EXHIBIT 4.1
COUNTRYWIDE CREDIT INDUSTRIES, INC.
DEFERRED COMPENSATION PLAN
Originally Effective August 1, 1993
Amended and Restated Effective March 1, 2000
Purpose
The purpose of this Plan is to provide specified benefits to a select
group of management and highly compensated Employees who contribute materially
to the continued growth, development and future business success of Countrywide
Credit Industries, a Delaware corporation, and its subsidiaries, if any, that
sponsor this Plan. This Plan shall be unfunded for tax purposes and for purposes
of Title I of ERISA.
ARTICLE 1
Definitions
For purposes of this Plan, unless otherwise clearly apparent from the
context, the following phrases or terms shall have the following indicated
meanings:
1.1 "Account Balance" shall mean, with respect to a Participant, a credit
on the records of the Employer equal to the sum of (i) the Deferral
Account balance, (ii) the vested Company Contribution Account balance
and (iii) the Stock Option Account balance. The Account Balance, and
each other specified account balance, shall be a bookkeeping entry only
and shall be utilized solely as a device for the measurement and
determination of the amounts to be paid to a Participant, or his or her
designated Beneficiary, pursuant to this Plan.
1.2 "Annual Bonus" shall mean any compensation, in addition to Base Annual
Salary, paid during any Plan Year, whether or not relating to services
performed in such Plan Year, payable to a Participant as an Employee
under any Employer's annual bonus and cash incentive plans, excluding
stock options.
1.3 "Annual Company Contribution Amount" shall mean, for any one Plan Year,
the amount determined in accordance with Section 3.5.
1.4 "Annual Deferral Amount" shall mean that portion of a Participant's
Base Annual Salary and Annual Bonus that a Participant elects to have,
and is deferred, in accordance with Article 3, for any one Plan Year.
In the event of a Participant's Retirement, Disability (if deferrals
cease in accordance with Section 8.1), death or a Termination of
Employment prior to the end of a Plan Year, such year's Annual Deferral
Amount shall be the actual amount withheld prior to such event.
1.5 "Annual Stock Option Amount" shall mean, with respect to a Participant
for any one Plan Year, the amount of Qualifying Gains deferred on
Eligible Stock Option exercise in accordance with Section 3.6 of this
Plan, calculated using the closing price of Stock as of the end of the
business day closest to the date of such Eligible Stock Option exercise
1.6 "Base Annual Salary" shall mean the annual cash compensation relating
to services performed during any Plan Year, whether or not paid in such
Plan Year or included on the Federal Income Tax Form W-2 for such Plan
Year, excluding bonuses, commissions, overtime, fringe benefits, stock
options, relocation expenses, incentive payments, non-monetary awards,
directors fees and other fees, automobile and other allowances paid to
a Participant for employment services rendered (whether or not such
allowances are included in the Employee's gross income). Base Annual
Salary shall be calculated before reduction for compensation
voluntarily deferred or contributed by the Participant pursuant to all
qualified or non-qualified plans of any Employer and shall be
calculated to include amounts not otherwise included in the
Participant's gross income under Code Sections 125, 402(e)(3), 402(h),
or 403(b) pursuant to plans established by any Employer; provided,
however, that all such amounts will be included in compensation only to
the extent that, had there been no such plan, the amount would have
been payable in cash to the Employee.
1.7 "Beneficiary" shall mean one or more persons, trusts, estates or other
entities, designated in accordance with Article 9, that are entitled to
receive benefits under this Plan upon the death of a Participant.
1.8 "Beneficiary Designation Form" shall mean the form established from
time to time by the Committee that a Participant completes, signs and
returns to the Committee to designate one or more Beneficiaries.
1.9 "Board" shall mean the board of directors of the Company.
1.10 "Bonus Rate" shall mean, with respect to amounts deemed invested in the
Moody's Bond Index Measurement Fund for a Plan Year, an interest rate,
if any, determined by the Committee, in its sole discretion, which rate
shall be determined and announced before the commencement of the Plan
Year for which the rate applies. This rate may be zero for any Plan
Year.
1.11 "Change in Control" shall mean the first to occur of any of the
following events:
(a) An acquisition (other than directly from Employer) of any common stock
or other "Voting Securities" (as hereinafter defined) of Employer by any
"Person" (as the term person is used for purposes of Section 13(d) or 14(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act")),
immediately after which such Person has "Beneficial Ownership" (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty five
percent (25%) or more of the then outstanding shares of Employer's common
stock or the combined voting power of Employer's then outstanding Voting
Securities; provided, however, in determining whether a Change in Control
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has occurred, Voting Securities which are acquired in a "Non-Control
Acquisition" (as hereinafter defined) shall not constitute an acquisition
which would cause a Change in Control. For purposes of this Agreement, (1)
"Voting Securities" shall mean Employer's outstanding voting securities
entitled to vote generally in the election of directors and (2) a
"Non-Control Acquisition" shall mean an acquisition by (i) an employee
benefit plan (or a trust forming a part thereof) maintained by (A) Employer
or (B) any corporation or other Person of which a majority of its voting
power or its voting equity securities or equity interest is owned, directly
or indirectly, by Employer (for purposes of this definition, a
"Subsidiary"), (ii) Employer or any of its Subsidiaries, or (iii) any
Person in connection with a "Non-Control Transaction" (as hereinafter
defined);
(b) The individuals who, as of September 13, 1996, are members of the Board
(the "Incumbent Board"), cease for any reason to constitute at least
two-thirds of the members of the Board; provided,
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however, that if the election, or nomination for election by Employer's
common stockholders, of any new director was approved by a vote of at least
two-thirds of the Incumbent Board, such new director shall, for purposes of
this Agreement, be considered as a member of the Incumbent Board; provided
further, however, that no individual shall be considered a member of the
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Incumbent Board if such individual initially assumed office as a result of
either an actual or threatened "Election Contest" (as described in Rule
14a-11 promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than
the Board (a "Proxy Contest') including by reason of any agreement intended
to avoid or settle any Election Contest or Proxy Contest; or
(c) The consummation of:
(i) A merger, consolidation or reorganization involving
Employer, unless such merger, consolidation or
reorganization is a "Non-Control Transaction." A
"Non-Control Transaction" shall mean a merger,
consolidation or reorganization of Employer where:
(A) the stockholders of Employer, immediately
before such merger, consolidation or
reorganization, own directly or indirectly
immediately following such merger,
consolidation or reorganization, at least
seventy percent (70%) of the combined voting
power of the outstanding Voting Securities
of the corporation resulting from such
merger, consolidation or reorganization (the
"Surviving Corporation") in substantially
the same proportion as their ownership of
the Voting Securities immediately before
such merger, consolidation or
reorganization;
(B) the individuals who were members of the
Incumbent Board immediately prior to the
execution of the agreement providing for
such merger, consolidation or reorganization
constitute at least two-thirds of the
members of the Board of Directors of the
Surviving Corporation, in the event that,
immediately following the consummation of
such transaction, a corporation beneficially
owns, directly or indirectly, a majority of
the Voting Securities of the Surviving
Corporation, the Board of Directors of such
corporation; and
(C) no Person other than (i) Employer, (ii) any Subsidiary, (iii) any
employee benefit plan (or any trust forming a part thereof) maintained by
Employer, the Surviving Corporation,
or any Subsidiary, or (iv) any Person who, immediately prior to such
merger, consolidation or reorganization had Beneficial Ownership of twenty
five percent (25%) or more of the then outstanding Voting Securities or
common
stock of Employer, has Beneficial Ownership of twenty five (25%) or more of
the combined voting power of the Surviving Corporation's then outstanding
Voting Securities or its common stock;
(ii) A complete liquidation or dissolution of Employer; or
(iii) The sale or other disposition of all or substantially
all of the assets of Employer to any Person (other
than a transfer to a Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not
be deemed to occur solely because any Person (the "Subject
Person") acquired Beneficial Ownership of more than the
permitted amount of the then outstanding common stock or
Voting Securities as a result of the acquisition of common
stock or Voting Securities by Employer which, by reducing the
number of shares of common stock or Voting Securities then
outstanding, increases the proportional number of shares
Beneficially Owned by the Subject Persons; provided, however,
that if a Change in Control would occur (but for the operation
of this sentence) as a result of the acquisition of common
stock or Voting Securities by Employer, and after such share
acquisition by Employer, the Subject Person becomes the
Beneficial Owner of any additional common stock or Voting
Securities which increases the percentage of the ten
outstanding common stock or Voting Securities Beneficially
Owned by the Subject Person, then a Change in Control shall
occur."
1.12 "Claimant" shall have the meaning set forth in Section 14.1.
1.13 "Code" shall mean the Internal Revenue Code of 1986, as it may be
amended from time to time.
1.14 "Committee" shall mean the committee described in Article 12.
1.15 "Company" shall mean Countrywide Credit Industries, Inc., a Delaware
corporation, and any successor to all or substantially all of the Company's
assets or business.
