NATIONAL FUEL GAS COMPANY

TOPHAT PLAN

Adopted March 20, 1997

Amended April 6, 1998 and December 10, 1998

Amended and Restated December 7, 2005

Current as of December 7, 2005

 

 

 

 

TABLE OF CONTENTS

 

                                          
                                          
                                                   
                                            Page

 

 

 

 

 

 

Preamble

1

 

 

ARTICLE 1

Definitions

1

 

1.1

“AARCIP

1

 

1.2

“Base Salary

1

 

1.3

“Beneficiary

2

 

1.4

“Code

2

 

1.5

“Committee

2

 

1.6

“Company

2

 

1.7

“DCP

2

 

1.8

“Employer

2

 

1.9

“ERP

2

 

1.10

“Legal Limits

2

 

1.11

“Maximum Matching Contribution Percentage

3

 

1.12

“Participant

3

 

1.13

“Plan

3

 

1.14

“Plan Year

3

 

1.15

“Policies

3

 

1.16

“Retirement

3

 

1.17

“Retirement Plan

3

 

1.18

“Retirement Plan-Related Tophat Benefit

3

 

1.19

“TDSP

3

 

1.20

“TDSP-Related Tophat Benefit

3

 

1.21

“Termination of Employment

4

 

1.22

“409A Transition Rules

4

 

ARTICLE 2

Benefits Provided

4

 

2.1

Coordination With Other Benefits

4

 

2.2

TDSP-Related Tophat Benefit

4

 

(a)

Example

4

 

2.3

Retirement Plan-Related Tophat Benefit.

5

 

(a)

Tophat

5

 

(b)

Example

5

 

2.4

Distribution of TDSP-Related Tophat Benefit.

6

 

(a)

Benefits Accrued Prior to August 1, 2005

6

 

(b)

Benefits Accrued After July 31, 2005

6

 

ARTICLE 3

Participants’ Termination of Employment

6

 

 

i

 

 

 

TABLE OF CONTENTS

(continued)

                                          
                                          
                                                   
                                            Page

 

 

 

 

3.1

TDSP-Related Tophat Benefits.

6

 

(a)

Termination

6

 

(b)

Death

6

 

3.2

Retirement Plan-Related Tophat Benefits.

7

 

(a)

Termination.

7

 

(b)

Retirement

7

 

(c)

Death.

8

 

3.3

Lump Sum Cash-Out of De Minimis Tophat Benefits

9

 

ARTICLE 4

Beneficiary Designation

10

 

4.1

Beneficiary Designation

10

 

4.2

Change of Beneficiary Designation

10

 

4.3

No Beneficiary Designation

10

 

4.4

Effect of Payment

10

 

ARTICLE 5

Termination and Modification

10

 

5.1

Termination and Amendment

10

 

5.2

Limited Power of President to Amend Plan

10

 

ARTICLE 6

Administration

11

 

6.1

Committee Duties

11

 

6.2

Agents

11

 

6.3

Binding Effect of Decisions

11

 

6.4

Indemnity of Committee

11

 

6.5

Section 409A of the Code

11

 

ARTICLE 7

Miscellaneous

11

 

7.1

Unsecured General Creditor

11

 

7.2

Nonassignability

12

 

7.3

Not a Contract of Employment

12

 

7.4

Health Information

12

 

7.5

Governing Law

12

 

7.6

Withholding

12

 

7.7

Binding Effect

12

 

7.8

Borrowing

12

 

7.9

Validity

13

 

7.10

Incapacity of Person Entitled To Payment

13

 

7.11

Captions

13

 

7.12

Construction

13

 

 

ii

 

 

 

 

NATIONAL FUEL GAS COMPANY

TOPHAT PLAN

Preamble

National Fuel Gas Company has adopted the National Fuel Gas Company Tophat Plan
(“Plan”) to help attract and retain high caliber employees in high-level
management positions, to provide such employees with a tax-favored vehicle to
accumulate assets and to enhance retirement benefits, to restore benefits lost
to employees under the TDSP as a result of the effect of Legal Limits upon their
receipt of Company matching contributions in the TDSP, and to restore benefits
lost to employees under the Retirement Plan as a result of their participation
in the DCP (with respect to persons not eligible for the ERP). Notwithstanding
the above, the only employees eligible to receive benefits under this Plan are
highly-compensated employees as defined by the Code and its corresponding
regulations, as the same may be amended from time to time.

