Document:

a6622311_ex10b.htm

Exhibit 10-B

 

 

FORD MOTOR COMPANY

DEFERRED COMPENSATION PLAN FOR NON-EMPLOYEE DIRECTORS

(Amended and Restated Effective as of December 31, 2010)

I.           Name and Purpose

The name of this plan is the Ford Motor Company Deferred Compensation Plan for Non-Employee Directors (the "Plan").  The Plan supersedes and amends in its entirety the plan of the same name that was adopted on January 13, 1983 and subsequently amended and restated.  Its purpose is to provide non-employee directors of Ford Motor Company (the "Company") with an opportunity to defer compensation earned as a director.

II.           Effective Date

The Plan shall be effective as of January 13, 1983.

III.           Participants

Any director of the Company who is not an employee of the Company or of a subsidiary of the Company shall be eligible to participate in the Plan.  Any such person (a "director") who elects to participate in the Plan or whose compensation is or was subject to a mandatory deferral pursuant to Section XXII of the Plan is hereinafter called a "Participant."  The Plan shall establish for each Participant an unfunded deferred compensation account ("Account").

IV.           Election of Deferral

	
(A)  

	
On or before December 31 of any year, each director, or nominee for election as a director, shall be entitled to make an irrevocable election to defer receipt of all or a specified portion of the compensation (exclusive of expense reimbursements and/or stock-based compensation) otherwise payable to such director during the following year for service on the Board of Directors of the Company (the "Board") and its Committees.  Any such election shall become irrevocable as of December 31 of the year of election.

 

	
(B)  

	
Any deferral election pursuant to this Section shall include an election as to whether the compensation deferred pursuant to this Section shall be credited to such Participant's Account in cash and/or Common Stock Units ("Stock Units").  Each Stock Unit shall have the same value as a share of Common Stock of the Company ("Common Stock") and shall be entitled to dividend equivalents as provided in Section V.  Stock Units shall not have any voting rights, shall not represent actual shares of Common Stock, and shall not give any Participant any rights as a stock holder in the Company.

 

	
(C)  

	
With respect to the year 1983 only, a director may make an election to defer compensation and have such compensation credited to the director's Account in cash prior to February 13, 1983, in which case such election shall apply to the director's compensation allocable to the period commencing March 1, 1983 and ending December 31, 1983.  With respect to the year 1991 only, a director may make an election to defer compensation and have such compensation credited to the director's Account in Stock Units prior to August 11, 1991, in which case such election shall apply to the director's compensation allocable to the period commencing September 1, 1991 and ending December 31, 1991.

 

	
(D)  

	
A newly elected director may elect to defer compensation pursuant to this Section and to have such compensation credited to such Participant's Account in cash and/or Stock Units for the remainder of the calendar year in which such director joins the Board.  Any such election shall be made within 30 days following the date of such director's election to the Board and shall be effective with respect to compensation earned on and after the first day of the month next following the date on which such election by such director becomes irrevocable and ending on the next following December 31.

 

 

  

  

  

 

	
(E)  

	
A Participant may elect to defer compensation for each year while the Plan is in effect by giving written notice to the Company in accordance with Section XX setting forth the Participant's irrevocable election as to:

 

	
(a)  

	
the percentage of each component of the Participant's compensation for such year (annual retainer, committee chair fees, and presiding director fees, but excluding any expense reimbursement and/or stock-based compensation) to be deferred and credited to the Participant's Account in cash and the percentage to be deferred and credited to the Participant's Account in Stock Units; and

 

	
(b)  

	
the method of distribution (i.e., a lump sum payment or up to ten annual installments as provided for in Section VII) desired for each of the following:  (i) the portion of such year's compensation deferred pursuant to this Section and credited to the Participant's Account in cash, (ii) the portion of such year's compensation deferred pursuant to this Section and credited to the Participant's Account in Stock Units, (iii) the portion of such year's compensation mandatorily deferred pursuant to Section XXII, and (iv) any "dividend equivalents," as determined in Section V(E), to be credited to the Participant's Account for such year.

 

	
    

	

Such notice shall be delivered to the Company on or before December 31 of the year preceding the first year to which such election relates, except that (i) notice of an election to defer and have such compensation credited to a Participant's Account in cash with respect to the year 1983 may be delivered at any time prior to February 13, 1983, (ii) notice of an election to defer and have such compensation credited to a Participant's Account in Stock Units with respect to the year 1991 may be delivered at any time prior to August 11, 1991, and (iii) notice of an election to defer and have such compensation credited to a Participant's Account in cash and/or Stock Units from any newly-elected director may be delivered at any time within thirty (30) days following the date of such director's election to the Board.  The elections set forth in such notice shall be given continuing effect for subsequent years until a new notice terminating such previous elections or specifying different elections shall be delivered to the Company.  Any such new notice shall apply only to compensation earned in years subsequent to the year in which such new notice is delivered and shall become irrevocable as of December 31 of the year in which such new notice is delivered.

 

 

	
(F)  

	
Notwithstanding anything contained in the Plan to the contrary, no otherwise permissible election or other action is allowed that would trigger taxation of any amount under Section 409A of the Internal Revenue Code of 1986, as amended ("Code").

 

V.           Deferred Compensation Accounts

 

	
(A)  

	
All compensation deferred by a Participant pursuant to Section IV shall be held in the general funds of the Company and shall be credited pursuant to this Section to the Participant's Account in cash and/or Stock Units as elected by the Participant in accordance with Section IV.

 

	
(B)  

	
With respect to amounts deferred and credited to a Participant's Account in cash, the Participant's Account shall be credited with the amount so deferred, as of the date when the amount so deferred otherwise would have been payable if it had not been deferred.

 

	
(C)  

	
With respect to amounts deferred and credited to a Participant's Account in cash, the Participant's Account shall be credited with "interest equivalents" as of each June 30 and December 31 on the average daily balance credited to such Account in cash during the period of six months ended on such date, at an annual rate equal to (i) the rate, on a bond yield equivalency basis, on six-month (26-week) Treasury Bills maturing during the week in which such date falls, plus (ii) 75 basis points.  Interest equivalents shall continue to be so credited until such time as the entire balance of such Account shall have been distributed.

 

	
(D)  

	
With respect to amounts deferred and credited to a Participant's Account in Stock Units, the Participant's Account shall be credited with the number of Stock Units (including fractional interest therein) as of the date when the amount so deferred otherwise would have been payable if it had not been deferred, determined by dividing such amount by the applicable "Crediting Price," as determined pursuant to this Section.

 

 

  

  

  

 

	
(E)  

	
As of each date of payment of a dividend on the Common Stock, with respect to the Stock Units credited to the Participant's Account on the record date for such dividend, there shall be credited as "dividend equivalents" such additional Stock Units (including fractional interest therein),

 

	
(a)  

	
In the case of cash dividends, as could be purchased at the Crediting Price as of such payment date with the dividends payable on the number of outstanding shares of Common Stock corresponding to the number of Stock Units credited to the Participant's Account on such record date;

 

	
(b)  

	
In the case of dividends payable in property other than cash or Common Stock, as could be purchased at the Crediting Price as of such payment date with an amount equal to the fair market value of such property, determined by the Committee as of the date of payment, payable on the number of outstanding shares of Common Stock corresponding to the number of Stock Units credited to the Participant's Account on such record date; or

 

	
(c)  

	
In the case of dividends payable in Common Stock, as would equal the number of shares of Common Stock payable on the number of outstanding shares of Common Stock corresponding to the number of Stock Units credited to the Participant's Account on such record date.