1.16 "Company Contribution Account" shall mean (i) the sum of the
Participant's Annual Company Contribution Amounts, plus (ii) amounts
credited in accordance with all the applicable crediting provisions of
this Plan that relate to the Participant's Company Contribution
Account, less (iii) all distributions made to the Participant or his or
her Beneficiary pursuant to this Plan that relate to the Participant's
Company Contribution Account.
1.17 "Company Stock Index Measurement Fund" shall have the meaning set
forth in Section 3.10(c).
1.18 "Crediting Rate" shall mean, with respect to amounts deemed invested in
the Moody's Bond Index Measurement Fund for a Plan Year, an interest
rate, stated as an annual rate, determined and announced by the
Committee before the Plan Year for which it is to be used, that is
equal to the applicable "Moody's Rate." The Moody's Rate for a Plan
Year shall be an interest rate, stated as an annual rate, that (i) is
published in Moody's Bond Record under the heading of "Moody's
Corporate Bond Yield Averages--Av. Corp." and (ii) is equal to the
average corporate bond yield calculated for the month of December that
immediately precedes the Plan Year for which the rate is to be used;
provided, however, that, effective March 1, 2000, the Moody's Rate for
a Plan Year shall be an interest rate, stated as an annual rate, that
(i) is published in Moody's Bond Record under the heading of "Moody's
Corporate Bond Yield Averages--Av. Corp." and (ii) is equal to the
average corporate bond yield calculated for the month of October that
immediately precedes the Plan Year for which the rate is to be used.
1.19 "Deduction Limitation" shall mean the following described limitation on
a benefit that may otherwise be distributable pursuant to the
provisions of this Plan. Except as otherwise provided, this limitation
shall be applied to all distributions that are "subject to the
Deduction Limitation" under this Plan. If an Employer determines in
good faith prior to a Change in Control that there is a reasonable
likelihood that any compensation paid to a Participant for a taxable
year of the Employer would not be deductible by the Employer solely by
reason of the limitation under Code Section 162(m), then to the extent
deemed necessary by the Employer to ensure that the entire amount of
any distribution to the Participant pursuant to this Plan prior to the
Change in Control is deductible, the Employer may defer all or any
portion of a distribution under this Plan. Any amounts deferred
pursuant to this limitation shall continue to be credited/debited with
additional amounts in accordance with Section 3.11 below, even if such
amount is being paid out in installments. The amounts so deferred and
amounts credited thereon shall be distributed to the Participant or his
or her Beneficiary (in the event of the Participant's death) at the
earliest possible date, as determined by the Employer in good faith, on
which the deductibility of compensation paid or payable to the
Participant for the taxable year of the Employer during which the
distribution is made will not be limited by Section 162(m), or if
earlier, the effective date of a Change in Control. Notwithstanding
anything to the contrary in this Plan, the Deduction Limitation shall
not apply to any distributions made after a Change in Control.
1.20 "Deferral Account" shall mean (i) the sum of all of a Participant's
Annual Deferral Amounts, plus (ii) amounts credited in accordance with
all the applicable crediting provisions of this Plan that relate to the
Participant's Deferral Account, less (iii) all distributions made to
the Participant or his or her Beneficiary pursuant to this Plan that
relate to his or her Deferral Account.
1.21 "Disability" shall mean a period of disability during which a
Participant qualifies for permanent disability benefits under the
Participant's Employer's long-term disability plan, or, if a
Participant does not participate in such a plan, a period of disability
during which the Participant would have qualified for permanent
disability benefits under such a plan had the Participant been a
participant in such a plan, as determined in the sole discretion of the
Committee. If the Participant's Employer does not sponsor such a plan,
or discontinues to sponsor such a plan, Disability shall be determined
by the Committee in its sole discretion.
1.22 "Disability Benefit" shall mean the benefit set forth in Article 8.
1.23 "Election Form" shall mean the form established from time to time by
the Committee that a Participant completes, signs and returns to the
Committee to make an election under the Plan.
1.24 "Eligible Employee" shall mean an employee whose base salary is at
least $100,000 or such greater amount as may be determined by the Committee
from time to time.
1.25 "Eligible Stock Option" shall mean, prior to July 27, 1997, one or more
non-qualified stock option(s) selected by the Committee in its sole
discretion.
1.26 "Employee" shall mean a person who is an employee of any Employer and
who is compensated through the payroll system.
1.27 "Employer(s)" shall mean the Company and/or any of its subsidiaries
(now in existence or hereafter formed or acquired) that have adopted
the Plan by having one or more Employees participating in the Plan.
1.28 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as it may be amended from time to time.
1.29 "First Plan Year" shall mean the period beginning August 1, 1993 and
ending February 28, 1994.
1.30 "Installment Method" shall mean, for installment payments of benefits
in pay status on or before February 28, 2000, the Monthly Installment
Method; and shall mean, for installment payments of benefits commencing
pay status on or after March 1, 2000, the Variable Retirement
Installment Method.
1.31 "Measurement Fund" shall have the meaning set forth in Section 3.10(c).
1.32 "Monthly Installment Method" shall be a monthly installment payment(s)
over the number of months selected by the Participant in accordance
with this Plan, calculated as follows:
(a) The portion of the Account Balance deemed invested in the
Moody's Bond Index Measurement Fund (the "Moody's Fund Account
Balance") shall have interest credited and compounded
commencing on the first day of the month after a Participant
terminates employment using a fixed interest rate that is
determined by averaging the Preferred Rates for the current
Plan year and the four (4) preceding Plan Years. If a
participant has completed fewer than five (5) Plan Years, this
average shall be determined using the Crediting Rate for the
Plan Years during which the Participant participated in the
Plan.
(b) The portion of the Account Balance deemed invested in the Company Stock
Index Measurement Fund ("Stock Fund Account Balance") shall be calculated
as of the close of business three business days prior to the last business
day of the month. The monthly installment shall be calculated by
multiplying this balance by a fraction, the numerator of which is one, and
the denominator of which is the remaining number of monthly payments due
the Participant. By way of example, if the Participant elects a 120 month
Monthly Installment Method, the first payment shall be 1/120 of the Stock
Fund Account Balance, calculated as described in this definition. The
following month, the payment shall be 1/119 of the Stock Fund Account
Balance, calculated as described in this definition. Each monthly
installment shall be paid on or as soon as practicable after the last
business day of the applicable month; and
1.33 "Moody's Bond Index Measurement Fund" shall have the meaning set forth
in Section 3.10(c).
1.34 "Participant" shall mean any Eligible Employee: (i) who is selected to
participate in the Plan, (ii) who elects to participate in the Plan,
(iii) who signs an Election Form and a Beneficiary Designation Form,
(iv) whose signed Election Form and Beneficiary Designation Form are
accepted by the Committee, (v) who commences participation in the Plan,
and (vi) whose Plan participation has not terminated. A spouse or
former spouse of a Participant shall not be treated as a Participant in
the Plan or have an account balance under the Plan, even if he or she
has an interest in the Participant's benefits under the Plan as a
result of applicable law or property settlements resulting from legal
separation or divorce.
1.35 "Plan" shall mean the Company's Amended and Restated Deferred
Compensation Plan, which shall be evidenced by this instrument, as it
may be amended from time to time.
1.36 "Plan Year" shall, except for the First Plan Year, mean a period
beginning March 1 of each calendar year and continuing through February
28 of such calendar year. Effective March 1, 2000, "Plan Year" shall
mean a period beginning March 1, 2000 and continuing through December
31, 2000. Effective January 1, 2001, "Plan Year" shall mean a period
beginning January 1 of each calendar year and continuing through
December 31 of such calendar year.
1.37 "Preferred Rate" shall mean, for amounts deemed invested in the Moody's
Bond Index Measurement Fund for a Plan Year, an interest rate that is
the sum of the Crediting Rate and the Bonus Rate for that Plan Year.
1.38 "Pre-Retirement Survivor Benefit" shall mean the benefit set forth in
Article 6.
1.39 "Qualifying Gain" shall mean the value accrued upon exercise of an
Eligible Stock Option (i) using a Stock-for-Stock payment method and
(ii) having an aggregate fair market value in excess of the total Stock
purchase price necessary to exercise the option. In other words, the
Qualifying Gain upon exercise of an Eligible Stock Option equals the
total market value of the shares (or share equivalent units) acquired
minus the total stock purchase price. For example, assume a Participant
elects to defer the Qualifying Gain accrued upon exercise of an
Eligible Stock Option to purchase 1000 shares of Stock at an exercise
price of $20 per share, when Stock has a current fair market value of
$25 per share. Using the Stock-for-Stock payment method, the
Participant would deliver 800 shares of Stock (worth $20,000) to
exercise the Eligible Stock Option and receive, in return, 800 shares
of Stock plus a Qualifying Gain (in this case, in the form of an
unfunded and unsecured promise to pay money or property in the future)
equal to $5,000 (i.e., the current value of the remaining 200 shares of
Stock).
1.40 "Retirement", "Retire(s)" or "Retired" shall mean, with respect to an
Employee, severance from employment from all Employers for any reason
other than a leave of absence, death or Disability on or after the
earlier of the attainment of (a) age sixty-five (65) or (b) age
fifty-five (55) with eleven (11) Years of Service.
