designation shall be made in a written instrument
filed with the Company and shall become effective only when received, accepted
and acknowledged in writing by the Company.
     SECTION 2.02 “Board” means the Board of Directors of the Company.
     SECTION 2.03 “Change in Control” means the first to occur of any of the
following events:
     (i) An acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 20% or more of either (1) the then outstanding shares of Common Stock (the
“Outstanding Common Stock”) or (2) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Voting Securities”); excluding, however,
the following: (1) any acquisition directly from the Company, other than an
acquisition by virtue of the exercise of a conversion privilege unless the
security being so converted was itself acquired directly from the Company;
(2) any acquisition by the Company; (3) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any entity
controlled by the Company; or (4) any acquisition pursuant to a transaction
which complies with clauses (A), (B) and (C) of subsection (iii) of this
Section 2.03; or

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     (ii) A change in the composition of the Board such that the Directors who,
as of the effective date of the Plan, constitute the Board (such Board shall be
hereinafter referred to as the “Incumbent Board”) cease for any reason to
constitute at least a majority of the Board; provided, however, for purposes of
this Section 2.03, that any individual who becomes a Director subsequent to the
effective date of the Plan, whose election, or nomination for election by the
Company’s shareholders, was approved by a vote of at least a majority of those
Directors who were members of the Incumbent Board (or deemed to be such pursuant
to this proviso) shall be considered as though such Director were a member of
the Incumbent Board; but, provided, further, that any such individual whose
initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board shall not be so considered as a member of the Incumbent Board; or
     (iii) Consummation of a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets of the Company
(“Corporate Transaction”); excluding, however, such a Corporate Transaction
pursuant to which (A) all or substantially all of the individuals and entities
who are the beneficial owners, respectively, of the Outstanding Common Stock and
Outstanding Voting Securities immediately prior to such Corporate Transaction
will beneficially own, directly or indirectly, more than 50% of, respectively,
the outstanding shares of common stock, and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such Corporate
Transaction (including, without limitation, a corporation which as a result of
such transaction owns the Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries) in substantially the
same proportions as their ownership, immediately prior to such Corporate
Transaction, of the Outstanding Common Stock and Outstanding Voting Securities,
as the case may be, (B) no Person (other than the Company, any employee benefit
plan (or related trust) of the Company or such corporation resulting from such
Corporate Transaction) will beneficially own, directly or indirectly, 20% or
more of, respectively, the outstanding shares of common stock of the corporation
resulting from such Corporate Transaction or the combined voting power of the
outstanding voting securities of such corporation entitled to vote generally in
the election of directors except to the extent that such ownership existed prior
to the Corporate Transaction, and (C) individuals who were members of the
Incumbent Board will constitute at least a majority of the members of the board
of directors of the corporation resulting from such Corporate Transaction; or
     (iv) The approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
     SECTION 2.04 “Claimant” has the meaning set forth in Section 9.01 of the
Plan.

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     SECTION 2.05 “Code” means the Internal Revenue Code of 1986, as amended
from time to time, and the applicable rules and regulations promulgated
thereunder.
     SECTION 2.06 “Committee” means the Compensation Committee of the Board.
     SECTION 2.07 “Common Stock” means the common stock, $1.00 par value per
share, of the Company.
     SECTION 2.08 “Company” means The McGraw-Hill Companies, Inc., a corporation
organized under the laws of the State of New York, or any successor corporation.
     SECTION 2.09 “Deferred Account” means a bookkeeping account maintained by
the Company for a Participant representing the Participant’s interest in the
Incentive Compensation credited to such account pursuant to Sections 6.01 and
6.02 of the Plan.
     SECTION 2.10 “Determination Date” means the date on which the amount of a
Participant’s Deferred Account is determined as provided in Sections 6.01 and
6.02 of the Plan. The last day of each calendar month shall be a Determination
Date.
     SECTION 2.11 “Director” means an individual who is a member of the Board.
     SECTION 2.12 “Disability” means a Participant’s becoming disabled within
the meaning of Section 409A(a)(2)(C) of the Code.
     SECTION 2.13 “Employment Termination Date” means the date of a
Participant’s “separation from service” from the Company, as defined in
Section 409A(a)(2)(A)(i) of the Code.
     SECTION 2.14 “ERISA” means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the applicable rules and regulations
promulgated thereunder.
     SECTION 2.15 “Exchange Act” means the Securities Exchange Act of 1934, as
amended from time to time, and the applicable rules and regulations promulgated
thereunder.
     SECTION 2.16 “Extension Notice” has the meaning set forth in Section 9.01
of the Plan.
     SECTION 2.17 “Incentive Compensation” means any short-term compensation
cash award, payable by the Company to a Participant in a Plan Year pursuant to
the provisions of The McGraw-Hill Companies, Inc. Key Executive Short-Term
Incentive Compensation Plan, and successor programs thereto, and/or such other
cash compensation as determined by the Committee.
     SECTION 2.18 “Participant” means each employee who participates in the
Plan, as provided in Section 4.01 of the Plan.

