<PAGE> 1
As filed with the Securities and Exchange Commission on March 21, 1997
Registration No. 333-_______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
--------------------------
CAMCO INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)
DELAWARE 13-3517570
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification No.)
7030 ARDMORE
HOUSTON, TEXAS 77054
(Address of Principal Executive Offices) (Zip Code)
CAMCO INTERNATIONAL INC. DEFERRED INCOME PLAN
(Full title of the plan)
RONALD R. RANDALL, ESQ.
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
CAMCO INTERNATIONAL INC.
7030 ARDMORE
HOUSTON, TEXAS 77054
(Name and address of agent for service)
(713) 747-4000
(Telephone number, including area code, of agent for service)
--------------------------
With Copy to:
Curtis W. Huff
Fulbright & Jaworski L.L.P.
1301 McKinney, Suite 5100
Houston, Texas 77010-3095
(713) 651-5151
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===============================================================================================================================
Proposed maximum Proposed maximum Amount of
Title of securities to be Amount to be offering price per aggregate offering registration
registered registered share price(1) fee(2)
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Deferred Income Plan Obligations $5,000,000(1) N/A $5,000,000 $1,516
===============================================================================================================================
</TABLE>
(1) Represents the estimated dollar amount of participant compensation
deferrals under the Deferred Income Plan and the obligations of Camco
International Inc. with respect thereto.
(2) Calculated pursuant to Rule 457(o) under the Securities Act of 1933
and based upon the maximum aggregate amount of compensation that may
be deferred under the Deferred Income Plan.
================================================================================
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
Camco International Inc., a Delaware corporation (the "Company" or
"Registrant"), incorporates by reference in this Registration Statement the
following documents:
1. The Registrant's annual report on Form 10-K for the year
ended December 31, 1996; and
2. All other reports filed by the Registrant pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 since December
31, 1996.
All documents filed by the Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934 subsequent to the
date of the filing hereof and prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be a part hereof from the date
of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware
provides that a corporation has the power to indemnify a director, officer,
employee or agent of the corporation and certain other persons serving at the
request of the corporation in related capacities against amounts paid and
expenses incurred in connection with an action or proceeding to which he is or
is threatened to be made a party by reason of such position, if such person
shall have acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the corporation, and, in any criminal
proceeding, if such person had no reasonable cause to believe his conduct was
unlawful; provided that, in the case of actions brought by or in the right of
the corporation, no indemnification shall be made with respect to any matter as
to which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the adjudicating court determines that such
indemnification is proper under the circumstances.
The Restated Certificate of Incorporation contains provisions which
eliminate the personal liability of the Registrant's directors for monetary
damages resulting
II-1
<PAGE> 3
from breaches of their fiduciary duty other than liability for breaches of the
duty of loyalty, acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, violations under Section
174 of the General Corporation Law of the State of Delaware or any transaction
from which the director derived an improper personal benefit.
Article VIII of the Registrant's By-laws contains detailed
provisions for the indemnification by the Registrant of current and former
directors, officers, employees and agents of the Registrant on terms that have
been derived from Section 145 of the General Corporation Law of the State of
Delaware.
The Registrant has obtained directors' and officers' liability
insurance that covers certain liabilities and expenses of the Registrant's
directors and officers. In addition, the Registrant has entered into
indemnification agreements with each of its directors and certain of its
executive officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
4.1 -- Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit
3.1 to the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1993).
4.2 -- By-laws of the Registrant (incorporated by
reference to Exhibit 3.4 to the Registrant's
Registration Statement on Form S-1 (Reg. No.
33-70036)).
4.3 -- Form of Common Stock Certificate (incorporated by
reference to Exhibit 4.2 to the Registrant's
Registration Statement on Form S-1 (Reg. No.
33-70036)).
4.4 -- Credit Facility dated December 7, 1993
(incorporated by reference to Exhibit 10.12 to the
Registrant's Registration Statement on Form S-1
(Reg. No. 33-70036)).
4.5 -- First Amendment to Credit Facility dated August 29,
1994 (incorporated by reference to Exhibit 10.14 to
the Registrant's Registration Statement on Form S-1
(Reg. No. 33-83562)).
4.6 -- Camco International Inc. Deferred Income Plan.
4.7 -- Camco International Inc. Deferred Income Plan
Trust.
23.1 -- Consent of Arthur Andersen LLP.
II-2
<PAGE> 4
24.1 -- Powers of Attorney (included on page II-5 of this
Registration Statement).
As permitted by Item 601(b)(4)(iii)(A) of Regulation S-K, the
Registrant has not filed with this Registration Statement certain instruments
defining the rights of holders of long-term debt of the Registrant and its
subsidiaries because the total amount of securities authorized under any of
such instruments does not exceed 10% of the total assets of the Registrant and
its subsidiaries on consolidated basis. The Registrant agrees to furnish a copy
of any such agreements to the Securities and Exchange Commission upon request.
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most recent
post-effective amendment hereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar volume of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the Securities and Exchange
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished to
the Securities and Exchange Commission by the Registrant pursuant to Section 13
or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered herein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
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<PAGE> 5
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934)
that is incorporated by reference in this Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer
or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Houston, State of Texas, on March 11, 1997.
CAMCO INTERNATIONAL INC.
By: /s/ GARY D. NICHOLSON
-----------------------------------
Gary D. Nicholson
Chairman of the Board, President
and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Herbert S. Yates and Ronald R. Randall,
and each of them, either one of whom may act without joinder of the other, his
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, and each of them, or the substitute or
substitutes of any or all of them, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ GARY D. NICHOLSON Chairman of the Board, President and March 11, 1997
------------------------------------------ Chief Executive Officer (Principal
Gary D. Nicholson Executive Officer)
/s/ HERBERT S. YATES Senior Vice President-Finance March 11, 1997
------------------------------------------ and Chief Financial Officer
Herbert S. Yates (Principal Financial Officer)
/s/ BRUCE F. LONGAKER, JR. Vice President-Finance March 11, 1997
------------------------------------------ and Corporate Controller
Bruce F. Longaker, Jr. (Principal Accounting Officer)
</TABLE>
II-5
<PAGE> 7
<TABLE>
<S> <C> <C>
/s/ HUGH H. GOERNER Director March 7, 1997
------------------------------------------
Hugh H. Goerner
/s/ ROBERT L. HOWARD Director March 3, 1997
------------------------------------------
Robert L. Howard
/s/ WILLIAM J. JOHNSON Director March 11, 1997
------------------------------------------
William J. Johnson
/s/ WILLIAM A. KRAUSE Director March 3, 1997
------------------------------------------
William A. Krause
/s/ CHARLES P. SIESS, JR. Director March 6, 1997
------------------------------------------
Charles P. Siess, Jr.
/s/ GILBERT H. TAUSCH Director March 8, 1997
------------------------------------------
Gilbert H. Tausch
</TABLE>
II-6
<PAGE> 8
EXHIBIT INDEX
Exhibit Number Description Page Number
- -------------- ----------- -----------
4.1 Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit 3.1
to the Registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993).
4.2 By-laws of the Registrant (incorporated by reference
to Exhibit 3.3 to the Registrant's Registration
Statement on Form S-1 (Reg. No. 33-70036)).
4.3 Form of Common Stock Certificate (incorporated
by reference to Exhibit 4.2 to the Registrant's
Registration Statement on Form S-1 (Reg. No.
33-70036)).
4.4 Credit Facility dated December 7, 1993
(incorporated by reference to Exhibit 10.12 to the
Registrant's Registration Statement on Form S-1
(Reg. No. 33-70036)).
4.5 First Amendment to Credit Facility dated
August 29, 1994 (incorporated by reference to
Exhibit 10.14 to the Registrant's Registration
Statement on Form S-1 (Reg. No. 33-83562)).
4.6 Camco International Inc. Deferred Income Plan.
4.7 Camco International Inc. Deferred Income Plan Trust.
23.1 Consent of Arthur Andersen LLP.
24.1 Powers of Attorney (included on page II-5 of
this Registration Statement).
<PAGE> 1
EXHIBIT 4.6
CAMCO INTERNATIONAL INC.
DEFERRED INCOME PLAN
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
ARTICLE ONE - ESTABLISHMENT, PURPOSE AND STATUS OF THE PLAN
1.1 Establishment of Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Purpose of Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Status of Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE TWO - DEFINITIONS
2.1 Administrator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.4 Bonus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.5 Change in Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.6 Claimant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.7 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.8 Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.9 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.10 Compensation Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.11 Deferral Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.12 Deferred Compensation Ledger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.13 Determination Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.14 Disabled or Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.15 Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.16 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.17 Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.18 Financial Emergency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.19 Investment Experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.20 Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.21 Outside Director . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.22 Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.23 Person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.24 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.25 Plan Administration Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.26 Plan Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.27 Qualified Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.28 Retirement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.29 Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.30 Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.31 Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.32 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
ARTICLE THREE - ADMINISTRATION
3.1 Administrator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.2 Administration of Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C>
3.3 Delegation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.4 Reliance Upon Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.5 Responsibility and Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE FOUR - PARTICIPATION
4.1 Eligibility of Employees and Outside Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.2 Notification of Eligible Employees and Outside Director . . . . . . . . . . . . . . . . . . . . . . . . 14
4.3 Participant Compensation Deferral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.4 Bonus Deferral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.5 Suspension of Deferrals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.6 Vesting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE FIVE - ACCOUNTS
5.1 Deferral of Compensation and/or Bonus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
5.2 Investment of Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
5.3 Allocation of Investment Experience to Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.4 Participants Rights Under the Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
5.5 Determination of Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE SIX - DISTRIBUTIONS
6.1 Amount of Deferred Compensation Subject to Distribution . . . . . . . . . . . . . . . . . . . . . . . . 22
6.2 Form of Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.3 Timing of Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.4 Advance Distribution Election Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
6.5 Withdrawals Due to Financial Emergency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
6.6 Payor of Deferred Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
6.7 Claims Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.8 Facility of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.9 Beneficiary Designations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.10 Withholding of Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE SEVEN - RIGHTS OF PARTICIPANTS
7.1 Annual Statement to Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
7.2 Limitation of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
7.3 Nonalienation of Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
7.4 Prerequisites to Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE EIGHT - MISCELLANEOUS
8.1 Amendment or Termination of the Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
8.2 Powers of the Company/Change in Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
8.3 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
8.4 Separability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
8.5 Gender, Tense and Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.6 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.7 Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
</TABLE>
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<PAGE> 4
CAMCO INTERNATIONAL INC.
DEFERRED INCOME PLAN
ARTICLE ONE
ESTABLISHMENT, PURPOSE AND STATUS OF THE PLAN
1.1 ESTABLISHMENT OF PLAN. Camco International Inc. (the
"Company") hereby establishes, effective as of April 1, 1997, an unfunded
deferred compensation plan to be known as the "Camco International Inc.
Deferred Income Plan" (the "Plan").
1.2 PURPOSE OF PLAN. The Plan is maintained for the purpose of
providing Participants the opportunity to defer all or a portion of base
compensation that would otherwise be received in an earlier year. In addition,
the Plan provides a mechanism through which Participants may defer all or a
portion of any annual bonus that would otherwise be received in an earlier
year.
1.3 STATUS OF PLAN. The Plan is intended as an unfunded plan
maintained primarily for the purpose of providing deferred compensation for (i)
outside directors and (ii) a select group of management or highly compensated
employees within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of the
Employee Income Retirement Security Act of 1974, as amended ("ERISA"), and as
such it is intended that the Plan be exempt from the participation and vesting,
funding, and fiduciary responsibility requirements of Title I of ERISA and that
the Plan qualify for simplified reporting under U.S. Department of Labor
regulation Section 2530.104-23, which provides for an alternative method of
compliance for plans described in such regulation. The Plan is not intended to
satisfy the qualification requirements of Section 401 of the Code.
<PAGE> 5
ARTICLE TWO
DEFINITIONS
Each term below shall have the meaning assigned thereto for all
purposes of the Plan unless the context reasonably requires a broader, narrower
or different meaning.
2.1 ADMINISTRATOR. "Administrator" means the Person or Persons
designated by the Compensation Committee pursuant to Section 3.1.
2.2 BENEFICIARY. "Beneficiary" means the beneficiary or
beneficiaries designated by the Participant to receive any amounts
distributable under the Plan upon the death of the Participant.
2.3 BOARD. "Board" means the Board of Directors of the Company.
2.4 BONUS. "Bonus" means any amount payable to the Employee with
respect to a complete or partial Plan Year as an award granted under any bonus
program of the Company or a Subsidiary.
2.5 CHANGE IN CONTROL. "Change in Control" means the occurrence
of any of the following events: (i) any person (as defined in Sections 3(a)(9)
and 13(d)(3) of the Securities Exchange Act of 1934 (the "Exchange Act")),
becoming a beneficial owner (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act on September 1, 1993) of 30% or more of the Company's voting
securities, (ii) there is a change in the composition of a majority of the
Company's Board within any period of four consecutive years which change was
not approved by a majority of the Board as constituted immediately prior to the
commencement of such four-year period, (iii) at any meeting of stockholders of
the Company called for the purpose of electing directors, more than one of the
persons nominated by the Board fails to be elected or (iv) the stockholders of
the Company approve a merger, consolidation, sale of substantially all
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assets or other reorganization of the Company, other than reincorporation in
which the Company does not survive.
2.6 CLAIMANT. "Claimant" means the Person or Persons described in
Section 6.7 who apply for benefits that may be payable under the Plan.
2.7 CODE. "Code" means the Internal Revenue Code of 1986, as
amended, and the regulations and other authority issued thereunder by the
appropriate governmental authority. References herein to any section of the
Code shall include references to any successor section or provision of the
Code.
2.8 COMPANY. "Company" means Camco International Inc. or any
successor thereto.
2.9 COMPENSATION. "Compensation" means the base salary paid in
cash during the Plan Year by the Company or a Subsidiary to the Employee for
services rendered or labor performed for the Company or Subsidiary increased by
any amounts that the Employee could have received in cash in lieu of deferrals
pursuant to Section 4.3. In the case of an Outside Director, Compensation
means the cash remuneration paid as fees for services rendered to the Company
as a member of the Board increased by amounts that the Outside Director could
have received in cash in lieu of deferrals pursuant to Section 4.3.
2.10 COMPENSATION COMMITTEE. "Compensation Committee" means the
Executive Compensation Committee of the Board.
2.11 DEFERRAL AGREEMENT. "Deferral Agreement" means a separate
written agreement entered into by and between the Company or a Subsidiary and a
Participant, which agreement describes the terms and conditions of such
Participant's deferred compensation arrangement hereunder for the Plan Year.
The Deferral Agreement shall be executed and dated by the
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Participant and shall specify (i) the amount of Compensation and/or Bonus, by
percentage or dollar amount, to be deferred and (ii) the date or dates for
payment of deferred amounts.
2.12 DEFERRED COMPENSATION LEDGER. "Deferred Compensation Ledger"
means the appropriate accounting records maintained by the Administrator for
the Participants which set forth the name of each Participant and separate
accounts reflecting for each Participant (i) the amount of Compensation and
Bonus deferred pursuant to Article Four of the Plan and (ii) the amount of
Investment Experience credited or charged to the Participant's accounts
pursuant to Article Five. The Deferred Compensation Ledger shall be utilized
solely as a device for the measurement and determination of the contingent
amounts to be paid to Participants under the Plan. The Deferred Compensation
Ledger shall not constitute or be treated as an escrow, trust fund, or any
other type of funded account of whatever kind for Code or ERISA purposes and,
moreover, contingent amounts credited thereto shall not be considered "plan
assets" for ERISA purposes. In addition, no economic benefit or constructive
receipt of income shall be provided to any Participant for purposes of the Code
unless and until cash payments under the Plan are actually made to the
Participant. The Deferred Compensation Ledger merely provides a record of the
bookkeeping entries relating to the contingent benefits that the Company or a
designated Subsidiary intends to provide to Participants and shall thus reflect
a mere unsecured promise to pay such amounts in the future.