1.41 "Retirement Benefit" shall mean the benefit set forth in Article 5.
1.42 "Short-Term Payout" shall mean the payout set forth in Section 4.1.
1.43 "Stock" shall mean Countrywide Credit Industries, Inc. common stock,
$0.05 par value, or any other equity securities of the Company designated
by the Committee.
1.44 "Stock Option Account" shall mean the sum of (i) the Participant's
Annual Stock Option Amounts, plus (ii) amounts credited/debited in
accordance with all the applicable crediting/debiting provisions of
this Plan that relate to the Participant's Stock Option Account, less
(iii) all distributions made to the Participant or his or her
Beneficiary pursuant to this Plan that relate to the Participant's
Stock Option Account.
1.45 "Stock Option Amount" shall mean, for any Eligible Stock Option, the
amount of Qualifying Gains deferred in accordance with Section 3.7 of
this Plan, calculated using the average of the high and low price of
Stock as of the business day closest to the date of exercise of such
Eligible Stock Option.
1.46 "Termination Benefit" shall mean the benefit set forth in Article 7.
1.47 "Termination of Employment" shall mean the severing of employment with
all Employers, voluntarily or involuntarily, for any reason other than
Retirement, Disability, death or an authorized leave of absence.
1.48 "Trust" shall mean one or more trusts established pursuant to that
certain Master Trust Agreement, dated as of August 1, 1993 between the
Company and the trustee named therein, as amended from time to time.
1.49 "Unforeseeable Financial Emergency" shall mean an unanticipated
emergency that is caused by an event beyond the control of the
Participant that would result in severe financial hardship to the
Participant resulting from (i) a sudden and unexpected illness or
accident of the Participant or a dependent of the Participant, (ii) a
loss of the Participant's property due to casualty, or (iii) such other
extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant, all as determined in the
sole discretion of the Committee.
1.50 "Variable Retirement Installment Method" shall be an installment
payment over the number of years selected by the Participant in
accordance with this Plan, calculated as follows: The Account Balance
of the Participant shall be calculated as of the close of business on
the last business day of the year. The annual installment shall be
calculated by multiplying this balance by a fraction, the numerator of
which is one, and the denominator of which is the remaining number of
annual payments due the Participant. By way of example, if the
Participant elects a 10 year Annual Installment Method, the first
payment shall be 1/10 of the Account Balance, calculated as described
in this definition. The following year, the payment shall be 1/9 of the
Account Balance, calculated as described in this definition. One
twelfth of each annual installment shall be paid on or as soon as
practicable after the last business day of each month of the applicable
year.
1.51 "Years of Plan Participation" shall mean the total number of full Plan
Years a Participant has been a Participant in the Plan prior to his or
her Termination of Employment (determined without regard to whether
deferral elections have been made by the Participant for any Plan
Year). Any partial year shall not be counted. Notwithstanding the
previous sentence, a Participant's first Plan Year of participation
shall be treated as a full Plan Year for purposes of this definition,
even if it is only a partial Plan Year of participation.
Notwithstanding any provision of this Plan that may be construed to the
contrary, solely for purposes of Section 7.1 below, effective March 1,
2000, each Participant shall be deemed to have no less than five (5)
Years of Plan Participation.
1.52 "Years of Service" shall mean the total number of full years in which a
Participant has been employed by one or more Employers. For purposes of
this definition, a year of employment shall be a 365 day period (or 366
day period in the case of a leap year) that, for the first year of
employment, commences on the Employee's date of hiring and that, for
any subsequent year, commences on an anniversary of that hiring date.
Any partial year of employment shall not be counted.
ARTICLE 2
Selection, Enrollment, Eligibility
2.1 Selection by Committee. Participation in the Plan shall be limited to a
select group of management and highly compensated Employees of the
Employers, as determined by the Committee in its sole discretion. From
that group, the Committee shall select, in its sole discretion,
Employees to participate in the Plan.
2.2 Enrollment Requirements. As a condition to participation, each selected
Employee shall complete, execute and return to the Committee an
Election Form and a Beneficiary Designation Form, all within 30 days
after he or she is selected to participate in the Plan. In addition,
the Committee shall establish from time to time such other enrollment
requirements as it determines in its sole discretion are necessary.
2.3 Eligibility; Commencement of Participation. Provided an Employee
selected to participate in the Plan has met all enrollment requirements
set forth in this Plan and required by the Committee, including
returning all required documents to the Committee within the specified
time period, that Employee shall commence participation in the Plan on
the first day of the month following the month in which the Employee
completes all enrollment requirements. If an Employee fails to meet all
such requirements within the period required, in accordance with
Section 2.2, that Employee shall not be eligible to participate in the
Plan until the first day of the Plan Year following the delivery to and
acceptance by the Committee of the required documents.
2.4 Termination of Participation and/or Deferrals. If the Committee
determines in good faith that a Participant no longer qualifies as a
member of a select group of management or highly compensated employees,
as membership in such group is determined in accordance with Sections
201(2), 301(a)(3) and 401(a)(1) of ERISA, the Committee shall have the
right, in its sole discretion, to (i) terminate any deferral election
the Participant has made for the remainder of the Plan Year in which
the Participant's membership status changes, (ii) prevent the
Participant from making future deferral elections and/or (iii)
immediately distribute the Participant's then Account Balance as a
Termination Benefit and terminate the Participant's participation in
the Plan.
ARTICLE 3
Deferral Commitments/Crediting/Taxes
3.1 Minimum Deferrals.
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1. Base Annual Salary and Annual Bonus. Subject to Section 3.3
below, for each Plan Year, a Participant may elect to defer
Base Annual Salary (to the extent it exceeds the amount stated
in section 401(a)(17) of the Code) and Annual Bonus, provided
that the amounts so elected for that Plan Year total, in the
aggregate, at least $2,000. If no election is made, the amount
deferred shall be zero.
(b) Short Plan Year. If a Participant first becomes a Participant
after the first day of a Plan Year, or in the case of the
first Plan Year of the Plan itself, the minimum Base Annual
Salary deferral shall be an amount equal to $2,000, multiplied
by a fraction, the numerator of which is the number of
complete months remaining in the Plan Year and the denominator
of which is 12.
(c) Stock Option Amount. For each Eligible Stock Option, a
Participant may elect to defer, as his or her Stock Option
Amount, the following minimum percentage of Qualifying Gain
with respect to exercise of the Eligible Stock Option:
Deferral Minimum
Qualifying Gain 10%
provided, however, that such Stock Option Amount shall be no
less than the lesser of $20,000 or 100% of such Qualifying
Gain.
3.2 Maximum Deferral
(a) Base Annual Salary and Annual Bonus. For each Plan Year, a
Participant may elect to defer, as his or her Annual Deferral
Amount, Base Annual Salary and Annual Bonus up to the
following maximum percentages for each deferral elected:
Maximum
Deferral Amount -------- ------ Base Annual Salary 50% Annual Bonus 100%
(b) Notwithstanding the foregoing, if a Participant first becomes a
Participant after the first day of a Plan Year, or in the case of the first
Plan Year of the Plan itself, the maximum Annual Deferral Amount, with
respect to Base Annual Salary and Annual Bonus shall be limited to the
amount of compensation not yet earned by the Participant as of the date the
Participant submits an Election Form to the Committee for acceptance.
(c) For each Eligible Stock Option, a Participant may elect to
defer, as his or her Stock Option Amount, Qualifying Gain up
to the following maximum percentage with respect to exercise
of the Eligible Stock Option:
Maximum
Deferral Percentage
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Qualifying Gain 100%
(d) Stock Option Amounts may also be limited by other terms or
conditions set forth in the stock option plan or agreement
under which such options are granted.
3.3 Election to Defer; Effect of Election Form.
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(a) First Plan Year. In connection with a Participant's
commencement of participation in the Plan, the Participant
shall make an irrevocable deferral election for the Plan Year
in which the Participant commences participation in the Plan,
along with such other elections as the Committee deems
necessary or desirable under the Plan. For these elections to
be valid, the Election Form must be completed and signed by
the Participant, timely delivered to the Committee (in
accordance with Section 2.2 above) and accepted by the
Committee.
(b) Subsequent Plan Years. For each succeeding Plan Year, an
irrevocable deferral election for that Plan Year, and such
other elections as the Committee deems necessary or desirable
under the Plan, shall be made by timely delivering to the
Committee, in accordance with its rules and procedures, before
(i) the end of the Plan Year preceding the Plan Year for which
the election is made for deferral of Base Annual Salary, and
(ii) the end of the calendar year preceding the Plan Year in
which an Annual Bonus is payable, a new Election Form. If no
such Election Form is timely delivered for a Plan Year, the
Annual Deferral Amount shall be zero for that Plan Year.