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     SECTION 2.19 “Participation Agreement” means a deferral agreement, on such
form as may be prescribed by the Committee, executed and filed by a Participant
prior to the beginning of the first period for which the Participant’s Incentive
Compensation is to be deferred pursuant to the Plan. A new Participation
Agreement shall be executed and filed by a Participant for each Incentive
Compensation deferral election.
     SECTION 2.20 “Plan” means The McGraw-Hill Companies, Inc. Key Executive
Short-Term Incentive Deferred Compensation Plan, as amended from time to time.
     SECTION 2.21 “Plan Administrator” has the meaning set forth in Section 3.01
of the Plan.
     SECTION 2.22 “Plan Year” means the calendar year.
     SECTION 2.23 “Specified Employee” means a specified employee within the
meaning of Section 409A(a)(2)(B)(i) of the Code.
ARTICLE III
ADMINISTRATION
     SECTION 3.01 Administration. The Plan shall be administered by the
Executive Vice President, Human Resources of the Company (the “Plan
Administrator”), who shall have full authority to construe and interpret the
Plan, to establish, amend and rescind rules and regulations relating to the
Plan, and to take all such actions and make all such determinations in
connection with the Plan as he may deem necessary or desirable. Subject to
Article IX of the Plan, decisions of the Plan Administrator shall be reviewable
by the Committee. Subject to Article IX of the Plan, the Committee shall also
have the full authority to make, amend, interpret, and enforce all appropriate
rules and regulations for the administration of the Plan and decide or resolve
any and all questions, including interpretations of the Plan, as may arise in
connection with the Plan.
     SECTION 3.02 Binding Effect of Decisions. Subject to Article IX of the
Plan, the decision or action of the Plan Administrator or Committee in respect
to any question arising out of or in connection with the administration,
interpretation and application of the Plan and the rules and regulations
promulgated hereunder shall be final, conclusive and binding upon all persons
having any interest in the Plan.
     SECTION 3.03 Indemnification. To the fullest extent permitted by law, the
Plan Administrator, the Committee and the Board (and each member thereof), and
any employee of the Company to whom fiduciary responsibilities have been
delegated shall be indemnified by the Company against any claims, and the
expenses of defending against such claims, resulting from any action or conduct
relating to the administration of the Plan, except claims arising from gross
negligence, willful neglect or willful misconduct.

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ARTICLE IV
PARTICIPATION
     SECTION 4.01 Eligible Participants. Any individual who was a Participant in
the Plan immediately prior to the effective date of this amendment and
restatement shall continue to be a Participant on such date, subject to the
terms and provisions of the Plan. Thereafter, participation in the Plan shall be
limited to such Participants and to other executives selected by the Committee
who elect to participate in the Plan by filing a Participation Agreement with
the Company.
ARTICLE V
PARTICIPATION AGREEMENTS
     SECTION 5.01 Initial Participation Agreement. Each new Participant in the
Plan may file an irrevocable Participation Agreement to defer payment of all or
part of his Incentive Compensation to be earned during the Plan Year in which
the individual becomes a Participant in the Plan and to have the Participant’s
Deferred Account credited with such deferred amounts. In order to make a
deferral pursuant to this Section 5.01, the Participant must file an executed
Participation Agreement with the Company. This Participation Agreement must be
filed within 30 days of the date on which the individual becomes eligible to
participate in the Plan (or in any other account balance plan described in
Treasury Regulation Section 1.409A-1(c)(2)(i)(A), or any successor provision
thereto) and shall be effective with respect to compensation earned after the
date of filing thereof.
     SECTION 5.02 Annual Participation Agreements. A Participant may file a
Participation Agreement on an annual basis to defer payment of all or part of
his Incentive Compensation to be earned during the next succeeding Plan Year and
to have the Participant’s Deferred Account credited with such deferred amounts.
In order to make a deferral pursuant to this Section 5.02, the Participant must
file an executed Participation Agreement with the Company. The Participation
Agreement must be filed not later than, and such Participation Agreement shall
become irrevocable on, the last business day prior to the commencement of the
Plan Year to which the Participation Agreement relates.
     SECTION 5.03 Applicability of Participation Agreement. With respect to
Incentive Compensation deferrals, the deferral selected in each Participation
Agreement shall apply only to the Participant’s Incentive Compensation paid for
the Plan Year for which the respective Participation Agreement is applicable.
     SECTION 5.04 Elective Deferred Incentive Compensation. The amount of
Incentive Compensation that a Participant elects to defer in his Participation
Agreement shall be credited by the Company to the Participant’s Deferred Account
at such times as the compensation would have been paid had it not been deferred.