 

	
(F)  

	
The "Crediting Price" with respect to any compensation deferred in Stock Units pursuant to Section IV shall mean the fair market value of the Common Stock on the date on which such compensation otherwise would have been payable if it had not been deferred.  The Crediting Price with respect to any dividend equivalent shall mean the fair market value of the Common Stock on the date of payment of the related dividend on Common Stock.  The Crediting Price with respect to any amount converted into Stock Units pursuant to Section VI shall be determined as provided in Section VI.

 

	
(G)  

	
For all purposes of the Plan, "fair market value" of the Common Stock on any date shall mean the average of the highest and lowest prices at which the Common Stock shall have been sold regular way on the New York Stock Exchange on such date or, if no such sales shall have been made on such date, on the next preceding date on which there were such sales of the Common Stock on such Exchange.

 

VI.           Conversion of Deferred Cash into Stock Units

 

	
(A)  

	
Any Participant who shall have any amount credited in cash to his or her Account at September 30, 1991 may elect to convert all or a portion of such amount into Stock Units on or after July 11, 1991 and on or before December 31, 1991 by giving written notice of such election to the Company prior to December 31, 1991 in accordance with Section XX.  The portion of the Account specified in such notice shall be converted into Stock Units (including fractional interests therein) at the applicable Crediting Price, which shall be the daily average of the fair market value of the Common Stock on each business day during the first "window period" that begins subsequent to the date of such notice.  The term "window period," as used in the preceding sentence, shall mean the period beginning on the third business day following the date of release by the Company of quarterly or annual statements of sales and earnings and ending on the 12th business day following such date.  Such conversion shall be effective as of the last business day in such first window period (such business day being hereinafter called the "date of conversion"), except that compensation otherwise payable on September 30, 1991 shall be converted, at such Crediting Price, as of September 30, 1991.  Interest equivalents accrued through the date of conversion shall be converted at such Crediting Prices as of the date of conversion.

 

	
(B)  

	
Interest equivalents on the amount converted pursuant to this Section shall cease to accrue on the date of conversion.  The Stock Units credited to a Participant's Account as a result of any such conversion shall be dealt with in the same manner as all other Stock Units credited to Participants' Accounts under the Plan.

 

VII.          Method of Distribution of Deferred Compensation

 

	
(A)  

	
No distribution of deferred compensation may be made except as provided in this Section.

 

 

  

  

  

 

	
(B)  

	
The amount of cash and the value of Stock Units credited to a Participant's Account for each year shall be payable either in a lump sum cash payment or in up to ten annual installments as elected by the Participant in accordance with Section IV with respect to each category of deferred compensation credited to the Participant's Account.  If annual installments are elected for any year with respect to any category of deferred compensation, the amount of the first payment shall be a fraction of the value of the portion of the Participant's Account for such year represented by such category as of December 31 of the year preceding such first payment, the numerator of which is one and the denominator of which is the total number of annual installments elected.  The amount of each subsequent payment with respect to such category shall be a faction of the value of such portion as of the December 31 of the year preceding such subsequent payment, the numerator of which is one and the denominator of which is the number of annual installments remaining, including the payment then being made.  If the Participant shall have elected to have deferred compensation credited to such Participant's Account partly in cash and partly in Stock Units for any year, each such category shall be distributed separately in accordance with the Participant's distribution election with respect to such category for such year and in accordance with the two immediately preceding sentences of this paragraph.

 

	
(C)  

	
Each distribution of deferred compensation, either in a lump sum or in annual installments, shall be made, or commence, on January 10 of the year following the year in which the Participant's service as a director terminates, or as soon thereafter as reasonably practicable.

 

	
(D)  

	
For the purpose of determining the amount of each distribution to a Participant with respect to Stock Units, each Stock Unit credited to the Participant's Account for any year shall be deemed to have a value equal to the fair market value of the Common Stock at December 31 of the year prior to such distribution.

 

	
(E)  

	
At the written request of a Participant, the Committee (as hereinafter defined), in its sole discretion, may authorize the cessation of deferrals by such Participant that were to be credited to such Participant's Account in cash and distribution of all or part of the cash portion of the Participant's Account prior to his or her termination of service as a director, or accelerate payment of any installments payable with respect to amounts deferred in cash, upon a showing of an unforeseeable emergency by the Participant.  For purposes of this paragraph, "unforeseeable emergency" shall mean severe financial hardship resulting from an illness or accident of the Participant, the Participant's spouse or beneficiary, or the Participant's dependent (as defined in Code Section 152, without regard to Code Sections 152(b)(1), (b)(2) and (d)(1)(B)), loss of the Participant's property due to casualty (including the need to rebuild a home following damage not otherwise covered by insurance), or other similar extraordinary and unforeseeable circumstances arising as a result of one or more recent events beyond the control of the Participant.  In any event, payment shall not be made to the extent such emergency is or may be relieved (i) through reimbursement or compensation by insurance or otherwise, (ii) by liquidation of the Participant's assets, to the extent the liquidation of such assets would not itself cause severe financial hardship, and/or (iii) by cessation of deferrals under the Plan.  Withdrawals of amounts because of an unforeseeable emergency shall only be permitted to the extent reasonably necessary to satisfy the emergency.  Examples of what are not considered to be unforeseeable emergencies include the need to send a Participant's child to college or the desire to purchase a home.  The amount distributed shall be credited with interest equivalents through the date of distribution in accordance with Section V.  This Section shall not apply to amounts credited to a Participant's Account in Stock Units.

 

	
(F)  

	
Notwithstanding anything contained in the Plan to the contrary, no otherwise permissible distribution or other action is allowed that would trigger taxation of any amount under Code Section 409A.

 

VIII.        Distribution upon Death

 

If any Participant shall die while a director, or thereafter, before receiving all funds credited to his or her Account, the total value of the Participant's Account shall be distributed in cash in one lump sum to any beneficiary or beneficiaries designated or deemed designated by the Participant pursuant to Section XIV or, in the absence of such designation, to such Participant's estate.  Any amount distributed pursuant to this Section shall be distributed on January 10 of the year following the year of death, or as soon thereafter as reasonably practicable.  Any Stock Units credited to the Participant's Account shall be deemed to have a value, for purposes of this Section VIII, equal to the fair market value of the Common Stock on December 31 of the year of the Participant's death or on such other date as the Committee (as hereinafter defined) in its sole discretion may determine.

 

 

  

  

  

 

IX.          Participant's Rights in Account

 

A Participant shall not have any interest in any deferred compensation, interest equivalents or Stock Units credited to his or her Account until it is distributed in accordance with the Plan.  All amounts deferred under the Plan shall remain the sole property of the Company, subject to the claims of its general creditors and available for its use for whatever purposes are desired.  With respect to amounts deferred, a Participant shall be merely a general creditor of the Company, and the obligation of the Company hereunder shall be purely contractual and shall not be funded or secured in any way.

 

X.           Statements of Account

 

Statements shall be sent to Participants during February of each year as to the balances in their respective Accounts as of the end of the previous calendar year.

 

XI.          Administration

 

A committee (the "Committee") consisting of at least three persons who shall not be eligible to participant under the Plan shall be appointed by the Board to administer, interpret and make determinations under the Plan and perform such other functions as are assigned to the Committee under the Plan; provided, however, that if the Board shall not take action to appoint the members of the Committee, the persons who from time to time shall be the members of the Committee under the Company's Restricted Stock Plan for Non-Employee Directors shall constitute the member of the Committee under this Plan.  The Committee is authorized, subject to the provisions of the Plan, from time to time to establish such rules and regulations as it may deem appropriate for the proper administration or operation of the Plan.  In the event that an Article, Section or paragraph of the Code, Treasury Regulations, or Plan is renumbered, such renumbered Article, Section or paragraph shall apply to applicable references herein.

