Exhibit 10.2

 

CALIFORNIA RESOURCES CORPORATION

 

DEFERRED COMPENSATION PLAN

 

(Effective December 1, 2014)

 

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Table of Contents

 

 

 

Page

 

 

ARTICLE I PURPOSE

1

ARTICLE II DEFINITIONS

1

ARTICLE III ADMINISTRATION OF THE PLAN

7

ARTICLE IV PARTICIPATION

8

4.1

Election to Participate

8

4.2

DCP Deferral Accounts

10

4.3

Interest

11

4.4

Valuation of Deferral Accounts

11

4.5

Savings Plan Restoration Contribution

11

4.6

Vesting of Deferral Accounts

12

4.7

Statement of Deferral Accounts

12

ARTICLE V BENEFITS

12

5.1

Separation from Service for a Reason other than Death

12

5.2

Beneficiary Benefits

13

5.3

Early Payment

14

5.4

Emergency Benefit

15

5.5

Effect of Change in Control

15

5.6

Small Benefit

15

5.7

Tax Withholding and Reporting

15

5.8

Reemployment

16

5.9

Qualified Divorce Orders

16

ARTICLE VI BENEFICIARY DESIGNATION

16

ARTICLE VII CLAIMS PROCEDURE

17

7.1

Applications for Benefits

17

7.2

Claims Procedure

17

7.3

Section 409A Compliance

18

7.4

Limitations on Actions

18

ARTICLE VIII AMENDMENT AND TERMINATION OF PLAN

18

8.1

Amendment

18

8.2

Termination

19

ARTICLE IX MISCELLANEOUS

19

 

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9.1

Unsecured General Creditor

19

9.2

Trust Fund

20

9.3

Nonassignability

20

9.4

Release from Liability to Participant

20

9.5

Employment Not Guaranteed

20

9.6

Gender, Singular & Plural

21

9.7

Captions

21

9.8

Validity

21

9.9

Notice

21

9.10

Applicable Law

21

 

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CALIFORNIA RESOURCES CORPORATION

 

DEFERRED COMPENSATION PLAN

 

(Effective December 1, 2014)

 

ARTICLE I
PURPOSE

 

Occidental Petroleum Corporation, a Delaware corporation (“OPC”), and California
Resources Corporation, a Delaware corporation (“CRC”), have entered into that
certain Separation and Distribution Agreement (the “Separation Agreement”),
dated as of November 25, 2014, which generally governs the separation of CRC’s
businesses from OPC’s other businesses and provides for, among other things,
OPC’s distribution to holders of shares of OPC’s common stock, through a
spin-off, of at least 80.1% of the outstanding shares of CRC’s common stock (the
“Spin-Off”).  In connection with the Spin-Off, OPC and CRC have also entered
into that certain Employee Matters Agreement, dated as of November 25, 2014 (the
“Employee Matters Agreement”), which requires, among other things, that CRC (or
a subsidiary or affiliate of CRC) establish a deferred compensation plan to
assume the liabilities under the Occidental Petroleum Corporation Modified
Deferred Compensation Plan (the “OPC MDCP”) in respect of certain employees of
CRC and its subsidiaries as of immediately prior to the effective time of the
Spin-Off who were participants in the OPC MDCP as of such time (the “CRC MDCP
Participants”).  In order to satisfy its obligations under the Employee Matters
Agreement with respect to such liabilities, CRC Services, LLC, a Delaware
limited liability company (“CRC Services”) establishes this California Resources
Corporation Deferred Compensation Plan (the “Plan”) effective as of December 1,
2014 (the “Effective Date”).  The Plan is also intended to provide a
tax-deferred opportunity for key management and highly compensated employees of
the Company (as defined below) to accumulate additional retirement income
through deferrals of compensation.

 

As of the Effective Date, the “DCP Deferral Account” (if any) and the “Savings
Plan Restoration Account” (if any) of each CRC MDCP Participant under the OPC
MDCP is transferred to and assumed by the Plan and shall be credited to such CRC
MDCP Participant’s corresponding “DCP Deferral Account” and “Savings Plan
Restoration Account,” respectively, maintained under the Plan.

 

The Plan is intended to satisfy the requirements of Section 409A of the Internal
Revenue Code, and any regulations promulgated thereunder, so that the taxation
to Participants or Beneficiaries of any compensation deferred under the Plan is
deferred.

 

ARTICLE II
DEFINITIONS

 

Whenever the following words and phrases are used in the Plan with the first
letter capitalized, they shall have the meanings specified below:

 

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Affiliate.  “Affiliate” means (i) any corporation that is a member of a
controlled group of corporations (within the meaning of Code Section 1563(a),
determined without regard to Code Sections 1563(a)(4) and (e)(3)(C), and with
the phrase “more than 50%” substituted for the phrase “at least 80%” each place
it appears in Code Section 1563(a)) of which CRC is a component member, or
(ii) any entity (whether or not incorporated) that is under common control with
CRC (as defined in Code Section 414(c) and the Treasury Regulations thereunder,
and with the phrase “more than 50%” substituted for the phrase “at least 80%”
each place it appears in the Treasury Regulations under Code Section 414(c)).

 

Alternate Payee.  “Alternate Payee” means a former spouse of a Participant who
is recognized by a Divorce Order as having a right to receive all, or a portion
of, the benefits payable under the Plan with respect to such Participant.

 

Amortization Method.  “Amortization Method” means an annual installment method
of paying a Participant’s benefits under which the Company will pay the
Participant an initial payment in an amount equal to (i) plus (ii) divided by
(iii), where (i) is the value of the Participant’s Deferral Accounts as of the
end of the month preceding such payment, (ii) is the amount of interest that
would accrue during the entire payout period on the unpaid balance credited to
the Participant’s Deferral Accounts immediately following such initial payment
if the Declared Rate then in effect remained unchanged and (iii) is the number
of years over which annual installments are to be paid.  For each Plan Year
after the initial benefit payment is made, the annual benefit payment will be
determined under the same equation where (i) is the value of the Participant’s
Deferral Accounts as of the end of the month preceding the benefit payment,
(ii) is the amount of interest that would accrue during the remaining payout
period on the unpaid balance credited to the Participant’s Deferral Accounts
immediately following such annual payment if the Declared Rate then in effect
remained unchanged and (iii) is the number of annual payments remaining.

 

Base Salary.  “Base Salary” means the base salary earned by a Participant during
pay periods beginning in a Plan Year, excluding Bonus, all severance allowances,
forms of incentive compensation, Savings Plan or other Company qualified plan
contributions or benefits, retainers, insurance premiums or benefits,
reimbursements, and all other payments, prior to reduction for any deferrals
under the Plan or any other plan of the Company or reductions under the Savings
Plan allowed under Code Section 401(k).

 

Beneficiary.  “Beneficiary” means the person or persons designated as such in
accordance with Article VI.

 

Beneficiary Benefit.  “Beneficiary Benefit” means the payment to a Participant’s
Beneficiary of the value of the Participant’s Deferral Accounts pursuant to
Section 5.2 on account of the Participant’s death.

 

Board.  “Board” means the Board of Directors of CRC Services.

 

Bonus.  “Bonus” means the bonus earned by a Participant under a regular annual
incentive compensation plan (excluding without limitation a special individual
or group bonus, a

 

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project bonus, and any other special bonus) during a Plan Year prior to
reduction for any deferral under the Plan or any other plan of the Company.

