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Exhibit 10.18
CPR SELECT
THE CORPORATE PLAN FOR RETIREMENT
SELECT PLAN
ADOPTION AGREEMENT
IMPORTANT NOTE
This document is NOT an IRS approved Prototype Plan. An Adopting Employer may
not rely solely on this Plan to ensure that the Plan is "unfunded and maintained
primarily for the purpose of providing deferred compensation to a select group
of management or highly compensated employees" and exempt from Parts 2 through 4
of Title I of the Employee Retirement Income Security Act of 1974 with respect
to the Employer's particular situation. Fidelity Management Trust Company, its
affiliates and employees may not provide you with legal advice in connection
with the execution of this document. This document should be reviewed by your
attorney and/or accountant prior to execution.
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ADOPTION AGREEMENT
ARTICLE I
1.01 PLAN INFORMATION
(a) NAME OF PLAN:
This is the Tweeter Home Entertainment Group Deferred Compensation
Plan (the "Plan").
(b) NAME OF PLAN ADMINISTRATOR, IF NOT THE EMPLOYER:
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Address:
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Phone Number:
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The Plan Administrator is the agent for service of legal process for
the Plan.
(c) THREE DIGIT PLAN NUMBER: 002
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(d) PLAN YEAR END (month/day): DECEMBER 31
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(e) PLAN STATUS (check one):
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(1) [ ] Effective Date of new Plan: MAY 1, 2000
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(2) [ ] Amendment Effective Date:
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The original effective date of the Plan: MAY 1, 2000
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The first Plan Year will be a short Plan Year from 5-1-00 to
12-31-00.
1.02 EMPLOYER
(a) THE EMPLOYER IS: TWEETER HOME ENTERTAINMENT GROUP, INC.
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Address: 10 PEQUOT WAY
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CANTON, MA 02021
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Contact's Name: ANN WHITE
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Telephone Number: 781-830-3473
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(1) Employer's Tax Identification Number: 04-3417513
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(2) Business form of Employer (check one):
(A) [ ] Corporation
(B) [ ] Sole proprietor or partnership.
(C) [ ] Subchapter S Corporation.
(3) Employer's fiscal year end: 9/30
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(b) THE TERM "EMPLOYER" INCLUDES THE FOLLOWING RELATED EMPLOYER(S)
(as defined in Section 2.01(a)(21)):
dba HiFi Buys
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dba Bryn Mawr Stereo & Video
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dba Home Entertainment, Inc.
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dba Dow Stereo / Video
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dba Tweeter, Etc.
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1.03 COVERAGE
(a) ONLY THOSE EMPLOYEES LISTED IN ATTACHMENT A WILL BE ELIGIBLE TO
PARTICIPATE IN THE PLAN.
(b) THE ENTRY DATE(S) SHALL BE (CHECK ONE):
(1) [ ] the first day of each Plan Year.
(2) [ ] the first day of each Plan Year and the date six months later.
(3) [ ] the first day of each Plan Year and the first day of the
fourth, seventh, and tenth months.
(4) [ ] the first day of each month.
(5) [ ] the first day of each Plan Year and July 1st for newly
eligible Participants.
1.04 COMPENSATION
For purposes of determining Contributions under the Plan, Compensation
shall be as defined in Section 2.01(a)(6), but excluding (check the
appropriate box(es)):
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(a) [ ] Overtime Pay.
(b) [ ] Bonuses.
(c) [ ] Commissions.
(d) [ ] The value of a qualified or a non-qualified stock option granted to an
Employee by the Employer to the extent such value is includable in the
Employee's taxable income.
(e) [ ] No exclusions.
1.05 CONTRIBUTIONS
(a) DEFERRAL CONTRIBUTIONS. THE EMPLOYER SHALL MAKE A DEFERRAL CONTRIBUTION IN
ACCORDANCE WITH SECTION 4.01 ON BEHALF OF EACH PARTICIPANT WHO HAS AN
EXECUTED SALARY REDUCTION AGREEMENT IN EFFECT WITH THE EMPLOYER FOR THE
PLAN YEAR (OR PORTION OF THE PLAN YEAR) IN QUESTION, NOT TO EXCEED 50% OF A
PARTICIPANT'S BASE SALARY AND 100% OF A PARTICIPANT'S BONUS AMOUNT FOR THAT
PLAN YEAR. THE MINIMUM AMOUNT THAT MAY BE DEFERRED IS FIVE THOUSAND DOLLARS
($5,000.)