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ARTICLE VI
DEFERRED ACCOUNTS
     SECTION 6.01 Accounts. Each Participant’s Deferred Account, as of each
Determination Date, shall consist of the balance of the Participant’s Deferred
Account as of the immediately preceding Determination Date. The Deferred Account
of each Participant shall then be increased by any deferred Incentive
Compensation credited to or reduced by the amount of all distributions, if any,
made from such Deferred Account since the preceding Determination Date.
     SECTION 6.02 Interest Credit. As of each Determination Date, the
Participant’s Deferred Account shall be increased by the amount of interest
earned since the preceding Determination Date. Interest shall be credited at a
rate determined to be in effect for each Plan Year based on 120% of the
Applicable Federal Long-Term Rate as prescribed by the Internal Revenue Service
in December of the year prior to the year in which the Incentive Compensation is
credited. Notwithstanding the foregoing, if a Participant’s Deferred Account is
paid in installments in accordance with Section 7.05 of the Plan, interest shall
be credited, (i) for retired Participants, at the rate determined to be in
effect during the Plan Year in which the Participant retires, and (ii) for all
other installment payments, at the rate determined to be in effect during the
Plan Year in which such payments commence.
     SECTION 6.03 Statement of Accounts. The Company shall submit to each
Participant, by July 1 following the close of each Plan Year, a statement in
such form as the Company deems desirable, setting forth the balance to the
credit of such Participant in his Deferred Account as of the last day of the
preceding Plan Year.
     SECTION 6.04 Vesting of Accounts. A Participant shall be 100% vested in his
Deferred Account at all times.
ARTICLE VII
DISTRIBUTIONS
     SECTION 7.01 Payment Elections. A Participant may elect in any
Participation Agreement whether payment of the balance of the amounts credited
to his Deferred Account shall be made or commence (i) on a date specified by the
Participant in the Participation Agreement, or (ii) upon the occurrence of an
event described in Sections 7.02, 7.03 or 7.04 of the Plan. The Participant
shall be entitled to the balance of the amounts credited to his Deferred
Account, as determined under Sections 6.01 and 6.02 of the Plan and as payable
in accordance with Section 7.05 of the Plan, as of the Determination Date
coincident with or immediately following such specified date or the occurrence
of such event.
     SECTION 7.02 Employment Termination. Payment of a Participant’s Deferred
Account shall be made or commence as of the Determination Date coincident with
or immediately following the Participant’s Employment Termination Date;
provided, however, if such Participant is a Specified Employee as of the
Participant’s Employment Termination Date then the payment shall be made or
commence as of the six-month anniversary of the