(c) Stock Option Deferral. For an election to defer gain upon an
Eligible Stock Option exercise to be valid:
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(i) a separate Election Form must be completed and signed by the
Participant with respect to the Eligible Stock Option; (ii) the
Election Form must be timely delivered to the Committee and accepted
by the Committee at least six (6) months prior to the date the
Participant elects to exercise the Eligible Stock Option; provided,
however, that, effective January 1, 1998, the Election Form must be
timely delivered to the Committee and accepted by the Committee at
least twelve (12) months prior to the date the Participant elects to
exercise the Eligible Stock Option, or prior to the date the
Participant becomes vested with respect to the Eligible Stock Option,
whichever is later; (iii) the Eligible Stock Option must be exercised
using an actual or phantom Stock-for-Stock payment method; and (iv)
the Stock actually or constructively delivered by the Participant to
exercise the Eligible Stock Option must have been owned by the
Participant during the entire six (6) month period prior to its
delivery.
3.4 Withholding of Annual Deferral Amounts. For each Plan Year, the Base
Annual Salary portion of the Annual Deferral Amount shall be withheld
from each regularly scheduled Base Annual Salary payroll in equal
amounts, as adjusted from time to time for increases and decreases in
Base Annual Salary. The Annual Bonus portion of the Annual Deferral
Amount shall be withheld at the time the Annual Bonus is or otherwise
would be paid to the Participant.
3.5 Annual Company Contribution Amount. For each Plan Year, an Employer, in
its sole discretion, may, but is not required to, credit any amount it
desires to any Participant's Company Contribution Account under this
Plan, which amount shall be for that Participant the Annual Company
Contribution Amount for that Plan Year. The amount so credited to a
Participant may be smaller or larger than the amount credited to any
other Participant, and the amount credited to any Participant for a
Plan Year may be zero, even though one or more other Participants
receive an Annual Company Contribution Amount for that Plan Year. The
Annual Company Contribution Amount, if any, shall be credited as of the
first day of the Plan Year. Commencing with contributions made on or
after March 1, 1999, a Participant shall vest in the Annual Company
Contribution Amount at the same time he or she vests in the Countrywide
Credit Industries, Inc. Supplemental Executive Retirement Plan Benefit.
3.6 Stock Option Amount. Subject to any terms and conditions imposed by the
Committee, Participants may elect to defer, under the Plan, Qualifying
Gains attributable to an Eligible Stock Option exercise. Stock Option
Amounts shall be credited/debited to the Participant on the books of
the Employer at the time Stock would otherwise have been delivered to
the Participant pursuant to the Eligible Stock Option exercise, but for
the election to defer.
3.7 Investment of Trust Assets. The Trustee of the Trust shall be
authorized, upon written instructions received from the Committee or
investment manager appointed by the Committee, to invest and reinvest
the assets of the Trust in accordance with the applicable Trust
Agreement, including the disposition of Stock and reinvestment of the
proceeds in one or more investment vehicles designated by the
Committee.
3.8 Sources of Stock. If Stock is credited under the Plan in the Trust
pursuant to Section 3.6 in connection with an Eligible Stock Option
exercise, the shares so credited shall be deemed to have originated,
and shall be counted against the number of shares reserved, under such
other plan, program or arrangement.
3.9 Vesting. Except as provided in Section 7.1, a Participant shall at all
times be 100% vested in his or her Deferral Account and Stock Option
Account. A Participant shall vest in his or her Company Contribution
Amount in accordance with Section 3.5 above.
3.10 Crediting/Debiting of Account Balances. In accordance with, and subject
to, the rules and procedures that are established from time to time by
the Committee, in its sole discretion, amounts shall be credited or
debited to a Participant's Account Balance in accordance with the
following rules:
(a) Election of Measurement Funds. Except as otherwise provided in
Section 3.10(f) below, a Participant, in
-------------------------------------- connection with his or her
initial deferral election in accordance with Section 3.3(a) above,
shall elect, on the Election Form, one or more Measurement Fund(s) (as
described in Section 3.10(c) below) to be used to determine the
additional amounts to be credited to his or her Account Balance for
the first business day in which the Participant commences
participation in the Plan and continuing thereafter for each
subsequent day in which the Participant participates in the Plan,
unless changed in accordance with the next sentence. Except as
otherwise provided in Section 3.10(f) below, commencing with the first
business day that follows the Participant's commencement of
participation in the Plan and continuing thereafter for each
subsequent day in which the Participant participates in the Plan, the
Participant may (but is not required to) elect, by submitting an
Election Form to the Committee that is accepted by the Committee, to
add or delete one or more Measurement Fund(s) to be used to determine
the additional amounts to be credited to his or her Account Balance,
or to change the portion of his or her Account Balance allocated to
each previously or newly elected Measurement Fund. If an election is
made in accordance with the previous sentence, it shall apply to the
next business day and continue thereafter for each subsequent day in
which the Participant participates in the Plan, unless changed in
accordance with the previous sentence.
(b) Proportionate Allocation. In making any election described in
Section 3.10(a) above, the Participant shall specify on the
Election Form, in increments of five percentage points (5%),
the percentage of his or her Account Balance to be allocated
to a Measurement Fund (as if the Participant was making an
investment in that Measurement Fund with that portion of his
or her Account Balance).
(c) Measurement Funds. Except as otherwise provided in Section
3.10(f) below, subject to the rules and procedures established
by the Committee, the Participant may elect one or more of the
following measurement funds (the "Measurement Funds"), for the
purpose of crediting additional amounts to his or her Account
Balance:
(i) Moody's Bond Index Measurement Fund. Amounts
deemed invested in the Moody's Bond Index
Measurement Fund shall be credited with
interest at the Preferred Rate until
February 28, 2000, except as otherwise
provided in this Plan, and, effective March
1, 2000, at the Crediting Rate, which rate
shall be treated as the nominal rate for
crediting interest on such amounts.
(ii) Company Stock Index Measurement Fund.
Amounts deemed invested in the Company Stock
Index Measurement Fund shall be credited or
debited, based on the performance of the
Company's Stock, as if 100% of such amounts
had been invested in whole or fractional
shares of Stock, with any dividends declared
deemed reinvested in additional whole or
fractional shares of Stock.
(iii) PIMCO Total Return Fund.
--------------------------------
(iv) BT Investment Equity 500 Index Fund.
--------------------------------------------
(v) BT Advisor Small Cap Index.
-----------------------------------
(vi) Morgan Stanley (Van Kampen) International Magnum Fund.
--------------------------------------------------------------
As necessary, the Committee may, in its sole discretion,
discontinue, substitute or add a Measurement Fund. As
necessary, the Committee may restrict the availability of any
Measurement Fund to any Participant. Each such action will
take effect as of the first day of the calendar quarter that
follows by thirty (30) days the day on which the Committee
gives Participants advance written notice of such change.
(d) Crediting or Debiting Method. The performance of each elected
Measurement Fund (either positive or
--------------------------------------
negative) will be determined by the Committee, in its reasonable
discretion, based on the performance of the Measurement Funds
themselves. A Participant's Account Balance shall be credited or
debited on a daily basis based on the performance of each Measurement
Fund selected by the Participant, as determined by the Committee in
its sole discretion, as though (i) a
---------------------------------------------------------
Participant's Account Balance were invested in the Measurement Fund(s)
selected by the Participant, in the percentages applicable to such
day, at the closing price on such date; (ii) the portion of the Annual
Deferral Amount that was actually deferred during any day were
invested in the Measurement Fund(s) selected by the Participant, in
the percentages applicable to such day, no later than the close of
business on the first business day after the day on which such amounts
are actually deferred from the Participant's Base Annual Salary and/or
Annual Bonus through reductions in his or her payroll, at the closing
price on such date; and (iii) any distribution made to a Participant
that decreases such Participant's Account Balance ceased being
invested in the Measurement Fund(s), in the percentages applicable to
such business day, no earlier than one business day prior to the
distribution, at the closing price on such date. The Participant's
Annual Company Contribution Amount shall be credited to his or her
Company Contribution Account for purposes of this Section 3.10(d) as
of the close of
business on the business day selected by the Committee. The
Participant's Annual Stock Option Amount(s) shall be credited to his
or her Stock Option Account no later than the close of business on the
first business day after the day on which the Eligible Stock Option
was exercised or otherwise disposed of.
(e) No Actual Investment. Notwithstanding any other provision of this
Plan that may be interpreted to the
------------------------------
contrary, the Measurement Funds are to be used for measurement
purposes only, and a Participant's election of any such Measurement
Fund, the allocation to his or her Account Balance thereto, the
calculation of additional amounts and the crediting or debiting of
such amounts to a Participant's Account Balance shall not be
considered or construed in any manner
----- ---
as an actual investment of his or her Account Balance in any such
Measurement Fund. In the event that the Company or the Trustee (as
that term is defined in the Trust), in its own discretion, decides to
invest funds in any or all of the Measurement Funds, no Participant
shall have any rights in or to such investments themselves. Without
limiting the foregoing, a
Participant's Account Balance shall at all times be a bookkeeping
entry only and shall not represent any investment made on his or her
behalf by the Company or the Trust; the Participant shall at all times
remain an unsecured creditor of the Company.