 

Change in Control.  “Change in Control” means (i) for purposes of Sections 8.1
and 8.2(a), any event described in (a), (b), (c) or (d) below, and (ii) for
purposes of Section 5.5, any event that constitutes a “change in control event”
for purposes of Code Section 409A and Treas. Reg. § 1.409A-3(i)(5) (or any
successor provisions) and that is described in subsection (a), (b), (c) or
(d) below:

 

(a)                                 Approval by the stockholders of CRC (or, if
no stockholder approval is required, by the CRC Board) of the dissolution or
liquidation of CRC, other than in the context of a transaction that does not
constitute a Change in Control under subsection (b) below;

 

(b)                                 Consummation of a merger, consolidation, or
other reorganization, with or into, or the sale of all or substantially all of
CRC’s business and/or assets as an entirety to, one or more entities that are
not subsidiaries or other affiliates of CRC (a “Business Combination”), unless
(i) as a result of the Business Combination, more than 50% of the outstanding
voting power of the surviving or resulting entity or a parent thereof (the
“Successor Entity”) immediately after the Business Combination is, or will be,
owned, directly or indirectly, by holders of CRC’s voting securities immediately
before the Business Combination; (ii) no “person” (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended from
time (the “Exchange Act”)), excluding the Successor Entity, OPC or any employee
benefit plan of OPC or CRC and any trustee or other fiduciary holding securities
under an OPC or CRC employee benefit plan or any person described in and
satisfying the conditions of Rule 13d-1(b)(i) of the Exchange Act (an “Excluded
Person”; provided, however, that OPC, employee benefit plans of OPC and trustees
and fiduciaries holding securities under an OPC employee benefit plan shall
cease to be Excluded Persons at such time as OPC distributes the remaining
outstanding shares of CRC common stock to the OPC shareholders following the
Spin-Off and as contemplated in the Separation Agreement), beneficially owns,
directly or indirectly, more than 30% of the outstanding shares or the combined
voting power of the outstanding voting securities of the Successor Entity, after
giving effect to the Business Combination, except to the extent that such
ownership existed prior to the Business Combination; and (iii) at least 50% of
the members of the board of directors of the entity resulting from the Business
Combination were members of the CRC Board at the time of the execution of the
initial agreement or of the action of the CRC Board approving the Business
Combination;

 

(c)                                  Any “person” (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act, but excluding any Excluded Person)
is or becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of CRC representing 30% or more of
the combined voting power of CRC’s then outstanding voting securities, other
than as a result of (i) an acquisition directly from CRC; (ii) an acquisition by
CRC; or (iii) an acquisition by any employee benefit plan (or related trust)
sponsored or maintained by CRC or a Successor Entity; or

 

(d)                                 During any period not longer than two
consecutive years and beginning no earlier than the Effective Date, individuals
who at the beginning of such period constituted the

 

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CRC Board cease to constitute at least a majority thereof, unless the election,
or the nomination for election by CRC’s stockholders, of each new CRC Board
member was approved by a vote of at least two-thirds (2/3) of the CRC Board
members then still in office who were CRC Board members at the beginning of such
period (including for these purposes, new members whose election or nomination
was so approved), but excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a
person other than the CRC Board.

 

Code.  “Code” means the Internal Revenue Code of 1986, as amended.

 

Committee.  “Committee” means the administrative committee appointed to
administer the Plan pursuant to Article III.

 

Company.  “Company” means CRC Services, or any successor thereto, and any
Affiliates (including, without limitation, CRC or any successor thereto).

 

Company Management.  “Company Management” means the Chairman of the Board, Chief
Executive Officer, President or any Executive Vice President of CRC Services.

 

Compensation.  “Compensation” means Base Salary and/or Bonus.

 

CRC.  “CRC” has the meaning assigned to such term in Article I.

 

CRC Board.  “CRC Board” means the Board of Directors of CRC.

 

CRC MDCP Participants.  “CRC MDCP Participants” has the meaning assigned to such
term in Article I.

 

CRC Services.  “CRC Services” has the meaning assigned to such term in
Article I.

 

DCP Deferral Account.  “DCP Deferral Account” means the account maintained on
the books of account of the Company for each Participant pursuant to Article IV
to account for amounts deferred under the Prior Plans and the Plan (other than
pursuant to Section 4.5).

 

DCP Deferral Amount.  “DCP Deferral Amount” means an amount of a Participant’s
Base Salary and/or Bonus that is deferred under the Plan, including amounts
deferred under the Prior Plans and the Plan.

 

DCP2.  “DCP2” means the Occidental Petroleum Corporation Deferred Compensation
Plan 2, effective as of October 12, 2006.

 

Declared Rate.  “Declared Rate” with respect to any Plan Year means the rate at
which interest will be credited on Deferral Accounts for such Plan Year.  The
Declared Rate for each Plan Year will be the monthly yield on 5-year Treasury
Constant Maturities plus 2%.

 

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Deferral Account(s).  “Deferral Account(s)” means a Participant’s DCP Deferral
Account and/or Savings Plan Restoration Account (if any) maintained on the books
of account of the Company for each Participant pursuant to Article IV.

 

Deferral Election Form.  “Deferral Election Form” means a paper or electronic
election form provided by the Committee on which an Eligible Employee may elect
to defer Base Salary and/or Bonus and may elect to receive an Early Payment
Benefit in accordance with Article IV.

 

Distribution Election Form.  “Distribution Election Form” means a paper or
electronic election form provided by the Committee on which a Participant may
elect the form of payment of his Retirement Benefits and/or the form of payment
of Beneficiary Benefits to his Beneficiary in accordance with Article V.

 

Divorce Order.  “Divorce Order” means any judgment, decree, or order (including
judicial approval of a property settlement agreement) that relates to the
settlement of marital property rights between a Participant and his former
spouse pursuant to state domestic relations law (including, without limitation
and if applicable, community property law), as described in Treas. Reg.
§ 1.409A-3(j)(4)(ii).

 

Early Payment Benefit.  “Early Payment Benefit” means the payment to a
Participant of part or all of the Participant’s DCP Deferral Account in an Early
Payment Year beginning prior to the Participant’s Retirement or other Separation
from Service pursuant to Section 5.3.

 

Early Payment Year.  “Early Payment Year” means any year beginning prior to a
Participant’s Retirement or other Separation from Service that a Participant
elects pursuant to Section 4.1(c) to have an Early Payment Benefit paid or
commenced to be paid.

 

Early Payment Year Subaccount.  “Early Payment Year Subaccount” means any
subaccount of a Participant’s DCP Deferral Account established to separately
account for deferred Base Salary and/or Bonus (and interest credited thereto)
that is subject to an Early Payment Benefit election.

 

Effective Date.  “Effective Date” has the meaning assigned to such term in
Article I.

 

Eligible Employee.  “Eligible Employee” means each key management employee or
other highly compensated employee of the Company who is selected by Company
Management to participate in the Plan.

 

Emergency Benefit.  “Emergency Benefit” means the payment to a Participant of
part or all of his Deferral Accounts in the event that the Participant has an
Unforeseeable Emergency pursuant to Section 5.4.