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Determination Date coincident with or immediately following the Participant’s
Employment Termination Date.
     SECTION 7.03 Death. If a Participant dies after the commencement of
payments of his Deferred Account, or if a Participant dies while employed prior
to any payments of the balance of the amounts credited to his Deferred Account,
his Beneficiary shall receive a lump-sum payment equal to the balance of the
amounts credited to his Deferred Account as of the Determination Date coincident
with or immediately following the date of the Participant’s death.
     SECTION 7.04 Disability. In the event of a Participant’s Disability prior
to his Employment Termination Date, such Participant shall receive a lump-sum
payment of the balance of the amounts credited to his Deferred Account as of the
Determination Date coincident with or immediately following the date of the
Participant’s Disability.
     SECTION 7.05 Payment of Benefit. Except as otherwise provided in the
Participant’s Participation Agreements, upon, or commencing upon, the first
scheduled payroll date of the first calendar month following the earliest of the
happening of the specified date, if any, or the occurrence of an event described
in Sections 7.02, 7.03 or 7.04 of the Plan, the Company shall pay to the
Participant the applicable portion of the balance of the amounts credited to his
Deferred Account in a lump sum or in equal annual installments, as elected in
the applicable Participation Agreements. If a Participant elects to receive
payments in installments, payment of such portion of the balance of the amounts
credited to his Deferred Account shall be in an amount which amortizes the
Deferred Account balance thereof in equal annual payments of principal and
interest over a period not to exceed 15 years. For purposes of determining the
amount of the annual payment, the assumed rate of interest shall be the rate
specified under the terms of Section 6.02 of the Plan.
     SECTION 7.06 Change in Election. No change in a Participant’s payment
election shall be valid unless it is made in a Participation Agreement that is
executed and filed with the Company in accordance with this Section 7.06. Any
change in a Participant’s payment election with respect to his Deferred Account
may not take effect until at least 12 months after the date on which the
election is made in a Participation Agreement that is executed and filed with
the Company and, in the case of a payment to be made or commenced on a specified
date, the election is made in a Participation Agreement that is not executed and
filed with the Company less than 12 months prior to the date of the
Participant’s first such payment scheduled under the Plan. The first payment
with respect to which the election is made must be deferred for a period of not
less than five years from the date such payment would otherwise have been made.
ARTICLE VIII
EFFECT OF CORPORATE TRANSACTIONS
     SECTION 8.01 Change in Control. (a) Notwithstanding anything contained in
the Plan to the contrary, in the event of a Change in Control that is a “change
in control event” within the meaning of Section 409A(a)(2)(A)(v) of the Code,
the Company shall immediately

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pay to each Participant in a lump sum the then remaining balance in his Deferred
Account. The terms of Sections 11.01 and 11.02 of the Plan shall not be
applicable following a Change in Control.
     (b) The reasonable legal fees incurred by any Participant to enforce his
valid rights under this Section 8.01 shall be paid for by the Company to the
Participant in addition to sums otherwise due hereunder, whether or not the
Participant is successful in enforcing his rights or whether or not the matter
is settled; provided that such payment shall be made not later than the end of
the taxable year following the year in which such legal fees are incurred;
provided, further, that no such payment shall be made after the last day of the
sixth year following the expiration of the period described under Section 9.03
of the Plan.
ARTICLE IX
CLAIMS PROCEDURE
     SECTION 9.01 Claims. In the event any person or his authorized
representative (a “Claimant”) disputes the amount of, or his entitlement to, any
benefits under the Plan or their method of payment, such Claimant shall file a
claim in writing with, and on the form prescribed by, the Plan Administrator for
the benefits to which he believes he is entitled, setting forth the reason for
his claim. The Claimant shall have the opportunity to submit written comments,
documents, records and other information relating to the claim and shall be
provided, upon request and free of charge, reasonable access to and copies of
all documents, records or other information relevant to the claim. The Plan
Administrator shall consider the claim and within 90 days of receipt of such
claim, unless special circumstances exist which require an extension of the time
needed to process such claim, the Plan Administrator shall inform the Claimant
of its decision with respect to the claim. In the event of special
circumstances, the response period can be extended for an additional 90 days, as
long as the Claimant receives written notice advising of the special
circumstances and the date by which the Plan Administrator expects to make a
determination (the “Extension Notice”) before the end of the initial 90- day
response period indicating the reasons for the extension and the date by which a
decision is expected to be made. If the Plan Administrator denies the claim, the
Plan Administrator shall give to the Claimant (i) a written notice setting forth
the specific reason or reasons for the denial of the claim, including references
to the applicable provisions of the Plan, (ii) a description of any additional
material or information necessary to perfect such claim along with an
explanation of why such material or information is necessary, and
(iii) appropriate information as to the Plan’s appeals procedures as set forth
in Section 9.02 of the Plan.
     SECTION 9.02 Appeal of Denial. A Claimant whose claim is denied by the Plan
Administrator and who wishes to appeal such denial must request a review of the
Plan Administrator’s decision by filing a written request with the Committee for
such review within 60 days after such claim is denied. Such written request for
review shall contain all relevant comments, documents, records and additional
information that the Claimant wishes the Committee to consider, without regard
to whether such information was submitted or considered in the initial review of
the claim by the Plan Administrator. In connection with that review, the
Claimant may examine, and receive free of charge, copies of pertinent Plan
documents and submit such written comments as may be appropriate. Written notice
of the decision on review