 

XII.          Indemnification and Exculpation

 

	
(A)  

	
Each person who is or shall have been a member of the Board or of the Committee shall be indemnified and held harmless by the Company against and from any and all loss, cost, liability or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit or proceeding to which such person may be or become a party or in which such person may be or become involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by such person in settlement thereof (with the Company's written approval) or paid by such person in satisfaction of a judgment in any such action, suit or proceeding, except a judgment in favor of the Company based upon a finding of such person's lack of good faith; subject, however, to the condition that, upon the institution of any claim, action, suit or proceeding against such person, such person shall in writing give the Company an opportunity, at its own expense, to handle and defend the same before such person undertakes to handle and defend it on such person's behalf.  The foregoing right of indemnification shall not be exclusive of any other right to which such person may be entitled as a matter of law or otherwise, or any power that the Company may have to indemnify or hold such person harmless.

 

	
(B)  

	
Each member of the Board or of the Committee, and each officer and employee of the Company, shall be fully justified in relying or acting in good faith upon any information furnished in connection with the administration of the Plan by any appropriate person or persons other than such person.  In no event shall any person who is or shall have been a member of the Board or of the Committee, or an officer or employee of the Company, be held liable for any determination made or other action taken or any omission to act in reliance upon any such information, or for any action (including the furnishing of information) taken or any failure to act, if in good faith.

 

XIII.           Adjustment in Event of Changes in Capitalization

 

In the event of a recapitalization, stock split, stock dividend, combination or exchange of shares, merger, consolidation, rights offering, separation, reorganization or liquidation, or any other change in the corporate structure or shares of the Company, the Committee may make such equitable adjustments, to prevent dilution or enlargement of rights, as it may deem appropriate in the number of Stock Units credited or authorized to be credited under the Plan.

 

 

  

  

  

 

XIV.       Finality of Determinations

 

Each determination, interpretation or other action made or taken pursuant to the provisions of the Plan by the Committee shall be final and shall be binding and conclusive for all purposes and upon all persons.

 

XV.         Designation of Beneficiaries and Effect of Death

 

A Participant may file with the Company a written designation of beneficiary or beneficiaries under the Plan (subject to such limitations as to the classes and number of beneficiaries and contingent beneficiaries and such other limitations as the Committee from time to time may prescribe) to receive in cash, in the event of the death of such Participant, the unpaid amount in the Participant's Account in accordance with Section VIII.  A Participant shall be deemed to have designated as beneficiary or beneficiaries under the Plan the person or persons who receive such Participant's life insurance proceeds under the Company-paid directors life insurance plan, unless such Participant shall have assigned such life insurance or shall have filed with the Company a written designation of a different beneficiary or beneficiaries under the Plan.  A Participant may from time to time revoke or change any such designation of beneficiary. Any designation of beneficiary under the Plan shall be controlling over any testamentary or other disposition; provided, however, that if the Committee shall be in doubt as to the right of such beneficiary to receive any such shares, the same may be delivered to the legal representatives of the Participant, in which case the Company, the Committee and the members thereof shall not be under any further liability to anyone.

 

XVI.       No Right to Reelection

 

Nothing in the Plan shall be deemed to create any obligation on the part of the Board to nominate any Participant for reelection by the Company's stockholders, nor confer upon any Participant the right to remain a member of the Board for any period of time, or at any particular rate of compensation.

 

XVII.      Withholding of Taxes

 

The Company shall have the right, prior to the distribution of any amount from a Participant's Account, to withhold from such amount an amount sufficient to satisfy any withholding taxes that the Company may be required by law to pay with respect to such distribution.

 

XVIII.     No Assignment of Benefits

 

No rights or benefits under the Plan shall, except as otherwise specifically provided by law, be subject to assignment (except for the designation of beneficiaries pursuant to Section XV), nor shall such rights or benefits be subject to attachment or legal process for or against a Participant or his or her beneficiary or beneficiaries.

 

XIX.       Amendment and Termination

 

The Plan may at any time be amended, modified or terminated by the Board or the Executive Committee of the Board; provided, however, that no distribution of benefits shall occur upon termination of this Plan unless applicable requirements of Code Section 409A have been met. No amendment, modification or termination shall, without the consent of a Participant, adversely affect such Participant's rights with respect to amounts accrued in his or her Account.

 

XX.        Notices

 

All notices to the Company hereunder shall be delivered to the attention of the Secretary of the Company.

 

XXI.       Governing Law

 

The Plan shall be governed by and construed in accordance with the laws of the State of Michigan.

 

 

  

  

  

 

XXII.      Mandatory Deferral

 

Notwithstanding anything contained in the Plan to the contrary, the Board in its sole discretion may mandatorily defer payment of all or a portion of compensation that is otherwise deferrable by Participants pursuant to Section IV.  In no event may any mandatory deferral pursuant to this Section be made later than December 31 of the calendar year immediately preceding the year in which such deferred compensation otherwise would have been payable for services on the Board.  Any mandatory deferral pursuant to this Section shall remain in effect, until terminated or modified by the Board, with respect to compensation payable in future years; provided, however, that such mandatory deferral election shall become irrevocable as of December 31 of the year immediately preceding the year in which such deferred compensation otherwise would have been payable for services rendered.  Any such compensation which is mandatorily deferred pursuant to this Section shall be credited to the Participant's Account in the form of Stock Units and shall be entitled to dividend equivalents pursuant to Section V.  The value of Stock Units attributable to a mandatory deferral shall be payable in cash in a lump sum or in up to ten annual installments, as elected by the Participant pursuant to Section IV on, or commencing on, January 10 of the year following the year in which the Participant's service as a director terminates, or as soon thereafter as reasonably practicable.  Notwithstanding the foregoing, in the event a Participant fails to elect a method of payment for mandatory deferrals pursuant to Section IV, any such mandatory deferral for which the Participant failed to elect a payment method shall be paid in a cash lump sum payment on January 10 of the year following the year in which the Participant's service as a director terminates, or as soon there after as reasonably practicable.  In the event of a mandatory deferral pursuant to this Section, any election of a Participant to voluntarily defer compensation pursuant to Section IV shall apply only to compensation which is not subject to a mandatory deferral pursuant to this Section.

 

XXIII.     Code Section 409A.

 

(A) The provisions of Code Section 409A are incorporated into the Plan by reference to the extent necessary for any benefit provided under the Plan that is subject to Code Section 409A to comply with such requirements and, except as otherwise expressly determined by the Committee, the Plan shall be administered in accordance with Code Section 409A as if the requirements of Code Section 409A were set forth herein.  The Committee reserves the right to take such action, on a uniform and consistent basis, as the Committee deems necessary or desirable to ensure compliance with Code Section 409A, and applicable additional regulatory guidance thereunder, or to achieve the goals of the Plan without having adverse tax consequences under this Plan for any director or beneficiary.  Unless determined otherwise by the Committee, any such action shall be taken in a manner that will enable any benefit provided under the Plan that is intended to be exempt from Code Section 409A to continue to be so exempt, or to enable any benefit provided under the Plan that is intended to comply with Code Section 409A to continue to so comply.

(B) In no event shall any transfer of obligations to or from this Plan result in an impermissible acceleration or deferral under Code Section 409A. In the event such a transfer would cause an impermissible acceleration or deferral under Code Section 409A, such transfer shall not occur.

(C) In the event a former director is reelected to the Board, distribution of any benefit under this Plan shall not cease upon such director's reelection to the Board.