 

Employee Matters Agreement.  “Employee Matters Agreement” has the meaning
assigned to such term in Article I.

 

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

 

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Fractional Method.  “Fractional Method” means an installment method of paying a
Participant’s Retirement Benefit under which the Company will determine the
amount of each annual installment by dividing the value of the Participant’s
Deferral Accounts as of the end of the month preceding the payment date by the
number of annual installments remaining to be paid.

 

OPC.  “OPC” has the meaning assigned to such term in Article I.

 

OPC DCP.  “OPC DCP” means the Occidental Petroleum Corporation Deferred
Compensation Plan, as amended and restated as of January 1, 2003, under which
deferrals ceased as of December 31, 2004.

 

OPC MDCP.  “OPC MDCP” has the meaning assigned to such term in Article I

 

Participant.  “Participant” means (i) each CRC MDCP Particpant, (ii) an Eligible
Employee who has filed a completed and fully executed Deferral Election
Form with the Committee and is participating in the Plan in accordance with the
provisions of Article IV, and (iii) any person who has a Deferral Account by
reason of his prior status as an Eligible Employee.  Under no circumstances
shall “Participant” mean any Alternate Payee.

 

Plan.  “Plan” has the meaning assigned to such term in Article I.

 

Plan Year.  “Plan Year” means the calendar year beginning on January 1 and
ending on December 31; provided, however, that the first Plan Year shall begin
of the Effective Date and end on December 31, 2014.

 

Prior Plans.  “Prior Plans” means (a) the OPC MDCP, (b) the OPC DCP, (c) the
DCP2, and (d) the 2005 DCP.

 

Qualified Divorce Order.  “Qualified Divorce Order” means a Divorce Order that
(a) creates or recognizes the existence of an Alternate Payee’s right to, or
assigns to an Alternate Payee the right to, receive all or a portion of the
benefits payable to a Participant under the Plan; (b) clearly specifies (i) the
name and the last known mailing address of the Participant and the name and last
known mailing address of the Alternate Payee covered by the order, (ii) the
amount or percentage of the Participant’s benefits to be paid by the Plan to the
Alternate Payee, or the manner in which such amount or percentage is to be
determined, (iii) the number of payments or period to which such order applies,
and (iv) that it applies to the Plan; and (c) does not (i) require the Plan to
provide any type or form of benefit, or any option, not otherwise provided under
the Plan, (ii) require the Plan to provide increased benefits, or (iii) require
the payment of benefits to an Alternate Payee that are required to be paid to
another Alternate Payee under another Divorce Order previously determined to be
a Qualified Divorce Order.

 

Retirement.  “Retirement” means the Participant’s Separation from Service for
reasons other than death after the Participant attains age 55.

 

Retirement Benefit.  “Retirement Benefit” means the payment to a Participant of
the value of the Participant’s Deferral Accounts pursuant to Section 5.1
following Retirement.

 

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Savings Plan.  “Savings Plan” means the California Resources Corporation Savings
Plan, as amended from time to time.

 

Savings Plan Restoration Account.  “Savings Plan Restoration Account” means the
account maintained on the books of account of the Company to reflect a CRC MDCP
Participant’s account balance, if any, transferred to the Plan as of the
Effective Date from such Participant’s “Savings Plan Restoration Account”
maintained under the OPC MDCP.  The Savings Plan Restoration Account also
includes the contributions made by the Company on behalf of a Participant from
and after the Effective Date pursuant to Section 4.5, and such amounts may be
held in one or more subaccounts of the Savings Plan Restoration Account.

 

Separation Agreement.  “Separation Agreement” has the meaning assigned to such
term in Article I.

 

Separation from Service.  “Separation from Service” means a Participant’s
“separation from service” as defined under Code Section 409A and Treas. Reg. §
1.409A-1(h) (or successor provisions) from the Company.

 

Specified Employee.  “Specified Employee” means an employee who is a “specified
employee” within the meaning of Section 409A and Treas. Reg. § 1.409A-1(i) (or
successor provisions) and as determined pursuant to any rules adopted for such
purposes by CRC Services.

 

Spin-Off.  “Spin-Off” has the meaning assigned to such term in Article I.

 

Termination Benefit.  “Termination Benefit” means the payment to a Participant
of the value of the Participant’s Deferral Accounts pursuant to Section 5.1 on
account of the Participant’s Separation from Service other than due to
Retirement or death.

 

2005 DCP.  “2005 DCP” means the Occidental Petroleum Corporation 2005 Deferred
Compensation Plan, restated as of January 1, 2005 and as subsequently amended.

 

Unforeseeable Emergency.  “Unforeseeable Emergency” means 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, without regard to Code Sections 152(b)(1), (b)(2) and (d)(1)(B)) 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.

 

ARTICLE III
ADMINISTRATION OF THE PLAN

 

A Committee shall be appointed by the Board to administer the Plan and
establish, adopt, or revise such rules and regulations as the Committee may deem
necessary or advisable for the administration of the Plan and to interpret the
provisions of the Plan, and, except as otherwise indicated herein, any such
interpretations shall be conclusive and binding.  All decisions of the Committee
shall be by vote of at least two of the Committee members and shall be final. 
The Committee may appoint any agent and delegate to such agent such powers and
duties in connection with the administration of the Plan as the Committee may
from time to time

 

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prescribe.  The Plan is intended to comply with the requirements of Code
Section 409A and shall be interpreted and administered accordingly.

 

Members of the Committee shall be eligible to participate in the Plan while
serving as members of the Committee, but a member of the Committee shall not
vote or act upon any matter which relates solely to such member’s interest in
the Plan as a Participant.

 

ARTICLE IV
PARTICIPATION

 

4.1                               Election to Participate.

 

(a)                                 CRC MDCP Participants.  Notwithstanding any
provision in the Plan to the contrary, the participation in the Plan of each CRC
MDCP Participant shall be subject to the following:

 

(i)                                     The CRC MDCP Participant shall become an
Eligible Employee and a Participant as of the Effective Date;

 

(ii)                                  All deferral elections made by the CRC
MDCP Participant under the OPC MDCP for calendar year 2014 that were in effect
immediately prior to the Effective Date shall remain in effect under the Plan
for the Plan Year that begins on the Effective Date;

 

(iii)                               All time and form of payment elections
(including, without limitation, elections with respect to “Early Payment
Benefits” under the OPC MDCP) made by the CRC MDCP Participant under the OPC
MDCP that were in effect immediately prior to the Effective Date shall continue
in effect under the Plan, shall be treated as elections under the Plan, and may
be changed only in accordance with the provisions of Sections 5.1(b)(iii) and
(iv);

 

(iv)                              All Beneficiary designations and time and form
of payment elections relating to the distribution of benefits to Beneficiaries
made by the CRC MDCP Participant under the OPC MDCP that were in effect
immediately prior to the Effective Date shall continue in effect under the Plan,
shall be treated as elections under the Plan, and may be changed only in
accordance with the provisions of Sections 5.2(c); and

 

(v)                                 Subaccounts shall be maintained under the
CRC MDCP Participant’s Deferral Accounts to the extent necessary to reflect the
matters described in clauses (ii), (iii) and (iv) above.

