Attached files
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8-K - FORM 8-K - Baker Hughes Holdings LLC | h74679e8vk.htm |
EX-10.1 - EX-10.1 - Baker Hughes Holdings LLC | h74679exv10w1.htm |
Exhibit 10.2
BAKER HUGHES INCORPORATED
SUPPLEMENTAL RETIREMENT PLAN
SUPPLEMENTAL RETIREMENT PLAN
(As Amended and Restated
Effective January 1, 2011)
Effective January 1, 2011)
BAKER HUGHES INCORPORATED
SUPPLEMENTAL RETIREMENT PLAN
SUPPLEMENTAL RETIREMENT PLAN
(As Amended and Restated
Effective January 1, 2011)
Effective January 1, 2011)
WITNESSETH:
WHEREAS,
Baker Hughes Incorporated and other adopting entities have heretofore
adopted the Baker Hughes Incorporated Supplemental Retirement Plan, hereinafter referred to as the
Plan, for the benefit of their eligible employees; and
WHEREAS, Baker Hughes Incorporated desires to amend and restate the Plan, on behalf of itself
and on behalf of the other adopting entities;
NOW THEREFORE, the Plan is hereby restated in its entirety as follows, effective as of January
1, 2011.
BAKER HUGHES INCORPORATED
SUPPLEMENTAL RETIREMENT PLAN
SUPPLEMENTAL RETIREMENT PLAN
TABLE OF CONTENTS
Page | ||||||
ARTICLE I DEFINITIONS AND CONSTRUCTION | 1 | |||||
1.01
|
Definitions | 1 | ||||
1.02
|
Number and Gender | 7 | ||||
1.03
|
Headings | 8 | ||||
ARTICLE II PARTICIPATION | 8 | |||||
2.01
|
Eligibility | 8 | ||||
2.02
|
Commencement of Participation | 8 | ||||
2.03
|
Cessation of Participation Upon Plan Administrator Determination | 8 | ||||
2.04
|
Suspension of Participation Due to Certain Distributions | 9 | ||||
ARTICLE III PARTICIPANT DEFERRALS | 9 | |||||
3.01
|
Amount of Participant Deferrals | 9 | ||||
3.02
|
Participant Deferral Elections | 9 | ||||
3.03
|
Period of Effectiveness of Participant Deferral Elections | 9 | ||||
3.04
|
Changes to Participant Deferral Election | 10 | ||||
3.05
|
Cancellation of Participant Deferral Election | 10 | ||||
3.06
|
Time and Form of Payment Specified in Participant Deferral Election | 10 | ||||
3.07
|
Irrevocable Change of Election of Time and/or Form of Payment for Grandfathered Amounts | 11 | ||||
3.08
|
Change of Time and Form of Payment for Amounts Other Than Grandfathered Amounts | 11 | ||||
3.09
|
Suspension of Participant Deferrals Due to Withdrawal for Unforeseeable Financial Emergency | 11 | ||||
ARTICLE IV COMPANY DEFERRALS | 12 | |||||
4.01
|
Company Basic Deferrals | 12 | ||||
4.02
|
Company Base Thrift Deferrals | 12 | ||||
4.03
|
Company Pension Deferrals | 12 | ||||
4.04
|
Company Discretionary Deferrals | 12 | ||||
4.05
|
Time and Form of Payment Elections for Company Deferrals | 13 | ||||
ARTICLE V VALUATION OF ACCOUNTS | 13 | |||||
ARTICLE VI DEEMED INVESTMENT OF FUNDS | 13 | |||||
ARTICLE VII DETERMINATION OF VESTED INTEREST AND FORFEITURES | 14 |
-i-
TABLE OF CONTENTS
(continued)
(continued)
Page | ||||||
7.01
|
Vested Interest | 14 | ||||
7.02
|
Forfeitures | 14 | ||||
ARTICLE VIII ACCELERATED DISTRIBUTIONS | 15 | |||||
8.01
|
Restrictions on In-Service Distributions and Loans | 15 | ||||
8.02
|
Emergency Benefit | 15 | ||||
ARTICLE IX PAYMENT OF BENEFITS | 16 | |||||
9.01
|
Amount of Benefit | 16 | ||||
9.02
|
Time of Payment of Grandfathered Amounts | 16 | ||||
9.03
|
Time of Payment of Amounts Other Than Grandfathered Amounts | 16 | ||||