(b) [ ] MATCHING CONTRIBUTIONS
(1) THE EMPLOYER SHALL MAKE A MATCHING CONTRIBUTION ON BEHALF OF EACH
PARTICIPANT IN AN AMOUNT EQUAL TO THE FOLLOWING PERCENTAGE OF A
PARTICIPANT'S DEFERRAL CONTRIBUTIONS DURING THE PLAN YEAR (CHECK ONE):
(A) [ ] 50%
(B) [ ] 100%
(C) [ ] _____%
(D) [ ] (Tiered Match) _______% of the first ______% of the Participant's
Compensation contributed to the Plan,
_________% of the next ________% of the Participant's Compensation
contributed to the Plan,
__________% of the next _______% of the Participant's Compensation
contributed to the Plan.
(E) [ ] The percentage declared for the year, if any, by a Board of
Directors' resolution.
(F) [ ] Other: __________________________________
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(2) [ ] MATCHING CONTRIBUTION LIMITS (CHECK THE APPROPRIATE BOX(ES)):
(A) [ ] Deferral Contributions in excess of 25% of the Participant's
Compensation for the period in question shall not be
considered for Matching Contributions.
Note: If the Employer elects a percentage limit in (A) above and
requests the Trustee to account separately for matched and
unmatched Deferral Contributions, the Matching Contributions
allocated to each Participant must be computed, and the
percentage limit applied, based upon each period.
(B) [ ] Matching Contributions for each Participant
for each Plan Year shall be limited to $ ___________.
(3) ELIGIBILITY REQUIREMENT(S) FOR MATCHING CONTRIBUTIONS
A Participant who makes Deferral Contributions during the Plan Year
under Section 1.05(a) shall be entitled to Matching Contributions for
that Plan Year if the Participant satisfies the following
requirement(s) (Check the appropriate box(es). Options (B) and (C) may
not be elected together):
(A) [ ] Is employed by the Employer on the last day of the Plan Year.
(B) [ ] Earns at least 500 Hours of Service during the Plan Year.
(C) [ ] Earns at least 1,000 Hours of Service during the Plan Year.
(D) [ ] No requirements.
Note: If option (A), (B) or (C) above is selected then Matching
Contributions can only be made by the Employer after the Plan
Year ends. Any Matching Contribution made before Plan Year end
shall not be subject to the eligibility requirements of this
Section 1.05(b)(3)),
The eligibility requirements for receiving a Matching Contribution set
forth in Section 1.05(3) of the Adoption Agreement are waived if a
Participant terminates employment due to death, disability or
attainment of Normal Retirement Age. Additionally, the eligibility
requirements are waived if there is a change in control of the employer.
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For purposes of this section, "disability" shall mean that a
Participant cannot engage in any substantial, gainful activity because
of a medically determinable physical or mental impairment likely to
result in death or to be of a continuous period of not less than 12
months. Determination as to disability shall be made by the Plan
Administrator.
"Change in control" shall mean and shall be deemed to occur if the
"Incumbent Directors" (as defined below) cease for any reason,
including without limitation as a result of a tender offer, proxy
contest, merger or similar transaction to constitute at least a
majority of the Tweeter Board, provided, however, that any person
becoming a Director of the Company subsequent to such date whose
election was approved by a vote of at least two-thirds of the
Incumbent Directors or whose nomination for election was approved by a
nominating committee comprised of Incumbent Directors shall be deemed
an Incumbent Director. The "Incumbent Directors" shall mean persons
who, as of the closing of the company's initial public offering of its
common stock constitute the Tweeter Board and those persons deemed
Incumbent Directors pursuant to the preceding sentence. A change in
control shall not be deemed to have occurred by reason of a corporate
reorganization or other transaction in which Tweeter Home
Entertainment Group merges into another entity if the stockholders of
Tweeter immediately prior to such occurrence or transaction continue
to own, immediately after such occurrence or transaction a majority in
voting and economic interests of the successor.