 

(b)                                 Deferral Elections.  Elections under this
Section 4.1(b) and under Section 4.1(c) may be made only with respect to Plan
Years beginning on or after January 1, 2015.  An Eligible Employee may elect to
participate in the Plan and elect to defer annual Base Salary and/or Bonus under
the Plan by filing with the Committee a completed and fully executed Deferral
Election Form prior to the beginning of the Plan Year during which the Eligible
Employee performs the services for which such Base Salary and Bonus are to be
earned, or at such other time as the Committee may permit in accordance with the
regulations promulgated under Code Section 409A.  Such Deferral Election Forms
must be filed in accordance with the

 

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instructions set forth in the Deferral Election Forms and will become
irrevocable as of the day immediately preceding the Plan Year to which they
relate.

 

An employee who first becomes an Eligible Employee during a Plan Year may make
an initial deferral election under the Plan within 30 days after the date the
employee becomes an Eligible Employee provided that such Eligible Employee has
not previously become eligible to participate in any other account balance plan
that is required to be aggregated with the Plan as described in Treas. Reg. §
1.409A-1(c)(2) (or any successor provision).  Any such election shall apply to
Base Salary earned for services performed after the 30-day election window
described in the previous sentence and to that portion of the Bonus earned
during such Plan Year equal to the total amount of the Bonus multiplied by the
ratio of the number of days remaining in the Plan Year after the 30-day election
window described in the previous sentence ends over the total number of days in
the Plan Year.  Any such election shall become irrevocable at the end of the
30-day election window described in the first sentence of this paragraph.

 

A Deferral Election Form filed for a Plan Year shall be effective for Base
Salary and/or Bonus to be earned during that Plan Year only.  For each
subsequent Plan Year, an Eligible Employee who wishes to defer Base Salary
and/or Bonus must file a new complete and fully executed Deferral Election
Form in accordance with the instructions set forth in the Deferral Election
Form but in any event prior to January 1 of such Plan Year.

 

Each Deferral Election Form will designate the DCP Deferral Amounts as a fixed
dollar amount or fixed percentage (in increments of 1%) of Base Salary and/or
(i) a fixed dollar amount or a fixed percentage of Bonus or (ii) 100% of any
Bonus exceeding a specified dollar amount, as elected by the Participant. 
Deferrals of Base Salary will normally be deducted ratably during the Plan Year,
except as otherwise determined by the Committee to take into account special
circumstances; provided that in no event will the Committee’s action alter the
total amount of deferrals for the Plan Year.  In its sole discretion, the
Committee may also permit amounts that an Eligible Employee has previously
elected to defer under other plans or agreements with the Company to be
transferred to the Plan and credited to his Deferral Accounts that are
maintained hereunder, provided that no change shall be made in the time or form
of payment of such transferred amounts except as may be permitted by Code
Section 409A.

 

(A)                               Minimum Deferral.  For each Plan Year, the
minimum amount of Base Salary that a Participant may elect to defer is $5,000,
if expressed as a dollar amount, or 5% of Base Salary, if expressed as a
percentage, and the minimum amount of Bonus that a Participant may elect to
defer is any of the following:  (I) $5,000, (II) 5% of Bonus, or (III) 100% of
that portion of any Bonus that exceeds a dollar amount specified by the
Participant on his Deferral Election Form.

 

(B)                               Maximum Deferral.  For each Plan Year, the
maximum amount of Base Salary that a Participant may elect to defer is 75% of
Base Salary, and the maximum amount of Bonus that a Participant may elect to
defer is 90% of Bonus.  Notwithstanding the foregoing, for each Plan Year, the
maximum total amount of Compensation that a Participant may elect to defer is
$75,000 and such limit shall apply to amounts of Base Salary and Bonus earned in
any one Plan Year.  For example, in Plan Year 2015, the $75,000 limit shall
first apply to deferrals of Base Salary that would have

 

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otherwise been paid in 2015 and then to deferrals of Bonus that are earned in
2015 and would otherwise be payable in 2016.

 

(C)                               Deferral Account Balance.  Notwithstanding
anything herein to the contrary, if as of December 31 of any Plan Year, a
Participant’s total Deferral Account balance is $1,000,000 or more, then the
Participant may not defer any compensation earned in the following Plan Year and
any election to do so shall be considered void.  If as of December 31 of any
Plan Year, a Participant’s total Deferral Account balance is less than
$1,000,000, then the Participant may defer compensation earned in the following
Plan Year in accordance with this Article IV.

 

(c)                                  Early Payment Benefit Election.  On the
Deferral Election Form filed pursuant to Section 4.1(b), an Eligible Employee
may irrevocably elect to receive all or a portion of the Base Salary and/or
Bonus deferred pursuant to that election in a lump sum payment or in annual
installments over two (2) to five (5) years commencing prior to Separation from
Service in an Early Payment Year.  If a Participant fails to designate the form
of distribution for an Early Payment Benefit, the distribution shall be in the
form of a lump sum.  The Early Payment Year elected must be a year that begins
at least two (2) years after the end of each Plan Year to which the election
applies.  An Early Payment Benefit election filed for the Plan Year shall be
effective for the deferred Base Salary and/or Bonus earned during that Plan
Year.  A Participant may make an election for an Early Payment Benefit with
respect to deferred Base Salary and/or Bonus earned in any future Plan Year by
filing a new Deferral Election Form with the Committee prior to January 1 of
such Plan Year.  A Participant may not, however, change the form of benefit or
time of commencement of an Early Payment Benefit with respect to Base Salary
and/or Bonus deferred pursuant to a Deferral Election Form after that Deferral
Election is filed pursuant to Section 4.1(b).

 

A Participant may not at any time have Early Payment Benefits scheduled for more
than two Early Payment Years.  However, after an Early Payment Year has occurred
and all payments with respect to the corresponding Early Payment Year election
have been completed, a Participant may elect a new Early Payment Year for future
deferrals of Base Salary and/or Bonuses.  For purposes of applying the
limitations described in this paragraph, elections with respect to “Early
Payment Benefits” under the OPC MDCP made by a CRC MDCP Participant shall be
counted.

 

4.2                               DCP Deferral Accounts.  The Committee shall
establish and maintain a separate DCP Deferral Account for each Participant.  A
DCP Deferral Amount shall be credited by the Company to the Participant’s DCP
Deferral Account, subject to the Committee’s authority in Section 4.1(b), as of
the date that the Participant’s Base Salary and/or Bonus would otherwise have
been paid.  Such DCP Deferral Account shall be debited by the amount of any
payments made by the Company to the Participant or the Participant’s Beneficiary
therefrom as of the date of payment.  The Committee shall establish an Early
Payment Year Subaccount within a Participant’s DCP Deferral Account for each
Early Payment Year elected by that Participant.  Any such Early Payment Year
Subaccount shall be debited by the amount of any Early Payment Benefit paid by
the Company to the Participant pursuant to Section 5.3 as of the date of
payment.

 

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4.3                               Interest.  Each Deferral Account of a
Participant shall be deemed to bear interest on the monthly balance of such
Deferral Account at the Declared Rate, compounded monthly.  Interest will be
credited to each Deferral Account on a monthly basis on the last day of each
month as long as any amount remains credited to such Deferral Account.  Amounts
of deferred Compensation that are credited to a DCP Deferral Account prior to
the end of a calendar month shall accrue interest from the date of crediting,
computed from date of crediting to the end of the month.