(D) After receipt of any deferrals, the obligations of the Company with respect to such amounts shall be satisfied and no director, surviving spouse, or beneficiary shall have any further claims against the Plan or the Company with respect to any deferrals.

(E) For the avoidance of doubt, and notwithstanding any provisions of the Plan to the contrary, in the event a Specified Employee becomes entitled to a benefit under this Plan, payment of any such benefit shall commence on or as soon as reasonably practicable after the first day of the seventh month following such Specified Employee's Separation From Service (other than as a result of death).  For purposes of this Plan, a Separation From Service will be deemed to have occurred on the date on which the Specified Employee incurs a “separation from service” within the meaning of Code Section 409A.  Any payments to which a Specified Employee otherwise would have been entitled under the Plan during the first 6 months following such Specified Employee's Separation From Service shall be accumulated and paid in a lump sum payment on or as soon as reasonably practicable after the first day of the seventh month following such Separation From Service.  Any payment delayed under this Section shall not bear interest.

 

 

  

  

  

For purposes of this Section, "Specified Employee" shall mean a director who is a "Key Employee" as defined in Code Section 416(i)(1)(A)(i), (ii) or (iii), applied in accordance with the regulations thereunder and disregarding Subsection 416(i)(5).  A Specified Employee shall be identified as of December 31 of each calendar year and such identification shall apply to any Specified Employee who shall terminate employment with the Company, other than as a result of such director's death, in the 12-month period commencing April 1 of the immediately succeeding calendar year.  A director who is determined to be a Specified Employee shall remain a Specified Employee throughout the 12-month period regardless of whether such director meets the definition of "Specified Employee" on the date the director terminates employment with the Company.  This provision is effective for Specified Employees who resign or terminate employment on or after January 1, 2005.  For purposes of determining Specified Employees, the definition of compensation under Treasury Regulation Section 1.415(c)-2(d)(3) shall be used, applied without the use of any of the special timing rules provided in Treasury Regulation Section 1.415(c)-2(e) or the special rule in Treasury Regulation Section 1.415(c)-2(g)(5)(i), but applied with the use of the special rule in Treasury Regulation Section 1.415(c)-2(g)(5)(ii).a6622311_ex10c.htm

Exhibit 10-C

 

FORD MOTOR COMPANY

BENEFIT EQUALIZATION PLAN

(Amended and Restated Effective as of January 1, 2011)

Section 1.  Purpose.

The purpose of this Plan is to preserve certain benefits of employees under the Company's tax qualified General Retirement Plan, Ford Retirement Plan and Savings and Stock Investment Plan for Salaried Employees by providing appropriate Equalization Benefits under this Plan in place of benefits which cannot be provided under such tax qualified plans because of limitations imposed by Section 415 and Section 401(a)(17) of the Internal Revenue Code of 1986, as amended, as well as base salary amounts deferred to the Ford Motor Company Deferred Compensation Plan.

Section 2.  Definitions.

As used in this Plan, the following terms shall have the following meanings, respectively:

2.01 "BEP Salary Reductions" shall mean that portion of salary at the basic salary rate which would have been credited to an Eligible Employee's account before January 1, 1985 pursuant to a salary reduction agreement under the SSIP but which, by reason of Code Section 415, exceeds salary reduction contributions that can be made by the Company on an Eligible Employee's behalf under the Tax-Efficient Savings Program of the SSIP.

2.02 "Code" shall mean the Internal Revenue Code of 1986, as amended.

2.03 "Committee" shall mean the Compensation Committee of the Board of Directors of Ford Motor Company.

2.04 "Company" shall mean Ford Motor Company and such of the subsidiaries of Ford Motor Company as, with the consent of Ford Motor Company, shall have adopted this Plan.

2.05 "DCP" shall mean the Ford Motor Company Deferred Compensation Plan.

2.06 "Designated Third Party Administrator" shall be Affiliated Computer Services, Inc. or a successor vendor who the Company shall employ to act as record keeper to maintain Eligible Employee subaccounts and process notional investment elections.

2.07 "Eligible Employee" shall mean a salaried employee of the Company whose benefits under the GRP, FRP and/or SSIP are limited as a result of the application of the limitations imposed by Code Sections 415 and/or 401(a)(17) or due to base salary deferrals under the DCP.

2.08 "Eligible Surviving Spouse" shall mean an Eligible Employee's spouse, as defined by the Federal Defense of Marriage Act of 1996, to whom the Eligible Employee has been married for at least one year prior to the Eligible Employee's date of death.

2.09 "Equalization Benefits" shall mean FRP Equalization Benefits, Periodic GRP Equalization Benefits and/or SSIP Equalization Benefits.

2.10 "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended.

2.11 "ESAP" shall mean the Ford Motor Company Executive Separation Allowance Plan, as amended from time to time.

2.12 "FERCO SRP" shall mean the Ford Electronics and Refrigeration Corporation Salaried Retirement Plan.

2.13 "FRP" shall mean the Ford Retirement Plan, as amended from time to time.

 

 

  

  

  

 

2.14 "FRP Equalization Benefit" shall mean the benefit provided pursuant to Section 3.03.

2.15 "GRP" shall mean the Ford Motor Company General Retirement Plan, as amended from time to time.

2.16 "Limitations" shall mean the limitations on benefits and/or contributions imposed on qualified plans by Code Sections 415 and 401(a)(17).

2.17 "Periodic GRP Equalization Benefit" shall mean the benefit provided pursuant to Section 3.01.

2.18 "Plan" shall mean this Ford Motor Company Benefit Equalization Plan, as amended from time to time.

2.19 "Plan Administrator" shall mean such person or persons to whom the Committee shall delegate authority to administer the Plan.

2.20 "SSIP" shall mean the Ford Motor Company Savings and Stock Investment Plan for Salaried Eligible Employees, as amended from time to time.

2.21 "SSIP Equalization Benefit" shall mean the benefit provided pursuant to Section 3.02.

2.22 "Separation From Service" shall be determined to have occurred on the date on which an Eligible Employee incurs a “separation from service” within the meaning of Code Section 409A.

2.23 "Specified Employee" shall mean an Eligible Employee who is a "Key Employee" as defined in Code Section 416(i)(1)(A)(i), (ii) or (iii), applied in accordance with the regulations thereunder and disregarding Subsection 416(i)(5).  A Specified Employee shall be identified as of December 31st of each calendar year and such identification shall apply to any Specified Employee who shall incur a Separation From Service in the 12-month period commencing April 1st of the immediately succeeding calendar year.  An Eligible Employee who is determined to be a Specified Employee shall remain a Specified Employee throughout such 12-month period regardless of whether the Eligible Employee meets the definition of "Specified Employee" on the date the Eligible Employee incurs a Separation From Service.  This provision is effective for Specified Employees who incur a Separation From Service on or after January 1, 2005.  For purposes of determining Specified Employees, the definition of compensation under Treasury Regulation Section 1.415(c)-2(d)(3) shall be used, applied without the use of any of the special timing rules provided in Treasury Regulation Section 1.415(c)-2(e) or the special rule in Treasury Regulation Section 1.415(c)-2(g)(5)(i), but applied with the use of the special rule in Treasury Regulation Section 1.415(c)-2(g)(5)(ii).

2.24 "Subsidiary" shall mean, as applied with respect to any person or legal entity specified, (i) a person or legal entity with a majority of the voting stock of which is owned or controlled, directly or indirectly, by the person or legal entity specified or (ii) any other type of business organization in which the person or legal entity specified owns or controls, directly or indirectly, a majority interest.