The tophat benefits provided by this Plan were previously contained within the
DCP. These tophat benefits have now been segregated into this separate Plan
document, in part because federal legislation enacted in 1996 (which limits the
ability of states to impose a source tax on retirement benefits earned within
such states) may penalize employees unless the provisions authorizing tophat
benefits are reflected in a separate plan, and in part to more fully and
accurately describe the tophat benefits.

This Plan has been amended to comply with the requirements of Section 409A of
the Code.

ARTICLE 1

Definitions

For purposes hereof, unless otherwise clearly apparent from the context, the
following phrases or terms shall have the following indicated meanings:

1.1         “AARCIP” shall mean the National Fuel Gas Company Annual At Risk
Compensation Incentive Program, as amended from time to time or any successor
thereto.

1.2         “Base Salary” shall mean gross cash compensation per regular payroll
period, including salary continuation payments made by an Employer on account of
sickness or accident, which are paid to a Participant for employment services
rendered to an Employer, before reduction for compensation deferred pursuant to
the DCP or pursuant to the TDSP, and shall also include (i) payments made to a
Participant pursuant to the AARCIP or a successor plan thereto, (ii) awards of
restricted stock that are made to

 

 

 

 

 

a Participant for service in the Company’s fiscal year 1996 or later to
supplement an AARCIP award for that fiscal year, which was approximately equal
to the maximum AARCIP award then permissible consistent with the shareholder
approval applicable to that AARCIP award, valued at the average of the high and
low market value on the grant date, and (iii) any performance-related lump sum
compensation (i.e., lump sum payments other than expense or tuition
reimbursements, moving expense reimbursements, lump sum payments for eligible
unused vacation, worker’s compensation payments, award payments for suggestions,
severance payments or any other non-performance related payments) made on or
after August 1, 1997, but shall exclude all other fees, commissions, special,
extra or nonperiodic compensation in any form. Notwithstanding the above,
amounts described in clause (iii) shall only be included in Base Salary for
officers of any Employer other than Seneca Resources Corporation.

1.3         “Beneficiary” shall mean the person, persons, or entity designated
by the Participant to receive any benefits payable under this Plan upon the
death of a Participant.

1.4

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

1.5         “Committee” shall mean the committee appointed to manage and
administer the Plan in accordance with its provisions of Article 6.

1.6         “Company” shall mean National Fuel Gas Company and all successor
companies thereto.

1.7         “DCP” shall mean the National Fuel Gas Company Deferred Compensation
Plan, as amended from time to time or any successor thereto.

1.8         “Employer” shall mean the Company and each of its subsidiaries which
has one or more eligible employees who have been selected to participate in the
Plan.

1.9         “ERP” shall mean the National Fuel Gas Company and Participating
Subsidiaries Executive Retirement Plan, as amended from time to time or any
successor thereto.

1.10       “Legal Limits” shall mean (i) the provisions of the Retirement Plan
and applicable section(s) of the Code that prevent the Retirement Plan from
including in calculating “Final Average Pay” compensation deferred pursuant to
the DCP, (ii) the maximum amount of annual compensation of an employee that may
be taken into account under the Retirement Plan in accordance with Section
401(a)(17) of the Code, as amended and supplemented, and the implementing
provisions of the Retirement Plan, but only with respect to Participants who are
not members under the ERP, (iii) the nondiscrimination rules under Section
401(a)(4) and the annual limits imposed by Sections 401(k)(3), 401(m)(2),
401(a)(17), 402(g) or 415 of the Code, or a successor to any such sections,
and/or (iv) the corresponding requirements of the Employment

 

2

 

 

 

 

Retirement Income Security Act of 1974, as amended (“ERISA”), respecting the
Retirement Plan and respecting deferrals under and employer matching
contributions to the TDSP.