2.13 DETERMINATION DATE. "Determination Date" means, with respect
to all or a portion of a Participant's deferrals for a given Plan Year, as
specified by the Participant in his Deferral Agreement, the earlier to occur of
(i) the termination of his Employment due to his death, Disability, retirement
or another reason or (ii) the first day of any calendar year that may be
specified by the Participant in his Deferral Agreement which date shall not be
earlier than
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the first day of the calendar month following the fourth anniversary of the
last day of the Plan Year with respect to which the relevant deferral(s) was
(were) made.
2.14 DISABLED OR DISABILITY. "Disabled" or "Disability" means any
physical or mental incapacity of a Participant as defined in the Company's long
term disability plan, as in effect from time to time.
2.15 EMPLOYEE. "Employee" means a member of a select group of
management or highly compensated common-law employees of the Company or a
designated Subsidiary.
2.16 ERISA. "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended, and the regulations and other authority issued
thereunder by the appropriate governmental authority. References herein to any
section of ERISA shall include references to any successor section or provision
of ERISA.
2.17 EMPLOYMENT. "Employment" means either (i) employment as an
Employee or (ii) Board service as an Outside Director, whichever is applicable.
In cases involving an Employee, all periods of employment by the Company or a
Subsidiary shall be taken into account whether or not consecutive, and neither
the transfer of the Employee from employment by the Company to employment by a
Subsidiary nor the transfer of the Employee from employment by a Subsidiary to
employment by the Company shall be deemed to be a termination of Employment by
the Employee. Moreover, the Employment of an Employee shall not be deemed to
have been terminated because of his absence from active employment on account
of temporary illness or authorized vacation, or during temporary leaves of
absence from active employment granted by the Company or a Subsidiary for
reasons of professional advancement, education, health, or government service,
or during military leave for any period if the Employee returns to active
employment within 90 days after the termination of his military
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leave, or during any period required to be treated as a leave of absence by
virtue of (i) any enforceable employment or other agreement or (ii) any
applicable law, such as the federal Family and Medical Leave Act of 1993.
2.18 FINANCIAL EMERGENCY. "Financial Emergency" means an
unforeseeable emergency and severe financial hardship to the Participant
resulting from a sudden and unexpected illness or accident of the Participant
or of a dependent (as defined in Section 152(a) of the Code) of the
Participant, loss of the Participant's property due to casualty, or other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant. The circumstances that will
constitute an unforeseeable emergency will depend upon the facts of each case,
but a Financial Emergency shall not be deemed to exist to the extent that such
hardship is or may be relieved;
(i) Through reimbursement or compensation by insurance or
otherwise,
(ii) By liquidation of the Participant's assets, to the
extent the liquidation of such assets would not itself cause severe
financial hardship, or
(iii) By cessation of Compensation or Bonus deferrals
under the Plan.
By way of example, the need to send a Participant's child to college
or the desire to purchase a home would not be considered a Financial Emergency.
As a further example, a Financial Emergency that may be relieved by a cessation
of Compensation or Bonus deferrals will be considered to be a Financial
Emergency until such time as it is relieved by cessation of Compensation or
Bonus deferrals or by other means.
2.19 INVESTMENT EXPERIENCE. "Investment Experience" means the
hypothetical amounts credited (as income, gains or appreciation on any
hypothetical investments that may be permitted under the Plan) or charged (as
losses or depreciation on any such hypothetical
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investments) to the balances in the Participant's accounts under the Deferred
Compensation Ledger pursuant to Article Five.
2.20 LOSSES. "Losses" mean any and all losses, claims, damages,
judgments, settlements, liabilities, expenses and costs (and all actions in
respect thereof and any legal or other costs and expenses in giving testimony
or furnishing documents in response to a subpoena or otherwise), including the
cost of investigating, preparing or defending any pending threatened or
anticipated possible action, claim, suit or other proceeding, whether or not in
connection with litigation in which any Plan Administration Employee is a
party.
2.21 OUTSIDE DIRECTOR. "Outside Director" means a member of the
Board who is not at the time an Employee of the Company or any Subsidiary.
2.22 PARTICIPANT. "Participant" means for a given Plan Year an
Employee or Outside Director who meets the requirements set forth in Section
4.1. Notwithstanding the preceding sentence, an Employee or Outside Director
shall be considered a participant hereunder as long as he has any balance
credited to his accounts under the Deferred Compensation Ledger, regardless of
whether he is eligible to authorize Compensation and/or Bonus deferrals
hereunder for any Plan Year.
2.23 PERSON. "Person" means any natural person, firm, partnership,
association, corporation company, trust, business trust or other legal entity.
2.24 PLAN. "Plan" means the Camco International Inc. Deferred
Income Plan as set forth herein, and as the same may hereafter be amended from
time to time.
2.25 PLAN ADMINISTRATION EMPLOYEE. "Plan Administration Employee
means each past, present and future Administrator and each other employee who
acts in the capacity of an agent, delegate or representative of the
Administrator or the Company under the Plan.
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2.26 PLAN YEAR. "Plan Year" means the initial short Plan Year
beginning on April 1, 1997 and ending December 31, 1997. Thereafter, "Plan
Year" means the twelve consecutive month calendar year.
2.27 QUALIFIED PLAN. "Qualified Plan" means the Camco Thrift Plan
or any successor defined contribution plan maintained by the Company which is
intended to qualify under Section 401(a) and 401(k) of the Code.
2.28 RETIREMENT DATE. "Retirement Date" means the first day of the
month coincident with or next following the later to occur of (i) or (ii) where
(i) is the fifty-fifth birthday of the Participant and completion of at least
five years of Employment or the sixty-fifth birthday of a Participant,
whichever occurs first and (ii) is the date of his actual termination of
Employment.
2.29 SUBSIDIARY. "Subsidiary" means any majority-owned subsidiary
of the Company or any majority-owned subsidiary thereof, or any other
corporation, partnership or business venture in which the Company owns,
directly or indirectly, a significant financial interest provided that (i) the
Board designates such corporation, partnership or business venture to be a
Subsidiary for the purposes of this Plan for any Plan Year and (ii) the Board
of Directors (or equivalent governing authority) of such corporation,
partnership or business venture consents to being designated as a Subsidiary.
2.30 TRUST. "Trust" means a grantor trust of the type commonly
referred to as a "rabbi trust" created under the Trust Agreement to "informally
fund" contingent benefits payable under the Plan.
2.31 TRUST AGREEMENT. "Trust Agreement" means the Camco
International Inc. Management Deferred Income Plan Trust.
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2.32 TRUSTEE. "Trustee" means the duly appointed and acting
trustee of the Trust, and any successor thereto.
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<PAGE> 13
ARTICLE THREE
ADMINISTRATION
3.1 ADMINISTRATOR. The Administrator shall be the Person or
Persons as may be chosen by the Compensation Committee from time to time. In
the event of a vacancy in the office of Administrator, the Compensation
Committee shall be the Administrator. The Administrator shall serve at the
pleasure of the Compensation Committee and the Compensation Committee may
remove or replace the Administrator pursuant to procedures established by the
Compensation Committee.
The Administrator may also be a Participant. Any Administrator who is
also a Participant shall not act on any matter relating solely to himself. Any
action required under such circumstances shall be taken by the Compensation
Committee.
The Administrator shall not receive any special compensation for
serving as Administrator, but shall be reimbursed by the Company for any
reasonable expenses incurred in connection therewith. No bond or other
security need be required of the Administrator.
3.2 ADMINISTRATION OF PLAN. The Administrator shall operate,
administer, interpret, construe and construct the Plan, including, without
limitation, correcting any error or defect, supplying any omission or
reconciling any inconsistency. The Administrator reserves all powers necessary
or appropriate to implement and administer the terms and provisions of the
Plan, including the power to make findings of fact. The determination of the
Administrator as to the proper interpretation, construction, or application of
any term or provision of the Plan shall be final, binding, and conclusive with
respect to all interested persons and entities.
In addition, the Administrator shall implement the provisions of
Section 5.3 regarding investment of accounts, including the authority to direct
the Trustee in the selection or
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establishment of any investment funds that are to be made available by the
Trustee for investment by Participants of their accounts in assets held under
the Trust and, if such investment funds are in fact made available to
Participants, instruct the Trustee regarding Participants' investment
directions received by the Administrator. Furthermore, the Administrator shall
direct the Trustee in matters relating to the payment to the Participants of
amounts from their accounts maintained under the Plan in accordance with the
terms of the Plan.
3.3 DELEGATION. The Administrator may, in his discretion,
delegate one or more of his ministerial duties to his designated agents or to
employees of the Company or a Subsidiary, but may not delegate his
discretionary authority to make the determinations specified in Section 3.2.
3.4 RELIANCE UPON INFORMATION. The Administrator shall not be
liable for any decision, action, omission, or mistake in judgment, provided
that he acted in good faith in connection with the administration of the Plan.
Without limiting the generality of the foregoing, any decision or action taken
by the Administrator in reasonable reliance upon any information supplied to
him by the Board, the Compensation Committee, any employee of the Company or a
Subsidiary, the Company's legal counsel, or the Company's independent
accountants shall be deemed to have been taken in good faith.
The Administrator may consult with legal counsel, who may be counsel
for the Company or other counsel, with respect to his obligations or duties
hereunder, or with respect to any action, proceeding or question at law, and
shall not be liable with respect to any action taken, or omitted, in good faith
pursuant to the advice of such counsel.
3.5 RESPONSIBILITY AND INDEMNITY. To the full extent permitted by
law, the Company shall indemnify and hold harmless each Plan Administration
Employee against, and each Plan
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Administration Employee shall be entitled without further act on his part to
indemnity from the Company for, any and all Losses, as and when incurred,
directly or indirectly, relating to, based upon, arising out of, or resulting
from his being or having been a Plan Administration Employee; provided,
however, that such indemnity shall not include any Losses incurred by such Plan
Administration Employee with respect to any matters as to which he is finally
adjudged in any such action, suit or proceeding to have been guilty of criminal
misconduct in the performance of his duties as a Plan Administration Employee.
Any such Plan Administration Employee shall give Company prompt written notice
of his actual receipt of service of process in any such action, suit or other
proceeding. Notwithstanding the foregoing, the right to indemnification
hereunder shall not be affected by any failure of a Plan Administration
Employee to give such notice (or by delay by a Plan Administration Employee in
giving such notice) unless, and then only to the extent that, the rights and
remedies of the Company shall have been prejudiced as a result of the failure
to give, or delay in giving, such notice. In addition, any such Plan
Administration Employee shall, upon request of the Company, offer the Company
in writing, the opportunity to handle and defend same at its sole expense. The
decision by the Company to handle such proceeding shall conclusively determine
that the Plan Administration Employee is entitled to the indemnity provided
herein. The foregoing right of indemnification shall be in addition to any
liability that the Company may otherwise have to the Plan Administration
Employee.
THE COMPANY'S OBLIGATION HEREUNDER TO INDEMNIFY THE PLAN
ADMINISTRATION EMPLOYEE SHALL EXIST WITHOUT REGARD TO THE CAUSE OR CAUSES OF
THE MATTERS FOR WHICH INDEMNITY IS OWED AND EXPRESSLY INCLUDES (BUT IS NOT
LIMITED TO) THE LOSSES, DIRECTLY OR
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INDIRECTLY, RELATING TO, BASED UPON, ARISING OUT OF, OR RESULTING FROM ANY ONE
OR MORE OF THE FOLLOWING:
(i) THE SOLE NEGLIGENCE OR FAULT OF ANY PLAN
ADMINISTRATION EMPLOYEE OR COMBINATION OF PLAN ADMINISTRATION
EMPLOYEES;
(ii) THE SOLE NEGLIGENCE OR FAULT OF THE COMPANY;
(iii) THE SOLE NEGLIGENCE OR FAULT OF THIRD PARTIES;
(iv) THE CONCURRENT NEGLIGENCE OR FAULT OR ANY COMBINATION
OF THE PLAN ADMINISTRATION EMPLOYEE AND/OR THE COMPANY AND/OR ANY
THIRD PARTY; AND
(v) ANY OTHER CONCEIVABLE OR POSSIBLE COMBINATION OF
FAULT OR NEGLIGENCE, IT BEING THE SPECIFIC INTENT OF THE COMPANY TO
PROVIDE THE MAXIMUM POSSIBLE INDEMNIFICATION PROTECTION HEREUNDER, BUT
EXCLUDING ANY SUCH LOSSES THAT ARE FINALLY ADJUDGED BY A COURT OF
COMPETENT JURISDICTION TO HAVE RESULTED FROM THE CRIMINAL MISCONDUCT
OF THE PLAN ADMINISTRATION EMPLOYEE.
The Plan Administration Employee shall have the right to retain
counsel of its own choice to represent him, however, such counsel shall be
acceptable to the Company which acceptance shall not be unreasonably withheld.
The Company shall pay the fees and expenses of such counsel and such counsel
shall to the full extent consistent with its professional responsibilities
cooperate with the Company and any counsel designated by it. The Company shall
be liable for any settlement of any claim against the Plan Administration
Employee made with the written consent of the Company which consent shall not
be unreasonably withheld.
The foregoing right of indemnification shall inure to the benefit of
the successors and assigns, and the heirs, executors, administrators and
personal representatives of each Plan
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Administration Employee, and shall be in addition to all other rights to which
the Plan Administration Employee may be entitled as a matter of law, contract,
or otherwise.
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ARTICLE FOUR
PARTICIPATION
4.1 ELIGIBILITY OF EMPLOYEES AND OUTSIDE DIRECTORS. The only
individuals who shall be eligible to participate in the Plan for the Plan Year
are (i) Outside Directors scheduled for Board service during the Plan Year and
(ii) Employees who are (1) determined by the Company's Chief Executive Officer
(and any other officers of the Company appointed for this purpose by such Chief
Executive Officer) to be included in a select group of management or highly
compensated Employees of the Company or a Subsidiary, (2) nominated by such
officer or officers to participate in the Plan for such Plan Year and (3)
approved for such participation by the Compensation Committee. A Participant's
deferral election for a given Plan Year shall continue to be fully operative
during any paid leave of absence granted in accordance with Company or
Subsidiary policies. See Section 4.5 regarding unpaid leaves of absence.
4.2 NOTIFICATION OF ELIGIBLE EMPLOYEES AND OUTSIDE DIRECTORS. Not
less than thirty (30) days prior to the beginning of each Plan Year, the
Administrator shall notify in writing each of the affected Employees and
Outside Directors that they are eligible to elect to defer Compensation and/or
Bonus under the Plan. Employees or Outside Directors may be nominated and
approved as new Participants at any time during a Plan Year. As soon as
practicable (but in all events within thirty (30) days) after the effective
date on which an Employee or Outside Director described in the preceding
sentence first becomes eligible, the Administrator shall notify in writing each
of the designated persons of their initial eligibility to defer Compensation
and/or Bonus under the Plan. An Employee or Outside Director shall be a
Participant hereunder as long as he has any balance credited to his accounts
under the Deferred Compensation Ledger,
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regardless of whether he is eligible to authorize Compensation and/or Bonus
deferrals hereunder for any Plan Year.