9.04
|
Alternative Forms of Benefit Payments for Grandfathered Amounts | 17 | ||||
9.05
|
Alternative Forms of Benefit Payments for Amounts Other Than Grandfathered Amounts | 17 | ||||
9.06
|
Accelerated Pay-Out of Certain Grandfathered Amounts | 18 | ||||
9.07
|
Accelerated Pay-Out of Certain Amounts, Including Grandfathered Amounts | 18 | ||||
9.08
|
Designation of Beneficiaries | 19 | ||||
9.09
|
Payment of Benefits | 19 | ||||
9.10
|
Unclaimed Benefits | 19 | ||||
9.11
|
Plan Administrator Determination of Pay-Out of Certain Benefits | 20 | ||||
9.12
|
Statutory Benefits | 20 | ||||
9.13
|
Payment to Alternate Payee Under Domestic Relations Order | 20 | ||||
ARTICLE X ADMINISTRATION OF THE PLAN | 20 | |||||
10.01
|
Plan Administrator | 20 | ||||
10.02
|
Resignation and Removal | 20 | ||||
10.03
|
Records and Procedures | 21 | ||||
10.04
|
Self-Interest of Plan Administrator | 21 | ||||
10.05
|
Compensation and Bonding | 21 | ||||
10.06
|
Plan Administrator Powers and Duties | 21 | ||||
10.07
|
Reliance on Documents, Instruments, etc | 22 | ||||
10.08
|
Claims Review Procedures; Claims Appeals Procedures | 22 | ||||
10.09
|
Company to Supply Information | 24 | ||||
10.10
|
Indemnity | 24 | ||||
ARTICLE XI ADMINISTRATION OF FUNDS | 25 | |||||
11.01
|
Payment of Expenses | 25 | ||||
11.02
|
Trust Fund Property | 25 | ||||
ARTICLE XII ADOPTION OF PLAN BY OTHER EMPLOYERS | 25 |
-ii-
TABLE OF CONTENTS
(continued)
(continued)
Page | ||||||
12.01
|
Adoption Procedure | 25 | ||||
12.02
|
No Joint Venture Implied | 26 | ||||
ARTICLE XIII NATURE OF THE PLAN AND ESTABLISHMENT OF THE TRUST | 26 | |||||
13.01
|
Nature of the Plan | 26 | ||||
13.02
|
Establishment of the Trust | 27 | ||||
ARTICLE XIV MISCELLANEOUS | 27 | |||||
14.01
|
Plan Not Contract of Employment | 27 | ||||
14.02
|
Alienation of Interest Forbidden | 27 | ||||
14.03
|
Withholding | 27 | ||||
14.04
|
Amendment and Termination | 28 | ||||
14.05
|
Severability | 28 | ||||
14.06
|
Arbitration | 28 | ||||
14.07
|
Compliance With Section 409A | 28 | ||||
14.08
|
Governing Law | 29 |
-iii-
BAKER HUGHES INCORPORATED
SUPPLEMENTAL RETIREMENT PLAN
SUPPLEMENTAL RETIREMENT PLAN
(As Amended and Restated
Effective January 1, 2011)
Effective January 1, 2011)
ARTICLE I
DEFINITIONS AND CONSTRUCTION
DEFINITIONS AND CONSTRUCTION
1.01 Definitions. The words and phrases defined in this Article shall have the meaning set
out in the definition unless the context in which the word or phrase appears reasonably requires a
broader, narrower or different meaning.
Account(s) means all ledger accounts pertaining to a Participant or former
Participant which are maintained by the Plan Administrator or Plan recordkeeper to reflect
the Companys obligation to the Participant or former Participant under the Plan. The Plan
Administrator or Plan recordkeeper shall establish the following subaccounts and any
additional subaccounts that the Plan Administrator considers necessary to reflect the entire
interest of the Participant or former Participant under the Plan. Each of the subaccounts
listed below and any additional subaccounts established by the Plan Administrator shall
reflect credits and debits made to such subaccounts for earnings, losses, distributions and
forfeitures.