1.11       “Maximum Matching Contribution Percentage” shall mean with respect to
a Participant the maximum employer matching contribution percentage applicable
to the Participant under the TDSP based on such Participant’s actual
contributions under the TDSP.

1.12       “Participant” shall mean any person currently or formerly in the
regular full-time employment of an Employer,

(a)          (i)  who has lost benefits under the TDSP as a result of Legal
Limits; and (ii) whose Accounts have not been completely distributed to him or
her; or

(b)          (i) who has vested in his or her benefits under the Retirement
Plan; (ii) who has lost benefits under the Retirement Plan as a result of Legal
Limits; (iii) whose Retirement Plan benefits have not been completely
distributed to him or her; and (iv) who is not a member under the ERP.

1.13       “Plan” shall mean the National Fuel Gas Company Tophat Plan, as
amended from time to time or any successor thereto.

1.14       “Plan Year” shall mean the 12 consecutive month period commencing on
August 1 and ending on the next following July 31.

1.15

“Policies” shall mean the policies described in Section 0.

1.16       “Retirement” and “Retire” shall mean severance from employment with
the Employer at or after the attainment of age fifty-five (55), or prior thereto
pursuant to the disability retirement provisions of the Retirement Plan.

1.17       “Retirement Plan” shall mean the National Fuel Gas Company Retirement
Plan, as amended from time to time or any successor thereto.

1.18       “Retirement Plan-Related Tophat Benefit” shall mean the tophat
benefit described in Section 2.3.

1.19       “TDSP” shall mean the National Fuel Gas Company Tax-Deferred Savings
Plan for Non-Union Employees, as amended from time to time or any successor
thereto.

1.20       “TDSP-Related Tophat Benefit” shall mean the tophat benefit described
in Section 2.4.

 

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1.21       “Termination of Employment” shall mean the cessation of employment
with the Company, voluntarily or involuntarily, for any reason other than
Retirement.

1.22

“409A Transition Rules” shall mean the rules described in Section 0.

ARTICLE 2

Benefits Provided

2.1         Coordination With Other Benefits. The benefits provided for a
Participant under the Plan are in addition to any other benefits to which the
Participant may be entitled under any other plan or program of the Employer.
This Plan shall supplement and shall not supersede, modify, amend, enhance or
diminish any other such plan or program except as may otherwise be expressly
provided.

2.2         TDSP-Related Tophat Benefit. Each Participant who is eligible to
participate in the TDSP shall be credited with a TDSP-Related Tophat Benefit
equal to the employer matching contributions that the Participant would have
received under the TDSP based on such Participant’s elective deferrals
thereunder and assuming that the employer matching contribution for the
Participant was not limited by the Legal Limits.

(a)          Example. This example shall illustrate how the “tophat” provisions
of this Section 2.2 are to be applied. Assume that a particular Participant’s
TDSP deferral percentage (salary contribution percentage) is 7%, and that his or
her Maximum Matching Contribution Percentage under the TDSP is 6%. Also assume
that his or her Base Salary as defined in the Plan for that calendar year is
$420,000 (i.e., $300,000 base annual pay plus $120,000 paid under the AARCIP),
that his or her base salary as defined in the TDSP for the same period is
$300,000, that the Code §401(a)(17) limit for that year is $210,000, that the
Code §402(g) limit is $14,000 for that year, and that the Code §401(k)(3) and
§415 limits do not adversely affect the Participant in this example.