(f) Special Rule for Company Contribution Account. Notwithstanding
any provision of this Plan that may be construed to the
contrary, the Participant's Company Contribution Account must
be deemed invested in the Moody's Bond Index Measurement Fund
at all times prior to any distribution of benefits under
Articles 4, 5, 6, 7 or 8.
3.11 FICA and Other Taxes.
-----------------------------
(a) Annual Deferral Amounts. For each Plan Year in which an Annual
Deferral Amount is being withheld from a Participant, the
Participant's Employer(s) shall withhold from that portion of
the Participant's Base Annual Salary and Annual Bonus that is
not being deferred, in a manner determined by the Employer(s),
the Participant's share of FICA and other employment taxes on
such Annual Deferral Amount and/or on benefits due under any
other nonqualified employee benefit plan(s) of the Employer.
If necessary, the Committee may reduce the Annual Deferral
Amount in order to comply with this Section 3.11.
(b) Company Contribution Amounts. When a participant becomes
vested in a portion of his or her Company Contribution
Account, the Participant's Employer(s) shall withhold from the
Participant's Base Annual Salary and/or Annual Bonus that is
not deferred, in a manner determined by the Employer(s), the
Participant's share of FICA and other employment taxes. If
necessary, the Committee may reduce the vested portion of the
Participant's Company Contribution Account in order to comply
with this Section 3.11.
(c) Annual Stock Option Amounts. For each Plan Year in which an
Annual Stock Option Amount is being first withheld from a
Participant, the Participant's Employer(s) shall withhold from
that portion of the Participant's Base Annual Salary, Annual
Bonus and Qualifying Gains that are not being deferred, in a
manner determined by the Employer(s), the Participant's share
of FICA and other employment taxes on such Annual Stock Option
Amount. If necessary, the Committee may reduce the Annual
Stock Option Amount in order to comply with this Section 3.11.
(d) Distributions. The Participant's Employer(s), or the trustee
of the Trust, shall withhold from any payments made to a
Participant under this Plan all federal, state and local
income, employment and other taxes required to be withheld by
the Employer(s), or the trustee of the Trust, in connection
with such payments, and/or in connection with any other
nonqualified benefit plan(s) of the Employer, in amounts and
in a manner to be determined in the sole discretion of the
Employer(s) and the trustee of the Trust.
ARTICLE 4
Short-Term Payout; Unforeseeable Financial Emergencies; Withdrawal
Election
4.1 Short-Term Payout. In connection with each election to defer an Annual
Deferral Amount, a Participant may irrevocably elect to receive a
future "Short-Term Payout" from the Plan with respect to such Annual
Deferral Amount. Subject to the Deduction Limitation, the Short-Term
Payout shall be a lump sum payment in an amount that is equal to the
Annual Deferral Amount plus amounts credited or debited in the manner
provided in Section 3.10 above on that amount, determined at the time
that the Short-Term Payout becomes payable. Subject to the Deduction
Limitation and the other terms and conditions of this Plan, each
Short-Term Payout elected shall be paid out during a period beginning 1
day and ending 60 days after the first day of any Plan Year designated
by the Participant that is at least five Plan Years after the Plan Year
in which the Annual Deferral Amount is actually deferred. By way of
example, if a five year Short-Term Payout is elected for Annual
Deferral Amounts that are deferred in the Plan Year commencing March 1,
1997, the five year Short-Term Payout would become payable during a 60
day period commencing March 1, 2002.
4.2 One-Time Rollover Election. Notwithstanding Section 4.1, a Participant
may make a one-time election to change a Short-Term Payout from the
Plan with respect to an Annual Deferral Amount to a Retirement Payout;
provided, that such election occur at least one year in advance of the
first day of the Plan Year for which such Short-Term Payout is payable.
By way of example, a Short-Term Payout that becomes payable during a
60-day period commencing March 1, 2002, may be changed to a Retirement
Payout if the election to defer is made prior to March 1, 2001.
4.3 Other Benefits Take Precedence Over Short-Term. Should an event occur
that triggers a benefit under Article 5, 6, 7 or 8, any Annual Deferral
Amount, plus amounts credited or debited thereon, that is subject to a
Short-Term Payout election under Section 4.1 shall not be paid in
accordance with Section 4.1 but shall be paid in accordance with the
other applicable Article.
4.4 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies.
If the Participant experiences an Unforeseeable Financial Emergency,
the Participant may petition the Committee to (i) suspend any deferrals
required to be made by a Participant and/or (ii) receive a partial or
full payout from the Plan. The payout shall not exceed the lesser of
the Participant's Account Balance, calculated as if such Participant
were receiving a Termination Benefit, or the amount reasonably needed
to satisfy the Unforeseeable Financial Emergency. If, subject to the
sole discretion of the Committee, the petition for a suspension and/or
payout is approved, suspension shall take effect upon the date of
approval and any payout shall be made within 60 days of the date of
approval. The payment of any amount under this Section 4.4 shall not be
subject to the Deduction Limitation.
4.5 Withdrawal Election. A Participant (or, after a Participant's death,
his or her Beneficiary) may elect, at any time, to withdraw all of his
or her Account Balance, calculated as if there had occurred a
Termination of Employment as of the day of the election, less a
withdrawal penalty equal to 10% of such amount (the net amount shall be
referred to as the "Withdrawal Amount"). This election can be made at
any time, before or after Retirement, Disability, death or Termination
of Employment, and whether or not the Participant (or Beneficiary) is
in the process of being paid pursuant to an installment payment
schedule. If made before Retirement, Disability or death, a
Participant's Withdrawal Amount shall be his or her Account Balance
calculated as if there had occurred a Termination of Employment as of
the day of the election. No partial withdrawals of the Withdrawal
Amount shall be allowed. The Participant (or his or her Beneficiary)
shall make this election by giving the Committee advance written notice
of the election in a form determined from time to time by the
Committee. The Participant (or his or her Beneficiary) shall be paid
the Withdrawal Amount within 60 days of his or her election. Once the
Withdrawal Amount is paid, the Participant's participation in the Plan
shall terminate and the Participant shall not be eligible to
participate in the Plan in the future. The payment of this Withdrawal
Amount shall not be subject to the Deduction Limitation.
ARTICLE 5
Retirement Benefit
5.1 Retirement Benefit. Subject to the Deduction Limitation, a Participant
who Retires or who attains "Rule of 105 Status" (as hereafter defined)
shall receive as a Retirement Benefit his or her Account Balance
provided that no payment shall be made to or in respect of any
Participant prior to April 1, 1999, on account of attainment of Rule
105 of Status. For purposes of the Plan, a Participant attains Rule of
105 Status when while employed by an Employer the sum of his or her age
and Years of Service equals 105.
5.2 Payment of Retirement Benefit. A Participant, in connection with his or
her commencement of participation in the Plan, shall elect on an
Election Form to receive the Retirement Benefit in a lump sum or
pursuant to an Installment Method of 60, 120 or 180 months. The
Participant may annually change his or her election to an allowable
alternative payout period by submitting a new Election Form to the
Committee; provided that any Election Form must be submitted at least
one year prior to the Participant's Retirement or attainment of Rule of
105 Status, as the case may be, and such Form is accepted by the
Committee in its sole discretion; provided, further, that in the case
of any Participant attaining Rule of 105 Status prior to April 1, 2000,
such Election Form must be submitted prior to April 1, 1999, or if
later, the date the Participant attains Rule of 105 Status, and shall
be given effect the date that is one year after such Election Form is
submitted and accepted by the Committee. The Election Form most
recently accepted by the Committee shall govern the payout of the
Retirement Benefit. If a Participant does not make any election with
respect to the payment of the Retirement Benefit, then such benefit
shall be payable in a lump sum. The lump sum payment shall be made, or
installment payments shall commence, no later than 60 days following
the earlier of (a) the date the Participant Retires, or (b) the date
the Participant attains Rule of 105 Status, or, if later, one year
following the date the Participant submits and the Committee accepts a
revised Election Form as described above. Any payment made shall be
subject to the Deduction Limitation.
5.3 Death Prior to Completion of Retirement Benefit. If a Participant dies
after Retirement but before the Retirement Benefit is paid in full, the
Participant's unpaid Retirement Benefit payments shall continue and
shall be paid to the Participant's Beneficiary (a) over the remaining
number of months and in the same amounts as that benefit would have
been paid to the Participant had the Participant survived, or (b) in a
lump sum, if requested by the Beneficiary and allowed in the sole
discretion of the Committee, that is equal to the Participant's unpaid
remaining Account Balance.
ARTICLE 6
Pre-Retirement Survivor Benefit
6.1 Pre-Retirement Survivor Benefit. Subject to the Deduction Limitation,
the Participant's Beneficiary shall receive a Pre-Retirement Survivor
Benefit equal to the Participant's Account Balance if the Participant
dies before he or she Retires, experiences a Termination of Employment
or suffers a Disability.