(a) Participant Deferral Account the Participants or former Participants
deferrals, if any, made pursuant to Section 3.01.
(b) Company Basic Deferral Account the credits on behalf of a Participant or
former Participant made pursuant to Section 4.01.
(c) Company Base Thrift Deferral Account the credits on behalf of a
Participant or former Participant, if any, made pursuant to Section 4.02.
(d) Company Pension Deferral Account the credits on behalf of a Participant
or former Participant, if any, made pursuant to Section 4.03.
(e) Company Discretionary Deferral Account the credits on behalf of a
Participant or former Participant, if any, made pursuant to Section 4.04.
The Plan Administrator or Plan recordkeeper shall also maintain records that reflect a
Participants or former Participants Grandfathered Amounts.
Affiliate means any entity which is a member of the same controlled group of
corporations within the meaning of section 414(b) of the Code, or which is a trade or
business (whether or not incorporated) which is under common control (within the meaning of
section 414(c) of the Code), or which is a member of an affiliated service group (within the
meaning of section 414(m) of the Code), with Baker Hughes.
1
Annual Incentive Plan means Baker Hughes Incorporated 1995 Employee Annual Incentive
Compensation Plan, as amended from time to time, or any successor annual bonus program that
is exempt from section 162(m) of the Code.
Assets means assets of any kind owned by Baker Hughes, including but not limited to
securities of Baker Hughes direct and indirect subsidiaries and Affiliates.
Baker Hughes means Baker Hughes Incorporated, a Delaware corporation.
Base Compensation means a Participants base salary or wages measured on an annual
basis (as defined in section 3401(a) of the Code for purposes of federal income tax
withholding) from the Company, modified by including any portion thereof that such
Participant could have received in cash in lieu of (a) Participant Deferrals pursuant to
Section 3.01 or (b) elective contributions made on his behalf by the Company pursuant to a
qualified cash or deferred arrangement described in section 401(k) of the Code and any
elective contributions under a cafeteria plan described in section 125, and modified further
by excluding any bonus; incentive compensation; commissions; expense reimbursements or other
expense allowances; fringe benefits (cash and noncash); moving expenses; deferred
compensation (other than (a) Participant Deferrals pursuant to Section 3.01 or (b) elective
contributions to the Companys qualified cash or deferred arrangement described in section
401(k) of the Code); welfare benefits as defined in the Employee Retirement Income Security
Act of 1974, as amended; overtime pay; special performance compensation amounts and
severance compensation.
Beneficial Owner or Beneficial Ownership shall have the meaning ascribed to the
term in Rule 13d-3 of the General Rules and Regulations under the Exchange Act.
Board means the Board of Directors of Baker Hughes.
Bonus means the Employees incentive bonus earned under the Annual Incentive Plan for
services rendered or labor performed by the Employee during the applicable Plan Year. An
Employees Bonus shall be determined by including any portion thereof that such Employee
could have received in cash in lieu of (a) any Participant Deferrals pursuant to Section
3.01 or (b) elective contributions made on his behalf by the Company pursuant to a qualified
cash or deferred arrangement (as defined in section 401(k) of the Code) or pursuant to a
plan maintained under section 125 of the Code.
Change in Control means the occurrence of any of the following events:
(a) the individuals who are Incumbent Directors cease for any reason to constitute a
majority of the members of the Board;
(b) the consummation of a Merger of Baker Hughes or an Affiliate of Baker Hughes with
another Entity, unless the individuals and Entities who were the Beneficial Owners of the
Voting Securities of Baker Hughes outstanding immediately prior to such Merger own, directly
or indirectly, at least 50 percent of the combined voting power of
2
the Voting Securities of any of Baker Hughes, the surviving Entity or the parent of the
surviving Entity outstanding immediately after such Merger;
(c) any Person, other than a Specified Owner, becomes a Beneficial Owner, directly or
indirectly, of securities of Baker Hughes representing 30 percent or more of the combined
voting power of Baker Hughes then outstanding Voting Securities;
(d) a sale, transfer, lease or other disposition of all or substantially all of Baker
Hughes Assets is consummated (an Asset Sale), unless:
(i) the individuals and Entities who were the Beneficial Owners of the Voting
Securities of Baker Hughes immediately prior to such Asset Sale own, directly or
indirectly, 50 percent or more of the combined voting power of the Voting Securities
of the Entity that acquires such Assets in such Asset Sale or its parent immediately
after such Asset Sale in substantially the same proportions as their ownership of
Baker Hughes Voting Securities immediately prior to such Asset Sale; or
(ii) the individuals who comprise the Board immediately prior to such Asset
Sale constitute a majority of the board of directors or other governing body of
either the Entity that acquired such Assets in such Asset Sale or its parent (or a
majority plus one member where such board or other governing body is comprised of an
odd number of directors); or
(e) The stockholders of Baker Hughes approve a plan of complete liquidation or
dissolution of Baker Hughes.