Under the TDSP, the Participant would be entitled to a Maximum Matching
Contribution of $12,600 (6% x $210,000 Code §401(a)(17) limit). Under Section
2.2, the Participant would receive a total tophat of $12,600 (i.e., 6% x
[$420,000 minus $210,000 base salary taken into account under the TDSP]).
Therefore, the total aggregate “employer matching contribution” received by the
Participant would be $25,200 ($12,600 in the TDSP and $12,600 by virtue of this
“tophat”).

As can be seen by this illustration, the tophats are intended to make up for and
not under- or overcompensate for Participants’ losses caused by the various
Legal Limits applying to, and the base salary definition of, the TDSP.

 

4

 

 

 

 

 

 

2.3

Retirement Plan-Related Tophat Benefit.

(a)          Tophat. Any loss of benefits to a Participant under the Retirement
Plan, which results from deferrals made under the DCP by the Participant, or
otherwise are due to the Legal Limits, shall be restored by the Company,
provided that such Participant is not also a member of the ERP. The following
rules shall apply with respect to distribution elections made in respect of the
Retirement Plan-Related Tophat Benefit under this Section 2.3:

(i)           Pursuant to the transitional rules contained in the Internal
Revenue Service guidance and treasury regulations under Section 409A of the Code
(the “409A Transition Rules”), a Participant who commences receiving payment of
his or her tophat prior to January 1, 2007 by reason of Retirement shall receive
such payments in the same form as the annuity he or she receives under the
Retirement Plan.

(ii)          In accordance with the 409A Transition Rules, a Participant who is
entitled to a tophat with respect to any period ending on or prior to December
31, 2006, and who does not commence receiving a distribution thereof prior to
December 31, 2006, may make an election on or prior to, and effective as of,
December 31, 2006, regarding the distribution of such tophat; provided that any
such election shall also be applicable with respect to any tophat accrued by the
Participant under this Section 2.3 after December 31, 2006.

(iii)        A Participant who commences participation in the Plan after
December 31, 2006 may make an election regarding the distribution of the tophat
accrued under this Section 2.3 at such times (but no later than 30 days after
the date that participation in the Plan shall commence) and in such manner as
shall be prescribed by the Committee.

(iv)         Notwithstanding the foregoing, to the extent not inconsistent with
the requirements of Section 409A, a Participant who has elected to receive
distribution of the Retirement Plan-Related Tophat Benefit in the form of an
annuity for the Participant’s lifetime may elect whether such annuity has a
survivor benefit at such time or times, and subject to such conditions, as the
Committee may prescribe consistent with the requirements of Section 409A.

(b)          Example. An example of the Retirement Plan-Related Tophat Benefit
is as follows: Assume that a Participant eligible for this tophat retired in the
year 2000, at age 60. Assume that his or her “Final Average Pay” under the
Retirement Plan would have been $100,000, had he or she not participated in the
DCP. Assume further that, as a result of his or her participation in the DCP,
his or her “Final Average Pay” is reduced to $80,000. Assume further that his or
her Retirement Plan annuity (expressed as a single life annuity) consequently is
reduced from $3,750/month to $3,000/month. This

 

5

 

 

 

 

Participant will then receive $750 per month for life under this tophat (or the
actuarial equivalent thereof, determined using the actuarial assumptions under
the Retirement Plan).

2.4

Distribution of TDSP-Related Tophat Benefit.

(a)          Benefits Accrued Prior to August 1, 2005. The following rules shall
apply with respect to the TDSP-Related Tophat Benefits accrued prior to August
1, 2005:

(i)           The TDSP-Related Tophat Benefit accrued by a Participant who
previously elected to receive such benefit upon Termination of Employment or
Retirement shall be distributed to such Participant as soon as practicable after
July 31, 2005 during the calendar year 2005; and

(ii)          The TDSP-Related Tophat Benefit accrued by a Participant who
previously elected to receive such benefit on an annual basis shall be
distributed to such Participant, to the extent not previously distributed, in
August 2005.