6.2 Payment of Pre-Retirement Survivor Benefit. A Participant, in
connection with his or her commencement of participation in the Plan,
shall elect on an Election Form whether the Pre-Retirement Survivor
Benefit shall be received by his or her Beneficiary in a lump sum or
pursuant to an Installment Method of 60, 120 or 180 months. The
Participant may annually change this election to an allowable
alternative payout period by submitting a new Election Form to the
Committee, which form must be accepted by the Committee in its sole
discretion. The Election Form most recently accepted by the Committee
prior to the Participant's death shall govern the payout of the
Participant's Pre-Retirement Survivor Benefit. If a Participant does
not make any election with respect to the payment of the Pre-Retirement
Survivor Benefit, then such benefit shall be paid in a lump sum.
Despite the foregoing, if the Participant's Account Balance at the time
of his or her death is less than $25,000, payment of the Pre-Retirement
Survivor Benefit may be made, in the sole discretion of the Committee,
in a lump sum or pursuant to an Installment Method of not more than 60
months. The lump sum payment shall be made, or installment payments
shall commence, no later than 60 days after the date the Committee is
provided with proof that is satisfactory to the Committee of the
Participant's death. Any payment made shall be subject to the Deduction
Limitation.
ARTICLE 7
Termination Benefit
7.1 Termination Benefit. Subject to the Deduction Limitation and the
following sentence, the Participant shall receive a Termination
Benefit, which shall be equal to the Participant's Account Balance.
Interest on amounts deemed invested in the Moody's Bond Index
Measurement Fund shall be credited in the manner provided in Section
3.9, but using the applicable interest rate set forth in the following
schedule, if a Participant experiences a Termination of Employment
prior to his or her Retirement, death or Disability:
Completion of Years of Plan Participation Applicable Rate
Less than five years Crediting Rate Five or more years Preferred Rate
until February 28, 2000; Crediting Rate effective March 1, 2000
7.2 Payment of Termination Benefit. If the Participant's Account Balance at
the time of his or her Termination of Employment is less than $25,000,
payment of his or her Termination Benefit shall be paid in a lump sum.
If his or her Account Balance at such time is equal to or greater than
that amount, the Committee, in its sole discretion, may cause the
Termination Benefit to be paid in a lump sum or pursuant to an
Installment Method over a period of time that does not exceed fifteen
(15) years in duration. The lump sum payment shall be made, or
installment payments shall commence, no later than 60 days after the
date the date of the Participant's Termination of Employment. Any
payment made shall be subject to the Deduction Limitation.
ARTICLE 8
Disability Waiver and Benefit
8.1 Disability Waiver.
--------------------------
(a) Waiver of Deferral. A Participant who is determined by the
Committee to be suffering from a Disability shall be (i)
excused from fulfilling that portion of the Annual Deferral
Amount commitment that would otherwise have been withheld from
a Participant's Base Annual Salary and Annual Bonus for the
Plan Year during which the Participant first suffers a
Disability and (ii) excused from fulfilling any unexercised
Stock Option Amount commitments. During the period of
Disability, the Participant shall not be allowed to make any
additional deferral elections, but will continue to be
considered a Participant for all other purposes of this Plan.
(b) Return to Work. If a Participant returns to employment with an
Employer after a Disability ceases, the Participant may elect
to defer an Annual Deferral Amount and Stock Option Amount for
the Plan Year following his or her return to employment or
service and for every Plan Year thereafter while a Participant
in the Plan; provided such deferral elections are otherwise
allowed and an Election Form is delivered to and accepted by
the Committee for each such election in accordance with
Section 3.3 above.
8.2 Continued Eligibility; Disability Benefit. A Participant suffering a
Disability shall, for benefit purposes under this Plan, continue to be
considered to be employed and shall be eligible for the benefits
provided for in Articles 4, 5, 6 or 7 in accordance with the provisions
of those Articles. Notwithstanding the above, the Committee shall have
the right to, in its sole and absolute discretion and for purposes of
this Plan only, and must in the case of a Participant who is otherwise
eligible to Retire, deem the Participant to have experienced a
Termination of Employment, or in the case of a Participant who is
eligible to Retire, to have Retired, at any time (or in the case of a
Participant who is eligible to Retire, as soon as practicable) after
such Participant is determined to be suffering a Disability, in which
case the Participant shall receive a Disability Benefit equal to his or
her Account Balance at the time of the Committee's determination;
provided, however, that should the Participant otherwise have been
eligible to Retire, he or she shall be paid in accordance with Article
5. The Disability Benefit shall be paid in a lump sum or, upon a
Participant's request and in the Committee's sole discretion,
installment payments over not more than 180 months. The lump sum
payment shall be made, or installment payments shall commence, within
60 days of the Committee's exercise of its right to deem a Participant
to have experienced a Termination of Employment. Any payment made shall
be subject to the Deduction Limitation.
ARTICLE 9
Beneficiary Designation
9.1 Beneficiary. Each Participant shall have the right, at any time, to
designate his or her Beneficiary(ies) (both primary as well as
contingent) to receive any benefits payable under the Plan to a
beneficiary upon the death of a Participant. The Beneficiary designated
under this Plan may be the same as or different from the Beneficiary
designation under any other plan of an Employer in which the
Participant participates.
9.2 Beneficiary Designation; Change; Spousal Consent. A Participant shall
designate his or her Beneficiary by completing and signing the
Beneficiary Designation Form, and returning it to the Committee or its
designated agent. A Participant shall have the right to change a
Beneficiary by completing, signing and otherwise complying with the
terms of the Beneficiary Designation Form and the Committee's rules and
procedures, as in effect from time to time. If the Participant names
someone other than his or her spouse as a Beneficiary, a spousal
consent, in the form designated by the Committee, must be signed by
that Participant's spouse and returned to the Committee. Upon the
acceptance by the Committee of a new Beneficiary Designation Form, all
Beneficiary designations previously filed shall be canceled. The
Committee shall be entitled to rely on the last Beneficiary Designation
Form filed by the Participant and accepted by the Committee prior to
his or her death.
9.3 Acknowledgment. No designation or change in designation of a
Beneficiary shall be effective until
-----------------------
received and acknowledged in writing by the Committee or its
designated agent.
9.4 No Beneficiary Designation. If a Participant fails to designate a
Beneficiary as provided in Sections 9.1, 9.2 and 9.3 above or, if all
designated Beneficiaries predecease the Participant or die prior to
complete distribution of the Participant's benefits, then the
Participant's designated Beneficiary shall be deemed to be his or her
surviving spouse. If the Participant has no surviving spouse, the
benefits remaining under the Plan to be paid to a Beneficiary shall be
payable to the executor or personal representative on behalf of the
Participant's estate.
9.5 Doubt as to Beneficiary. If the Committee has any doubt as to the
proper Beneficiary to receive payments pursuant to this Plan, the
Committee shall have the right, exercisable in its discretion, to cause
the Participant's Employer to withhold such payments until this matter
is resolved to the Committee's satisfaction.
9.6 Discharge of Obligations. The payment of benefits under the Plan to a
Beneficiary shall fully and completely discharge all Employers and the
Committee from all further obligations under this Plan with respect to
the Participant, and that Participant's Plan participation shall
terminate upon such full payment of benefits.
ARTICLE 10
Leave of Absence
10.1 Paid Leave of Absence. If a Participant is authorized by the
Participant's Employer for any reason to take a paid leave of absence
from the employment of the Employer, the Participant shall continue to
be considered employed by the Employer and the Annual Deferral Amount
shall continue to be withheld during such paid leave of absence in
accordance with Section 3.3.
10.2 Unpaid Leave of Absence. If a Participant is authorized by the
Participant's Employer for any reason to take an unpaid leave of
absence from the employment of the Employer, the Participant shall
continue to be considered employed by the Employer and the Participant
shall be excused from making deferrals until the earlier of the date
the leave of absence expires or the Participant returns to a paid
employment status. Upon such expiration or return, deferrals shall
resume for the remaining portion of the Plan Year in which the
expiration or return occurs, based on the deferral election, if any,
made for that Plan Year. If no election was made for that Plan Year, no
deferral shall be withheld.
ARTICLE 11
Termination, Amendment or Modification
11.1 Termination. Although each Employer anticipates that it will continue
the Plan for an indefinite period of time, there is no guarantee that
any Employer will continue the Plan or will not terminate the Plan at
any time in the future. Accordingly, each Employer reserves the right
to discontinue its sponsorship of the Plan and/or to terminate the Plan
at any time with respect to any or all of its participating Employees
by action of its board of directors. Upon the termination of the Plan
with respect to any Employer, the Plan participation of the affected
Participants who are employed by that Employer shall terminate and
their Account Balances, determined as if they had experienced a
Termination of Employment on the date of Plan termination or, if Plan
termination occurs after the date upon which a Participant was eligible
to Retire, then with respect to that Participant as if he or she had
Retired on the date of Plan termination, shall be paid to the
Participants as follows: Prior to a Change in Control, if the Plan is
terminated with respect to all of its Participants, an Employer shall
have the right, in its sole discretion, and notwithstanding any
elections made by the Participant, to pay such benefits in a lump sum
or pursuant to a Monthly Installment Method of up to 15 years, with
amounts credited and debited during the installment period as provided
herein. If the Plan is terminated with respect to less than all of its
Participants, an Employer shall be required to pay such benefits in a
lump sum. After a Change in Control, the Employer shall be required to
pay such benefits in a lump sum. The termination of the Plan shall not
adversely affect any Participant or Beneficiary who has become entitled
to the payment of any benefits under the Plan as of the date of
termination; provided however, that the Employer shall have the right
to accelerate installment payments without a premium or prepayment
penalty by paying the Account Balance in a lump sum or pursuant to a
Monthly Installment Method using fewer months (provided that the
present value of all payments that will have been received by a
Participant at any given point of time under the different payment
schedule shall equal or exceed the present value of all payments that
would have been received at that point in time under the original
payment schedule). The applicable interest rate to be used as the
discount rate for determining such present value shall be the Crediting
Rate for the Plan Year of termination.