Code means the Internal Revenue Code of 1986, as amended from time to time.
Committee means the Administrative Committee or the Investment Committee that may be
appointed by the Board as a Plan Administrator.
Company means Baker Hughes or an Employer.
Company Base Thrift Deferrals means credits to a Participants Account pursuant to
Section 4.02.
Company Deferrals means, collectively or individually, any of the deferrals made by
the Company pursuant to Sections 4.01, 4.02, 4.03 and 4.04.
Company Discretionary Deferrals means credits, if any, to a Participants Account
pursuant to Section 4.04.
Company Basic Deferrals means credits to a Participants Account pursuant to Section
4.01.
Company Pension Deferrals means credits to a Participants Account pursuant to
Section 4.03.
3
Deferral Period means the period of deferral selected by a Participant pursuant to
Section 3.06 or Section 4.05.
Discretionary Bonus means a discretionary bonus that is classified by the Company as
Bonus Exec Discretionary in the Companys payroll system.
Domestic Relations Order has the meaning ascribed to that term in section 414(p) of
the Code.
Eligible Employee means any individual who, on the date he commences participation in
the Plan, is employed by the Company on the active payroll and who is also an executive
salary grade system employee (under the Companys then current payroll system categories),
or any comparable executive designations in any system that replaces the executive salary
grade system. Once an individual commences participation in the Plan, he may continue
participation even if his payroll system status changes to a level that is below the
executive salary grade system, provided that the individual continues to remain a member of
a select group of management or a highly compensated employee, as determined by the Plan
Administrator.
Employer means any Affiliate that adopts the Plan pursuant to the provisions of
Article XII.
Entity means any corporation, partnership, association, joint-stock company, limited
liability company, trust, unincorporated organization or other business entity.
Entry Date means the first day of each Plan Year.
Exchange Act means the Securities Exchange Act of 1934, as amended from time to time,
or any successor act.
Funds means the investment funds designated from time to time for the deemed
investment of Accounts pursuant to Article VI.
Grandfathered Amounts means amounts credited under the Plan that were earned and
vested as of December 31, 2004 within the meaning of Section 409A, and earnings and losses
thereon.
Incumbent Director means
(a) a member of the Board on July 24, 2008, or
(b) an individual
(i) who becomes a member of the Board after July 24, 2008;
(ii) whose appointment or election by the Board or nomination for election by
Baker Hughes stockholders is approved or recommended by a vote of
4
at least two-thirds of the then serving Incumbent Directors (as defined
herein); and
(iii) whose initial assumption of service on the Board is not in connection
with an actual or threatened election contest.
Ineligible Pension Plan Compensation means with respect to each Participant and each
payroll period, the amount of the Participants compensation not taken into account under
the Pension Plan benefit formula solely because (a) such Participant deferred such
compensation as a Participant Deferral pursuant to Section 3.01 and/or (b) such compensation
exceeded the maximum dollar limitation of section 401(a)(17) of the Code.
Ineligible Thrift Plan Compensation means with respect to each Participant and each
payroll period, the amount of such Participants compensation for such payroll period that
is not considered Compensation under the Thrift Plan for such payroll period solely
because (a) such Participant deferred such compensation as a Participant Deferral pursuant
to Section 3.01 and/or (b) such compensation exceeded the maximum dollar limitation of
section 401(a)(17) of the Code.
Merger means a merger, consolidation or similar transaction.
Participant means each Eligible Employee who has met the eligibility requirements for
participation in the Plan specified in Article II.