1.06 DISTRIBUTION DATES
A Participant may elect to receive a distribution or commence
distributions from his Account pursuant to Section 8.02 upon the
following date(s) (check the appropriate box(es). If Option (c) is
elected, then options (a) and (b) may not be elected):
(a) [ ] ATTAINMENT OF NORMAL RETIREMENT AGE - NORMAL RETIREMENT AGE
UNDER THE PLAN IS (CHECK ONE):
(1) [ ] age 65.
(2) [ ] age 55 (specify from 55 through 64).
(3) [ ] later of the age ___ (cannot exceed 65) or the
fifth anniversary of the Participant's Commencement
Date.
(b) [ ] ATTAINMENT OF EARLY RETIREMENT AGE. EARLY RETIREMENT AGE IS
THE FIRST DAY OF THE MONTH AFTER THE PARTICIPANT ATTAINS
AGE 55 (SPECIFY 55 OR GREATER) AND COMPLETES 6 YEARS OF
SERVICE FOR VESTING.
(c) [ ] Termination of employment with the Employer.
Notwithstanding the elections set forth in Section 1.06 of the
Adoption Agreement and a Participant's Enrollment Form, distribution
of a Participant's vested account balance will be distributed upon the
earlier of the date set forth in the Enrollment form or the
Participant's termination of employment with the Employer.
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1.07 VESTING SCHEDULE
(a) The Participant's vested percentage in Matching Contributions elected
in Section 1.05(b) shall be based upon the schedule(s) selected
below.
(1) [ ] N/A - No Matching Contributions
(2) [ ] 100% Vesting immediately
(3) [ ] 3 year cliff (see C below)
(4) [ ] 5 year cliff (see D below)
(5) [ ] 6 year graduated (see E below)
(6) [ ] 7 year graduated (see F below)
(7) [ ] G below
(8) [ ] Other (Attachment "B")
VESTING SCHEDULE
YEARS OF
SERVICE FOR
VESTING C D E F G
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0 0% 0% 0% 0% _______
1 0% 0% 0% 0% _______
2 0% 0% 20% 0% _______
3 100% 0% 40% 20% _______
4 100% 0% 60% 40% _______
5 100% 100% 80% 60% _______
6 100% 100% 100% 80% _______
7 100% 100% 100% 100% 100%
(b) [ ] YEARS OF SERVICE FOR VESTING SHALL EXCLUDE (check one):
(1) [ ] for new plans, service prior to the Effective Date as defined
in Section 1.01(e)(1).
(2) [ ] for existing plans converting from another plan document,
service prior to the original Effective Date as defined in
Section 1.01(e)(2).
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(c) [ ] A PARTICIPANT WILL FORFEIT HIS MATCHING CONTRIBUTIONS UPON THE
OCCURRENCE OF THE FOLLOWING EVENT(S):
(c) A Participant will forfeit his Matching Contributions upon the
occurrence of any of the following events:
(1) violation of company policy; or
(2) gross negligence or willful misconduct in connection with the
performance of the Participant's material duties; or
(3) a breach by the Participant of any of his material duties
assigned to him by the Tweeter Board (other than by reason of
physical or mental illness) and Participant's failure to cure
such breach within thirty (30) days of written notice thereof; or
(4) conduct by a Participant against the material best interests of
Tweeter Home Entertainment Group or its affiliates or a material
act of common law fraud by the Participant against Tweeter Home
Entertainment Group or its affiliates or employees; or
(5) conviction of or pleading nolo contendere to a felony.
(d) A Participant will be 100% vested in his Matching Contributions upon (check
the appropriate box(es), if any):
(1) [ ] Normal Retirement Age (as defined in Section 1.06(a)).
(2) [ ] Early Retirement Age (as defined in Section 1.06(b)).
(3) [ ] Death
(4) [ ] Total disability as defined in Section 1.05(3) of this Adoption
Agreement.
(5) [ ] Change in Control as defined in Section 1.05(3) of this Adoption
Agreement.
1.08 PREDECESSOR EMPLOYER SERVICE
[ ] Service for purposes of vesting in Section 1.07(a) shall include service
with the following employer(s):
(a) _________________________________________________
(b)_________________________________________________
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(c)_________________________________________________
(d)_________________________________________________
No Predecessor Employer Service with any acquired company will be recognized for
purposes of vesting in Section 1.07(a). Service for Participants who were
employed by companies acquired by or merged with the Employer will be counted as
of the date of the closing of the acquisition or merger, provided they are
employed by the Employer on that date.