11.2 Amendment. Any Employer may, at any time, amend or modify the Plan in
whole or in part with respect to that Employer by the action of its
board of directors; provided, however, that no amendment or
modification shall be effective to decrease or restrict the value of a
Participant's Account Balance in existence at the time the amendment or
modification is made, calculated as if the Participant had experienced
a Termination of Employment as of the effective date of the amendment
or modification or, if the amendment or modification occurs after the
date upon which the Participant was eligible to Retire, the Participant
had Retired as of the effective date of the amendment or modification.
The amendment or modification of the Plan shall not affect any
Participant or Beneficiary who has become entitled to the payment of
benefits under the Plan as of the date of the amendment or
modification; provided, however, that the Employer shall have the right
to accelerate installment payments by paying the Account Balance in a
lump sum or pursuant to a Monthly Installment Method using fewer months
(provided that the present value of all payments that will have been
received by a Participant at any given point of time under the
different payment schedule shall equal or exceed the present value of
all payments that would have been received at that point in time under
the original payment schedule, using the Crediting Rate as of the date
of amendment or modification as the discount rate for calculating
present value).
11.3 Effect of Payment. The full payment of the applicable benefit under
Articles 4, 5, 6, 7 or 8 of the Plan shall completely discharge all
obligations to a Participant and his or her designated Beneficiaries
under this Plan and the Participant's Plan participation shall
terminate.
ARTICLE 12
Administration
12.1 Committee Duties. This Plan shall be administered by a Committee, which
shall consist of the Board, or such committee as the Board shall
appoint. Members of the Committee may be Participants under this Plan.
The Committee shall also have the discretion and authority to (i) make,
amend, interpret, and enforce all appropriate rules and regulations for
the administration of this Plan, (ii) interpret where necessary all
provisions of this Plan (including, without limitation, by supplying
omissions from, correcting deficiencies in, or resolving
inconsistencies in, the language of this Plan), and (iii) determine all
factual matters as may arise in connection with the Plan. Any
individual serving on the Committee who is a Participant shall not vote
or act on any matter relating solely to himself or herself. When making
a determination or calculation, the Committee shall be entitled to rely
on information furnished by a Participant or the Company.
12.2 Agents. In the administration of this Plan, the Committee, and the
Administrator may, from time to time, employ agents and delegate to
them such administrative duties as it sees fit (including acting
through a duly appointed representative) and may from time to time
consult with counsel who may be counsel to any Employer.
12.3 Binding Effect of Decisions. The decision or action of the Committee
with respect to any question arising out of or in connection with the
administration, interpretation and application of the Plan and the
rules and regulations promulgated hereunder shall be final and
conclusive and binding upon all persons having any interest in the
Plan.
12.4 Indemnity of Committee. All Employers shall indemnify and hold harmless
the members of the Committee, and any Employee to whom the duties of
the Committee may be delegated, against any and all claims, losses,
damages, expenses or liabilities arising from any action or failure to
act with respect to this Plan, except in the case of willful misconduct
by the Committee or any of its members or any such Employee.
12.5 Employer Information. To enable the Committee to perform its functions,
each Employer shall supply full and timely information to the Committee
on all matters relating to the compensation of its Participants, the
date and circumstances of the Retirement, Disability, death or
Termination of Employment of its Participants, and such other pertinent
information as the Committee may reasonably require.
ARTICLE 13
Other Benefits and Agreements
13.1 Coordination with Other Benefits. The benefits provided for a
Participant and Participant's Beneficiary under the Plan are in
addition to any other benefits available to such Participant under any
other plan or program for employees of the Participant's Employer. The
Plan shall supplement and shall not supersede, modify or amend any
other such plan or program except as may otherwise be expressly
provided.
13.2 Coordination with Other Benefit Plans. Any Participant who was a
participant in the Countrywide Credit Industries, Inc. Deferred
Compensation Plan For Key Management Employees prior to becoming a
Participant in this Plan shall have the right to elect, upon the later
of the date upon which he or she first becomes designated for
participation in the Plan to transfer his or her Account balance in
that plan to this Plan. This election shall be made in accordance with
the rules and on the forms established from time to time by the
Committee. If the election is made, the Participant's Account Balance
under this Plan and any such transferred account balance shall become
subject to the terms and conditions of this Plan. Upon completion of
the transfer of his or her account balance under the other plan to this
Plan, the Participant's participation in the other plan shall be
terminated and he or she shall have no further interest in the
Countrywide Credit Industries, Inc. Deferred Compensation Plan for Key
Management Employees.
ARTICLE 14
Claims Procedures
14.1 Presentation of Claim. Any Participant or Beneficiary of a deceased
Participant (such Participant or Beneficiary being referred to below as
a "Claimant") may deliver to the Committee a written claim for a
determination with respect to the amounts distributable to such
Claimant from the Plan. If such a claim relates to the contents of a
notice received by the Claimant, the claim must be made within 60 days
after such notice was received by the Claimant. All other claims must
be made within 180 days of the date on which the event that caused the
claim to arise occurred. The claim must state with particularity the
determination desired by the Claimant.
14.2 Notification of Decision. The Committee shall consider a
Claimant's claim within a reasonable time, and
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shall notify the Claimant in writing:
(a) that the Claimant's requested determination has been made, and
that the claim has been allowed in full; or
(b) that the Committee has reached a conclusion contrary, in whole
or in part, to the Claimant's requested determination, and
such notice must set forth in a manner calculated to be
understood by the Claimant:
(i) the specific reason(s) for the denial of the claim, or any part of it;
(ii) specific reference(s) to pertinent provisions of the Plan upon
which such denial was based;
(iii) a description of any additional material or
information necessary for the Claimant to perfect the
claim, and an explanation of why such material or
information is necessary; and
(iv) an explanation of the claim review procedure set forth in Section
14.3 below.
14.3 Review of a Denied Claim. Within 60 days after receiving a notice from
the Committee that a claim has been denied, in whole or in part, a
Claimant (or the Claimant's duly authorized representative) may file
with the Committee a written request for a review of the denial of the
claim. Thereafter, but not later than 30 days after the review
procedure began, the Claimant (or the Claimant's duly authorized
representative):
(a) may review pertinent documents;
(b) may submit written comments or other documents; and/or
(c) may request a hearing, which the Committee, in its sole
discretion, may grant.
14.4 Decision on Review. The Committee shall render its decision on review
promptly, and not later than 60 days after the filing of a written
request for review of the denial, unless a hearing is held or other
special circumstances require additional time, in which case the
Committee's decision must be rendered within 120 days after such date.
Such decision must be written in a manner calculated to be understood
by the Claimant, and it must contain:
(a) specific reasons for the decision;
(b) specific reference(s) to the pertinent Plan provisions upon which
the decision was based; and
(c) such other matters as the Committee deems relevant.
14.5 Legal Action. A Claimant's compliance with the foregoing provisions of
this Article 14 is a mandatory prerequisite to a Claimant's right to
commence any legal action with respect to any claim for benefits under
this Plan.
ARTICLE 15
Trust
15.1 Establishment of the Trust. The Company shall establish the Trust, and
each Employer shall at least annually transfer over to the Trust such
assets as the Employer determines, in its sole discretion, are
necessary to provide, on a present value basis, for its respective
future liabilities created with respect to the Annual Deferral Amounts,
Annual Company Contribution Amounts, Annual Stock Option Amounts for
such Employer's Participants for all periods prior to the transfer, as
well as any debits and credits to the Participants' Account Balances
for all periods prior to the transfer, taking into consideration the
value of the assets in the trust at the time of the transfer.
15.2 Interrelationship of the Plan and the Trust. The provisions of the Plan
shall govern the rights of a Participant to receive distributions
pursuant to the Plan. The provisions of the Trust shall govern the
rights of the Employers, Participants and the creditors of the
Employers to the assets transferred to the Trust. Each Employer shall
at all times remain liable to carry out its obligations under the Plan.
15.3 Distributions From the Trust. Each Employer's obligations under the
Plan may be satisfied with Trust assets distributed pursuant to the
terms of the Trust, and any such distribution shall reduce the
Employer's obligations under this Plan.