2.25 "Totally and Permanently Disabled" shall mean an Eligible Employee who:

	
(a)       

	
is not engaged in regular employment or occupation for remuneration or profit (including employment with the Company and/or its Subsidiaries, but excluding employment or occupation which the Plan Administrator determines to be for purposes of rehabilitation);

	
(b)       

	
is determined by the Plan Administrator, on the basis of medical evidence, to be totally disabled by bodily injury or disease so as to be prevented thereby from engaging in any regular occupation with the Company, where such disability has been continuous for at least 5 months, and where the Plan Administrator determines such disability will be permanent and continuous during the remainder of such Eligible Employee's life; and

	
(c)       

	
has earned at least 10 years of credited service under the GRP.

 

 

  

  

  

 

Section 3.  Equalization of Benefits.

3.01   GRP Equalization Benefits.

	
  

	
(a)

	
A Periodic GRP Equalization Benefit shall be provided to any Eligible Employee (i) whose GRP benefit is subject to the Limitations or delayed pursuant to provisions set forth in (b)(iii),  and (ii) who, at the time of Separation From Service, has earned at least 5 years of credited service under the GRP (or, if age 65 or older, has earned at least 1 year of credited service under the GRP).

 

	
  

	
(b)

	

The Periodic GRP Equalization Benefit:

 

	
(i)  

	
Shall be equal in amount to the difference between the GRP benefit the Eligible Employee would receive if the Eligible Employee commenced GRP benefits upon Separation From Service and the corresponding benefit that would be payable under the GRP without regard to the Limitations.  For purposes of determining such amount, the Eligible Employee shall be treated as if he or she elected to receive his or her GRP benefit in the form of the qualified joint and survivor annuity benefit under the GRP if married, or the single life annuity form of benefit under the GRP if unmarried (including, a divorced or widowed Eligible Employee).  The amount of any Periodic GRP Equalization Benefit payable to an Eligible Employee whose benefit under the ESAP is not offset or reduced by the amount of any GRP benefit payable to such Eligible Employee prior to age 65 shall be increased upon the Eligible Employee's attainment of age 65 to reflect an unreduced normal retirement benefit under the GRP.  In determining the amount of the Periodic GRP Equalization Benefit, the Eligible Employee's salary shall be the Eligible Employee's salary (as that term is defined in the GRP) plus BEP Salary Reductions for periods before January 1, 1985 which are credited under this Plan pursuant to Section 3.02(a)(ii)(C) below, but the Eligible Employee shall not make contributions hereunder based on such BEP Salary Reductions.

	
(ii)  

	
Shall be paid monthly by the Company to an Eligible Employee who has had a Separation From Service and, for distributions commencing on and after January 1, 2005, shall be paid commencing on or as soon as reasonably practicable after the first day of the month following the earliest of the following dates:

(A)  the first date on or after Separation From Service on which such Eligible Employee attains age 55, if the Separation From Service occurs prior to the date on which the Eligible Employee earns 30 years of credited service under the GRP;

(B)  the date of Separation From Service, if the Separation From Service occurs on or after the date on which the Eligible Employee earned 30 years of credited service under the GRP; or

(C)  the date on which such Eligible Employee is determined to be Totally and Permanently Disabled.

	
(iii)  

	
Notwithstanding any other provision of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, other than as a result of such Specified Employee's death, payment of any Periodic GRP Equalization Benefit to such Specified Employee shall commence on or as soon as reasonably practicable after the first day of the seventh month following Separation From Service.  Any Periodic GRP Equalization Benefit payments to which a Specified Employee otherwise would have been entitled during the first six months following such Specified Employee's Separation From Service shall be accumulated and paid in a lump sum payment on or as soon as reasonably practicable after the first day of the seventh month following such Separation From Service.  The payment delayed under this Section shall not bear interest.

 

 

	
  

	
(c)

	

Upon an Eligible Employee's death, the Eligible Employee's Eligible Surviving Spouse will receive a monthly benefit under the Plan in an amount equal to the difference between any GRP benefit the Eligible Surviving Spouse receives and the corresponding benefit that would be payable to the Eligible Surviving Spouse under the GRP without regard to the Limitations.  Payment of any such Eligible Surviving Spouse benefit shall commence as soon as reasonably practicable following the date of the Eligible Employee's death.  Any such Eligible Surviving Spouse benefit shall cease upon the death of the Eligible Surviving Spouse.

 

 

  

  

  

 

 

	
  

	
(d)

	

GRP Equalization Benefits commencing on or before December 31, 2004, shall be made in accordance with the terms and conditions of the Plan in effect at the time of such commencement.  GRP Equalization Benefits commencing on and after January 1, 2005 shall be made as periodic payments pursuant to Section 3.01(b).

 

	
  

	
(e)

	

If the actuarially equivalent lump sum value of an Eligible Employee's GRP Equalization Benefit, determined in accordance with this Section on or after January 1, 2009, does not exceed $3,500, such GRP Equalization Benefit shall be distributed in accordance with this Section.  GRP Equalization Benefits shall not be distributed pursuant to this Section to any Eligible Employee who is eligible for benefits under any of the Company's other defined benefit non-qualified deferred compensation arrangements.  The actuarially equivalent lump-sum value of any GRP Equalization Benefit distributed pursuant to this Section shall be paid on or as soon as reasonably practicable after the first day of the month following the date on which such GRP Equalization Benefit otherwise would have commenced pursuant to Section 3.01.  For purposes of this Section, actuarially equivalent lump-sum values shall be calculated by applying the rate of interest as prescribed under Code Section 417(e)(3)(C) for the third month prior to the first day of the calendar year in which such determination is made and the mortality table as prescribed under Code Section 417(e)(3)(B).

 

3.02  Savings and Stock Investment Plan Equalization Benefits.

	
  

	
(a)

	
Pre-1985 Subaccount.

 

The provisions of this Subsection 3.02(a) shall apply in determining that part of an Eligible Employee's SSIP Equalization Benefit subaccount based on periods of service until December 31, 1984.

	
  

	
(i)

	
For an Eligible Employee who made the election regarding payroll deductions provided in this Subsection, or who elected to have credited under this Plan BEP Salary Reductions, a SSIP Equalization Benefit shall be provided with respect to any class or classes of the SSIP before January 1, 1985 with respect to which Company or Eligible Employee contributions were subject to the Limitations.

	
  

	
(ii)

	
If at any time during a plan year ending before January 1, 1985 it appeared that contributions by or on behalf of an Eligible Employee (including any related Company matching contributions) to the SSIP would be subject to the Limitations, such Eligible Employee may have elected to have the Company retain in its general funds and have credited for purposes of computing the Eligible Employee's subaccount of the SSIP Equalization Benefit under this Subsection 3.02(a):

	
  

	
(A)

	
by payroll deduction authorization under this Plan that portion of the amount the Eligible Employee had elected to contribute as employee regular savings contributions to the SSIP for such pay period (by a payroll deduction authorization in effect for such pay period under the SSIP) which, when added to all other actual and projected Annual Additions as defined under the SSIP during such plan year, exceeded the Limitations.

	
  

	
(B)

	
that portion of regular savings and related earnings which have been returned to the Eligible Employee pursuant to the SSIP, and

	
  

	
(C)

	
the Eligible Employee's BEP Salary Reductions.