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shall be furnished to the Claimant within 60 days after receipt by the Committee
of a request for review. In the event of special circumstances which require an
extension of the time needed for processing, the response period can be extended
for an additional 60 days, as long as the Claimant receives an Extension Notice.
If the Committee denies the claim on review, notice of the Committee’s decision
shall include (i) the specific reasons for the adverse determination, (ii)
references to applicable Plan provisions, (iii) a statement that the Claimant is
entitled to receive, free of charge, reasonable access to, and copies of, all
documents, records and other information relevant to the claim and (iv) a
statement of the Claimant’s right to bring an action under Section 502(a) of
ERISA following an adverse benefit determination on a review and a description
of the applicable limitations period under the Plan. The Claimant shall be
notified no later than five days after a decision is made with respect to the
appeal.
     SECTION 9.03 Statute of Limitations. A Claimant wishing to seek judicial
review of an adverse benefit determination under the Plan, whether in whole or
in part, must file any suit or legal action, including, without limitation, a
civil action under Section 502(a) of ERISA, within three years of the date the
final decision on the adverse benefit determination on review is issued or
should have been issued under Section 9.02 of the Plan or lose any rights to
bring such an action. If any such judicial proceeding is undertaken, the
evidence presented shall be strictly limited to the evidence timely presented to
the Plan Administrator. Notwithstanding anything in the Plan to the contrary, a
Claimant must exhaust all administrative remedies available to such Claimant
under the Plan before such Claimant may seek judicial review pursuant to Section
502(a) of ERISA.
ARTICLE X
BENEFICIARY DESIGNATION
     SECTION 10.01 Beneficiary Designation. Each Participant shall have the
right, at any time, to designate any person, persons, entity or entities as his
Beneficiary or Beneficiaries (both primary as well as contingent) to whom
payment under the Plan shall be paid in the event of his death prior to complete
distribution to the Participant of the benefits due him under the Plan.
     SECTION 10.02 Amendments. Any Beneficiary designation may be changed by a
Participant by the written filing of such change on a form prescribed by the
Company. The new Beneficiary designation form shall cancel all Beneficiary
designations previously filed.
     SECTION 10.03 No Beneficiary Designation. If a Participant fails to
designate a Beneficiary as provided above, or if all designated Beneficiaries
predecease the Participant, then any amounts to be paid to the Participant’s
Beneficiary shall be paid to the Participant’s estate.
     SECTION 10.04 Effect of Payment. The payment under this Article X of the
amounts due to a Participant under the Plan to a Beneficiary shall completely
discharge the Company’s obligations in respect of the Participant under the
Plan.