4.3 PARTICIPANT COMPENSATION DEFERRAL. The following provisions
of this Section 4.3 shall apply for such period or periods as determined by the
Compensation Committee from time to time in its sole discretion. After an
Employee or Outside Director has been notified by the Administrator that he is
eligible to participate in the Plan, he must, in order to defer Compensation
with respect to a given Plan Year, notify the Administrator of his deferral
election by completing and executing a Deferral Agreement which shall be
irrevocable after the commencement of the Plan Year. The Employee may defer up
to fifty percent (50%) of his Compensation, and each Outside Director may defer
up to one hundred percent (100%) of his Compensation, that is paid during a
Plan Year or the portion thereof that he is a Participant who satisfies the
eligibility requirements of Sections 4.1 and 4.2. Provided, however, deferrals
of Compensation (and Bonus) for any Plan Year, shall not be less than three
thousand dollars ($3,000) in the aggregate and, except in the case of an
earlier Determination Date, shall be deferred for a period that shall not end
prior to the date following the fourth anniversary of the last day of the Plan
Year for which the deferral was made. An effective Deferral Agreement,
completed and signed by the Employee, must be received by the Administrator
within a time period established by the Administrator and in all events prior
to the commencement of the Plan Year in order for the Employee to make a
deferral during such Plan Year. Failure to have a completed and signed
Deferral Agreement on file with the Administrator at the commencement of any
Plan Year shall be treated as the Employee's election not to defer Compensation
for that Plan Year. Should any minimum level of participation established by
the Compensation Committee not be met for a given Plan Year, deferrals of
Compensation under this Section 4.3
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shall not be permitted and, as soon as practicable after he determines that
such minimum level of participation for such year has not been met, the
Administrator shall appropriately notify in writing each of the affected
Employees and Outside Directors.
Notwithstanding any provisions hereof to the contrary, if pursuant to
Section 4.1 an Employee or Outside Director is eligible to become a Participant
for the first time as of a date that occurs after the Plan Year has begun, the
newly eligible Participant, in order to defer Compensation hereunder, must
complete and execute a Deferral Agreement and return it to the Administrator
within thirty (30) days after the date on which the Employee first was notified
by the Administrator that he became eligible to be a Participant. Such
Deferral Agreement shall only apply to defer Compensation for services to be
performed for the remainder of the Plan Year by the Participant provided that
such services are to be performed subsequent to receipt of his Deferral
Agreement by the Administrator. Deferrals will commence on the first day of
the pay period next following the Administrator's receipt of the Participant's
Deferral Agreement.
The amount of Compensation elected to be deferred pursuant to a
Deferral Agreement shall be withheld on a pro rata basis from the Participant's
regular payments of Compensation for each pay period during the Plan Year.
4.4 BONUS DEFERRAL. Subject to approval of the Compensation
Committee, the following provisions of this Section 4.4 shall apply for such
period or periods as determined by the Compensation Committee from time to time
in its sole discretion. A Participant who wishes to make a deferral election
with respect to the amount of any Bonus that may be awarded to him with respect
to services performed during a given Plan Year must make such deferral election
when completing his Deferral Agreement for that Plan Year. The Participant may
defer up to
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one hundred percent (100%) of his Bonus for any Plan Year. Provided, however,
deferrals of Bonus (and Compensation) for any Plan Year shall not be less than
three thousand dollars ($3,000) in the aggregate and, except in the case of an
earlier Determination Date, shall be deferred for a period that shall not end
prior to the date following the fourth anniversary of the last day of the Plan
Year for which the deferral was made. Should any minimum level of
participation established by the Compensation Committee not be met for a given
Plan Year, deferrals of any Bonus under this Section 4.4 shall not be permitted
and, as soon as practicable after he determines that such minimum level of
participation for such year has not been met, the Administrator shall
appropriately notify in writing each of the affected Employees.
The dollar amount or percentage of a Bonus elected to be deferred
under this Section shall be deferred in one lump sum and shall be deemed to
have been deferred on the date the deferred portion of the Bonus would
otherwise have been paid to the Participant in the absence of his deferral
election. Any Bonus deferral election hereunder shall be void and ineffective
to the extent that no Bonus is awarded to the Participant with respect to the
Plan Year.
4.5 SUSPENSION OF DEFERRALS. All deferrals of Compensation and
Bonuses hereunder for a Plan Year shall be irrevocable, except that the
Administrator may, in his discretion, grant a suspension of a Participant's
deferral election for such time as the Administrator deems to be necessary upon
a finding that the Participant has suffered a Financial Emergency. A
Participant who believes he has suffered a Financial Emergency must petition
the Administrator in writing to request a suspension of his deferrals
hereunder. In addition, a Participant's deferral election shall be suspended
during any unpaid leave of absence granted in accordance with Company or
Subsidiary policies; provided, however that such deferral election shall become
fully operative
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as of the first day of the payroll period commencing coincident with or next
following the Participant's return to active Employment following termination
of the approved unpaid leave in the Plan Year to which the Participant's
Deferral Agreement pertains.
4.6 VESTING. For any Determination Date, amounts attributable to
deferrals of Compensation or Bonus which are credited to the Participant's
account maintained in the Deferred Compensation Ledger shall be fully vested.
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ARTICLE FIVE
ACCOUNTS
5.1 DEFERRAL OF COMPENSATION AND/OR BONUS. If a Participant has
elected to defer Compensation and/or a Bonus hereunder for a Plan Year, the
deferred amounts shall not be paid when they otherwise would have been paid in
the absence of such election. A bookkeeping entry to reflect the deferred
amounts shall be credited by the Administrator to the Participant's accounts
under the Deferred Compensation Ledger. With respect to Compensation and
Bonuses deferred hereunder for a Plan Year, each such deferred amount shall be
credited to the Participant's accounts under the Deferred Compensation Ledger
as of the date it otherwise would have been paid to the Participant.
5.2 INVESTMENT OF ACCOUNTS. Subject to the terms of the Plan and
Trust, the Administrator shall provide for direction by Participants of amounts
credited to their accounts in the Deferred Compensation Ledger, in any one or a
combination of hypothetical investment funds that shall be maintained in
connection with the Plan and which may be mirrored by investment funds that
actually are maintained under the Trust. In either event, the investment funds
shall be at least as diverse as the investment funds that are made available
from time to time to participants in the Qualified Plan; provided, however, no
direct investment in securities issued by the Company or any Subsidiary shall
be permitted under the Plan or Trust. In the event that such investment funds
are maintained under the Trust, the Trustee shall invest the assets of the
Trust as directed by the Administrator (or its delegate) in accordance with the
Trust Agreement. Except as otherwise provided below, each Participant shall
direct the Administrator (or its delegate) as to how the amounts credited to
his account in the Deferred Compensation Ledger shall be hypothetically
invested in the investment fund or funds made available under the
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Plan or Trust. Except as otherwise provided below, with respect to
hypothetical investments made available under the Trust, the Administrator (or
its delegate) shall then relate to the Trustee the directions of each
Participant as to which hypothetical investments are to be made for each
Participant. The Participant's directions, if any, shall be in a form and
manner and in the minimum increments prescribed by the Administrator. The
Administrator may, in its sole discretion, permit such Participant to
communicate directly with the Trustee or any investment manager of the Trust to
direct a change in the investment fund or funds in which his Account is
invested. The Administrator may prescribe the fund in which the Participants'
amounts shall be hypothetically invested in the absence of a direction by any
such Participant.
In addition, notwithstanding any provision of the Plan to the
contrary, neither the Administrator nor the Trustee of the Trust maintained in
connection with the Plan shall be bound to follow investment directions of each
Participant, but the Participant nevertheless shall be credited with the
hypothetical performance in the hypothetical investment or investments selected
by the Participant with respect to the investment fund or funds made available
under the Plan or Trust. The Company shall have the right, at any time and
from time to time, in its sole discretion, to substitute assets of equal fair
market value for any asset held by the Trust.
5.3 ALLOCATION OF INVESTMENT EXPERIENCE TO ACCOUNTS. As of the
last day of each Plan Year (or such shorter period as may be determined to be
appropriate by the Administrator in the Administrator's sole discretion), the
Administrator shall determine the Investment Experience of the hypothetical
investment or investments for the applicable accounting period and as soon as
practicable after such period, shall post the amount of Investment Experience
to the Participant's accounts, effective as of the end of such period.
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5.4 PARTICIPANTS RIGHTS UNDER THE TRUST. The assets of the Trust
shall be held for the benefit of the Participants in accordance with the terms
of the Plan and Trust Agreement. In accordance with the provisions of Article
Three of the Trust Agreement, the assets of the Trust that are attributable to
the Company or a Subsidiary shall remain subject to the claims of the general
creditors of the Company or the Subsidiary and not otherwise, and the rights of
the affected Participants to the amounts in the Trust shall be limited as
provided in Article III of the Trust Agreement in the event that the Company or
the Subsidiary that employs such Participants becomes insolvent.
5.5 DETERMINATION OF ACCOUNT. The aggregate amount credited to a
Participant's accounts under the Deferred Compensation Ledger shall consist of
(i) the amounts of Compensation and Bonuses that were deferred pursuant to
Article Four, plus (or minus) (ii) the amounts of Investment Experience
credited (or charged) to such accounts pursuant to Article Five, minus (iii)
the aggregate amount of any distributions made from such accounts pursuant to
Article Six.
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ARTICLE SIX
DISTRIBUTIONS
6.1 AMOUNT OF DEFERRED COMPENSATION SUBJECT TO DISTRIBUTION. As
of the Participant's Determination Date, the aggregate distributable vested
amount credited to his accounts maintained under the Deferred Compensation
Ledger shall be distributable in accordance with the provisions of Section 6.2.
Any amount that is to be distributed to a Participant or Beneficiary pursuant
to this Article Six shall be fixed and determined as is provided in Sections
6.2(a) and 6.3(b).
6.2 FORM OF DISTRIBUTIONS. Subject to Section 6.4, upon the
occurrence of the Participant's Determination Date with respect to all or a
portion of amounts deferred under the Plan for a given Plan Year, the amounts
credited to a Participant's accounts maintained under the Deferred Compensation
Ledger with respect to such Plan Year shall become distributable to such
Participant (or to his Beneficiary in the event of Participant's death) in one
of the forms set forth under Section 6.2(a) or Section 6.2(b), as elected in
writing by such Participant at the time the election was made to defer the
Compensation and/or Bonus.
(a) Lump Sum. If elected by the Participant in his
Deferral Agreement for a given Plan Year, the affected portion of the
Participant's accounts pertaining to such Plan Year shall be paid in a
lump-sum distribution of the entire vested balance credited to the
Participant's accounts maintained under the Deferred Compensation
Ledger with respect to the affected Plan Year(s) as of the applicable
Determination Date plus any deferrals of Compensation or Bonus that
were subsequently credited to the affected accounts of the Participant
up to the date benefits are paid pursuant to Section 6.3(a), less any
23
<PAGE> 27
distributions that were subsequently made from such accounts up to the
date benefits are paid pursuant to Section 6.3(a).
(b) Installment Payments. If the Participant's account
balance is at least fifty thousand dollars ($50,000) and if the
aggregate distributable amount of installment payments for any twelve
(12) consecutive month period is or will be at least $10,000, the
affected portion of the Participant's accounts pertaining to a given
Plan Year shall be paid in annual or monthly installments, as elected
by the Participant in his Deferral Agreement, to be paid during a
specified period of not less than five (5) years nor more than ten
(10) years, as elected by the Participant in his Deferral Agreement.
If the Participant's account balance at the beginning of the period is
(or during the distribution period drops) below fifty thousand dollars
($50,000), a lump sum payment may be made at the Company's discretion,
and if the aggregate distributable amount of installment payments for
any twelve (12) consecutive month period is (or will be) less than
$10,000, an annual installment may be made in lieu of monthly
installments at the Company's discretion.
Installment payments shall be available only to a Participant who terminates
Employment on or after attaining his Retirement Date. Accordingly, any amount
that is to be distributed with reference to a Participant who is in Employment
or who terminates Employment prior to attaining his Retirement Date shall be
paid in the form of a lump sum. Should a Participant terminate Employment on
or after his Retirement Date and die prior to receiving all installments due
under the Plan, installment payments shall be made or continue if the
Participant's Beneficiary is his surviving spouse; otherwise all unpaid
installments shall be paid to the any
24
<PAGE> 28
nonspouse Beneficiary of the deceased participant as soon as administratively
practicable following the Participant's death in the form of a lump sum
payment.
6.3 TIMING OF DISTRIBUTIONS. The following provisions are subject
to Section 6.4.
(a) Lump Sum Distribution. Lump sum distributions shall
be made within sixty (60) days after the Participant's termination of
Employment or any earlier Determination Date, if applicable.
(b) Installment Payments. Installment payments shall
commence as of the date selected by the Participant which date must be
(i) the first day of any calendar month and (ii) within sixty (60)
days after the Participant's Retirement Date. The initial installment
will be based on the amount credited to the recipient's account as of
the Determination Date last preceding the date of payment.
Thereafter, the remaining installment payments shall be made as of the
annual or monthly anniversary of the first installment date and will
be based on the recipient's account balance as of the anniversary of
the Determination Date last preceding the date of such installment
payment. Installment payments shall be determined by determining the
recipient's account balance as of the relevant anniversary and
multiplying the recipient's account balance as of the relevant
anniversary by a fraction the numerator of which is one and the
denominator of which is the remaining number of years or months of the
term for which payments have not been made.
(c) Acceleration of Distribution(s). Notwithstanding any
other provision of the Plan to the contrary, the Participant, through
submission of a written application to the Administrator, may apply
for a distribution of the entire balance of his/her accounts, without
regard to (i) whether payment of benefits due under the Plan have
commenced,
25
<PAGE> 29
or (ii) any condition of Financial Emergency. Any distribution so
requested shall be made as soon as practical following the
Participant's application and shall be subject to a forfeiture of ten
percent (10%) of the amount requested and a permanent suspension of
his participation in the Plan. Provided; however, if the
Administrator determines in good faith that there is a reasonable
likelihood that any benefits that are intended to be deferred pursuant
to this Plan would not be deferred under applicable income tax
provisions then in effect due to the provisions of this Section
6.3(c), then to the extent deemed necessary by the Administrator to
ensure that the desired deferral features of this Plan are operative
with respect to Participants who desire to avoid current taxation of
vested benefits accrued under the Plan, the Administrator may defer
payment of all or any portion of such benefits that would otherwise be
distributable under this Section 6.3(c). Any amounts deferred
pursuant to this Plan shall continue to receive Investment Experience
pursuant to the Plan until distribution. The amounts so deferred
shall be distributed to the affected Participant (or his Beneficiary
in the event of the Member's death) at the earliest possible date, as
determined by the Administrator in good faith, as of which such
desired deferral features will be ensured.
6.4 ADVANCE DISTRIBUTION ELECTION REQUIRED. Subject to
Section 6.3(c), the Participant's election as to the form and timing
of his distribution hereunder must be made at the same time the
Participant's Deferral Agreement is completed and signed by the
Participant prior to the last day of the Plan Year immediately
preceding the Plan Year to which the Deferral Agreement applies or, if
applicable, within thirty (30) days after the date on which an
Employee or Outside Director was first notified of eligibility to
become a Participant after the beginning of a Plan Year. Provided,
however, in the case
26
<PAGE> 30
of a Participant who retires for age after attaining his earliest
Retirement Date, such election may be changed at least one year prior
to the date that he would be eligible to receive a distribution due to
retirement after attaining his Retirement Date, and such election
shall be irrevocable during such one year period. If the Participant
validly elects installment payments, then Investment Experience shall
continue to be credited by the Administrator to undistributed amounts
allocated to the Participant's accounts under the Deferred
Compensation Ledger. Pending receipt of any distribution from the
Plan, the Participant or Beneficiary shall remain subject to Section
7.2 and other applicable provisions of the Plan.