	
  

	
(iii)

	
There has been established for each Eligible Employee a subaccount for periods of participation under this Subsection 3.02(a) under the SSIP Equalization Benefit Account.  This subaccount shall be equal to the amounts retained by the Company pursuant to Subsection 3.02(a)(ii), adjusted on the basis of investment performance and the Eligible Employee's election as to investment of funds under the SSIP and transfer of the value of employee and Company contributions under the SSIP as though contributions and credits to the Eligible Employee's account hereunder had been so invested, less any withdrawals pursuant to Subsection 3.02(a)(iv); provided, however, that an election by a Company officer of investment in Company common stock shall not apply under this Plan with respect to contributions pursuant to Subsection 3.02(a)(ii) (other than related Company matching contributions) which were made or credited hereunder by or on behalf of such Company officer; and the officer will be required to make any other investment election permitted under the SSIP with respect to such amounts.

 

 

  

  

  

 

 

	
  

	
(iv)

	

An Eligible Employee may not withdraw any amounts in excess of the Eligible Employee's regular savings contributions under this Plan and may not borrow against the subaccount of the Eligible Employee's SSIP Equalization Benefit.

 

	
  

	
(v)

	

The SSIP Equalization Benefit under this Subsection 3.02(a) shall be equal to the amount at the time of distribution credited to the Eligible Employee's subaccount of the SSIP Benefit Equalization Account as determined under Subsection 3.02(a)(iii).

 

(b)  Post-1984 Subaccount.

   The provisions of this Subsection 3.02(b) shall apply in determining an Eligible Employee's SSIP Equalization Benefit subaccount based on periods of service beginning on or after January 1, 1985.

 

	
  

	
(i)

	

If at any time during a plan year beginning on or after January 1, 1985 contributions by or on behalf of an Eligible Employee and related Company matching contributions to the SSIP are subject to the Limitations, there shall be credited for purposes of computing the Eligible Employee's SSIP Equalization Benefit under this Subsection 3.02(b) an amount equal to the Company matching contributions which would have been made under the SSIP based upon the Eligible Employee's SSIP elections, except that such Company matching contributions cannot be made because of the Limitations.  For plan years beginning on or after January 1, 2005, if the amount credited as an Eligible Employee's SSIP Equalization Benefit for a plan year increases or decreases as a result of a change in the Eligible Employee's SSIP deferral elections for such plan year, such increase or decrease in the SSIP Equalization Benefit shall be adjusted to the extent necessary to prevent such increase or decrease, when aggregated with all SSIP Equalization Benefits credited for such plan year, from exceeding the amount of Company matching contributions that would have been contributed to the SSIP had the Limitations not applied.

 

	
  

	
(ii)

	
If at any time during a plan year an Eligible Employee elects to defer base salary amounts to the DCP, there shall be credited for purposes of computing the Eligible Employee's SSIP Equalization Benefit under this Subsection 3.02(b) an amount equal to the Company matching contributions that would have been contributed to the SSIP had the Eligible Employee not made base salary deferrals to the DCP.

	
  

	
(iii)

	
For periods on or after October 1, 1995 until May 31, 2007, any Company matching contributions credited for purposes of computing an Eligible Employee's SSIP Equalization Benefit shall be credited in the form of units in the Ford Stock Fund rather than shares of Ford common stock.  For periods on or after June 1, 2007, any Company matching contributions so credited shall be credited in the form of cash.

	
  

	
(iv)

	
There shall be established for each Eligible Employee a subaccount for periods of participation under this Subsection 3.02(b) under the SSIP Equalization Benefit Account.  For periods prior to May 1, 1996, this subaccount shall be equal to the amounts credited by the Company pursuant to Subsection 3.02(b)(i), adjusted on the basis of investment performance and any election by the Eligible Employee to transfer the value of matured Company matching contributions under the SSIP, as though credits to the Eligible Employee's account hereunder had been so invested.  For periods May 1, 1996 and after, this subaccount shall be equal to the amounts credited by the Company pursuant to Subsection 3.02(b)(i), and adjusted on the basis of investment performance attributable to any separate investment election made by an Eligible Employee (other than a Company officer) on or after May 1, 1996.  The investment options for managing the subaccount shall be identical to the investment options specified in the SSIP, although they will have separate fund codes.  Any BEP credits earned will be based on the investment options available under the SSIP.  The Designated Third Party Administrator will maintain the accounts and process the elections and otherwise be the record keeper with respect to this subaccount.  Company officers with this subaccount are not eligible to reallocate or transfer credits under the subaccount from the Ford Stock Fund to other investment options, or from other investment options to the Ford Stock Fund.

 

 

  

  

  

 

	
  

	
(v)

	
An Eligible Employee may not withdraw any amounts credited under this Subsection 3.02(b) and may not borrow against this subaccount of the Eligible Employee's SSIP Equalization Benefit.  This subaccount will not accept rollovers from other plans.

	
  

	
(vi)

	
The SSIP Equalization Benefit under this Subsection 3.02(b) shall be equal to the amount at the time of distribution credited to the Eligible Employee's subaccount of the SSIP Benefit Equalization Account as determined under Subsection 3.02(b)(ii).

	
  

	
(vii)

	
In the event of death of an Eligible Employee with an SSIP Benefit Equalization subaccount, the balance of the subaccount shall be payable to the same beneficiary as the Eligible Employee has designated under the SSIP, unless the Eligible Employee makes a separate designation under this Plan pursuant to the rules established by the Committee.

	
  

	
(c)

	
Payment of SSIP Equalization Benefit.

   The SSIP Equalization Benefit:

	
(i)  

	
Shall be paid in a lump sum cash payment by the Company to the Eligible Employee or, if the Eligible Employee is deceased, to the Eligible Employee's beneficiary under the SSIP, on or as soon as reasonably practicable after the earlier of the Eligible Employee’s Separation From Service or death.  In the event of an Eligible Employee’s death, the balance of the Eligible Employee’s SSIP Equalization Benefit book entry account, if any, shall be payable to the same beneficiary as the Eligible Employee's beneficiary under the SSIP, unless the Eligible Employee makes a separate designation under this Plan pursuant to the rules established by the Committee.

	
(ii)  

	
Notwithstanding any other provision of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, other than as a result of death, payment of the amount credited to such Specified Employee’s SSIP Equalization Benefit subaccount, accrued or vested after December 31, 2004, shall be paid on or as soon as reasonably practicable after the first day of the seventh month following such Separation From Service.  A Specified Employee who is subject to a six-month distribution delay pursuant to this Subsection 3.02(c)(ii) will be permitted to continue to manage the investment elections applicable to such Specified Employee’s subaccount during the six-month distribution delay.

	
(iii)  

	
The SSIP Equalization Benefit under this Subsection 3.02(c) shall be equal to the amount credited to the Eligible Employee's book entry account at the time of distribution, as determined under Subsection 3.03(a) or (b), as applicable.

	
3.03  

	
  Ford Retirement Plan (FRP) Equalization Benefits

	
(a)  

	
FRP Subaccount.

	
  

	 

The provisions of this Subsection 3.03(a) shall apply in determining an Eligible Employee's FRP Equalization Benefit for periods of service beginning on or after January 1, 2004.

	
(i)  

	
The Company shall establish a book entry account for each Eligible Employee for purposes of computing the Eligible Employee's FRP Equalization Benefit under this Section 3.03.  The Eligible Employee's FRP Equalization Benefit under this Subsection 3.03(a) shall be equal to the amount(s) credited to the book entry account at the time of distribution.

	
(ii)  

	
If, at any time during a plan year beginning on or after January 1, 2004, contributions made to the FRP on behalf of an Eligible Employee are limited due to the application of the Limitations, there shall be credited to the book entry account established for the Eligible Employee pursuant to this Subsection 3.03(a) an amount equal to the amount of Company contributions that would have been made under the FRP on behalf of the Eligible Employee but for the application of the Limitations.