 

4.4                               Valuation of Deferral Accounts.  The value of
a Deferral Account as of any date shall equal the amounts previously credited to
such Deferral Account less any payments debited to such Deferral Account plus
the interest deemed to be earned on such Deferral Account in accordance with
Section 4.3 through the end of the preceding month.

 

4.5                               Savings Plan Restoration Contribution.

 

(a)                                 General Rule.  For each Plan Year, the
Company shall credit to the Savings Plan Restoration Account of each Participant
an amount equal to the amount by which the matching employer contribution and
other non-elective employer contribution that would otherwise have been made by
the Company on behalf of the Participant to the Savings Plan for such Plan Year
is reduced by reason of the reduction in the Participant’s Compensation (as
defined in the Savings Plan) for such Plan Year because of deferrals under this
Plan (which amount shall be determined in accordance with the remaining
paragraphs of this Section 4.5(a)).  Such amount shall be credited to the
Savings Plan Restoration Account of each Participant for each Plan Year at the
same time as the Company matching employer contribution and other non-elective
employer contribution for such Plan Year is made to the Savings Plan.

 

The amount to be allocated relating to the Plan Year with respect to a
Participant’s matching employer contribution under the Savings Plan shall equal
seven percent (7%) multiplied by the amount of Compensation the Participant has
deferred under this Plan for the Plan Year.

 

The amount to be allocated relating to the Plan Year with respect to a
Participant’s other nonelective employer contribution under the Savings Plan
shall equal twelve percent (12%) multiplied by the amount of Compensation the
Participant has deferred under this Plan for the Plan Year.

 

(b)                                 Vesting.  A Participant’s interest in any
credit to his Savings Plan Restoration Account relating to matching employer
contributions pursuant to Section 4.5(a) and earnings thereon shall be
immediately vested.

 

A Participant’s interest in any credit to his Savings Plan Restoration Account
relating to other nonelective employer contributions pursuant to
Section 4.5(a) and earnings thereon shall vest at the same rate and at the same
time as would have been the case had such contribution been made to the Savings
Plan.

 

Notwithstanding anything contained herein to the contrary, if, upon a
Participant’s Separation from Service, the Participant has not or does not
become 100% vested in his Savings

 

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Plan Restoration Account, the unvested portion of his Savings Plan Restoration
Account shall be forfeited prior to the determination of the amount of any
benefits under Article V.

 

4.6                               Vesting of Deferral Accounts.  Except as
provided in Section 4.5(b), each Participant shall be 100% vested in his
Deferral Accounts at all times.

 

4.7                               Statement of Deferral Accounts.  The Committee
shall submit to each Participant, within 120 days after the close of each Plan
Year, a statement in such form as the Committee deems desirable, setting forth
the Participant’s Deferral Account(s).

 

ARTICLE V
BENEFITS

 

5.1                               Separation from Service for a Reason other
than Death.

 

(a)                                 Form and Time of Benefit.  Except as
otherwise provided in this Section 5.1 and Section 5.3, upon a Participant’s
Separation from Service for a reason other than death (including Retirement),
the Company shall pay to the Participant in a single lump sum within the first
90 days of the calendar year following the year of the Participant’s Separation
from Service an amount equal to the value of the Participant’s Deferral Accounts
as of the end of the month preceding payment.  Any Retirement Benefit paid in
annual installments pursuant to Section 5.1(b) shall be paid within the first 90
days of each calendar year, beginning with the year following the Participant’s
Retirement, and shall be determined based on the value of the Participant’s
Deferral Accounts as of the last day of the month preceding payment. 
Notwithstanding anything herein to the contrary, in the event that a Participant
who is a Specified Employee is entitled to a distribution from the Plan upon or
by virtue of such Participant’s Separation from Service for a reason other than
death, the lump sum payment or the first annual installment payment, as the case
may be, shall be paid in the month next following the date that is six
(6) months after the date of the Participant’s Separation from Service, if later
than the time provided above.  Any additional installment payments shall be paid
within the first 90 days of each subsequent calendar year.

 

(b)                                 Retirement.  (i) On a Distribution Election
Form filed simultaneously with and in the same manner as the first Deferral
Election Form that a Participant is required to file in accordance with the
requirements set forth in Section 4.1(b) hereof, a Participant (A) may elect to
have the Retirement Benefit, but which will not include any amounts attributable
to an Early Payment Year Subaccount if Separation from Service occurs after the
beginning of the relevant Early Payment Year, paid to him in a lump sum or
annual payments for any other number of years between two (2) and twenty (20)
years, and (B) may elect to have the amount of each annual installment
determined under either the Amortization Method or the Fractional Method.  If a
Participant fails to elect either the Amortization Method or the Fractional
Method, such Participant shall be deemed to have elected the Fractional Method. 
Notwithstanding the foregoing, the preceding provisions of this
Section 5.1(b) shall not apply to a CRC MDCP Participant and, in accordance with
Section 4.1(a)(iii), such a Participant’s elections under the OPC MDCP that were
in effect immediately prior to the Effective Date shall continue in effect under
the Plan, shall be treated as elections under the Plan, and may only be changed
in accordance with the provisions of Section 5.1(b)(iii) and (iv).

 

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(ii)                                  Notwithstanding anything herein to the
contrary, an election to receive distribution in a series of annual installments
shall be treated as a single payment for purposes of Code Section 409A.

 

(iii)                               Subject to Section 5.1(b)(iv), a Participant
may change his election as to the form of Retirement distribution under the Plan
subject to the following conditions:  (A) the election shall not be effective
until twelve (12) months after the election is filed with the Committee; (B) the
election must defer the lump sum payment or the initial amount of an installment
payment for a period of at least five (5) years from the date that the lump sum
payment or initial amount of the installment payment, as the case may be, was
otherwise payable; and (C) the election must be made at least twelve (12) months
prior to the beginning of the calendar year in which the lump sum payment or
initial amount of the installment payment, as the case may be, would have been
payable if no change as to the form of distribution were ever made.

 

(iv)                              A Participant may only make two changes
pursuant to Section 5.1(b)(iii).  Each such change must satisfy all of the
requirements of Section 5.1(b)(iii).  No further changes may be made following a
Participant’s Separation from Service.

 

(c)                                  Separation Prior to Retirement.  If a
Participant’s Separation from Service is for any reason other than Retirement or
death, then the Participant shall receive a Termination Benefit in a lump sum as
provided in Section 5.1(a).

 

5.2                               Beneficiary Benefits.

 

(a)                                 If a Participant’s Separation from Service
is due to death, the Company will pay to the Participant’s Beneficiary in a
single lump sum a Beneficiary Benefit that is an amount equal to the value of
the Participant’s Deferral Accounts (other than his or her Early Payment Year
Subaccount attributable to an Early Payment Year beginning before the date of
the Participant’s death (if any)).

 

(b)                                 Notwithstanding the foregoing, if a
Participant’s Separation from Service is due to death after attaining age 55,
payment to his Beneficiary (other than payment of his or her Early Payment Year
Subaccount attributable to an Early Payment Year beginning before the date of
the Participant’s death (if any)) shall be made in the same form as payment of
the Participant’s Retirement Benefit would have been made to the Participant if
he were living.