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ARTICLE XI
AMENDMENT AND TERMINATION OF PLAN
     SECTION 11.01 Amendment. The Board or the Committee may from time to time
make such amendments to the Plan as it may deem proper and in the best interest
of the Company; provided, however, that, subject to Section 11.03 of the Plan,
no amendment shall be effective to decrease or restrict any Deferred Account at
the time of such amendment.
     SECTION 11.02 Company’s Right to Terminate. The Board or the Committee may
terminate the Plan at any time with respect to future deferrals of Incentive
Compensation if, in its judgment, the continuance of the Plan, the tax,
accounting, or other effects thereof, or potential payments thereunder would not
be in the best interests of the Company. The Board or the Committee may also
terminate the Plan in its entirety at any time, and, upon any such termination,
the Company shall immediately pay to each Participant in a lump sum the then
remaining balance in his Deferred Account, subject to and in accordance with the
requirements of Treasury Regulation Section 1.409A-3(j)(4)(ix) (or any successor
provision thereto).
     SECTION 11.03 Section 409A. If, in the good faith judgment of the
Committee, any provision of the Plan or any Participation Agreement could
otherwise cause any person to be subject to the interest and penalties imposed
under Section 409A of the Code, such provision shall be modified by the
Committee in its sole discretion to maintain, to the maximum extent practicable,
the original intent of the applicable provision without causing the interest and
penalties under Section 409A of the Code to apply, and, notwithstanding any
provision therein to the contrary, the Committee shall have broad authority to
amend or to modify the Plan or any Participation Agreement, without advance
notice to or consent by any person, to the extent necessary or desirable to
ensure that no Deferred Accounts are subject to tax under Section 409A of the
Code. Any determinations made by the Committee under this Section 11.03 shall be
final, conclusive and binding on all persons.
ARTICLE XII
MISCELLANEOUS
     SECTION 12.01 Unsecured General Creditor. The Plan is an unfunded deferred
compensation plan for a select group of management or highly compensated
employees within the meaning of ERISA, and shall be construed and administered
accordingly. Participants and their Beneficiaries shall have no legal or
equitable rights, interest or claims in any property or assets of the Company.
The assets of the Company shall not be held under any trust for the benefit of
Participants or their Beneficiaries or held in any way as collateral security
for the fulfilling of the obligations of the Company under the Plan. Any and all
of the Company’s assets shall be, and remain, the general, unpledged,
unrestricted assets of the Company. The Company’s obligation under the Plan
shall be merely that of an unfunded and unsecured promise of the Company to pay
money in the future.
     SECTION 12.02 Nonassignability. Each Participant’s rights under the Plan
shall be nontransferable except by will or by the laws of descent and
distribution. Subject to the foregoing, neither a Participant nor any other
person shall have any right to commute, sell, assign, transfer, pledge,
anticipate, mortgage or otherwise encumber, transfer, hypothecate or

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convey in advance of actual receipt the amounts, if any, payable hereunder, or
any part thereof, which are, and all rights to which are, expressly declared to
be nonassignable and non-transferable. No part of the amounts payable shall,
prior to actual payment, be subject to seizure or sequestration for the payment
of any debts, judgments, alimony or separate maintenance owed by a Participant
or any other person, nor be transferable by operation of law in the event of a
Participant’s or any other person’s bankruptcy or insolvency.
     SECTION 12.03 Not a Contract of Employment. The terms and conditions of the
Plan shall not be deemed to constitute a contract of employment with the
Participant, and the Participant (or his Beneficiary) shall have no rights
against the Company except as specifically provided herein. Moreover, nothing in
the Plan shall be deemed to give a Participant the right to be retained in the
service of the Company or to interfere with the rights of the Company to
discipline or discharge him at any time.
     SECTION 12.04 Binding Effect. The Plan shall be binding upon and shall
inure to the benefit of the Participant or his Beneficiary, his heirs and legal
representatives, and the Company.
     SECTION 12.05 Protective Provisions. A Participant will cooperate with the
Company by furnishing any and all information requested by the Company, in order
to facilitate the payment of benefits hereunder, and by taking such other action
as may be requested by the Company.
     SECTION 12.06 Withholding; Payroll Taxes. To the extent that the Company is
required to withhold any taxes or other amounts from the employee’s deferred
compensation pursuant to any state, federal or local law, such amounts shall
first be taken out of the portion of the Participant’s Incentive Compensation
that is not deferred under the Plan, or the Participant’s base salary. To the
extent required by the law in effect at the time payments are made, the Company
shall withhold from payments made hereunder any taxes or other amounts required
to be withheld for any federal, state or local government and other authorized
deductions.
     SECTION 12.07 Severability. In the event that any provision or portion of
the Plan shall be determined to be invalid or unenforceable for any reason, the
remaining provisions and portions of the Plan shall be unaffected thereby and
shall remain in full force and effect to the fullest extent permitted by law.
     SECTION 12.08 Governing Law. The Plan shall be construed under the laws of
the State of New York, to the extent not preempted by federal law.
     SECTION 12.09 Headings. The section headings used in this document are for
ease of reference only and shall not be controlling with respect to the
application and interpretation of the Plan.
     SECTION 12.10 Rules of Construction. Any words herein used in the masculine
shall be read and construed in the feminine where they would so apply. Words in
the singular shall be read and construed as though used in the plural in all
cases where they would so

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apply. All references to sections are, unless otherwise indicated, to sections
of the Plan. The Plan is intended to meet the requirements of Section 409A of
the Code and shall be interpreted and construed consistent with such intent.

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