 

 

  

  

  

 

	
(iii)  

	
Each Eligible Employee's book entry account also will be credited or debited with amounts determined based on investment options selected by the Eligible Employee under this Subsection 3.03(a)(iii).  The investment options available for selection under this Subsection 3.03(a)(iii) shall be identical to the investment options available under the FRP, but will have separate fund codes.  Each Eligible Employee shall select which investment options are to be used in determining the Eligible Employee's FRP Equalization Benefit.  In the absence of an investment selection by an Eligible Employee, the Eligible Employee's book entry account will be credited or debited with amounts based on the appropriate target date – retirement fund offered under the FRP as identified by the Company for the Eligible Employee.  The Designated Third Party Administrator will maintain a record of each book entry account, process investment selections, and otherwise be the record keeper of the book entry accounts.  Investment options selected under this Section 3.03 shall be used solely for purposes of determining an Eligible Employee's FRP Equalization Benefit.  An Eligible Employee's FRP Equalization Benefit will be based on the value of the Eligible Employee's book entry account as if the amounts in the book entry account had been invested in actual investments selected by the Eligible Employee; however, no such investments shall be made on behalf of the Eligible Employee.  Eligible Employees shall not have voting rights or any other ownership rights with respect to any investment options selected as the measuring mechanism for book entry accounts established under this Section 3.03.

	
(iv)  

	
Eligible Employees may not withdraw or borrow against amounts credited to any book account under this Subsection 3.03(a).  Book entry accounts will not accept rollovers from other plans.

	
(b)  

	
Payment of FRP Equalization Benefit.

 

   The FRP Equalization Benefit:

	
(i)  

	
Shall be paid in a lump sum cash payment by the Company to the Eligible Employee or, if the Eligible Employee is deceased, to the Eligible Employee's beneficiary under the FRP, on or as soon as reasonably practicable after the earlier of the Eligible Employee's Separation From Service or death.  In the event of an Eligible Employee’s death, the balance of the Eligible Employee’s FRP Equalization Benefit book entry account, if any, shall be payable to the same beneficiary as the Eligible Employee designated under the FRP, unless the Eligible Employee makes a separate designation under this Plan pursuant to the rules established by the Committee.

	
(ii)  

	
Notwithstanding any other provision of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, other than as a result of death, payment of any amount credited to the Specified Employee's FRP Equalization Benefit book entry account, accrued or vested after December 31, 2004, shall be made on or as soon as reasonably practicable after the first day of the seventh month following Separation From Service.  A Specified Employee who is subject to a six-month distribution delay pursuant to this Subsection 3.02(c)(ii) will be permitted to continue to manage the investment elections applicable to such Specified Employee’s book entry account during the six-month distribution delay.

	
(iii)  

	
The FRP Equalization Benefit under this Subsection 3.03(b) shall be equal to the amount credited to the Eligible Employee's book entry account at the time of distribution, as determined under Subsection 3.03(a).

Section 4.  Equalization Benefits Not Funded.

The Company's obligations under this Plan shall not be funded and Equalization Benefits under this Plan shall be payable only out of the general funds of the Company.

 

 

  

  

  

Section 5.  No Contract of Employment.

The Plan is an expression of the Company's present policy with respect to Eligible Employees; it is not a part of any contract of employment.  No Eligible Employee, Eligible Surviving Spouse, or any other person shall have any legal or other right to any benefit under this Plan.

Section 6.  Amendment, Termination, Etc.

The Board of Directors of the Company shall have the right at any time to amend, modify, discontinue or terminate this Plan in whole or in part; provided, however, that no such action shall deprive any person of an Equalization Benefit under this Plan if payment of such Equalization Benefit shall have commenced prior to the date of such action by the Board of Directors; provided, further, however, that no distribution of benefits shall occur upon termination of this Plan unless applicable requirements of Code Section 409A have been met.  Notwithstanding anything contained in this Section to the contrary, Equalization Benefits payable under this Plan remain subject to the claims of the Company’s general creditors at all times.

Section 7.  Administration and Interpretation of the Plan.

Full authority to administer and interpret this Plan shall be vested in the Committee.  The Committee is authorized from time to time to establish such rules and regulations as it may deem appropriate for the proper administration of the Plan, and to make such determinations under, and such interpretations of, and to take such steps in connection with, the Plan as it may deem necessary or advisable.  Each determination, interpretation, or other action by the Committee shall be in its sole discretion and shall be final, binding and conclusive for all purposes and upon all persons.  The Committee may act, in its sole discretion, to delegate administrative and interpretative authority under this Section to the Plan Administrator.

In the event that an Article, Section or paragraph of the Code, Treasury Regulations, GRP, FRP or SSIP concerning the Limitations is renumbered, such renumbered Article, Section or paragraph shall apply to applicable references herein,.

Section 8.  Local Payment Authorities

The Vice President and Treasurer and the Assistant Treasurer (or, in the event of a change in title, their functional equivalent) may act individually to delegate authority to administrative personnel to make benefit payments to employees in accordance with plan provisions.

Section 9. Deductions

The Company may deduct from any Benefit Equalization payment to an Eligible Employee, or such Eligible Employee's Eligible Surviving Spouse, any and all amounts owing to it by such Eligible Employee for any reason, and all taxes required by law or government regulation to be deducted or withheld.

Section 10.  Visteon Corporation.

The following shall be applicable to employees of Ford who were transferred to Visteon Corporation on April 1, 2000 ("U.S. Visteon Employees") and who ceased active participation in the Plan as of June 30, 2000 after Visteon Corporation was spun-off from Ford, June 28, 2000.

 

(a)           Group I and Group II Employees

For purposes of this paragraph, a "Group I Employee" shall mean a U.S. Visteon Employee who as of July 1, 2000 was eligible for immediate normal or regular early retirement under the provisions of the GRP as in effect on July 1, 2000.  A "Group II Employee" shall mean a U.S. Visteon Employee who (i) was not a Group I Employee; (ii) had as of July 1, 2000 a combination of age and continuous service that equals or exceeds sixty (60) points (partial months disregarded); and (iii) could become eligible for normal or regular early retirement under the provisions of the GRP as in effect on July 1, 2000 within the period after July 1, 2000 equal to the employee's Ford service as of July 1, 2000. A Group I or Group II Employee shall retain eligibility to receive a GRP Equalization Benefit and/or a SSIP Equalization Benefit and shall receive such

benefits as are applicable under the terms of the Plan in effect on the retirement date, based on meeting eligibility criteria as of July 1, 2000 with respect to GRP or SSIP participation prior to July 1, 2000 and upon incurring a Separation From Service from Visteon, or from the Company for Group I or II Employees who return to Company employment pursuant to the Visteon Salaried Employee Transition Agreement dated as of October 1, 2005 and any subsequent amendments thereto.

 

 

  

  

  

 

(b)           Group III Employees.

For purposes of this paragraph, a "Group III Employee" shall mean a U.S. Visteon Employee who participated in the GRP prior to July 1, 2000 other than a Group I or Group II Employees.  The Plan shall have no liability for a GRP Equalization Benefit and/or a SSIP Equalization Benefit payable to Group III Employees who were otherwise eligible hereunder with respect to GRP or SSIP participation prior to July 1, 2000 on or after July 1, 2000.

Section 11.  Code Section 409A.