(b)          Benefits Accrued After July 31, 2005. The TDSP-Related Tophat
Benefit accrued by a Participant in any calendar year with respect to services
after July 31, 2005 shall be distributed in a lump sum payment no later than
March 15 of the calendar year following the calendar year in which such benefit
is accrued.

ARTICLE 3

Participants’ Termination of Employment

3.1

TDSP-Related Tophat Benefits.

(a)          Termination. If the Participant Retires or incurs a Termination of
Employment by means other than death, such Participant shall receive a lump sum
payment equal to the value, as of the date of such Termination of Employment or
Retirement, of the Participant’s TDSP-Related Tophat Benefit with respect to the
year of Termination of Employment or Retirement. Such TDSP-Related Tophat
Benefit shall be distributed 30 days after such Termination of Employment or
Retirement.

(b)          Death. If the Participant incurs a Termination of Employment by
reason of death, his or her Beneficiary shall receive a lump sum payment equal
to the value, as of the date of such Termination of Employment, of the
Participant’s TDSP-Related Tophat Benefit with respect to the year of such
Termination of Employment. Such benefit shall be paid 30 days after the
Participant’s date of death.

 

6

 

 

 

 

 

 

3.2

Retirement Plan-Related Tophat Benefits.

(a)

Termination.

 

(i)           If the Participant incurs a Termination of Employment by means
other than death, and the Participant is not vested in his or her benefits under
the Retirement Plan, such Participant shall receive no benefit under this Plan.

(ii)          If the Participant incurs a Termination of Employment after
January 1, 2005 other than due to death, is then less than 55 years old and is
vested in his or her benefits under the Retirement Plan, such Participant shall
receive a lump sum payment on the six month anniversary of the Participant’s
Termination of Employment in an amount equal to the present value of such
Retirement Plan-Related Tophat Benefit as of the date of such six month
anniversary. Such lump sum payment shall be determined using a discount rate
equal to the then-current yield to maturity on 30-year Treasury securities, or
in such other manner as the Committee reasonably determines

(iii)        Special Transitional Rules. Notwithstanding Section 3.2(a)(ii),
pursuant to the Transitional Rules the lump sum payment payable to a Participant
under Section 3.2(a)(ii) or 3.2(b) who (x) had a Termination of Employment in
2005 shall be made 30 days following such Termination of Employment, on the
basis that the Participant shall have terminated participation in the Plan, and
shall be valued as of the date of such Termination of Employment, or (y) had a
Termination of Employment in or prior to 2004 but did not receive a lump sum
payment prior to 2005, shall be paid on January 31, 2006, on the basis that the
Participant shall have terminated participation in the Plan as of January 1,
2006, and shall be valued as of January 1, 2006.

(b)          Retirement. When a Participant Retires after January 1, 2005, he or
she shall receive his or her Retirement Plan-Related Tophat Benefit in such form
(and with any actuarial reduction, as appropriate) as specified pursuant to
Section 2.3; provided that a Participant who fails to make a distribution
election in accordance with Section 2.3 with respect to a payment commencing
after 2006 shall be paid the present value of his or her Retirement Plan-Related
Tophat Benefit in a lump sum.

(i)           Lump Sums. Any lump sum payable, whether pursuant to Section 2.3
or as specified in this Section 3.2(b), shall be paid on the six month
anniversary of the Participant’s Retirement and the present value of such
Retirement Plan-Related Tophat Benefit shall be determined as of the date of
such six month anniversary using a discount rate equal to the then-current yield
to maturity on 30-year Treasury securities, or in such other manner as the
Committee reasonably determines.