 

(c)                                  Notwithstanding the foregoing, a
Participant may elect, on a Beneficiary Distribution Election Form filed
simultaneously with and in the same manner as the first Deferral Election
Form that the Participant is required to file in accordance with the
requirements set forth in Section 4.1(b) hereof, that, if his Separation from
Service is due to death prior to attaining age 55, payment to his Beneficiary
(other than amounts in his or her Early Payment Year Subaccount attributable to
an Early Payment Year beginning before the date of the Participant’s death (if
any)) shall be made in any form and calculated in any other manner described in
Section 5.1(b) (which may be different than the form of payment elected by the
Participant for his Retirement Benefit).  The provisions of the preceding
sentence shall not apply to a CRC MDCP Participant and, in accordance with
Section 4.1(a)(iv), such a Participant’s elections under the OPC MDCP

 

13

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that relate to the distribution of benefits to Beneficiaries and that were in
effect immediately prior to the Effective Date shall continue in effect under
the Plan, shall be treated as elections under the Plan, and may only be changed
in accordance with the remaining provisions of this Section 5.2(c).  A
Participant may change his election as to the form of payment to his Beneficiary
subject to the following conditions:  (1) the election shall not be effective
until twelve (12) months after the election is filed with the Committee and
(2) the election must be made at least twelve (12) months prior to the beginning
of the calendar year in which the lump sum payment or initial amount of the
installment payment, as the case may be, would have been payable if no change as
to the form of distribution were ever made.  Each such change must satisfy all
of the requirements of this Section 5.2(c).

 

(d)                                 If a Participant dies after Separation from
Service but before commencement or completion of his benefits under the Plan,
payment to his Beneficiary shall be made in the same amount, at the same time
and in the same form as payment would have been made to the Participant under
the Plan if he were living.  If installment payments to the Participant have
already commenced, then the remaining installments (if any) shall be paid to his
Beneficiary in the same amounts and at the same times as such remaining
installments would have been paid to the Participant if he were living.

 

(e)                                  The payment or payments to a Beneficiary of
a deceased Participant under Section 5.2(a), (b) or (c) shall be made or
commence during the first 90 days of the calendar year following the year in
which the Participant’s death occurred, with any subsequent installments paid
within the first 90 days of each subsequent calendar year, and the amount of
such payment shall be equal to, or determined based on, the value of the
Participant’s Deferral Accounts as of the end of the month preceding payment.

 

(f)                                   In the event that the Beneficiary of a
deceased Participant dies prior to the completion of payments under the Plan to
that Beneficiary, then the remaining payments shall be paid to that
Beneficiary’s estate in the same amounts and at the same times as such payments
would have been paid to the Beneficiary if he were living.

 

5.3                               Early Payment.  Payment of the amounts
credited to any Early Payment Year Subaccount of a Participant shall be paid or
commence to be paid within the first 90 days of the year elected as the Early
Payment Year in accordance with the Participant’s election under
Section 4.1(c) (or, if applicable, under the Prior Plans), with any subsequent
annual payments paid in the first 90 days of each applicable year.  The amount
of each annual installment will be determined under the Fractional Method unless
the Participant otherwise irrevocably elects the Amortization Method at the time
of making the Early Payment Benefit election.

 

Notwithstanding the foregoing, if a Participant has a Separation from Service
for any reason prior to the Early Payment Year elected by the Participant, the
election made by the Participant to receive the Early Payment Benefit shall
terminate and the amount credited to the Participant’s Early Payment Year
Subaccount shall be paid, together with the other amounts credited to the
Participant’s Deferral Account, as set forth in Section 5.1 or 5.2, as the case
may be.  If the Participant has a Separation from Service for any reason after
the start of the Early Payment Year but before the commencement or completion of
the Early Payment Benefit, the benefit or remaining benefit attributable to the
relevant Early Payment Year Subaccount shall be

 

14

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paid to the Participant (or his Beneficiary) in accordance with the
Participant’s Early Payment Benefit election without regard to the Participant’s
Separation from Service (i.e., once the Early Payment Year is reached, the
Participant’s subsequent Separation from Service for any reason shall not affect
the payment of the relevant Early Payment Year Subaccount).

 

5.4                               Emergency Benefit.  In the event that the
Committee, upon written petition of the Participant, determines in its sole
discretion that the Participant has suffered an Unforeseeable Emergency, the
Company shall pay to the Participant, as soon as practicable following such
determination, an Emergency Benefit that does not exceed the amount reasonably
necessary to satisfy such Unforeseeable Emergency plus amounts necessary to pay
taxes reasonably anticipated as a result of the distribution, 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 and the additional compensation available
to the Participant upon the termination of the Participant’s current deferral
elections under the Plan, as described in the following paragraph of this
Section 5.4.

 

Whenever a Participant receives a distribution under this Section 5.4, the
Participant will be deemed to have revoked all current deferral elections under
the Plan effective as of the date of the distribution.  The Participant will not
be permitted to participate in the next enrollment period under the Plan and
will be precluded from electing to make new deferrals under the Plan for a
minimum period of one (1) year (or such lesser period as the Committee may
permit) following receipt of the distribution.  Such new election shall comply
with the provisions of Section 4.1(b).

 

5.5                               Effect of Change in Control.  In the event of
a Change in Control, the Board may, in its sole discretion, within the 30 days
preceding such Change in Control, irrevocably take action to terminate and
liquidate the Plan, provided that the requirements of Treas. Reg. §
1.409A-3(j)(4)(ix)(B) (or any successor provision) are satisfied.

 

5.6                               Small Benefit.  Notwithstanding any election
by a Participant to receive payment of any account maintained for the
Participant under the Plan in an installment payment form, if the value of such
account is less than $50,000 at the time payment in such form is scheduled to
commence under Section 5.1 or 5.2, the account shall be paid to the Participant
in a single lump sum on the scheduled commencement date.  This provision shall
not apply to any Early Payment Year Subaccount that is being paid pursuant to an
Early Payment Benefit election.

 

5.7                               Tax Withholding and Reporting.

 

(a)                                 To the extent required by the law in effect
at the time payments are made, the Company shall withhold from payments made
hereunder the taxes required to be withheld by Federal, state and local law.

 

(b)                                 The Company shall have the right at its
option to (i) require a Participant to pay or provide for payment of the amount
of any taxes that the Company may be required to withhold with respect to
interest or other amounts that the Company credits to a Participant’s Deferral
Accounts or (ii) deduct from any amount of salary, bonus or other payment
otherwise payable in cash to the Participant the amount of any taxes that the
Company may be required to

 

15

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withhold with respect to interest or other amounts that the Company credits to a
Participant’s Deferral Accounts.  In addition, as permitted by Treas. Reg.
§ 1.409A-3(j)(4)(vi) (or any successor provision), payments may be made under
the Plan to pay any Federal Insurance Contributions Act (FICA) tax imposed under
Code Sections 3101 and 3121(v)(2) on the Participant’s Deferral Accounts, and to
pay any income tax imposed under Code Section 3401 (i.e., wage withholding) or
the corresponding withholding provisions of applicable state or local law as a
result of payment of the FICA amount, as well as to pay the additional income
tax attributable to the pyramiding wages and taxes.  The total payment may not
exceed the aggregate FICA tax amount and the income tax withholding related to
such FICA tax amount.