1.09 HARDSHIP WITHDRAWALS
PARTICIPANT WITHDRAWALS FOR HARDSHIP PRIOR TO TERMINATION OF EMPLOYMENT
(CHECK ONE):
(a) [ ] WILL BE ALLOWED IN ACCORDANCE WITH SECTION 7 07, SUBJECT TO A
$10,000 MINIMUM AMOUNT (MUST BE AT LEAST $1,000)
(b) [ ] WILL NOT BE ALLOWED
1.10 DISTRIBUTIONS
SUBJECT TO ARTICLES 7 AND 8, DISTRIBUTIONS UNDER THE PLAN WILL BE PAID
(CHECK THE APPROPRIATE BOX(ES)):
(a) [ ] AS A LUMP SUM.
(b) [ ] UNDER A SYSTEMATIC WITHDRAWAL PLAN (INSTALLMENTS) NOT TO EXCEED
10 YEARS.
1.11 INVESTMENT DECISIONS
(a) INVESTMENT DIRECTIONS
Investments in which the Accounts of Participants shall be treated as
invested and reinvested shall be directed (check one):
(1) [ ] by the EMPLOYER among the options listed in (b) below.
(2) [ ] by each PARTICIPANT among the options listed in (b) below.
(3) [ ] by each Participant with respect to Deferral Contributions
and by the Employer with respect to Employer Matching
Contributions. The Employer must direct the Employer
Matching Contributions among the same investment options
made available for Participant directed sources listed
in (b) below.
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(b) PLAN INVESTMENT OPTIONS
Participant Accounts will be treated as invested among the Fidelity Funds
listed below pursuant to Participant and/or Employer directions.
FUND NAME FUND NUMBER
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(1) Fidelity Retirement MM Portfolio 630
(2) Fidelity Capital & Income Fund 038
(3) Fidelity Growth & Income Portfolio 027
(4) Fidelity Aggressive Growth Fund 324
(5) Fidelity Diversified International Fund 325
(6) Spartan US Equity Index Fund 650
(7)
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(8)
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(9)
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(10)
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NOTE: An additional annual recordkeeping fee will be charged for each fund in
excess of ten (10) funds.
NOTE: The method and frequency for change of investments will be determined
under the rules applicable to the selected funds. Information will be
provided regarding expenses, if any, for changes in investment options.
1.12 RELIANCE ON PLAN
An adopting Employer may not rely solely on this Plan to ensure that the
Plan is "unfunded and maintained primarily for the purpose of providing
deferred compensation for a select group of management or highly
compensated employees" and exempt from Parts 2 through 4 of Title I of the
Employee Retirement Income Security Act of 1974 with respect to the
Employer's particular situation. This Agreement must be reviewed by your
attorney and/or accountant before it is executed.
This Adoption Agreement may be used only in conjunction with the
CORPORATEplan for Retirement Select Basic Plan Document.
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EXECUTION PAGE
(FIDELITY'S COPY)
IN WITNESS WHEREOF, the Employer has caused this Adoption Agreement to be
executed this __________day of _____________, 2000.
Employer ___________________________________
By _________________________________________
Title ______________________________________
Employer ___________________________________
By _________________________________________
Title ______________________________________
EXECUTION PAGE
(FIDELITY'S COPY)
IN WITNESS WHEREOF, the Employer has caused this Adoption Agreement to be
executed this __________day of ___________, 2000.
Employer ___________________________________
By _________________________________________
Title ______________________________________
Employer ___________________________________
By _________________________________________
Title ______________________________________
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ATTACHMENT A
PURSUANT TO SECTION 1.03(a) THE FOLLOWING ARE EMPLOYEES ELIGIBLE TO PARTICIPATE
IN THE PLAN:
NAME
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Jeffrey S. Stone
Sandy Bloomberg
Joseph McGuire
Albert S. Gordon
David Ginsberg
Bernie Sapienza
Paul Shindler
Noah Herschman
Roy Bertalotto
Linda Christman
David Malin
Alan Basmajian
Joseph Lopiccolo
Employer _____________________
By ___________________________
Title ________________________
Date _________________________
Note: The Employer must revise Attachment A to add employees as they become
eligible or delete employees who are no longer eligible.
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