 

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(ii)         Annuities. Payment of the Retirement Plan-Related Tophat in a form
other than a lump sum shall be determined in the same manner as would apply to
payment of the same form of annuity under the Retirement Plan, but payment of
the first monthly installment thereof shall commence on the six month
anniversary of the Participant’s Retirement. The first payment to be made
hereunder in respect of any annuity shall be equal to the sum of (i) the monthly
payments that would have been made to such Participant from the date of his
Retirement (but for the six month delay required to comply with Section 409A of
the Code), and (ii) an amount of interest on each monthly payment referenced in
subclause (i), at the short-term applicable federal rate (within the meaning of
Section 1274(d) of the Code), compounded semi-annually, in effect for January in
the calendar year in which the Participant Retires, from the date such payment
would have been made to the six month anniversary of such Retirement. Each
subsequent payment will be in the amount, and paid at the time, it is otherwise
payable without regard to the six month delay in payment required hereunder.
Notwithstanding the preceding sentence, with respect to a Retirement that
occurred in 2005, amounts that would have been payable for the lesser of (i) the
six months following such Retirement or (ii) through December 31, 2005, may be
paid in accordance with the 409A Transition Rules at any time during 2005, on
the basis that such payment is a partial cancellation of such Participant’s
participation in the Plan.

(iii)        Survivor Benefits. In the event that a Participant elects to
receive his or her Retirement Plan-Related Tophat Benefit in a form of a payment
that provides for continued payment of benefits after the Participant’s death to
his or her Beneficiary, payments pursuant to the Participant’s election shall
continue to be made to such Beneficiary after the Participant’s death; provided
that if a Participant dies prior to the end of the six-month period during which
payment of the Participant’s Retirement Plan-Related Tophat Benefit is delayed
as provided above, the Retirement Plan-Related Tophat Benefit payable to the
Participant’s Beneficiary shall commence on the first day of the month following
the Participant’s death and shall include (A) the benefit that would have been
payable to such Beneficiary following the Participant’s death under the form of
payment elected by the Participant assuming payment to the Participant had
commenced without delay and (B) the amounts that would have been payable to the
Participant after his or her Retirement and prior to the Participant’s date of
death including, where applicable, interest at the rate specified above for the
period of any such delay in payment in the absence of such delay in payment.

 

 

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(c) Death.

(i)           If the Participant incurs a Termination of Employment by reason of
death, and the Participant has no surviving spouse, no benefits shall be paid
with respect to the Participant under this Plan.

(ii)          If the Participant incurs a Termination of Employment by reason of
death, and the Participant has a surviving spouse, such surviving spouse shall
receive a Retirement Plan-Related Tophat under this Plan if and to the extent he
or she (A) receives a spouse’s pre-retirement death benefit under the Retirement
Plan and (B) such pre-retirement death benefit is less than the pre-retirement
death benefit that would have been payable but for the operation of Legal
Limits. This benefit shall equal the excess of (A) the pre-retirement death
benefit that would have been payable under the Retirement Plan disregarding the
Legal Limits over (B) the pre-retirement death benefit actually payable under
the Retirement Plan, and shall be paid in the form of an annuity over the life
of the surviving spouse. Such annuity shall commence 30 days after the
Participant’s date of death. The annuity payable to the surviving spouse shall
be based on the actuarial assumptions contained in the Retirement Plan.

(iii)        If a Participant incurs a Termination of Employment or Retires
other than due to death and is to receive payment of the Retirement Plan-Related
Tophat in a lump sum (either under Section 3.2(a) or 3.2(b)) or in an annuity
without a survivor benefit, and dies prior to payment of such lump sum or
commencement of such annuity due to the six-month delay in payment required
under either such Section, such lump sum or the amount that would have been
payable to such Participant as an annuity (with interest determined as provided
above in Section 3.2(b)(ii)) shall be paid to such Participant’s Beneficiary on
the six month anniversary of the Participant’s Termination of Employment or
Retirement, as the case may be.

3.3         Lump Sum Cash-Out of De Minimis Tophat Benefits. Notwithstanding any
other provision herein to the contrary, a Participant who Retires or incurs a
Termination of Employment and the sum of whose TDSP-Related Tophat Benefit and
Retirement Plan-Related Tophat Benefit do not together exceed the amount
limitation applicable to accelerated cash-out of de minimis payments permitted
under Section 409A of the Code and the IRS guidance thereunder, shall be paid
the value of his or her tophat benefits hereunder in a lump sum on or before the
later of (i) December 31 of the calendar year in which the Termination of
Employment or Retirement occurs or (ii) the date that is 2½ months after the
date of the Termination of Employment or Retirement.