6.5 WITHDRAWALS DUE TO FINANCIAL EMERGENCY. A Participant who
believes he has suffered a Financial Emergency may in writing request a
withdrawal of the portion of his account balances needed to satisfy the
emergency need. The Administrator will review the Participant's request to
determine whether, in his discretion, a Financial Emergency has occurred and,
if so, the amount reasonably needed to satisfy the emergency need. The
Participant must provide the Administrator with all relevant information needed
to make these determinations. All deferrals of Compensation and/or Bonuses
authorized by the Participant for the remainder of the Plan Year shall be
suspended before any withdrawal is made hereunder on account of the Financial
Emergency.
In his discretion, the Administrator shall authorize a withdrawal to
the Participant in the amount reasonably necessary to satisfy the Financial
Emergency. No Investment Experience shall be credited (or charged) to the
Participant's accounts during an applicable accounting period with respect to
the amount withdrawn to satisfy the Financial Emergency. Withdrawals will be
made with respect to the first amounts available for distribution for each Plan
Year;
27
<PAGE> 31
provided, however, if access must be had to amounts credited under the Plan for
a Plan Year where all amounts credited with respect to such Plan Year will not
be exhausted, amounts will be withdrawn pro rata between and among any
hypothetical investment funds that may be operative with respect to such year.
6.6 PAYOR OF DEFERRED COMPENSATION. Benefits payable under the
Plan with respect to a Participant's accounts maintained under the Deferred
Compensation Ledger shall be the obligation of, and payable by, the Company and
any Subsidiary that employed that Participant with respect to the periods for
which deferrals are made hereunder; provided, however, should the Company pay
any portion of a Subsidiary's obligation hereunder, the Company may seek
reimbursement from any Subsidiary which employed the Participant. Adoption and
maintenance of the Plan by the Company and any Subsidiary shall not, for that
reason, create a joint venture or partnership relationship between or among
such entities for purposes of payment of benefits under the Plan or for any
other purpose.
Neither the Company nor any Subsidiary shall set aside any assets or
otherwise create any type of fund in which any Participant, or any person
claiming under such Participant, has an interest other than that of an
unsecured general creditor of the Company or Subsidiary, or which would provide
any Participant, or any person claiming under such Participant, with a legally
enforceable right to priority over any general creditor of the Company or
Subsidiary in the event of insolvency of the Company or Subsidiary. For all
purposes of the Plan, the Company or Subsidiary shall be considered insolvent
if it is unable to pay its debts as they mature or if it is subject to a
pending proceeding as a debtor under the U.S. Bankruptcy Code.
During any period in which a Trust which conforms to the prior
paragraph is in existence, benefits payable under the Plan shall be payable by
the Trustee in accordance with
28
<PAGE> 32
the terms, provisions, conditions and limitations of the Plan and Trust. To
the extent that any distribution described in the immediately preceding
sentence does not fully satisfy the obligation for any benefit due under the
Plan, the Company or Subsidiary shall remain fully liable and obligated for
full payment of any unpaid benefit due and payable under the Plan.
6.7 CLAIMS PROCEDURES. A Participant is not required to file a
claim to receive benefits payable under the Plan. The Administrator or
Trustee, as applicable, shall pay benefits due under the Plan in accordance
with the terms of the various Deferral Agreements. To the extent that such
payments are not made when due, a claim should be submitted to the
Administrator or Trustee, as applicable, by the Participant or by his
Beneficiary in the event of Participant's death ("Claimant" for purposes of
this section). A decision on a Claimant's claim for benefits shall be made
within twenty (20) days after receipt of the claim. In the event there is a
disagreement concerning the amount payable to the Claimant, the Claimant shall
receive written notification of the amount in dispute and shall be entitled to
a full review of his claim. If a claim is denied, a Claimant desiring a review
must submit a written request to the Compensation Committee requesting such a
review, which request should include whatever comments or arguments that the
Claimant wishes to make. Incident to the review, the Claimant may represent
himself or appoint a representative to do so, and he shall have the right to
inspect all documents pertaining to the issue. The Compensation Committee, in
its discretion, may schedule any meeting with the Claimant and/or the
Claimant's representative that it deems to be necessary or appropriate to
facilitate or expedite its review of the amount in dispute.
A request for a review must be filed with the Compensation Committee
within sixty (60) days after notice of the disputed amount is received by the
Claimant. If no request is received within the 60-day time limit, the
determination of the amount due by the Administrator or
29
<PAGE> 33
Trustee, as applicable, will be final. However, if a request for review of a
disputed amount is timely filed, the Compensation Committee must render its
decision under normal circumstances within thirty (30) days of its receipt of
the request for review. In special circumstances the decision may be delayed
if, prior to expiration of the initial 30-day period, the Claimant is notified
of the extension, but must in any event be rendered no later than sixty (60)
days after receipt of the Claimant's request. All decisions of the
Compensation Committee shall be in writing and shall include specific reasons
for whatever action has been taken, as well as the Plan provisions on which the
decision is based.
6.8 FACILITY OF PAYMENTS. Every person receiving or claiming
benefits under the Plan shall be conclusively presumed to be mentally competent
until the date on which the Administrator receives written notice, in a form
and manner acceptable to the Administrator, that such person is incompetent,
and that a guardian, conservator, or other person legally vested with the care
of such person's person or estate has been appointed; provided, however, that
if the Administrator shall find that any person to whom a benefit is payable
under the Plan is unable to care for such person's affairs because of
incompetency, any payment due (unless a prior claim therefor shall have been
made by a duly appointed legal representative) may be paid as provided in the
Qualified Plan. Any such payment so made shall be a complete discharge of
liability therefor under the Plan.
6.9 BENEFICIARY DESIGNATIONS. Each Employee or Outside Director
upon becoming a Participant shall file with the Administrator a designation of
one or more Beneficiaries to whom benefits otherwise payable to the Participant
shall be made in the event of his death prior to the complete distribution of
the amount credited to his accounts under the Deferred Compensation Ledger.
Such designation shall be effective when received in writing by the
30
<PAGE> 34
Administrator subject to the subsequent provisions of this paragraph. Subject
to the following provisions of this Section 6.10, a Participant may, from time
to time, revoke or change his Beneficiary designation without the consent of
any prior Beneficiary by filing a new designation with the Administrator. The
last valid designation received by the Administrator shall be controlling;
provided, however, that no Beneficiary designation, or change or revocation
thereof, shall be effective unless received by the Administrator prior to the
Participant's death and in no event shall it be effective as of a date prior to
its receipt. Notwithstanding any contrary provision of this paragraph, no
Beneficiary designation made by a married Participant, other than one under
which the spouse of such Participant is designated as the sole Beneficiary,
shall be valid without the written consent of the spouse of such Participant.
In addition, except in the case of unpaid installments that are payable to the
spouse of the deceased retired Participant, all unpaid amounts credited to the
accounts maintained under the Deferred Compensation Ledger for a Participant
who dies prior to receiving such amounts in full shall be paid to the deceased
Participant's Beneficiary as soon as administratively practicable following the
Participant's death in the form of a lump sum cash distribution.
If no valid Beneficiary designation is in effect at the time of a
Participant's death, or if no designated Beneficiary survives the Participant,
or if such designation conflicts with applicable law, the payment of the
Participant's death benefits under the Plan shall be made to the Participant's
estate. If the Administrator is in doubt as to the right of any person to
receive such amount, the Administrator may direct that the amount be paid into
any court of competent jurisdiction, and such payment shall be a full and
complete discharge of any liability or obligation of the Plan, Trust, Company,
Administrator, Compensation Committee, Board and other interested parties,
therefor.
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<PAGE> 35
6.10 WITHHOLDING OF TAXES. The Company or, if appropriate, the
Trustee, shall withhold from the amount of benefits payable under the Plan all
federal, state and local taxes required to be withheld under any applicable law
or governmental regulation or ruling. Without limiting the scope of the
immediately preceding sentence, the Employee portion of any employment taxes
due on deferrals hereunder shall be withheld from the Participant's
compensation or under such other arrangement as may be acceptable to the
Administrator.
32
<PAGE> 36
ARTICLE SEVEN
RIGHTS OF PARTICIPANTS
7.1 ANNUAL STATEMENT TO PARTICIPANTS. As soon as practicable
after the end of each Plan Year, or at such other time as the Administrator
determines to be appropriate, the Administrator shall cause to be prepared and
delivered to each Participant a written statement showing such information as
the Administrator decides is appropriate.
7.2 LIMITATION OF RIGHTS. Nothing in this Plan shall be construed
to:
(i) Give any individual who is employed by the Company or
any Subsidiary any right to be a Participant in the Plan unless and
until such person meets applicable eligibility requirements;
(ii) Give a Participant or any other person any interests
or rights, other than as an unsecured general creditor of the Company
or any Subsidiary, with respect to the Compensation, Bonuses and
Investment Experience credited or charged to his accounts under the
Deferred Compensation Ledger until such amounts are actually
distributed to him;
(iii) Limit in any way the right of the Company or any
Subsidiary to terminate a Participant's Employment with the Company or
any Subsidiary;
(iv) Give a Participant or any other person any interest
in any fund or in any specific asset of the Company or any Subsidiary;
(v) Be evidence of any agreement or understanding,
express or implied, that the Company or any Subsidiary will employ a
Participant in any particular position, at any particular rate of
remuneration, or for any particular time period; or
33
<PAGE> 37
(vi) Create a fiduciary relationship between the
Participant and the Company, Subsidiary, Compensation Committee,
Board, and/or Administrator.
7.3 NONALIENATION OF BENEFITS. No right or benefit under this
Plan shall be subject to anticipation, alienation, sale, assignment, pledge,
encumbrance, or charge, and any attempt to anticipate, alienate, sell, assign,
pledge, encumber, or charge the same will be void and without effect. No right
or benefit hereunder shall in any manner be liable for or subject to any debts,
contracts, liabilities or torts of the person entitled to such benefits. If
any Participant or Beneficiary hereunder shall become bankrupt or attempt to
anticipate, alienate, assign, sell, pledge, encumber, or charge any right or
benefit hereunder, or if any creditor shall attempt to subject the same to a
writ of garnishment, attachment, execution, sequestration, or any other form of
process or involuntary lien or seizure, then such right or benefit shall be
held by the Company for the sole benefit of the Participant or Beneficiary, his
spouse, children, or other dependents, or any of them, in such manner as the
Administrator shall deem proper, free and clear of the claims of any party.
The first paragraph of this section shall not preclude (i) the
Participant from designating a Beneficiary to receive any benefit payable
hereunder upon his death, (ii) the executors, administrators, or other legal
representatives of the Participant or his estate from assigning any rights
hereunder to the person or persons entitled thereto, or (iii) compliance on the
part of the Administrator with a domestic relations order ("DRO") issued by a
court of competent jurisdiction, provided that such order is determined by the
Administrator to be a qualified domestic relations order ("QDRO") described in
Section 414(p) of the Code; provided, however, that any portion of a
Participant's vested interest in the Plan that is awarded to the nonparticipant
34
<PAGE> 38
spouse shall be distributed in a lump sum in cash by the Administrator or
Trustee, as applicable, as soon as practicable following the Administrator's
determination that the DRO is a QDRO.
7.4 PREREQUISITES TO BENEFITS. No Participant, nor any person
claiming through a Participant, shall have any right or interest in the Plan,
or any benefits hereunder, unless and until all the terms, conditions and
provisions of the Plan which affect such Participant or such other person shall
have been complied with as specified herein.
35
<PAGE> 39
ARTICLE EIGHT
MISCELLANEOUS
8.1 AMENDMENT OR TERMINATION OF THE PLAN. The Board may amend or
terminate the Plan at any time effective as of the date specified by the Board,
including amendments with a retroactive effective date; provided, however, the
provisions of Section 8.2 may not be amended without the consent of at least
two-thirds of all affected Participants. In addition, unless the particular
Participant (or his Beneficiary in the event of the Participant's death)
consents in writing, no such amendment or termination shall adversely affect
any rights of such Participant or Beneficiary to any amounts which are required
to be allocated and credited hereunder to his accounts maintained under the
Deferred Compensation Ledger. However, in the event that incident to any such
amendment or termination, payment of any benefit accrued under the Plan is
accelerated, such benefit shall be paid by the Company or Subsidiary if payment
of such benefit would otherwise be made by the Trustee from assets of the Trust
under circumstances which would at any time when the Company or Subsidiary is
insolvent (as defined in Section 6.6) (i) treat the Participant, or any person
claiming under the Participant, as other than a general unsecured creditor of
the Company or Subsidiary or (ii) provide the Participant, or any person
claiming under the Participant, with a legally enforceable right to priority
over any general unsecured creditor of the Company or Subsidiary.
8.2 POWERS OF THE COMPANY/CHANGE IN CONTROL. The existence of
outstanding and unpaid benefits under the Plan shall not affect in any way the
right or power of the Company or any Subsidiary to make or authorize any
adjustments, recapitalization, reorganization or other changes in the Company's
or Subsidiary's capital structure or in its business, or any merger or
consolidation of the Company or any Subsidiary, or any issue of bonds,
debentures, common
36
<PAGE> 40
or preferred stock, or the dissolution or liquidation of the Company or any
Subsidiary, or any sale or transfer of all or any part of their assets or
business, or any other act or corporate proceeding, whether of a similar
character or otherwise. Provided, however, in the event of a Change in
Control, the full amount of any remaining unpaid vested benefits credited to
the accounts maintained under the Deferred Compensation Ledger for each
Participant whose Employment is terminated or has a significant decrease in
level of responsibility within six months prior to, or within two years after,
a Change in Control shall immediately be paid in a single lump sum payment of
cash as of the later of the date of such termination or the Change in Control.
8.3 WAIVER. No term or condition of this Plan shall be deemed to
have been waived, nor shall there be an estoppel against the enforcement of any
provision of this Plan, except by written instrument of the party charged with
such waiver or estoppel. No such written waiver shall be deemed a continuing
waiver unless specifically stated therein, and each such waiver shall operate
only as to the specific term or condition waived and shall not constitute a
waiver of such term or condition for the future or as to any act other than
that specifically waived.
Any waiver by either party hereto of a breach of any provision of this
Plan by the other party shall not operate or be construed as a waiver by such
party of any subsequent breach thereof.
8.4 SEPARABILITY. In the event that any provision of this Plan is
declared invalid and not binding on the parties hereto in a final decree or
order issued by a court of competent jurisdiction, such declaration shall not
affect the validity of the other provisions of this Plan to which such
declaration of invalidity does not relate and such other provisions shall
remain in full force and effect.
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<PAGE> 41
8.5 GENDER, TENSE AND HEADINGS. Whenever the context requires,
words of the masculine gender used herein shall include the feminine and
neuter, and words used in the singular shall include the plural. The words
"hereof", "hereunder", "herein," and similar compounds of the word "here" shall
refer to the entire Plan and not to any particular term or provision of the
Plan. Headings of Articles and Sections, as used herein, are inserted solely
for convenience and reference and shall not affect the meaning, interpretation
or scope of the Plan.
8.6 GOVERNING LAW. The Plan shall be subject to and governed by
the laws of the State of Texas (other than such laws relating to choice of
laws), except to the extent preempted by ERISA or other applicable federal law.