Participant Deferral means any deferral made by a Participant pursuant to Section
3.01.
Pay means the sum of a Participants Base Compensation, Bonus and Discretionary
Bonus.
Pension Plan means the Baker Hughes Incorporated Pension Plan, as amended from time
to time.
Person shall have the meaning ascribed to the term in Section 3(a)(9) of the Exchange
Act and used in Sections 13(d) and 14(d) thereof, including a group as defined in Section
13(d) thereof, except that the term shall not include (a) the Company or any of its
Affiliates, (b) a trustee or other fiduciary holding Company securities under an employee
benefit plan of the Company or any of its Affiliates, (c) an underwriter temporarily holding
securities pursuant to an offering of those securities or (d) a corporation owned, directly
or indirectly, by the stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company.
Plan means the Baker Hughes Incorporated Supplemental Retirement Plan, as amended
from time to time.
Plan Administrator means Baker Hughes, acting through its delegates. Such delegates
shall include the Administrative Committee, the Investment Committee and any
5
individual Plan Administrator appointed by the Board with respect to the employee
benefit plans of Baker Hughes and its Affiliates, each of which shall have the duties and
responsibilities assigned to it from time to time by the Board. As used in the Plan, the
term Plan Administrator shall refer to the applicable delegate of Baker Hughes as
determined pursuant to the actions of the Board.
Plan Year means the twelve-consecutive month period commencing January 1 of each
year.
Pre-2009 Accounts means the Employees Accounts under the Plan attributable to
deferrals and credits made with respect to Plan Years prior to 2009, and earnings and losses
thereon.
Retirement means the Employees voluntary termination of his employment when the
Employee has attained at least 55 years of age and has at least ten (10) years of service
with the Company and the Affiliates.
Retirement Date means a Participants or former Participants Retirement Date as
defined under the Thrift Plan.
Section 409A means section 409A of the Code and the Department of Treasury rules and
regulations issued thereunder.
Separation from Service has the meaning ascribed to that term in Section 409A.
Specified Owner means any of the following:
(a) Baker Hughes;
(b) an Affiliate of Baker Hughes;
(c) an employee benefit plan (or related trust) sponsored or maintained by
Baker Hughes or any Affiliate of Baker Hughes;
(d) a Person that becomes a Beneficial Owner of Baker Hughes outstanding
Voting Securities representing 30 percent or more of the combined voting power of
Baker Hughes then outstanding Voting Securities as a result of the acquisition of
securities directly from Baker Hughes and/or its Affiliates; or
(e) a Person that becomes a Beneficial Owner of Baker Hughes outstanding
Voting Securities representing 30 percent or more of the combined voting power of
Baker Hughes then outstanding Voting Securities as a result of a Merger if the
individuals and Entities who were the Beneficial Owners of the Voting Securities of
Baker Hughes outstanding immediately prior to such Merger own, directly or
indirectly, at least 50 percent of the combined voting power of the Voting
Securities of any of Baker Hughes, the surviving Entity or the parent of the
surviving Entity outstanding immediately after such Merger in substantially
6
the same proportions as their ownership of the Voting Securities of Baker
Hughes outstanding immediately prior to such Merger.
Termination of Employment means, with respect to each Participant or former
Participant, the termination of such Participants or former Participants employment with
the Company and all Affiliates for any reason whatsoever.
Thrift Plan means the Baker Hughes Incorporated Thrift Plan, as amended from time to
time.
Trust means the trust, if any, established under the Trust Agreement.
Trust Agreement means the agreement, if any, entered into between the Company and the
Trustee pursuant to Article XIII, as amended from time to time.
Trust Fund means the funds and properties, if any, held pursuant to the provisions of
the Trust Agreement, together with all income, profits, and increments thereto.
Trustee means the trustee or trustees qualified and acting under the Trust Agreement
at any time.