 

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ARTICLE 4

Beneficiary Designation

4.1         Beneficiary Designation. Except with respect to benefits hereunder
that are payable solely to a surviving spouse, each Participant shall have the
right, at any time, to designate any person, persons or entity as his or her
primary and secondary Beneficiary or Beneficiaries to receive amounts payable
under the Plan.

4.2         Change of Beneficiary Designation. Any Beneficiary designation may
be changed by a Participant at any time by executing and filing a form
prescribed by the Committee. The filing of a new Beneficiary designation form
will cancel all Beneficiary designations previously filed. The Committee shall
be entitled to rely on the last designation filed by the Participant prior to
his or her death. In addition, the Committee may provide that the Beneficiary
designation made under the DCP and/or Retirement Plan shall apply to the
respective tophats that may be provided under this Plan.

4.3         No Beneficiary Designation. If a Participant fails to designate a
Beneficiary in accordance with Section 4.1, or if all designated Beneficiaries
predecease the Participant or die prior to complete distribution of the benefits
(if any) payable under the Plan upon the Participant’s death, then the
Participant’s designated Beneficiary shall be deemed to be the Participant’s
surviving spouse. If the Participant has no surviving spouse, any benefits
payable under the Plan upon the Participant’s death shall be paid to the
personal representative, executor or administrator of the Participant’s estate.

4.4         Effect of Payment. The payment of benefits under the Plan to the
named Beneficiary shall completely discharge the Employer’s obligations under
this Plan.

ARTICLE 5

Termination and Modification

5.1         Termination and Amendment. The Company reserves the right to
terminate or amend the Plan in whole or in part at any time. Such termination or
amendment shall have a binding effect on Participants and their Beneficiaries.
Upon termination of the Plan, the Participants’ accounts shall be paid out in
accordance with the distribution provisions contained in the Plan immediately
prior to such termination.

5.2         Limited Power of President to Amend Plan. The Chief Executive
Officer, President or Secretary of the Company is empowered to amend, restate or
otherwise change the Plan (i) as counsel may advise to be necessary or
appropriate in order to ensure that the Plan continues to operate as a plan of
deferred compensation for tax purposes, remains exempt from many of the
provisions of ERISA and otherwise continues to fulfill the purposes for which
the Plan was adopted and intended, (ii) as he or she may deem necessary in order
to make technical or clarifying changes not inconsistent with or in order to
fulfill the purposes of the Plan, (iii) as counsel may advise to be

 

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necessary to reflect new or revised Legal Limits, and (iv) in other respects
except as will materially increase the cost of the Plan to the Company or its
subsidiaries or the benefits of the Plan to Participants.

ARTICLE 6

Administration

6.1         Committee Duties. This Plan shall be administered by a Committee,
the members of which shall be appointed by the Board of Directors of the
Company. The Committee shall have the authority to make, amend, interpret, and
enforce all appropriate rules, regulations, and procedures for the
administration of this Plan, and to decide or resolve any and all questions
including interpretations of this Plan, as may arise in connection with the
Plan. Members of the Committee who are eligible to participate in the Plan may
participate to the same extent as other Participants but shall not take part in
any determination directly relating only to their own participation or benefits.

6.2         Agents. In the administration of this Plan, the Committee may, from
time to time, employ agents, including employees of the Company and
Participants, and may delegate to them such administrative duties as it sees
fit, and may from time to time consult with counsel who may be counsel to the
Employer.

6.3         Binding Effect of Decisions. The decision or action of the Committee
with 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.