8.7 NOTICE. Any notice required or permitted to be given under
this Plan shall be sufficient if in writing and hand-delivered with appropriate
proof of same, or sent by registered or certified mail, return receipt
requested, to the Company, Administrator, Compensation Committee, Participant,
Beneficiary or other person or entity at the address last furnished by such
person or entity. 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.
IN WITNESS WHEREOF, this Plan document is executed this ____the day of
___________, 1997 by a duly authorized officer of the Company, to be effective
as of April 1, 1997.
CAMCO INTERNATIONAL INC.
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
38
<PAGE> 1
EXHIBIT 4.7
CAMCO INTERNATIONAL INC.
DEFERRED INCOME
PLAN TRUST
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 Administrator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.4 Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.5 General Investment Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.6 Insolvent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.7 Investment Manager . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.8 Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.9 Participating Employer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.10 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.11 Separate Investment Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.12 Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.13 Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.14 Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.15 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II INCORPORATION OF PLAN
AND ADOPTION BY PARTICIPATING EMPLOYERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.1 Incorporation of Plan by Reference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.2 Trust Agreement is Irrevocable and is Given Precedence Over Plan Document . . . . . . . . . . . 4
2.3 Adoption by Participating Employers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.4 No Joint Venture Created. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE III CLAIMS OF GENERAL CREDITORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.1 Trust Fund Considered as General Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.2 Insolvency of a Participating Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE IV CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.1 Participating Employer Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.2 Trustee Only Responsible for Assets Received . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE V PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.1 Payments to Participants and Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.2 Insufficient Trust Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE VI THE TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
6.1 Accumulation Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
6.2 Exclusive Benefit of Participants and Beneficiaries . . . . . . . . . . . . . . . . . . . . . . 9
</TABLE>
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6.3 Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
6.4 Legal Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
6.5 Grantor Trust Intended . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
6.6 Separate Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE VII THE ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.1 Administrator Charged with Administration of the Plan . . . . . . . . . . . . . . . . . . . . . 11
7.2 Powers of Direction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.3 Change of Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE VIII THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
8.1 Trustee Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
8.2 Trustee as Fiduciary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
8.3 Powers Relating to Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
8.4 Standard of Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.5 Powers Relating to Payment and Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.6 Certain Powers Prohibited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
8.7 Proof of Trustee's Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
8.8 Employment of Legal Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
8.9 Exemption from Bond . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE IX NOTICES AND DIRECTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.1 Effective Time of Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.2 Evidence of Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.3 Notices from Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE X FEES AND EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE XI LIABILITY OF THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.1 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.2 Acts or Omissions Under Direction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.3 Acts or Omissions of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.4 Withholding for Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.5 Filing Returns or Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.6 Requesting Advice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE XII ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
12.1 Maintenance of Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
12.2 Written Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE XIII RESIGNATION, REMOVAL AND SUCCESSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
13.1 Notice of Resignation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
13.2 Notice of Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
13.3 Vacancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
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13.4 Appointment of Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
13.5 Transfer of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
13.6 Consolidation or Merger of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE XIV AMENDMENT AND TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
14.1 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
14.2 Withdrawal of a Participating Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
14.3 Termination of Participation in the Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
14.4 Consolidation or Merger of a Participating Employer . . . . . . . . . . . . . . . . . . . . . . 26
14.5 Ultimate Termination of the Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE XV MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
15.1 Trust Not a Contract with Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
15.2 Spendthrift Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
15.3 Ownership of Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
15.4 Insurance Company Not a Party . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
15.5 Gender of Words . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
15.6 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
15.7 Governing Law; Parties to Legal Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
</TABLE>
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<PAGE> 5
CAMCO INTERNATIONAL INC.
DEFERRED INCOME PLAN TRUST
THIS TRUST AGREEMENT is entered into this _____ day of
_________________, 1997 between Camco International Inc. (the "Employer"), as
settlor, and Wachovia Bank of North Carolina, N.A., as trustee (the "Trustee").
The trust created and maintained pursuant to this Trust Agreement is intended
to be an irrevocable grantor trust within the meaning of section 671 of the
Internal Revenue Code of 1986, as amended, (the "Code") for the express purpose
of setting aside assets to assist each Participating Employer (defined below)
in providing deferred compensation benefits to participants and beneficiaries
covered under the Camco International Inc. Deferred Income Plan (the "Plan").
The Employer has transferred and delivered to the Trustee that property which
is described in Exhibit "A" attached to and made a part of this Trust
Agreement. The Trustee accepts the trust created hereunder and the res
transferred, in trust, and agrees to hold, preserve, manage, administer, invest
and reinvest the assets which comprise the trust fund for the exclusive purpose
of providing benefits to the participants and beneficiaries under the Plan and
defraying reasonable expenses of administration of the trust, upon the terms
and conditions herein stated and agreed to by the parties as follows:
<PAGE> 6
ARTICLE I
DEFINITIONS
1.1 ADMINISTRATOR. "Administrator" shall mean the person or
persons appointed pursuant to applicable provisions of the Plan to manage and
administer the Plan.
1.2 BENEFICIARY. "Beneficiary" shall mean the person, persons or
entity designated under the provisions of the Plan to receive benefits in the
event of the death of the Participant.
1.3 CODE. "Code" shall mean the Internal Revenue Code of 1986, as
amended, and the regulations and other authority issued thereunder by the
appropriate governmental authority. References herein to any section of the
Code shall include references to any successor section or provision of the
Code.
1.4 EMPLOYER. "Employer" shall mean Camco International Inc. and
any successor thereof that adopts and continues the Trust.
1.5 GENERAL INVESTMENT FUND. "General Investment Fund" shall mean
the portion of the Trust Fund that is under the investment management of the
Trustee.
1.6 INSOLVENT. "Insolvent" shall mean with respect to a
Participating Employer the inability to pay debts as they mature, or being
subject to a pending proceeding as a debtor under Title 11 of the U.S. Code
(The Bankruptcy Act).
1.7 INVESTMENT MANAGER. "Investment Manager" shall mean a person,
or the agent of such person, who is not a Trustee, which may include an
individual, corporation or other entity, named by the Employer who (i) has
acknowledged that it is a fiduciary with respect to the Trust Fund, (ii) has
the power to manage, acquire or dispose of any asset or all or any portion of
the Trust Fund, and (iii) is (a) registered as an investment advisor under the
Investment Advisors Act of 1940, (b) a bank (as defined in the Investment
Advisors Act of 1940), or (c) an insurance company which is qualified to
manage, acquire and dispose of assets of a trust under the laws of more than
one state.
1.8 PARTICIPANT. "Participant" shall mean any employee of a
Participating Employer who is participating in the Plan in accordance with the
provisions of the Plan or who is not currently participating or accruing
benefits under the Plan but who is or may be eligible to receive benefits under
the Plan.
1.9 PARTICIPATING EMPLOYER. "Participating Employer" shall mean
the Employer and any other organization that shall have adopted the Plan and,
as a result, shall be deemed to have adopted the Trust Agreement pursuant to
the provisions of Section 2.3 of the Trust Agreement. The Participating
Employers shall be listed in Appendix "A" of the Trust Agreement. Where the
term Participating Employer is used in the singular in the Trust Agreement, it
shall include the plural, and the plural shall include the singular, where
applicable.
2
<PAGE> 7
1.10 PLAN. "Plan" shall mean the Camco International Inc. Deferred
Income Plan, as currently in effect, and any subsequent amendment thereto which
is intended to be an unfunded plan that is maintained primarily for the purpose
of providing deferred compensation to a select group of management or highly
compensated employees for purposes of the Employee Retirement Income Security
Act of 1974, as amended.
1.11 SEPARATE INVESTMENT FUND. "Separate Investment Fund" shall
mean any portion of the Trust Fund that is under the direction of (i) an
Investment Manager who may have general investment management powers with
respect to such portion of the Trust Fund (ii) the Administrator which, subject
to the terms of the Trust Agreement, may have general investment management
powers with respect to such portion of the Trust Fund.
1.12 TRUST. "Trust" shall mean the Camco International Inc.
Deferred Income Plan Trust as it is created by the terms and provisions of this
Trust Agreement.
1.13 TRUST AGREEMENT. "Trust Agreement" shall mean this
declaration of trust and any Exhibits or Appendices attached hereto, creating
the Trust, and as it may be amended from time to time.
1.14 TRUST FUND. "Trust Fund" shall mean all property transferred
to the Trustee, in trust, by the Employer and thereafter held by the Trustee
under the Trust established pursuant to this Trust Agreement, including the
investments and reinvestments thereof, and shall include any property held in
the General Investment Fund or the Separate Investment Fund.
1.15 TRUSTEE. "Trustee" shall mean the trustee or trustees
qualified and acting hereunder or any successor or successors appointed in
accordance with the applicable provisions of the Trust Agreement.
3
<PAGE> 8
ARTICLE II
INCORPORATION OF PLAN
AND ADOPTION BY PARTICIPATING EMPLOYERS
2.1 INCORPORATION OF PLAN BY REFERENCE. The Plan is incorporated
herein by reference.
2.2 TRUST AGREEMENT IS IRREVOCABLE AND IS GIVEN PRECEDENCE OVER
PLAN DOCUMENT. The Trust hereby established shall be irrevocable. In the
event of a conflict between the terms and provisions of the Trust Agreement and
those of the Plan document, the terms and provisions of the Trust Agreement
shall be given precedence. To the extent possible, the terms and provisions of
the Plan document and those of the Trust Agreement shall be interpreted as
mutually consistent.
2.3 ADOPTION BY PARTICIPATING EMPLOYERS. Any business
organization which shall have adopted the Plan shall be deemed to have adopted
this Trust Agreement, to be a grantor of this Trust and to have agreed to be
bound as a Participating Employer by all of the terms, provisions, conditions
and limitations of this Trust Agreement. A certified copy of the resolution of
the board of directors (or equivalent governing authority) of each
Participating Employer (evidencing its adoption of the Plan) shall be deposited
with the Trustee. In addition, a certified copy of the resolution of the board
of directors (or equivalent governing authority) of the Employer evidencing the
consent of the Employer to the Participating Employer's adoption of the Plan
shall be deposited with the Trustee. The Trustee shall not be required to
recognize any entity or organization as a Participating Employer prior to its
actual receipt of certified copies of resolutions in such form as may be
acceptable to the Trustee.
2.4 NO JOINT VENTURE CREATED. Neither the adoption of this Trust
Agreement by any such Participating Employer nor any act performed by it in
relation to this Trust shall ever create a joint venture or partnership
relationship between it and any other Participating Employer.
4
<PAGE> 9
ARTICLE III
CLAIMS OF GENERAL CREDITORS
3.1 TRUST FUND CONSIDERED AS GENERAL ASSETS. The portion of Trust
Fund assets attributable to Participants and Beneficiaries of a Participating
Employer shall be treated as general assets of the Participating Employer and,
as such, shall remain subject to claims of the general creditors of the
Participating Employer (including Participants and Beneficiaries) under
applicable state and federal law. Nothing in the Trust Agreement shall affect
the rights of Participants or Beneficiaries as general creditors of a
Participating Employer under the Plan or the Trust. No Participant or
Beneficiary shall have any preferred claim on or any beneficial ownership in
the Trust Fund prior to the time for distribution to such Participants or
Beneficiary under the terms of the Plan. Any rights of Participants or their
Beneficiaries under the Plan and this Trust Agreement shall be mere unsecured
contractual rights against a Participating Employer. Each Participant covered
under the Plan shall, in the event that a Participating Employer becomes
Insolvent, be deemed to waive any priority such Participant may have under law
as an employee, with respect to any claim against the Participating Employer
under the Plan and the Trust, beyond the rights such Participant would have as
a general creditor.
3.2 INSOLVENCY OF A PARTICIPATING EMPLOYER. At any time at which
the Trustee receives actual notice from a Participating Employer that the
Participating Employer is Insolvent, the Trustee shall deliver any
undistributed principal and income in the Trust attributable to Participants
who are employees (and their Beneficiaries) of such Participating Employer, or
Participants who are former employees (and their Beneficiaries) of such
Participating Employer (to the extent that such undistributed principal and
income are attributable to contributions made by such Participating Employer)
to satisfy such claims of the general creditors of the Participating Employer
as a court of competent jurisdiction may direct. The Trustee shall have the
right to pay the assets of the Trust into such court in an interpleader
proceeding for the purposes of being directed by such court as to the proper
disposition of such assets. The Trustee and all other parties shall be bound
by such direction, and payment of the Trust assets by the Trustee pursuant to
such court direction shall discharge the Trustee from liability with respect to
such payment under the Trust. The board of directors (or other equivalent
governing authority) of the Participating Employer shall inform the Trustee of
the Participating Employer's Insolvency, or shall appoint an officer of the
Employer, with notice to the Trustee, who shall have the duty to inform the
Trustee of any Participating Employer's Insolvency.
If a creditor of a Participating Employer files a claim with the
Trustee against the assets of the Trust Fund, the Trustee shall determine,
within 30 days after receipt of such claim, whether the Participating Employer
is Insolvent. Pending such determination of Insolvency by the Trustee, the
Trustee shall discontinue payments to the Participants and Beneficiaries with
respect to such Participating Employer. Any payments not paid during the
period of determination shall be made as soon as practicable after the
determination that the Participating Employer is not Insolvent. The amount of
such payment and/or the Account Balance of a Participant shall be increased or
decreased, as the case may be, for any earnings or losses during the period of
determination. The Trustee shall resume holding the Trust assets for the
benefit of the affected Participants and Beneficiaries and resume making any
payments under the Plan
5
<PAGE> 10
to the affected Participants and Beneficiaries only after the Trustee has
determined that the Participating Employer is not Insolvent (or is no longer
Insolvent, if the Trustee initially determined the Participating Employer to be
Insolvent). Unless the Trustee has actual notice of the Participating
Employer's Insolvency or has received a written claim against the Trust by a
creditor of the Participating Employer, the Trustee shall have no duty to
inquire whether the Participating Employer is Insolvent. The determination of
Insolvency shall be given to the Trustee by the affected Participating Employer
or shall be made by the Trustee in its reasonable discretion, whichever may be
applicable, and the Trustee may rely on evidence of solvency provided by a
Participating Employer and the Trustee shall not be liable to any person for
any good faith actions it takes on account of any such determination.
If more than one Participating Employer participates in the Trust, the
provisions of this Section 3.2 shall only apply to assets of the affected
Participating Employer; provided, however, in any event, all assets of the
Trust shall be available to the general creditors of each Insolvent
Participating Employer, but only to the extent of the portion of the Trust Fund
that is attributable to Participants who are employees or former employees (and
their Beneficiaries) of such Insolvent Participating Employer.
6
<PAGE> 11
ARTICLE IV
CONTRIBUTIONS
4.1 PARTICIPATING EMPLOYER CONTRIBUTIONS. A Participating
Employer shall contribute to the Trust, upon the establishment of the Trust
and from time to time thereafter, such amounts of cash and/or property as it
determines, in its sole discretion, to be appropriate to assist it in providing
deferred compensation benefits to Participants and Beneficiaries under the
Plan, such amounts to be held by the Trustee, together with the investments
thereof, in trust, for the purposes and with the powers and authorities
provided by the Trust Agreement and subject to the terms, provisions and
conditions of the Trust Agreement. Neither Trustee nor any Plan Participant or
Beneficiary shall have any right to compel additional deposits.
Notwithstanding any other provision hereof to the contrary, in the event of a
Change in Control (as defined in the Plan), each Participating Employer shall
make irrevocable contributions to the Trust in an amount that is sufficient to
pay each Participant then or last employed by such Participating Employer (or
his Beneficiary) the benefits to which the Participants (or their
Beneficiaries) have accrued or would be entitled pursuant to the terms of the
Plan as of the date on which the Change in Control occurred. All contributions
made pursuant to the provisions of the Trust Agreement and all assets and
earnings of the Trust are solely and irrevocably dedicated to the payment of
benefits to Plan Participants and Beneficiaries and during Insolvency general
creditors of the Participating Employers pursuant to the terms and provisions
of this Trust Agreement.