 

5.8                               Reemployment.

 

(a)                                 If, after a Participant’s Separation from
Service, such Participant is reemployed by the Company prior to the payment of
his benefits in a cash lump sum payment or while he is receiving benefits in the
form of annual installment payments, the payment of the lump sum amount or the
future installments, as the case may be, shall be made as scheduled without
regard to the Participant’s reemployment.

 

(b)                                 A reemployed Participant may elect to again
participate in the Plan and to defer additional Base Salary and/or Bonus as
provided in Section 4.1, in which case a new Deferral Account shall be
established for such Participant to which allocations relating to the period
following the Participant’s re-employment shall be credited.  The Participant
also shall be permitted to file a new Distribution Election Form, simultaneously
with and in the same manner as the first Deferral Election Form that the
Participant files upon his reemployment, governing the payment of his new
Retirement Benefit in accordance with Section 5.1(b) and payment to his
Beneficiary in accordance with Section 5.2(c).

 

5.9                               Qualified Divorce Orders.  Subject to the
policies and procedures established by the Committee under Section 9.3(b) hereof
and the provisions of the Plan, benefits may be paid from the balance of a
Participant’s Deferral Account(s) in accordance with a Qualified Divorce Order.

 

ARTICLE VI
BENEFICIARY DESIGNATION

 

Each Participant shall have the right, at any time, to designate any person or
persons as the Beneficiary to whom payments under the Plan shall be made in the
event of the Participant’s death prior to complete distribution to the
Participant of the benefits due under the Plan.  Each Beneficiary designation
shall become effective only when filed in writing with the Committee during the
Participant’s lifetime on a paper form prescribed by the Committee.

 

The filing of a new Beneficiary designation form will cancel any inconsistent
Beneficiary designation previously filed.

 

If a Participant fails to designate a Beneficiary as provided above, or if all
designated Beneficiaries predecease the Participant, any benefits remaining
unpaid shall be paid in accordance with the Participant’s Beneficiary
designation under the Savings Plan, and if there is no such valid Beneficiary
designation, to the Participant’s then surviving spouse, or if none, to

 

16

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the Participant’s estate, unless directed otherwise by the court that has
jurisdiction over the assets belonging to the Participant’s probate estate.

 

ARTICLE VII
CLAIMS PROCEDURE

 

7.1                               Applications for Benefits.  All applications
for benefits under the Plan shall be submitted to CRC Services, LLC, Attention: 
Deferred Compensation Plan Committee, at the address of CRC Services’ principal
office.  Applications for benefits must be in writing on the forms prescribed by
the Committee and must be signed by the Participant, or in the case of a
Beneficiary Benefit, by the Beneficiary or legal representative of the deceased
Participant.

 

7.2                               Claims Procedure.

 

(a)                                 Within a reasonable period of time, but not
later than 90 days after receipt of a claim for benefits, the Committee or its
delegate shall notify the claimant of any adverse benefit determination on the
claim, unless special circumstances require an extension of time for processing
the claim.  In no event may the extension period exceed 90 days from the end of
the initial 90-day period.  If an extension is necessary, the Committee or its
delegate shall provide the claimant with a written notice to this effect prior
to the expiration of the initial 90-day period.  The notice shall describe the
special circumstances requiring the extension and the date by which the
Committee or its delegate expects to render a determination on the claim.

 

(b)                                 In the case of an adverse benefit
determination, the Committee or its delegate shall provide to the claimant
written or electronic notification setting forth in a manner calculated to be
understood by the claimant (i) the specific reason or reasons for the adverse
benefit determination; (ii) reference to the specific Plan provisions on which
the adverse benefit determination is based; (iii) a description of any
additional material or information necessary for the claimant to perfect the
claim and an explanation of why the material or information is necessary; and
(iv) a description of the Plan’s claim review procedures and the time limits
applicable to such procedures, including a statement of the claimant’s right to
bring a civil action under Section 502(a) of ERISA following an adverse final
benefit determination on review and in accordance with Section 7.4.

 

(c)                                  Within 60 days after receipt by the
claimant of notification of the adverse benefit determination, the claimant or
his duly authorized representative, upon written application to the Committee,
may request that the Committee fully and fairly review the adverse benefit
determination.  On review of an adverse benefit determination, upon request and
free of charge, the claimant shall have reasonable access to, and copies of, all
documents, records and other information relevant to the claimant’s claim for
benefits.  The claimant shall have the opportunity to submit written comments,
documents, records, and other information relating to the claim for benefits. 
The Committee’s (or delegate’s) review shall take into account all comments,
documents, records, and other information submitted regardless of whether the
information was previously considered in the initial adverse benefit
determination.

 

(d)                                 Within a reasonable period of time, but not
later than 60 days after receipt of such request for review, the Committee or
its delegate shall notify the claimant of any final

 

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benefit determination on the claim, unless special circumstances require an
extension of time for processing the claim.  In no event may the extension
period exceed 60 days from the end of the initial 60-day period.  If an
extension is necessary, the Committee or its delegate shall provide the claimant
with a written notice to this effect prior to the expiration of the initial
60-day period.  The notice shall describe the special circumstances requiring
the extension and the date by which the Committee or its delegate expects to
render a final determination on the request for review.  In the case of an
adverse final benefit determination, the Committee or its delegate shall provide
to the claimant written or electronic notification setting forth in a manner
calculated to be understood by the claimant (i) the specific reason or reasons
for the adverse final benefit determination; (ii) reference to the specific Plan
provisions on which the adverse final benefit determination is based; (iii) 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; and (iv) a statement
of the claimant’s right to bring a civil action under Section 502(a) of ERISA
following an adverse final benefit determination on review and in accordance
with Section 7.4.

 

7.3                               Section 409A Compliance.  Any claim for
benefits under this Article must be made by the claimant no later than the time
prescribed by Treas. Reg. § 1.409A-3(g) (or any successor provision).  If a
claimant’s claim or appeal is approved, any resulting payment of benefits will
be made no later than the time prescribed for payment of benefits by Treas. Reg.
§ .409A-3(g) (or any successor provision).

 

7.4                               Limitations on Actions.  No legal action may
be commenced prior to the completion of the benefit claims procedure described
herein.  In addition, no legal action may be commenced after the later of
(a) 180 days after receiving the written response of the Committee to an appeal,
or (b) 365 days after an applicant’s original application for benefits.

 

ARTICLE VIII
AMENDMENT AND TERMINATION OF PLAN

 

8.1                               Amendment.  The Board may amend the Plan in
whole or in part at any time for any reason, including but not limited to, tax,
accounting or other changes, which may result in termination of the Plan for
future deferrals.  Without limiting the scope of the preceding sentence, the
Board may amend the Plan to (a) ensure that the Plan complies with the
requirements of Code Section 409A for deferral of taxation on compensation
deferred hereunder until the time of distribution and (b) add provisions for
changes to deferral elections and elections as to time and manner of
distributions and other changes that comply with the requirements of Code
Section 409A for the deferral of taxation on deferred compensation until the
time of distribution.  The Committee appointed pursuant to Article III, in its
discretion, may amend the Plan if the Committee determines that such amendment
does not significantly increase or decrease Plan benefits or costs. 
Notwithstanding the foregoing, except for any amendment required to preserve the
deferral of taxation of amounts deferred under the Plan, no amendment shall
reduce the amounts that have been credited to the Deferral Account(s) of any
Participant prior to the date such amendment is adopted.  Any amendment that
would either change the terms of the amendment provisions of this Section 8.1 or
the terms of the termination provisions of Section 8.2 shall not be effective
prior to the date that is two years after the date such amendment is adopted,
unless the amendment is required by a change in the tax or other

 

18

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applicable laws or accounting rules, or the amendment is required in order to
preclude any amounts deferred under the Plan from being included in the income
of Participants prior to a date of distribution as specified under the Plan. 
Notwithstanding the foregoing, following a Change in Control, no amendment shall
(x) reduce the amounts that have been credited to the Deferral Account(s) of any
Participant prior to the date such amendment is adopted; or (y) change the terms
of the amendment provisions of this Section 8.1 or the terms of the termination
provisions of Section 8.2.