	
  

	
(a)

	
The provisions of Code Section 409A are incorporated into the Plan by reference to the extent necessary for any benefit provided under the Plan that is subject to Code Section 409A to comply with such requirements and, except as otherwise expressly determined by the Committee, the Plan shall be administered in accordance with Code Section 409A as if the requirements of Code Section 409A were set forth herein.  With respect to Equalization Benefits, the Company reserves the right to take such action, on a uniform basis, as the Company deems necessary or desirable to ensure compliance with Code Section 409A, and applicable additional regulatory guidance thereunder, or to achieve the goals of the Plan without having adverse tax consequences under this Plan for any employee or beneficiary.  Unless determined otherwise by the Committee, any such action shall be taken in a manner that will enable any benefit provided under the Plan that is intended to be exempt from Code Section 409A to continue to be so exempt, or to enable any benefit provided under the Plan that is intended to comply with Code Section 409A to continue to so comply.

	
  

	
(b)

	
In no event shall any transfer of liabilities to or from this Plan result in an impermissible acceleration or deferral of Equalization Benefits under Code Section 409A. In the event such a transfer would cause an impermissible acceleration or deferral under Code Section 409A, such transfer shall not occur.

	
  

	
(c)

	
In no event will application of any eligibility requirements under this Plan cause an impermissible acceleration or deferral of any Plan benefits under Code Section 409A.

	
  

	
(d)

	
In the event an Eligible Employee is reemployed following a Separation From Service, distribution of any Equalization Benefit shall not cease upon such Eligible Employee's reemployment.

	
  

	
(e)

	
After receipt of any Equalization Benefits, the obligations of the Company with respect to such Equalization Benefits shall be satisfied and no Eligible Employee, Eligible Surviving Spouse, or other beneficiary shall have any further claims against the Plan or the Company with respect to Equalization Benefits.

Section 12. Claim for Benefits

(a)               Denial of a Claim

A claim for benefits under the Plan shall be submitted in writing to the Plan Administrator.  If a claim for benefits or participation is denied in whole or in part by the Plan Administrator, the employee will receive written notification within a reasonable period from the date the claim for benefits or participation is received.  Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the employee.  If the Plan Administrator determines that an extensive period of time for processing is required, written notice shall be furnished to the employee as soon as practical.

 

 

  

  

  

(b)           Review of Denial of the Claim to the Committee

In the event that the Plan Administrator denies a claim for benefits or participation, the employee may request a review by filing a written appeal to the Committee within sixty (60) days of receipt of the written notification of denial.  The appeal will be considered at the Committee's next scheduled meeting.  Under special circumstances, an extension of time for processing may be required in which case a decision shall be rendered as soon as practical.  In the event such an extension is needed, written notice shall be provided to the employee.

(c)           Decision of the Committee

The decision on review of the appeal shall be in writing.  Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the employee.  Decisions of the Committee are final and conclusive and are only subject to the arbitrary and capricious standard of judicial review.

(d)           Limitations Period

No legal action for benefits under the Plan may be brought against the Plan until after the claims and appeal procedures have been exhausted.  Legal actions under the Plan for benefits must be brought no later than two (2) years after the claim arises.  No other action may be brought against the Plan more than six (6) months after the claim arises.

Section 13. Special Equalization Benefits.

In addition to any other Equalization Benefits provided under this Plan, the Company may, in its sole discretion, provide special Equalization Benefits to certain Eligible Employees.  Special Equalization Benefits provided to Eligible Employees whose compensation is subject to the executive compensation disclosure rules under the Securities Exchange Act of 1934 shall be set forth in Appendix A.  Special Equalization Benefits provided to Eligible Employees who are not subject to such disclosure rules shall be set forth in a separate confidential schedule to the Plan that is administered by the HR Director-Executive Personnel Office.  Any special Equalization Benefit provided pursuant to this Section shall be paid in accordance with the terms and conditions of this Plan, including without limitation Subsections 3.01(b)(ii), (b)(iii) and (c).

Section 14. FERCO Equalization Benefits.

Effective as of December 31, 1999, former salaried employees of the Company, excluding any former salaried employees of the Company who transferred to Visteon Corporation as part of its spin-off from the Company in June 2000, who participated in the FERCO Salaried Retirement Plan ("SRP") and whose benefits under the FERCO SRP were limited as a result of the application of the Limitations shall be eligible to receive FERCO Equalization Benefits pursuant to the terms of Appendix B.

 

 

  

  

  

Appendix A

Special Equalization Benefits

Named Executive Officers

Section 1.  Special Periodic GRP Equalization Benefits.

Effective as of November 1, 2001, the Eligible Employees listed below shall receive a special Periodic GRP Equalization Benefit in an amount equal to the monthly benefit the Eligible Employee would have received under the GRP, without regard to the Limitations, had the Eligible Employee participated in the GRP on a contributory basis throughout all years of service with the Company during which such Eligible Employee did not receive a cash base salary.  The special Periodic GRP Equalization Benefit shall be determined based on a notional salary as determined by the Committee, in its sole discretion, for the period during which such Eligible Employee did not receive a cash base salary.  Upon the death of any such Eligible Employee, such Eligible Employee's Eligible Surviving Spouse will receive the special Periodic GRP Equalization Benefit provided by this Section commencing as soon as reasonably practicable following the date of the Eligible Employee's death and continuing until such Eligible Surviving Spouse's death.

William Clay Ford, Jr.

 

 

  

  

  

 

Appendix B

FERCO Equalization Benefits

Except as otherwise provided in this Appendix, all terms and provisions of the Ford Motor Company Benefit Equalization Plan shall apply to any FERCO Equalization Benefit provided pursuant to this Appendix.

Section 1.  Definitions.

The terms used in this Appendix shall have the same meaning as those in the Plan, except as follows:

1.01 "Eligible Employee" shall mean a former salaried employee of FERCO, excluding any former salaried employee of FERCO who transferred to Visteon Corporation as part of its spin-off from the Company in June 2000, whose benefits under the FERCO SRP were limited as a result of the application of the Limitations.

 

1.02 “FERCO” shall mean the Ford Electronics and Refrigeration Corporation.

 

1.03 “FERCO Equalization Benefit” shall mean any of the benefits described in this Appendix.

 

1.04 "PBGC" shall mean the Pension Benefit Guaranty Corporation.

 

Section 2.  FERCO Equalization Benefits.

A FERCO Equalization Benefit shall be provided as follows to any Eligible Employee whose FERCO SRP benefit was subject to the Limitations:

2.01  Amount of Benefit.  The amount of any FERCO Equalization Benefit payable pursuant to this Subsection shall be equal in amount to the difference between the FERCO SRP benefit the Eligible Employee would have received if the Eligible Employee commenced FERCO SRP benefits upon Separation From Service and the corresponding benefit that would have been payable under the FERCO SRP without regard to the Limitations.  For purposes of determining such amount, the Eligible Employee shall be treated as if he or she elected to receive his or her FERCO SRP benefit in the form of the qualified joint and survivor annuity benefit under the FERCO SRP if married, or the single life annuity form of benefit under the FERCO SRP if unmarried (including Eligible Employees who are widowed or divorced).  The amount of any Equalization Benefit payable to an Eligible Employee whose benefit under the ESAP is not offset or reduced by the amount of any FERCO SRP benefit payable to such Eligible Employee prior to age 65 shall be increased upon the Eligible Employee's attainment of age 65 to reflect an unreduced normal retirement benefit under the FERCO SRP.  In determining the amount of the Equalization Benefit, the Eligible Employee's salary shall be the Eligible Employee's salary as defined in the FERCO SRP.

2.02  Payment of FERCO Benefit.  FERCO Equalization Benefits shall be payable in accordance with Subsections 3.01(b)(ii) and (iii), 3.01(c), and 3.01(d).

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