4.2 TRUSTEE ONLY RESPONSIBLE FOR ASSETS RECEIVED. The Trustee
shall be responsible only for assets actually received by it as Trustee, and
shall have no duty or authority to compute amounts to be contributed or to take
any legal action or proceeding to collect such amounts. The Trustee shall be
subject to any defense that the Employer or the Participating Employer, could
otherwise assert against the Participant or Beneficiary under the Plan. Any
property acquired by the Trustee through the enforcement or compromise of any
claim or claims it has as Trustee of this Trust will become a part of the
assets of the Trust Fund.
7
<PAGE> 12
ARTICLE V
PAYMENTS
5.1 PAYMENTS TO PARTICIPANTS AND BENEFICIARIES. Provided that a
Participating Employer is not Insolvent, the Trustee shall make payments of
benefits that are due and payable under the Plan to Participants and
Beneficiaries from the Trust Fund in accordance with written instructions from
the Administrator regarding eligibility of a Participant or Beneficiary, the
correct amount of payment and the source of such payment as either from the
General Investment Fund or the Separate Investment Fund, to the extent Trust
assets are available in that Fund for distribution. Notwithstanding any
provision hereof to the contrary, if the Participating Employer, in its sole
discretion, elects to make any such payments directly from its general assets
to any Participant or Beneficiary in lieu of directing the Trustee to pay such
benefits to the Participant or Beneficiary from Trust assets, the Participating
Employer may, in its sole discretion, withdraw from the Trust Fund an amount
equal to all or any specified portion of the amount of benefits so paid
directly to the Participant or Beneficiary by requesting such reimbursement in
writing.
5.2 INSUFFICIENT TRUST ASSETS. To the extent that Trust assets of
the appropriate Fund are insufficient to allow the Trustee to make any or all
payments that are due and payable under the Plan to Participants and
Beneficiaries as directed by the Administrator, the affected Participating
Employer shall make a cash deposit in trust with the Trustee at least three
(3) days prior to the date upon which such benefit payment is due, in the
amount necessary to enable the Trustee to make such payment. Unless the
affected Participating Employer provides written notice to the Trustee
otherwise, such cash deposit made by the affected Participating Employer shall
be deemed to be a contribution under Section 4.1 of the Trust Agreement. In
any event, the Trustee shall not be held responsible for payment of benefits to
Participants and Beneficiaries to the extent the assets in the Fund from which
such benefits are to be paid are insufficient and the affected Participating
Employer fails to make the necessary cash deposit as provided for in this
Section 5.2.
8
<PAGE> 13
ARTICLE VI
THE TRUST FUND
6.1 ACCUMULATION TRUST. The Trust shall be an accumulation trust
and principal and all currently earned income shall be accumulated during the
term of the Trust. The Trustee shall hold, preserve, manage, administer,
invest and reinvest the assets of the Trust, collect the income therefrom and,
after deducting all charges and expenses properly payable therefrom, hold and
distribute the then principal of the Trust and the income therefrom in
accordance with the provisions of the Trust Agreement.
6.2 EXCLUSIVE BENEFIT OF PARTICIPANTS AND BENEFICIARIES. Except
as otherwise provided in Article III of this Trust Agreement, at no time prior
to the satisfaction of all liabilities with respect to the Participants and
their Beneficiaries shall any portion of the Trust Fund be used for or diverted
to purposes other than the exclusive benefit of the Beneficiaries, and such
other persons as may be entitled to benefits under the Plan (including the
defraying of reasonable expenses of administration of the Plan and Trust).
6.3 INVESTMENT. The assets of the Trust shall be held and
administered as a single trust. To this end, all assets of the Trust Fund
shall be invested and reinvested in the manner hereinafter provided. Subject
to applicable provisions of the Trust Agreement, the portion of the Trust Fund
held in the General Investment Fund shall be under the investment management of
the Trustee. To the extent the Administrator directs, the Trustee shall
establish one or more Separate Investment Fund(s), each of which will be
subject to the investment management of an Investment Manager or the
Administrator. Subject to applicable provisions of the Trust Agreement, to the
extent necessary or appropriate to achieve the investment objectives of the
Trust, the Trustee may establish sub-funds under the General Investment Fund
and/or any Separate Investment Fund(s), which sub-funds shall be subject to the
investment management of the Trustee with respect to sub-funds established
under the General Investment Fund and the Investment Manager or the
Administrator with respect to the affected Separate Investment Fund.
An Investment Manager shall have general investment powers with
respect to any Separate Investment Fund that is under the direction of such
Investment Manager. Subject to the terms of this Trust Agreement, the
Administrator shall have general investment powers with respect to any Separate
Investment Fund that is under the direction of the Administrator. Except as
otherwise required by applicable law, the Trustee shall not be responsible or
liable for an investment's outcome or performance if the Trustee is acting at
the direction of an investment manager selected by the Administrator or at the
direction of the Administrator. However, the Trustee shall not be required to
execute any direction of the Administrator that is inconsistent with the
provisions of this Section with respect to the acquisition, holding or
disposition of any specific asset, and must notify the Administrator in writing
of any failure to execute an investment direction.
Any portion of the Trust Fund that is allocated and credited
separately to any Separate Investment Fund shall not share in the earnings or
losses of the General Investment Fund or any other Separate Investment Fund,
but shall be credited as appropriate with net income, gains,
9
<PAGE> 14
losses and expenses as well as appreciation and depreciation in market value
during the applicable accounting periods attributable to such Separate
Investment Fund. The same applies with respect to such sub-funds and accounts
as may be established and maintained thereunder.
6.4 LEGAL OWNERSHIP. The Trustee shall be vested with legal
ownership of the assets constituting the Trust Fund. No Participant or
Beneficiary shall have any claim to or interest in a specific asset of the
Trust Fund as a result of any manner of accounting for a Participant's or
Beneficiary's interest in the Plan.
6.5 GRANTOR TRUST INTENDED. It is intended that the Trust be a
grantor trust under the provisions of Section 671 and Section 677(a)(2) of the
Code and that the Employer and Participating Employers as grantors be treated
as "owners" within the meaning of those provisions. The Participating
Employers shall file their federal income tax returns in a manner consistent
with those provisions of the Code.
6.6 SEPARATE ACCOUNTS. The Trustee may establish such separate
accounts within the Trust Fund as it determines appropriate to maintain its
books of accounts and other records in accordance with the provisions of the
Plan and the Trust Agreement. The Administrator shall maintain or cause to be
maintained accounting records sufficient to allow the determination of the
portion of the Trust Fund which is allocable to each of the Participating
Employers and such additional records as it determines appropriate to
facilitate execution of its responsibilities under the Plan and the Trust
Agreement.
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ARTICLE VII
THE ADMINISTRATOR
7.1 ADMINISTRATOR CHARGED WITH ADMINISTRATION OF THE PLAN. The
Administrator shall be charged with the administration of the Plan and shall
decide, subject to the terms of the Plan, all questions arising in its
administration, interpretation and application, including (but not limited to)
questions relating to the eligibility of employees to become participants in
the Plan, the amount of any benefits payable to each of the Participants or
Beneficiaries and shall direct and instruct the Trustee in all matters relating
to the time, form, manner and source of payment of benefits payable under the
Plan. The Trustee shall not be responsible for or in any way concerned with
the administration of the Plan.
7.2 POWERS OF DIRECTION. In addition to his powers relating to
the administration of the Plan, the Administrator may determine the "funding
policy and method" of the Trust Fund. The Administrator shall have the right
and power to direct the Trustee with respect to the acquisition, holding or
disposition of specific assets of the Trust Fund. The Administrator may also
appoint an Investment Manager who would have power to direct the Trustee with
respect to the management, investment and reinvestment of the assets held in
the Trust Fund. However, if the Administrator appoints an Investment Manager
who at any time, and from time to time, by written notice to the Trustee,
directs the Trustee in the management, investment and reinvestment of the
assets attributable to the Plan held in the Trust Fund, then in that event the
Trustee shall be subject to all proper directions that are made in accordance
with the terms of this Trust Agreement and applicable federal and state law.
To the extent that assets attributable to the Plan are not to be managed by the
Trustee, such assets shall be segregated from the General Investment Fund into
one or more Separate Investment Funds and shall be separately accounted for in
accordance with the applicable provisions of the Trust Agreement. Any
Investment Manager may be removed in the same manner in which appointed, and in
the event of any removal, the Investment Manager shall, as soon as possible,
but in no event more than thirty days after notice of removal, turn over all
assets managed by it to the Trustee or to any successor Investment Manager so
appointed, and shall make a full accounting to the Administrator with respect
to all assets managed by it since its appointment as an Investment Manager.
Subject to the terms of this Section 7.2, each Participant shall from
time to time, as determined by the Administrator, have the right to direct the
Administrator as to the hypothetical investments to be made (from among one or
more investment alternatives selected by the Administrator) with respect to the
amounts credited to such Participant's account maintained under the Plan by the
Administrator. To the extent that the Administrator permits Participant
direction of investment with respect to investment funds established under the
Trust (as distinguished from hypothetical investment funds maintained in
connection with the Plan) the Administrator (or its delegate) shall relate
these participant directions to the Trustee as to how the investments shall be
made in respect of investment funds made available under the Trust.
Notwithstanding any provision of the Trust Agreement to the contrary, the
Administrator shall not be bound to follow investment directions of each
Participant, and the Trustee, in its sole discretion, may convey such
investment directions to any Investment Manager(s), or other
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appropriate person(s), or disregard such directions from Participants and make
the investment decisions with respect to amounts credited to Participants
accounts. The Employer shall have the right, at any time and from time to
time, in its sole discretion, to substitute assets of equal fair market value
for any asset held by the Trust.
7.3 CHANGE OF CONTROL. In the event of a change of control (as
defined in the Plan), a Participant may notify the Trustee if the Participant
believes that he is entitled to a distribution from the Plan. The notice shall
specify the reason the Participant believes that he is entitled to such
distribution, the timing of the distribution, the form of the distribution and
the amount of the distribution (or the manner in which such distribution is to
be calculated). Upon receipt of such notice, the Trustee shall notify the
Administrator of the Participant's claim for benefits. The Administrator or
the Participating Employer shall have the right, within thirty (30) days of
such notice, to provide the Trustee with information which refutes all or any
part of the Participant's claim. In the event the Administrator or the
Participating Employer fails to produce such information as provided herein,
the Trustee shall have the right to rely conclusively upon the notice from the
Participant. In the event the Administrator or the Participating Employer
produces such information, the Trustee shall make its own independent
determination of the Participant's claim and such determination shall be in the
Trustee's sole discretion notwithstanding the Administrator's right to
administer the Plan.
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ARTICLE VIII
THE TRUSTEE
8.1 TRUSTEE ACTION. Initially, the Trustee shall be the person,
persons or entity described in Section 1.15. All references to the Trustee
shall include multiple Trustees, collectively, unless the use of the word
clearly requires that it apply to such persons separately. Should the Trustee
be composed of multiple individuals, any action taken by the Trustee shall be
determined by a majority of the individuals then acting. The Trustee in such
case may act by a vote taken at a meeting attended by a majority thereof or by
a vote, taken without a meeting, by a majority thereof. Any act of an
individual Trustee or the Trustee collectively shall be sufficiently evidenced
if certified to by any one of the individuals acting as Trustee.
8.2 TRUSTEE AS FIDUCIARY. The Trustee shall be a fiduciary with
respect to the Trust and except as otherwise provided herein shall have the
exclusive responsibility for and all the powers necessary to receive, hold,
preserve, manage, invest and reinvest the Trust Fund as provided generally in
the Trust Agreement and to pay all costs and expenses incident thereto. The
Trustee shall not to any extent be responsible for the adequacy of the Trust
Fund to meet and discharge any liabilities of the Plan.
8.3 POWERS RELATING TO INVESTMENTS. Except as may otherwise be
provided under Section 7.2 or under other applicable provisions of this Trust
Agreement, the Trustee shall have the following powers relating to the receipt,
preservation, management, investment and reinvestment of both principal and
income of the Trust, as it may be constituted from time to time, in addition to
all of the powers, rights, options and privileges now or hereafter provided
for, vested in, or granted to the Trustee under common law and all other
applicable statutes, as amended from time to time, except such as conflict with
the terms of the Trust Agreement or applicable law, and as far as possible, no
subsequent legislation or regulation shall be in limitation of the rights,
powers or privileges granted the Trustee hereunder at the time of the execution
hereunder:
(a) To handle, deal with and dispose of the Trust
property and estate as if it were the simple fee owner of such
property and estate;
(b) Except where prohibited by applicable law that cannot
be waived, to hold any securities hereunder in the name of nominees,
hold the same unregistered or hold any security in bearer form. As
used herein, unless specifically instructed in writing to the
contrary, the term "hold" shall include the Trustee's authority to
deposit any part or all of the trust assets with any centralized
securities depository system, whether now or hereafter organized, or
the Federal Reserve Bank in connection with book-entry procedures as
provided in Treasury Department regulations, as the Trustee may
select. All securities in registered form are to be registered in
Trustee's nominee or the nominee of the centralized securities
depository system. The possession by such centralized securities
processing system or the Federal Reserve Bank shall be deemed to be
possession by the Trustee;
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(c) To use its discretion with respect to proxy voting,
warrants, rights to subscribe, plans for reorganization or
recapitalization, plans for exchange of securities or the like with
respect to securities managed by the Trustee in accordance with the
Trustee's policies and procedures in effect at the time. With respect
to securities managed by the Administrator or the Investment Manager,
all proxy material will be forwarded to the Administrator or
Investment Manager, as applicable, from whom voting instructions will
be solicited by Independent Election Corporation of America, or any
other similar entity appointed for such purpose from time to time by
the Trustee. Other actions will be taken in accordance with written
instructions of the Administrator or Investment Manager, as
applicable;
(d) To collect the principal and income of the Trust as
the same may become due and payable and to give binding receipt
therefor;
(e) To take any action, whether by legal proceeding,
compromise, or otherwise, as the Trustee in its sole discretion deems
to be in the best interest of the Trust; to settle, compromise or
submit to arbitration any claims or damages owing the Trust; to
commence or defend suits or legal proceedings to protect any interests
of the Trust and to represent the Trust in all suits and legal
proceedings in any court or before any body, board, agency, panel or
tribunal;
(f) To hold uninvested at any time, and without liability
for interest thereon, any amount of money received by the Trustee or
raised by the Trustee from the sale of investments or otherwise, for a
reasonable time, until the same shall be reinvested or disbursed;
(g) To invest and reinvest the Trust assets, or any part
of them, in any property of any kind or nature whatsoever, whether
real, personal or mixed, whether tangible or intangible, whether or
not productive of income, in any rights or interests in property, or
in any evidence or indicia of property, including but not limited to
the following types of properties or interests therein, or anything of
a similar kind, character, or class: common or preferred stock,
interests in so-called Massachusetts trusts, key-man type insurance
contracts for the benefit of the Trust as a whole, any other insurance
contracts provided that no payment thereunder is in contravention of
any provision of the Plan under which the contract is purchased, fees,
beneficial interests, leaseholds, bonds, mortgages, leases, notes
(including, but not limited to, secured or unsecured notes of any
kind), obligations, oil and gas payments, oil and gas contracts,
savings accounts, certificates of deposit or like investments with the
commercial department of any bank, including any bank acting as
Trustee or its affiliates provided they bear a reasonable rate of
interest and the bank is supervised by the United States or a state,
common, pooled or collective trust funds that the Trustee or any other
corporation may now have or in the future may adopt for the collective
investment of funds pursuant to Section 584 of the Code, mutual funds
or money market funds as long as the purchases are made in accordance
with the requirements of applicable provisions of state or federal
law.