Unforeseeable Financial Emergency means a severe financial hardship of the
Participant resulting from an illness or accident of the Participant or of the Participants
spouse or dependent (as defined in section 152(a) of the Code), loss of the Participants
property due to casualty (including the need to rebuild a home following damage to a home
not otherwise covered by insurance), or other similar extraordinary and unforeseeable
circumstance arising as a result of events beyond the control of the Participant. The
circumstances that will constitute an Unforeseeable Financial Emergency will depend upon the
facts of each case, but, in any case, payment may not be made to the extent that the
emergency is or may be relieved through reimbursement or compensation by insurance or
otherwise or by liquidation of the Participants assets, to the extent the liquidation of
such assets will not itself cause severe financial hardship. Such foreseeable needs for
funds as the desire to send a Participants child to college or to purchase a home will not
be considered to be unforeseeable emergencies. Whether an Unforeseeable Financial Emergency
exists and the amount reasonably needed to satisfy the emergency will be determined by the
Committee.
Vested Interest means the portion of a Participants or former Participants Accounts
which, pursuant to the Plan, is nonforfeitable.
Voting Securities means the outstanding securities entitled to vote generally in the
election of directors or other governing body.
1.02 Number and Gender. Wherever appropriate herein, words used in the singular shall be
considered to include the plural and words used in the plural shall be considered to include the
singular. The masculine gender, where appearing in the Plan, shall be deemed to include the
feminine gender.
7
1.03 Headings. The headings of Articles and Sections herein are included solely for
convenience, and if there is any conflict between such headings and the text of the Plan, the text
shall control.
ARTICLE II
PARTICIPATION
PARTICIPATION
2.01 Eligibility.
(a) Each Eligible Employee shall be eligible to become a Participant for a Plan Year
with respect to Participant Deferrals by electing to make Participant Deferrals pursuant to
Section 3.01.
(b) Each Eligible Employee shall be a Participant for a Plan Year with respect to
Company Deferrals pursuant to Section 4.01.
(c) Each Eligible Employee who is a participant in the Thrift Plan during a Plan Year
with respect to Company Base Contributions under the Thrift Plan shall be a Participant for
such Plan Year with respect to Company Deferrals pursuant to Section 4.02.
(d) Each Eligible Employee who is a participant in the Pension Plan during a Plan Year
shall be a Participant for such Plan Year with respect to Company Deferrals pursuant to
Section 4.03.
(e) Notwithstanding any other provision of the Plan, in the case of a person who is not
a Participant on the date of the adoption of this Agreement, such person shall not be
eligible to participate in the Plan until the Plan Administrator selects him or her for
participation in the Plan.
2.02 Commencement of Participation. Prior to each Entry Date, the Plan Administrator shall
notify those Eligible Employees who are determined by the Plan Administrator to be eligible to
participate in the Plan as of such Entry Date. Any such Eligible Employee may elect to make
Participant Deferrals beginning on such Entry Date by effecting, prior to such Entry Date and
within the time period prescribed by the Plan Administrator, the Participant Deferral election in
the form prescribed by the Plan Administrator. Notwithstanding any provision herein to the
contrary, an Eligible Employee who first becomes an Eligible Employee on other than the first day
of a Plan Year may elect to make Participant Deferrals commencing on the date the Plan
Administrator selects him for participation in the Plan by effecting, prior to or within 30 days
after the date he first becomes eligible to participate and within the time period prescribed by
the Plan Administrator, the Participant Deferral election in the form prescribed by the Plan
Administrator.
2.03 Cessation of Participation Upon Plan Administrator Determination. Notwithstanding any
provision herein to the contrary, the Plan Administrator may determine that an Eligible Employee
who has become a Participant of the Plan shall cease to be entitled to make Participant Deferrals
hereunder or receive credits under Article IV effective as of the first day of the Plan Year that
commences subsequent to the determination. Any such Plan Administrator
8
action shall be communicated to the affected individual prior to the effective date of such
action. Any such Eligible Employee may again become entitled to make Participant Deferrals
hereunder and to receive credits under Article IV beginning on any subsequent Entry Date selected
by the Plan Administrator in its sole discretion.
2.04 Suspension of Participation Due to Certain Distributions. To the extent and for the
period of time specified in Section 3.09, a Participants participation in the Plan shall be
suspended upon his making a withdrawal under Section 8.02.