15.4 Stock Transferred to the Trust. Notwithstanding any other provision of
this Plan or the Trust: (i) if Trust assets are distributed to a
Participant in a distribution which reduces the Participant's Stock
Option Account balance under this Plan, such distribution must be made
in the form of Stock during every 6 month period beginning on the date
an Eligible Stock Option of the Participant is exercised, to the extent
of the Qualifying Gain deferred in accordance with Section 3.7 with
respect to that Eligible Stock Option; and (ii) any Stock transferred
to the Trust may not be otherwise distributed or disposed of by the
Trustee until at least 6 months after the date such Stock is
transferred to the Trust.
ARTICLE 16
Miscellaneous
16.1 Status of Plan. The Plan is intended to be a plan that is not qualified
within the meaning of Code Section 401(a) and that "is unfunded and is
maintained by an employer primarily for the purpose of providing
deferred compensation for a select group of management or highly
compensated employee" within the meaning of ERISA Sections 201(2),
301(a)(3) and 401(a)(1). The Plan shall be administered and interpreted
to the extent possible in a manner consistent with that intent.
16.2 Unsecured General Creditor. Participants and their Beneficiaries,
heirs, successors and assigns shall have no legal or equitable rights,
interests or claims in any property or assets of an Employer. For
purposes of the payment of benefits under this Plan, any and all of an
Employer's assets shall be, and remain, the general, unpledged
unrestricted assets of the Employer. An Employer's obligation under the
Plan shall be merely that of an unfunded and unsecured promise to pay
money in the future.
16.3 Employer's Liability. An Employer's liability for the payment of
benefits shall be defined only by the ------------------------------
Plan. An Employer shall have no obligation to a Participant under the
Plan except as expressly provided in the Plan.
16.4 Nonassignability. Neither a Participant nor any other person shall have
any right to commute, sell, assign, transfer, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate, alienate or
convey in advance of actual receipt, the amounts, if any, payable
hereunder, or any part thereof, which are, and all rights to which are
expressly declared to be, unassignable and non-transferable. No part of
the amounts payable shall, prior to actual payment, be subject to
seizure, attachment, garnishment or sequestration for the payment of
any debts, judgments, alimony or separate maintenance owed by a
Participant or any other person, be transferable by operation of law in
the event of a Participant's or any other person's bankruptcy or
insolvency or be transferable to a spouse as a result of a property
settlement or otherwise.
16.5 Not a Contract of Employment. The terms and conditions of this Plan
shall not be deemed to constitute a contract of employment between any
Employer and the Participant. Such employment is hereby acknowledged to
be an "at will" employment relationship that can be terminated at any
time for any reason, or no reason, with or without cause, and with or
without notice, unless expressly provided in a written employment
agreement. Nothing in this Plan shall be deemed to give a Participant
the right to be retained in the service of any Employer as an Employee
or to interfere with the right of any Employer to discipline or
discharge the Participant at any time.
16.6 Furnishing Information. A Participant or his or her Beneficiary will
cooperate with the Committee by furnishing any and all information
requested by the Committee and take such other actions as may be
requested in order to facilitate the administration of the Plan and the
payments of benefits hereunder, including but not limited to taking
such physical examinations as the Committee may deem necessary.
16.7 Terms. Whenever any words are used herein in the masculine, they shall
be construed as though they were in the feminine in all cases where
they would so apply; and whenever any words are used herein in the
singular or in the plural, they shall be construed as though they were
used in the plural or the singular, as the case may be, in all cases
where they would so apply.
16.8 Captions. The captions of the articles, sections and paragraphs of this
Plan are for convenience only and shall not control or affect the
meaning or construction of any of its provisions.
16.9 Governing Law. Subject to ERISA, the provisions of this Plan
shall be construed and interpreted ----------------------- according
to the internal laws of the State of California without regard to its
conflicts of laws principles.
16.10 Notice. Any notice or filing required or permitted to be given to the
Committee under this Plan shall be sufficient if in writing and
hand-delivered, or sent by registered or certified mail, to the address
below:
Administrative Committee DCP
Countrywide Credit Industries, Inc.
4500 Park Granada
Calabasas, California 91302
Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the
receipt for registration or certification.
Any notice or filing required or permitted to be given to a Participant
under this Plan shall be sufficient if in writing and hand-delivered,
or sent by mail, to the last known address of the Participant.
16.11 Successors. The provisions of this Plan shall bind and inure to the
benefit of the Participant's Employer and its successors and assigns
and the Participant and the Participant's designated Beneficiaries.
16.12 Spouse's Interest. The interest in the benefits hereunder of a spouse
of a Participant who has predeceased the Participant shall
automatically pass to the Participant and shall not be transferable by
such spouse in any manner, including but not limited to such spouse's
will, nor shall such interest pass under the laws of intestate
succession.
16.13 Validity. In case any provision of this Plan shall be illegal or
invalid for any reason, said illegality or invalidity shall not affect
the remaining parts hereof, but this Plan shall be construed and
enforced as if such illegal or invalid provision had never been
inserted herein.
16.14 Incompetent. If the Committee determines in its discretion that a
benefit under this Plan is to be paid to a minor, a person declared
incompetent or to a person incapable of handling the disposition of
that person's property, the Committee may direct payment of such
benefit to the guardian, legal representative or person having the care
and custody of such minor, incompetent or incapable person. The
Committee may require proof of minority, incompetence, incapacity or
guardianship, as it may deem appropriate prior to distribution of the
benefit. Any payment of a benefit shall be a payment for the account of
the Participant and the Participant's Beneficiary, as the case may be,
and shall be a complete discharge of any liability under the Plan for
such payment amount.
16.15 Court Order. The Committee is authorized to make any payments directed
by court order in any action in which the Plan or the Committee has
been named as a party. In addition, if a court determines that a spouse
or former spouse of a Participant has an interest in the Participant's
benefits under the Plan in connection with a property settlement or
otherwise, the Committee, in its sole discretion, shall have the right,
notwithstanding any election made by a Participant, to immediately
distribute the spouse's or former spouse's interest in the
Participant's benefits under the Plan to that spouse or former spouse.
16.16 Distribution in the Event of Taxation.
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(a) In General. If, for any reason, all or any portion of a
Participant's benefits under this Plan becomes
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taxable to the Participant prior to receipt, a Participant may
petition the Committee before a Change in Control, or the trustee of
the Trust after a Change in Control, for a distribution of that
portion of his or her benefit that has become taxable. Upon the grant
of such a petition, which grant shall not be unreasonably withheld
(and, after a Change in Control, shall be granted), a Participant's
Employer shall distribute to the Participant immediately available
funds in an amount equal to the taxable portion of his or her benefit
(which amount shall not exceed a Participant's unpaid Account Balance
under the Plan). If the petition is granted, the tax liability
distribution shall be made within 90 days of the date when the
Participant's petition is granted. Such a distribution shall affect
and reduce the benefits to be paid under this Plan.
(b) Trust. If the Trust terminates in accordance with Section
3.6(e) of the Trust and benefits are distributed from the
Trust to a Participant in accordance with that Section, the
Participant's benefits under this Plan shall be reduced to the
extent of such distributions.
16.17 Insurance. The Employers, on their own behalf or on behalf of the
trustee of the Trust, and, in their sole discretion, may apply for and
procure insurance on the life of the Participant, in such amounts and
in such forms as the Trust may choose. The Employers or the trustee of
the Trust, as the case may be, shall be the sole owner and beneficiary
of any such insurance. The Participant shall have no interest
whatsoever in any such policy or policies, and at the request of the
Employers shall submit to medical examinations and supply such
information and execute such documents as may be required by the
insurance company or companies to whom the Employers have applied for
insurance.
16.18 Legal Fees To Enforce Rights After Change in Control. The Company and
each Employer is aware that upon the occurrence of a Change in Control,
the Board or the board of directors of a Participant's Employer (which
might then be composed of new members) or a shareholder of the Company
or the Participant's Employer, or of any successor corporation might
then cause or attempt to cause the Company, the Participant's Employer
or such successor to refuse to comply with its obligations under the
Plan and might cause or attempt to cause the Company or the
Participant's Employer to institute, or may institute, litigation
seeking to deny Participants the benefits intended under the Plan. In
these circumstances, the purpose of the Plan could be frustrated.
Accordingly, if, following a Change in Control, it should appear to any
Participant that the Company, the Participant's Employer or any
successor corporation has failed to comply with any of its obligations
under the Plan or any agreement thereunder or, if the Company, such
Employer or any other person takes any action to declare the Plan void
or unenforceable or institutes any litigation or other legal action
designed to deny, diminish or to recover from any Participant the
benefits intended to be provided, then the Company and the
Participant's Employer irrevocably authorize such Participant to retain
counsel of his or her choice at the expense of the Company and the
Participant's Employer (who shall be jointly and severally liable) to
represent such Participant in connection with the initiation or defense
of any litigation or other legal action, whether by or against the
Company, the Participant's Employer or any director, officer,
shareholder or other person affiliated with the Company, the
Participant's Employer or any successor thereto in any jurisdiction.
IN WITNESS WHEREOF, the Company has signed this Plan document as of
March 1, 2000.
"Company"
Countrywide Credit Industries, Inc., a Delaware
corporation
By: /s/ Anne D. McCallion
Title: Managing Director