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(h) To lease, enter into leasebacks, and let all or any
portion of the properties possessed by the Trust to any party (other
than a party specifically prohibited by federal or state statutes) for
the development or production of oil, gas, sulphur or other minerals,
or for any other purpose, on such terms, times and conditions
(including a term that will extend beyond the term of this Trust), and
for such considerations or royalties as it deems proper;
(i) To borrow from or loan to anyone (other than any
person specifically prohibited by federal or state statutes), such
sums as the Trustee considers necessary or desirable, and for that
purpose to mortgage or pledge all or any part of the Trust Fund;
(j) To purchase with Trust assets, hold or surrender
(partially or wholly) group or individual term, universal, variable or
ordinary life insurance contracts in order to fund the benefits
payable under the Plan; provided, however, that if such contracts are
purchased or held, the Trustee shall pay the premiums thereon to the
extent that Trust assets are sufficient to do so; and provided further
that the Trustee shall have no power to name a beneficiary of any such
policy other than the Trust;
(k) If specifically directed by the Administrator, to
purchase deposit administration contracts, individual annuity
contracts, or group annuity contracts from insurance companies
licensed in the State of Texas; provided, however, no payment under
such contract(s) shall be in contravention of applicable provisions
the Plan;
(l) To invest Trust assets in the forms of investment
contemplated under Section 5.2 of the Plan;
(m) To engage the services of individuals, partnerships
or corporations (including but not limited to accountants, actuaries,
brokers, banks, investment counsel, lawyers, or other agents or
employees) to assist and advise with respect to the management or
investment of the Trust Fund and to delegate to them such duties,
rights, and powers of the Trustee (including the power to vote shares
of stock) as the Trustee deems advisable in managing the Trust Fund;
and
(n) To delegate by written notice such clerical and
recordation duties as may be required of the Trustee, including, but
not by way of limitation, the preparation of checks or other documents
for the payment of benefits.
The Trustee shall be required to take any appropriate legal action to collect,
preserve or maintain any Trust property. It will be promptly indemnified by
the Trust itself if not promptly indemnified by the affected Participating
Employer. Following receipt of a written request of the Trustee, the Employer
shall promptly reimburse the Trust for all reasonable legal fees properly
incurred by the Trustee under the Trust. Any property acquired by the Trustee
through the enforcement or compromise of any claim or claims it has as Trustee
of this Trust will become a part of the Trust Fund.
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8.4 STANDARD OF PERFORMANCE. Except as otherwise provided in this
Trust Agreement, and also specifically except as provided in Article VII after
a change in control (as defined in the Plan), the Trustee, in discharging its
duties with respect to the management, investment and reinvestment of the Trust
Fund, shall do so solely in the interest of the Participants and Beneficiaries
using the care, skill, prudence and diligence under the circumstances then
prevailing that a prudent man acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of a like character; shall
diversify the investments of the Trust Fund under its management so as to
minimize the risk of large losses, unless under the circumstances it is clearly
prudent not to do so; and shall otherwise act in accordance with the provisions
of the Trust Agreement and applicable federal or state law.
8.5 POWERS RELATING TO PAYMENT AND DISTRIBUTION. The Trustee
shall have the following power relating to payments and distributions to be
made from the Trust Fund:
(a) Except where inconsistent with applicable law that
cannot be waived, to convey, assign and deliver, upon full termination
of the Trust, to such persons as then shall be entitled thereto under
the Plan, the Trust Fund or the net proceeds of the Trust Fund in cash
after conversion of the Trust Fund into cash at the direction of the
Employer, which direction shall not be unreasonably delayed or
withheld;
(b) To pay out of the Trust Fund (i) amounts due and
payable on any advance made by the Trustee or on any loan made by
anyone to the Trust Fund; (ii) reasonable expenses of the Trustee,
including fees of accountants, actuaries and legal counsel to the Plan
and the Trust; and (iii) the Trustee's compensation as provided in
Article X if not paid by the Employer;
(c) To make distributions out of the Trust Fund only to
the person or persons as directed by the Administrator in accordance
with the provisions of the Plan, which direction shall not be
unreasonably delayed or withheld. After the Participating Employer
reasonably attempts to locate the person, if such person or persons
cannot be found, to hold such payment or deposit same in a bank,
including the Trustee, for the credit of said person or persons
without liability for interest thereon. The Trustee shall be under no
obligation to attempt to locate any person or entity. If a check in
payment of the benefit hereunder has been mailed by regular U.S. mail
to the last address of the payee furnished the Trustee by the
Administrator and is returned unclaimed, the Trustee shall notify the
Administrator and shall discontinue further payments to such payee
until it receives instructions from the Administrator. The Trustee
shall not be required to make any investigation to determine the
whereabouts or mailing address of any such person or persons. The
Trustee may make payment of any benefit hereunder by mailing its check
for the amount thereof to the person certified to the Trustee by the
Administrator as the person to whom such payment is to be made or by
personally delivering same to said person; and
(d) Distributions pursuant to this Section 8.5(d) may
only be effected prior to a change in control (as defined in the
Plan). The Administrator may from time to time direct an enrolled
actuary selected by the Administrator to determine whether the assets
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in the Trust exceed by at least fifteen percent the amount needed to
pay (i) benefits to Participants and Beneficiaries under the Plan
attributable to a Participating Employer and (ii) estimated fees of
the Trustee for a period of three months based on the fee schedule
then in effect (the "Surplus Amount"). If the actuary determines that
the Trust has a Surplus Amount, the Administrator shall notify the
Trustee and the Participants and Beneficiaries that the Participating
Employer is entitled to receive the Surplus Amount. The Trustee shall
have no duty to independently calculate or verify the actuary's
computation of any Surplus Amount. The Trustee shall make payment to
the Participating Employer of any such Surplus Amount due as soon as
is administratively practicable following the expiration of ten (10)
business days after the day of receipt of reasonable written
instructions from the Administrator.
8.6 CERTAIN POWERS PROHIBITED. Notwithstanding any powers granted
to Trustee pursuant to this Trust Agreement or to applicable law, Trustee shall
not have any power that could give this Trust the objective of carrying on a
business and dividing the gains therefrom, within the meaning of section
301.7701-2 of the Procedure and Administrative Regulations promulgated pursuant
to the Code.
8.7 PROOF OF TRUSTEE'S AUTHORITY. All persons dealing with the
Trustee are entitled to rely upon the representations of the Trustee as to its
authority and are released from any duty to inquire into its authority for
taking or omitting any action or to verify that any money paid or other
property delivered to the Trustee is used by the Trustee for Trust purposes.
Any action of the Trustee under the Trust Agreement shall be conclusively
evidenced for all purposes by a certificate or other document signed by the
Trustee, and any such certificate or document shall be conclusive evidence of
the facts recited in it. All persons shall be fully protected when acting or
relying upon any notice, resolution, instruction, direction, order,
certificate, opinion, letter telegram or other document believed by such
persons to be genuine, to have been signed by the Trustee, and to be the act of
the Trustee.
8.8 EMPLOYMENT OF LEGAL COUNSEL. The Trustee may engage and
consult with legal counsel of its choice, who may be counsel for any employee
of any Participating Employer, Participant, Beneficiary or Trustee's own
general counsel or counsel for the Participating Employer, with respect to the
meaning or construction of the Plan or the Trust Agreement as regards the
Trustee's obligations or duties hereunder.
8.9 EXEMPTION FROM BOND. The Trustee shall not be required to
give bond or other security for the faithful performance of its duties unless
required by a law that cannot be waived; and the Trustee shall not be required
to make any inventory, return, or report of any kind to any court unless
required by a law that cannot be waived.
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ARTICLE IX
NOTICES AND DIRECTIONS
9.1 EFFECTIVE TIME OF NOTICE. The Trustee shall not be bound by
any certificate, notice, resolution, consent, order, information or other
communication unless and until it shall have been received in writing by the
Trustee.
9.2 EVIDENCE OF AUTHORITY. The Trustee may accept, as evidence of
the authority of (i) any person acting as the Administrator or his agent, or
(ii) the proper representative(s) of any Investment Manager if one is
appointed, a copy of a certificate of the Administrator, as certified by the
Employer, or Participating Employer, together with a specimen signature of the
Administrator or his agent and/or the proper representative(s) of the
Investment Manager, if one is appointed, and shall be entitled to recognize
such persons as such and act upon the instructions, directions, consents, and
requests of the Administrator or his agent and/or the proper representative(s)
of any appointed Investment Manager last certified to it. The Trustee may
continue to act in accordance with any such notice (being fully protected as
provided in Section 11.2) until it receives notice rescinding or superseding
such action or resolution.
9.3 NOTICES FROM TRUSTEE. Notices or communications from the
Trustee to the Administrator or any duly appointed Investment Manager, shall be
addressed to such person or persons as shall have been certified to the Trustee
and shall be sent to such person or persons at the principal office of the
Employer, unless the Trustee shall have been instructed in writing to send such
communications to another address.
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ARTICLE X
FEES AND EXPENSES
The Trustee hereunder shall be reimbursed for expenses properly and
actually incurred in the performance of its duties under the Trust, including,
but not limited to compensation to agents and fees for professional services
incurred in administration of the Trust, and shall receive fair and reasonable
compensation for services rendered as may be agreed upon from time to time
between the Trustee and the Employer. No individual Trustee hereunder shall
receive compensation for services rendered but, like any corporate trustee
hereunder, shall be reimbursed for expenses properly and actually incurred in
the performance of its duties under the Trust. The Trustee's compensation and
the expenses of this Trust shall be paid by the Participating Employers, but in
any case, such compensation and expenses shall be a lien or charge on the Trust
Fund until actually paid. Unless otherwise agreed, each Participating Employer
shall bear that portion of such compensation and expense as the amount
contributed to the Trust on behalf of Plan Participants employed by a
Participating Employer bears to the total amount contributed to the Trust on
behalf of all Plan Participants. In the event that the Participating Employer
fails to pay the Trustee its compensation and expenses within ninety (90) days
after the presentation of its invoice, the Trustee is authorized to use assets
held by the Trustee under the Trust to pay its unpaid compensation and
expenses.
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ARTICLE XI
LIABILITY OF THE TRUSTEE
11.1 INVESTMENTS. The Trustee shall not be liable to the Trust
Fund or to any person with a beneficial interest in the Trust Fund for any
losses or decline in value that may be incurred upon any investment of the
Trust Fund, or for failure of such Trust Fund to produce any or greater
earnings, interest, or profits, so long as the Trustee acts in good faith and
in accordance with the responsibilities, obligations and duties placed on it
under applicable state or federal law that cannot be waived.
11.2 ACTS OR OMISSIONS UNDER DIRECTION. The Trustee shall not be
liable for any act or omission by it because of a direction received from the
Employer, a Participating Employer, the Administrator, or an Investment
Manager, or for any act of omission of the Employer, a Participating Employer,
the Administrator, or an Investment Manager except to the extent required by
applicable state or federal law that cannot be waived. When the Trustee has
made any payment out of the Trust Fund in accordance with the directions of the
Administrator, it shall not be responsible for the correctness of the amount of
the payment to the recipient, or the method by which it is paid. The Trustee
shall also be protected in relying upon any certificate, notice, resolution,
consent, order or other communication purporting to have been so signed on
behalf of the Employer, a Participating Employer, the Administrator, or an
Investment Manager that it believes to be genuine, without any obligation on
the part of the Trustee to ascertain whether or not the provisions of the Plan
are thereby being complied with. Without limiting the scope of the above
provision hereof, the Trustee shall not be liable with respect to the
acquisition and continued retention of stock issued by the Participating
Employer if such acquisition and/or retention of such stock is in accordance
with the terms and provisions of the Trust.
11.3 ACTS OR OMISSIONS OF TRUSTEE. The Trustee shall not be liable
for any act or omission on its own part except to the extent required by state
or federal law that cannot be waived, or except for those acts or omissions
resulting from (i) an intentional violation or failure to comply with its
duties or obligations hereunder, or (ii) its gross negligence. The Trustee
shall not be accountable or held liable for any act or omission of any agent of
the Trustee, so long as the Trustee used good faith and ordinary care in the
selection of such agent, and in such event, any liability shall be solely that
of such agent(s).
11.4 WITHHOLDING FOR TAXES. The Employer shall direct the Trustee
to withhold from distribution all or any part of the Trust Fund that the
Employer considers necessary and proper for the payment of any Participant's
taxes that are required to be withheld.
11.5 FILING RETURNS OR REPORTS. Unless otherwise agreed between
the Employer and the Trustee, the Trust shall be responsible for preparation
and timely filing of any tax return or other report that is required to be
filed with respect to the Trust or Participants and Beneficiaries. Any such
return or report will be submitted to the Trustee for signature, if required.
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11.6 REQUESTING ADVICE. If at any time the Trustee is in doubt
concerning the course that it should follow in connection with any matter
relating to the administration of the Trust, it may request the Administrator
or affected Participating Employer to advise it with respect thereto and shall
be protected in relying upon any written advice or direction that may be given
in response to such request.
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ARTICLE XII
ACCOUNTS
12.1 MAINTENANCE OF RECORDS. The Trustee shall keep such records
as the Trustee considers necessary for the management of the Trust. The
Trustee's books and records of the Trust Fund shall be open to inspection by
any Participating Employer, Participant, Beneficiary or member of the
Administrator during regular business hours of the Trustee.
12.2 WRITTEN ACCOUNTS. Within one hundred twenty (120) days after
the close of each fiscal year of the Trust, at such other times (or shorter
accounting periods) as requested in writing by the Employer, and as of the date
of the removal or resignation of the Trustee, the Trustee shall render to each
Participating Employer a written account of its management of the Trust Fund
covering the period since the previous account and report. The written
approval of such accounting and report by any Participating Employer or the
failure of any Participating Employer to notify the Trustee of its disapproval
of such accounting within ninety (90) days after its receipt shall be final and
binding, as to the Trustee's administration of the Trust for the period, upon
the Participating Employer and all persons who have or may thereafter have an
interest in the Trust. Written accountings described above shall be open to
inspection by any Participant or Beneficiary during regular business hours of
the affected Participating Employer or the Trustee, whichever may be
applicable.
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ARTICLE XIII
RESIGNATION, REMOVAL AND SUCCESSION
13.1 NOTICE OF RESIGNATION. The Trustee may resign at any time
upon giving thirty (30) days prior written notice to the Employer, unless prior
thereto a successor Trustee shall have been appointed and accepted and the
Employer consents to an earlier date. Any such resignation shall not be
effective until the Employer has appointed in writing a successor Trustee and
the successor has accepted the appointment in writing. Notwithstanding the
preceding sentence, if the appointment of a successor Trustee is to become
effective after the occurrence of a Change in Control (as defined in the Plan),
then the written consent of at least two-thirds of the Plan Participants to the
appointment of such successor Trustee must be obtained. If the consent of
two-thirds of the Participants is required for the appointment of a successor
Trustee, then the Trustee shall be responsible for securing such Participant
consents in a timely fashion and, unless ordered by a court of competent
jurisdiction, shall not reveal to the Employer or any other person any
information concerning such consents, except whether the required majority has
been achieved. Any notice sent to Participants by the Trustee canvassing the
Participants as to their consent to a successor Trustee, shall include the name
and address of the proposed successor Trustee. Any consent of a Participant
required under this Section 13.1 shall be deemed given if no written objection
is received by the Trustee from such Participant within fourteen days after
request for such consent is sent postpaid by United States registered or
certified mail with return receipt requested to such Participant.