ARTICLE III
PARTICIPANT DEFERRALS
PARTICIPANT DEFERRALS
3.01 Amount of Participant Deferrals. A Participant meeting the eligibility requirements of
Section 2.01(a) may, prior to the applicable Plan Year:
(a) elect to defer an integral percentage of from 1% to 60% of his Base Compensation
for the Plan Year; and/or
(b) elect to defer an integral percentage of from 1% to 100% of the sum of his Bonus
and Discretionary Bonus earned during the Plan Year.
Notwithstanding the foregoing, with respect to an Eligible Employee who first becomes a
Participant on a date other than an Entry Date, any such Participant Deferrals pursuant to Section
3.01(a) shall apply only for the portion of such Plan Year commencing with the date he first
becomes a Participant and ending on the last day of such Plan Year. An Eligible Employee who first
becomes a Participant during a Plan Year may not elect to defer any portion of his Bonus or
Discretionary Bonus earned during such Plan Year.
3.02 Participant Deferral Elections. Pay for a Plan Year that is not deferred pursuant to an
election under Section 3.01 shall be received by such Participant in cash. A Participants election
to defer an amount of his Pay pursuant to this Section shall be made by effecting, in the form
prescribed by the Plan Administrator, a Participant Deferral election pursuant to which the
Participant authorizes the Company to reduce his Pay in the elected amount and the Company, in
consideration thereof, agrees to credit an equal amount to his Participant Deferral Account
maintained under the Plan. The reduction in a Participants Pay pursuant to his Participant
Deferral election shall be effected by Pay reductions each payroll period as determined by the Plan
Administrator following the effective date of such election. Participant Deferrals made by a
Participant shall be credited to his Participant Deferral Account as of a date determined in
accordance with procedures established from time to time by the Plan Administrator; provided,
however, that such Participant Deferrals shall be credited to his Participant Deferral Account no
later than 30 days after the date upon which the Pay deferred would have been received by such
Participant in cash had he not elected to defer such amount pursuant to Section 3.01.
3.03 Period of Effectiveness of Participant Deferral Elections. A Participant Deferral
election pursuant to Section 3.01 shall become effective as of the Entry Date (or later initial
eligibility date, if applicable) which is on or after the date the election is effected by the
Participant. With respect to an Eligible Employee who first becomes a Participant on other than
9
an Entry Date, any such Participant Deferrals pursuant to Section 3.01(a) shall apply only to
Base Compensation earned during such Plan Year commencing after his deferral election for such Plan
Year. A Participant Deferral election pursuant to Section 3.01(b) shall become effective as of the
first day of the Plan Year following the date the election is effected by the Participant. A
Participant Deferral election shall remain in force and effect for the entire (or partial, if
applicable) Plan Year to which such election relates. A Participant Deferral election shall be made
for each Plan Year, or partial Plan Year, in which the Participant is eligible to participate. Plan
provisions to the contrary notwithstanding, a Participant Deferral election shall be suspended
during any period of unpaid leave of absence from the Company.
3.04 Changes to Participant Deferral Election. A Participant who makes a Participant Deferral
election may change his election for future Participant Deferrals, as of the Entry Date of any
subsequent Plan Year, by effecting such change in the annual election prior to the Entry Date of
such Plan Year, in the form and within the time period prescribed by the Plan Administrator. Any
such change shall be effective as of the Entry Date of such Plan Year.
3.05 Cancellation of Participant Deferral Election. A Participant who has made a Participant
Deferral election may cancel his election for future Participant Deferrals, as of the Entry Date of
any subsequent Plan Year, by effecting such cancellation in the annual election prior to the Entry
Date of such Plan Year, in the form and within the time period prescribed by the Plan
Administrator. Any such change shall be effective as of the Entry Date of such Plan Year. A
Participant who so cancels his Participant Deferral election may again make a new Participant
Deferral election for a subsequent Plan Year, if he satisfies the eligibility requirements set
forth in Article II, by effecting a new Participant Deferral election prior to the Entry Date of
such Plan Year, in the form and within the time period prescribed by the Plan Administrator.
3.06 Time and Form of Payment Specified in Participant Deferral Election. A Participant
Deferral election shall indicate the applicable time and form of payment, as provided in Sections
9.02, 9.03, 9.04 and 9.05 for the Pay deferred under the election for such Plan Year and the net
income (or net loss) allocated with respect thereto. Such time and form of payment election for
such Plan Year shall also apply to any Company Deferrals for such Plan Year and the earnings and
losses allocated with respect thereto. Each Participants Accounts shall be divided into
subaccounts to reflect the Participants various elections respecting time and form of payment.