 

8.2                               Termination.

 

(a)                                 Company’s Right to Terminate.  The Board may
terminate the Plan at any time, if in the Board’s judgment, the continuance of
the Plan would not be in the Company’s best interest due to tax, accounting or
other effects thereof, or potential payouts thereunder, or other reasons,
provided that any termination of the Plan shall not be effective prior to the
date that is two years after the date the Board adopts a resolution to terminate
the Plan, unless (i) the termination of the Plan is required by a change in the
tax or other applicable laws or accounting rules, or (ii) the Participants have
become subject to tax on the amounts deferred under the Plan.  Notwithstanding
the foregoing, following a Change in Control, the Plan may not be terminated
prior to the date that is three years after the date the Change in Control
occurs, or, if earlier, the date on which amounts deferred under the Plan have
become taxable to Participants.  In the event the Board adopts a resolution
terminating the Plan, the Board or the Committee shall determine the date as of
which deferral elections shall cease to have effect in accordance with the
requirements of Code Section 409A.

 

(b)                                 Payments Upon Termination.  Distributions to
the Participants or their Beneficiaries shall be made on the dates on which the
Participants or their Beneficiaries would receive benefits hereunder without
regard to the termination of the Plan, except that payments may, in the
discretion of the Board, be accelerated if:

 

(A)                               The Plan is terminated and liquidated pursuant
to Section 5.5 of the Plan;

 

(B)                               Accelerated payment is otherwise permitted by
Treas. Reg. § 1.409A-3(j)(4)(ix) (or any successor provision) or other guidance
issued by the Secretary of the Treasury, or

 

(C)                               The Plan is terminated because Participants
have become subject to tax on their deferrals due to the Plan’s failure to
satisfy the requirements of Code Section 409A.  Payment to a Participant may not
exceed the amount required to be included in income as a result of such failure.

 

ARTICLE IX
MISCELLANEOUS

 

9.1                               Unsecured General Creditor.  The rights of a
Participant, Beneficiary, or their heirs, successors, and assigns, as relates to
any Company promises hereunder, shall not be secured by any specific assets of
the Company, nor shall any assets of the Company be designated as attributable
or allocated to the satisfaction of such promises.

 

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9.2                               Trust Fund.  The Company shall be responsible
for the payment of all benefits provided under the Plan.  At its discretion, the
Company may establish one or more trusts, with such trustees as the Board or
Committee may approve, for the purpose of providing for the payment of such
benefits.  Such trust or trusts may be irrevocable, but the assets thereof shall
be subject to the claims of the Company’s creditors.  To the extent any benefits
provided under the Plan are actually paid from any such trust, the Company shall
have no further obligation with respect thereto, but to the extent not so paid,
such benefits shall remain the obligation of, and shall be paid by, the
Company.  No assets shall be transferred to a trust if such transfer would
result in the taxation of benefits prior to distribution under Code
Section 409A(b).

 

9.3                               Nonassignability.

 

(a)                                 Neither a Participant nor any other person
shall have any right to commute, sell, assign, transfer, pledge, anticipate,
mortgage or otherwise encumber, hypothecate or convey in advance of actual
receipt the amounts, if any, payable hereunder, or any part thereof, or interest
therein which are, and all rights to which are, expressly declared to be
unassignable 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.

 

(b)                                 Notwithstanding subsection (a), the right to
benefits payable with respect to a Participant pursuant to a Qualified Divorce
Order may be created, assigned, or recognized.  The Committee shall establish
appropriate policies and procedures to determine whether a Divorce Order
presented to the Committee constitutes a Qualified Divorce Order under the Plan,
and to administer distributions pursuant to the terms of Qualified Divorce
Orders.  In the event that a Qualified Divorce Order exists with respect to
benefits payable under the Plan, such benefits otherwise payable to the
Participant specified in the Qualified Divorce Order shall be payable to the
Alternate Payee specified in such Qualified Divorce Order.

 

9.4                               Release from Liability to Participant.  A
Participant’s right to receive benefits under the Plan shall be reduced to the
extent that any portion of a Participant’s Deferral Account(s) has been paid or
set side for payment to an Alternate Payee pursuant to a Qualified Divorce
Order.  The Participant shall be deemed to have released the Company and the
Plan from any claim with respect to such amounts in any case in which (a) the
Company, the Plan, or any Plan representative has been served with legal process
or otherwise joined in a proceeding relating to such amounts, and (b) the
Participant fails to obtain an order of the court in the proceeding relieving
the Company and the Plan from the obligation to comply with the judgment, decree
or order.

 

9.5                               Employment Not Guaranteed.  Nothing contained
in the Plan nor any action taken hereunder shall be construed as a contract of
employment or as giving any Participant any right to be retained in employment
with the Company.  Accordingly, subject to the terms of any written employment
agreement to the contrary, the Company shall have the right to terminate or
change the terms of employment of a Participant at any time and for any reason
whatsoever, with or without cause.

 

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9.6                               Gender, Singular & Plural.  All pronouns and
any variations thereof shall be deemed to refer to the masculine or feminine as
the identity of the person or persons may require.  As the context may require,
the singular may be read as the plural and the plural as the singular.

 

9.7                               Captions.  The captions of the articles,
sections, and paragraphs of the Plan are for convenience only and shall not
control or affect the meaning or construction of any of its provisions.

 

9.8                               Validity.  In the event any provision of the
Plan is held invalid, void, or unenforceable, the same shall not affect, in any
respect whatsoever, the validity of any other provision of the Plan.

 

9.9                               Notice.  Any notice or filing required or
permitted to be given to the Committee under the Plan shall be sufficient if in
writing and hand delivered, or sent by registered or certified mail, to the
principal office of the Company.  Such notice shall be deemed given as to the
date of delivery or, if delivery is made by mail, as of the date shown on the
postmark on the receipt for registration or certification.

 

9.10                        Applicable Law.  The Plan shall be governed by and
construed in accordance with Code Section 409A, and any regulations promulgated
thereunder, and in accordance with the laws of the State of California to the
extent such laws are not preempted by ERISA.

 

[Signature on the following page.]

 

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IN WITNESS WHEREOF, CRC Services has executed this document this 1st day of
December, 2014.

 

 

 

CRC SERVICES, LLC

 

 

 

 

 

By:

/s/ Daniel S. Watts

 

Name:

Daniel S. Watts

 

Title:

Vice President — Compensation and Benefits

 

Signature Page to Deferred Compensation Plan

 

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