6.4         Indemnity of Committee. The Company and Employer shall indemnify and
hold harmless the members of the Committee and their agents and delegates
against any and all claims, losses, damage, expense (including counsel fees) or
liability arising from any action or failure to act with respect to this Plan,
except in the case of willful misconduct by the Committee or any of its members
or agents.

6.5         Section 409A of the Code. Notwithstanding anything herein to the
contrary, neither the Committee nor any delegate thereof shall take any action
under the Plan, including without limitation pursuant to this Section 6, which
would result in the imposition of an additional tax under section 409A of the
Code on a Participant.

ARTICLE 7

Miscellaneous

7.1         Unsecured General Creditor. Participants and their Beneficiaries,
heirs, successors and assigns shall have no legal or equitable rights, interest
or claims in any property or assets of any Employer, nor shall they be
Beneficiaries of, or have any rights,

 

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claims or interests in any life insurance policies, annuity contracts or the
proceeds therefrom owned or which may be acquired by the Employer (“Policies”).
Such Policies or other assets of the Employer shall not be held under any trust
for the benefit of Participants, their Beneficiaries, heirs, successors or
assigns, or held in any way as collateral security for the fulfilling of the
obligations of the Employer under this Plan. Any and all of the Employer’s
assets and Policies shall be, and remain, the general assets of the Employer.
The Employer’s obligation under the Plan shall merely constitute an unfunded and
unsecured promise of the Employer to pay money in the future.

7.2         Nonassignability. Neither a Participant nor any other person shall
have any right to sell, assign, transfer, pledge, 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. 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.

7.3         Not a Contract of Employment. The terms and conditions of this Plan
shall not be deemed to constitute a contract of employment between the Employer
and the Participant, and the Participant (or his or her Beneficiary) shall have
no rights against the Employer except as may otherwise be specifically provided
herein. Moreover, nothing in this Plan shall be deemed to give a Participant the
right to be retained in the service of the Employer or to deny to the Employer
the right to discipline a Participant (including reducing his or her salary) or
discharge him or her at any time.

7.4         Health Information. The Participant shall provide to the Company, if
so requested and as a precondition for Plan participation, all health
information and other information as the Company may require in order to
purchase Policies.

7.5         Governing Law. The provisions of the Plan shall be construed and
interpreted according to the laws of the State of New York.

7.6         Withholding. All payments that are to be made by an Employer to a
Participant shall be subject to withholding for any and all taxes as the
Employer in its discretion deems appropriate.

7.7         Binding Effect. The provisions of this Plan shall bind the
Participant and his or her Beneficiaries, and shall bind and inure to the
benefit of the Employer and its successors and assigns.

7.8         Borrowing. No portions of any accounts may be borrowed by a
Participant or his or her Beneficiaries under this Plan.

7.9         Validity. In case any provision of this Plan shall be illegal or
invalid for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Plan shall be construed and enforced as if such
illegal and invalid provision had never been inserted herein.

7.10       Incapacity of Person Entitled To Payment. If the Committee shall
reasonably determine, upon evidence satisfactory to it, that it is not
desirable, because of the incapacity of the person who shall be entitled to
receive any payment in accordance with the provisions of the Plan, to make such
payment directly to such person, the Committee may apply such payment for the
benefit of such person in any way that the Committee shall deem advisable, or
the Committee may make such payment to any third person who, in the judgment of
the Committee, will apply such payment for the benefit of the person entitled
thereto. Such payment for the benefit of the person entitled thereto, or to a
third person for his or her benefit, shall be a complete discharge of all
liability with respect to such payment. The Committee may retain any amount that
would otherwise be payable in accordance with the provisions of the Plan to a
person who may be under legal disability until a representative of such person
competent to receive such payment on his or her behalf shall have been appointed
pursuant to law.

7.11       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.

7.12       Construction. Whenever any words are used herein in the singular or
in the plural, they shall be construed as though they were used in the plural or
the singular, as the case may be, in all cases where they would so apply.

 

 

 

 

 

 

 

 

 

 

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