13.2 NOTICE OF REMOVAL. The Employer may remove the Trustee by
giving thirty (30)at least thirty (30) days prior written notice to the
Trustee, unless prior thereto a successor Trustee shall have been appointed and
accepted and the Trustee consents to an earlier date. Any such removal shall
not be effective until the Employer has appointed in writing a successor
Trustee and the successor has accepted the appointment in writing.
Notwithstanding the preceding sentence, if the appointment of a successor
Trustee is to become effective following a Change in Control (as defined in the
Plan), then the written consent of at least a numeric two-thirds of the Plan
Participants to the appointment of such successor Trustee must be obtained. If
the consent of two-thirds of the Participants is required for the appointment
of a successor Trustee, then the Trustee shall be responsible for securing such
Participant consents in a timely fashion and, unless ordered by a court of
competent jurisdiction, shall not reveal to the Employer or any other person
any information concerning such consents, except whether the required majority
has been achieved. Any notice sent to Participants by the Trustee canvassing
the Participants as to their consent to a successor Trustee, shall include the
name and address of the proposed successor Trustee. Any consent of a
Participant required under this Section 13.2 shall be deemed given if no
written objection is received by the Trustee from such Participant within
fourteen days after request for such consent is sent postpaid by United States
registered or certified mail with return receipt requested to such Participant.
13.3 VACANCY. Any vacancy in the office of Trustee created by the
resignation or removal of the Trustee shall not terminate the Trust. As soon
as feasible after removal or resignation of the Trustee, the Employer shall
appoint a successor Trustee.
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13.4 APPOINTMENT OF SUCCESSOR. The appointment of a successor
Trustee hereunder shall be accomplished by the Employer's delivery to the
resigning or removed Trustee, as the case may be, a written instrument
appointing such successor Trustee, and the successor Trustee's acceptance in
writing of the appointment as successor Trustee hereunder. Any successor
Trustee hereunder shall be one or more individual successor trustees or a
corporation authorized and empowered to conduct a trust business in the state
of the situs of the Trust. All of the provisions set forth herein with respect
to the Trustee shall relate to each successor Trustee.
13.5 TRANSFER OF ASSETS. Any successor Trustee, after
acknowledging acceptance of this Trust Agreement and accepting the Trust assets
and the accounting of the retiring Trustee, shall be vested with all the
estates, titles, rights, powers, duties, and discretions granted to the
retiring Trustee. The retiring Trustee shall execute and deliver all
assignments or other instruments within a reasonable time as may be necessary
or advisable in the discretion of the successor Trustee; provided, however,
such retiring Trustee is hereby authorized to reserve such sum of money as is
reasonable for the payment of its fees and expenses in connection with the
settlement of its account or otherwise.
13.6 CONSOLIDATION OR MERGER OF TRUSTEE. In the event that a
corporate Trustee shall merge or be consolidated with or otherwise acquired by
any other corporation authorized to exercise trust powers, the continuing,
resulting or acquiring corporation shall automatically become Trustee hereunder
without the necessity of designation or appointment by the Employer.
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ARTICLE XIV
AMENDMENT AND TERMINATION
14.1 AMENDMENT. The Trust Agreement may be amended any time and to
any extent by a written instrument executed by the Trustee and Employer;
provided, however, that no such amendment shall be effective to the extent that
it purports to make the Trust revocable. No amendment to the Trust Agreement
shall be effective to the extent that such amendment would be inconsistent with
the intents and purposes of the Trust Agreement. After a change in control (as
defined in the Plan), the requirement of the immediately preceding sentence
shall be deemed to have been met if at least a numeric two-thirds of all
Participants and Beneficiaries consent to the amendment.
14.2 WITHDRAWAL OF A PARTICIPATING EMPLOYER. A Participating
Employer may withdraw from the Trust with provision for continuing the Plan and
the Trust as they relate to the withdrawing Participating Employer by giving
written notice of its intent to withdraw to the Employer, the Administrator and
the Trustee. The Administrator will then determine, within sixty (60) days
following the receipt of the notice, the portion of the Trust Fund that is
attributable to the affected Participants or Beneficiaries who are or were
employed by the withdrawing Participating Employer and shall forward a copy of
the determination to the Trustee. Upon receipt of the determination, the
Trustee will immediately segregate those assets attributable to such
Participants or Beneficiaries who are or were employed by the withdrawing
Participating Employer and will transfer those assets to the successor Trustee
or Trustees when it receives a designation of such successor from the
withdrawing Participating Employer.
The withdrawal from this Trust will not terminate the Plan or the
Trust with respect to the withdrawing Participating Employer. Instead, the
withdrawing Participating Employer shall, as soon as practical, either appoint
a successor Trustee or Trustees and reaffirm the Trust as a new and separate
trust intended to informally fund the Plan with respect to the withdrawing
Participating Employer or establish another trust or trusts intended to fund
the Plan with respect to the withdrawing Participating Employer.
The determination of the Administrator, in its sole discretion, of the
portion of the Trust Fund that is attributable to the affected Employees or
Beneficiaries who are or were employed by the withdrawing Participating
Employer will be final and binding upon all parties at interest; and, the
Trustee's transfer of those assets to the designated successor Trustee shall
relieve the Trustee of any further obligation, liability or duty to (i) the
withdrawing Participating Employer, (ii) the affected Participants or
Beneficiaries who are or were employed by that Participating Employer and (iii)
the successor trustee or trustees.
14.3 TERMINATION OF PARTICIPATION IN THE TRUST. A Participating
Employer may terminate its participation in this Trust without provisions for
continuing the Plan and the Trust as they relate to such Participating Employer
by executing and delivering to the Employer, the Administrator and the Trustee
a notice of termination which specifies the date on which its participation in
the Trust shall terminate with respect to the Plan. The Administrator will
then determine, within sixty (60) days following the receipt of the notice, the
portion of the Trust
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Fund that is attributable to the affected Participants or Beneficiaries who are
or were employed by the terminating Participating Employer and shall forward a
copy of the determination to the Trustee. Upon such termination of
participation in the Trust, the Trustee will distribute the portion of the
Trust Fund attributable to the affected Participating Employer, less charges
against the Trust Fund, in such manner and at such time as may be directed by
the Administrator under the terms of the Plan which are not inconsistent with
the terms of the Trust Agreement.
The termination of this Trust as to any one or more Participating
Employers will not constitute a termination of this Trust with respect to the
other remaining Participating Employers. Upon satisfaction of all liabilities
to Participants and Beneficiaries thereof under the Plan as they relate to any
Participating Employer and upon payment to the affected Participating Employer
of any surplus which remains after satisfaction of all liabilities under such
Plan, the Trust shall terminate with respect to the Plan as it relates to such
Participating Employer.
14.4 CONSOLIDATION OR MERGER OF A PARTICIPATING EMPLOYER. This
Trust will not automatically terminate with respect to a Participating Employer
in the event it consolidates, merges and is not the surviving corporation,
sells substantially all of its assets, is a party to a reorganization and its
employees and substantially all of its assets are transferred to another
entity, liquidates or dissolves, if there is a successor organization.
Instead, the resulting successor person, firm or corporation may continue this
Trust as it relates to the Plan of the affected Participating Employer by
executing a direction, entering into a contractual commitment or adopting a
resolution, as the case may be, providing for the continuance of the Trust
simultaneously with such consolidation, merger, sale, reorganization,
liquidation or dissolution. If the successor does not adopt the Trust, the
Trust will then automatically terminate with respect to a Participating
Employer simultaneously with such consolidation, merger, sale, reorganization,
liquidation or dissolution, and the portion of the Trust Fund allocable to such
Participating Employer will be distributed exclusively to the affected
Participants or their Beneficiaries under the terms of the Plan that are not
inconsistent with the Trust Agreement.
14.5 ULTIMATE TERMINATION OF THE TRUST. Notwithstanding any other
provisions of this Trust Agreement to the contrary, the Trust shall terminate
on the earlier of (i) a complete distribution of the Trust Fund in accordance
with the terms and provisions of the Plan or (ii) if required by the applicable
rule against perpetuities, one day prior to the last day of the period ending
21 years after the death of the last to die of the original Participants under
the Plan. If the Trust terminates pursuant to the requirements of the rule
against perpetuities, the assets of the Trust shall be transferred to a
successor trust established for this purpose. Except as otherwise provided in
the Plan, any assets remaining in the Trust Fund after satisfaction of all
liabilities and expenses of the Plan shall be returned to the Participating
Employers.
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ARTICLE XV
MISCELLANEOUS
15.1 TRUST NOT A CONTRACT WITH EMPLOYEES. The adoption and
maintenance of this Trust shall not be deemed to be a contract between the
Participating Employer and its employees that gives any employee the right to
be retained in the employment of the Participating Employer; to interfere with
the rights of the Participating Employer to discharge any employee at any time;
or to interfere with the employee's right to terminate his employment at any
time.
15.2 SPENDTHRIFT PROVISIONS. No principal or income payable or to
become payable from this Trust will be subject: to anticipation or assignment
by any person entitled to receive benefits under the Plan; to attachment by,
interference with, or control of any creditor of any person entitled to receive
benefits under the Plan; or to being taken or reached by any legal or equitable
process in satisfaction of any debt or liability of any person entitled to
receive benefits under the Plan prior to its actual receipt by such person.
Any attempted conveyance, transfer, assignment, mortgage, pledge, or
encumbrance of the Trust Fund, any part of it, or any interest in it by any
person entitled to receive benefits under the Plan prior to distribution will
be void, whether that conveyance, transfer, assignment, mortgage, pledge, or
encumbrance is intended to take place or become effective before or after any
distribution of trust assets or the termination of this Trust. In addition,
the Trustee will never under any circumstances be required to recognize any
conveyance, transfer, assignment, mortgage, pledge or encumbrance by any person
entitled to receive benefits under the Plan, any part of them, or any interest
in them, or to pay any money or thing of value to any creditor or assignee of
such person for any cause whatsoever. However, this Section will in no way
affect the provisions of Article III of this Trust Agreement.
15.3 OWNERSHIP OF CONTRACTS. The Trust Fund may be invested
primarily in insurance contracts ("Contracts"). Such Contracts may be
purchased by any Participating Employer and transferred to the Trustee as
in-kind contributions or may be purchased by the Trustee with the proceeds of
cash contributions (or may be purchased upon direction by the Administrator or
an Investment Manager pursuant to Section 6.3. The Trustee shall have the
power to exercise all rights, privileges, options and elections granted by or
permitted under any Contract or under the rules of the insurance company
issuing the Contract ("Insurer"), including the right to obtain policy loans
against the cash value of the Contract. The exercise by the Trustee of any
incidents of ownership under any Contract shall be subject to the direction of
the Administrator. The Administrator may from time to time direct the Trustee
in writing as to the designation of the Beneficiary of a Participating under a
Contract for any part of the death benefits payable to such Beneficiary
thereunder, and the Trustee shall file such designation with the Insurer.
Notwithstanding anything contained herein to the contrary, neither the
Company nor the Trustee shall be liable for the refusal of any Insurer to issue
or change any Contract or Contracts or to take any other action requested by
the Trustee; nor for the form, genuineness, validity, sufficiency or effect of
any Contract or Contracts held in the trust; nor for the act of any person
(other than itself) or persons that may render any such Contract or Contracts
null and void; nor for failure of any Insurer to pay the proceeds of any such
Contract or Contracts as and when the
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same shall become due and payable; nor for any delay in payment resulting from
any provision contained in any such Contract or Contracts; nor for the fact
that for any reason whatsoever (other than its own negligence or willful
misconduct) any Contracts shall lapse or otherwise become uncollectible.
15.4 INSURANCE COMPANY NOT A PARTY. No insurance company that may
issue any contract held by the Trustee shall be (i) required to take or permit
any action contrary to the provisions of such contract; (ii) bound to allow any
benefit or privilege to any person interested in any contract it has issued
that is not provided in such contract; (iii) deemed to be a party to this Trust
Agreement; (iv) required to look into the terms of this Trust Agreement; (v)
required or entitled to question any act of the Trustee hereunder; or (vi)
required to see that any action of the Trustee is authorized by this Trust
Agreement. Except as may be otherwise provided by applicable state or federal
law that cannot be waived, such issuing company shall be fully discharged from
any and all liability for any amount paid to the Trustee or paid in accordance
with its direction, and no issuing company shall be obligated to see to the
application of any moneys so paid by it. Any such issuing company shall be
fully protected in taking or permitting any action on the faith of any
instrument executed by the Trustee in its name as Trustee and shall incur no
liability hereunder for so doing.
15.5 GENDER OF WORDS. Whenever the context requires such, words of
the masculine gender used herein shall include the feminine and the neuter, and
the words used in the singular shall include the plural.
15.6 SEVERABILITY. Each provision of the Trust Agreement is
severable and if any provision is found to be void as against public policy it
shall not affect the validity of any other provision hereof.
15.7 GOVERNING LAW; PARTIES TO LEGAL ACTIONS. The provisions of
this Trust Agreement shall be construed according to the laws of the State of
Texas and, to the extent applicable, according to the laws of the United
States. The Trustee or the Participating Employer may at any time initiate a
legal action or proceeding for the settlement of the account of the Trustee or
for the determination of any question or for instructions. The only necessary
parties to any such action or proceeding are the Trustee and the Participating
Employer concerned; however, any other person or persons may be included as
parties defendant at the election of the Trustee and the Participating
Employer.
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IN WITNESS WHEREOF, the Employer and Trustee have caused this Trust
Agreement to be executed in multiple counterparts, each of which shall be
deemed to be an original, as of the date above first written.
EMPLOYER:
ATTEST: CAMCO INTERNATIONAL INC.
By: By:
----------------------------- -----------------------------
Name: Name:
--------------------------- ---------------------------
Title: Title:
-------------------------- --------------------------
TRUSTEE:
ATTEST: WACHOVIA BANK OF NORTH
CAROLINA, N.A.
By: By:
----------------------------- -----------------------------
Name: Name:
--------------------------- ---------------------------
Title: Title:
-------------------------- --------------------------
THE STATE OF TEXAS Section
Section
COUNTY OF HARRIS Section
This instrument was acknowledged before me on __________, 199__, by
__________________, _________________, of Camco International Inc., a Delaware
corporation, on behalf of said corporation.
----------------------------------
NOTARY PUBLIC IN AND FOR THE STATE
OF T E X A S
My Commission Expires:
------------
29
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STATE OF NORTH CAROLINA )
)
COUNTY OF ________________ )
This instrument was acknowledged before me on ___________, 199__ by
_______________________, ____________________ of Wachovia Bank of North
Carolina, N.A., a national banking association, as trustee of the Camco
International Inc. Deferred Income Plan Trust.
----------------------------------
NOTARY PUBLIC IN AND FOR THE STATE
OF NORTH CAROLINA
My Commission Expires:____________
30
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EXHIBIT A
The Employer hereby transfers and delivers the following property to
the Trustee:
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APPENDIX A
The Participating Employers of this Trust Agreement as of ___________, 1997
are:
Employer -- Camco International Inc.
Other Participating Employers -- _________________________
_________________________
_________________________
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EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Form S-8 registration statement of our report dated February
10, 1997 included in Camco International Inc.'s Form 10-K for the year ended
December 31, 1996, and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
Houston, Texas
March 20, 1997