Notwithstanding the foregoing, with respect to the portion of a Participants Account attributable
to the amount, if any, credited to his Account on December 31, 1994, under the Plan as in effect
immediately prior to the January 1, 1995 restatement of the Plan, such portion and the net income
(or net loss) allocated with respect thereto shall be allocated to a subaccount which shall be
payable at the time and in the form provided under the Plan as in effect immediately prior to such
restatement. In accordance with procedures established by the Plan Administrator, a Participant
may elect to have his Account or subaccount balance paid or commence to be paid (i) upon the
expiration of a specified term following the Participants Separation from Service, (ii) as soon as
administratively practicable after December 31 of the Plan Year in which the Participants
Separation From Service occurs, (iii) on a date specified by the Participant that is at least 18
months following the end of the Plan Year for which the deferral election is made, or (iv) upon the
earlier to occur of the date specified in clause (iii) or the date specified in clause (ii) (the
Deferral Period). The Plan Administrator is authorized to establish
10
written guidelines concerning limitations on the number of subaccounts respecting time and
form of payment that may be maintained under the Plan for any given Participant. Any such written
guidelines shall be deemed to be incorporated by reference in the Plan. Once an election as to
time and form of payment has been made for a Plan Year, the election may not be changed by the
Participant or former Participant except as specified in Sections 3.07 and 3.08.
3.07 Irrevocable Change of Election of Time and/or Form of Payment for Grandfathered Amounts.
In accordance with procedures established by the Plan Administrator, a Participant or former
Participant may make a one-time irrevocable election to change the time and/or form of payment he
previously selected for all of the Grandfathered Amounts credited to his Account. Any such change
election must be made no later than 18 months before the date on which such amounts were scheduled
to be paid or commence to be paid under the Participants or former Participants original
election. In addition, any such change election may not provide for a payment or commencement of
payment that is earlier than 18 months after the date on which the change election is made. For
purposes of calculating the 18-month period, such period will commence on the first day of the
month immediately following the month in which the election is made.
3.08 Change of Time and Form of Payment for Amounts Other Than Grandfathered Amounts. In
accordance with procedures established by the Plan Administrator, a Participant or former
Participant may make an election to change the time and/or form of payment he previously selected
for the amounts credited to his Account other than Grandfathered Amounts. Any such change election
must be made no later than 12 months before the date on which such amounts were scheduled to be
paid or commence to be paid under the Participants or former Participants original election. In
addition, any such change election may not provide for a payment or commencement of payment that is
earlier than five years after the date on which the amounts were originally scheduled to be paid or
commence to be paid. For purposes of this Section 3.08, installment payments shall be treated as a
single payment.
3.09 Suspension of Participant Deferrals Due to Withdrawal for Unforeseeable Financial
Emergency. Upon written petition of a Participant, in the event that the Plan Administrator
determines in its sole discretion that such Participant has suffered an Unforeseeable Financial
Emergency or that such Participant will, absent termination of such Participants Participant
Deferral election then in effect, suffer an Unforeseeable Financial Emergency, then the Participant
Deferral election of such Participant then in effect, if any, shall be terminated as soon as
administratively practicable after such determination. A Participant whose Participant Deferral
election has been so terminated may again make a new Participant Deferral election for a subsequent
Plan Year that commences at least twelve months after the effective date of such termination, if he
satisfies the eligibility requirements set forth in Article II and by effecting a new Participant
Deferral election for such Plan Year, in the form and within the time period prescribed by the Plan
Administrator.
11
ARTICLE IV
COMPANY DEFERRALS
COMPANY DEFERRALS
4.01 Company Basic Deferrals. Each Plan Year the Company shall make a Company Basic Deferral
on the Participants behalf in an amount equal to the sum of (A) plus (B) where (A) is five percent
of the sum of the amount of the Participants Base Compensation deferred under Section 3.01 of the
Plan for the Plan Year, the amount of the Bonus payable to the Participant during the Plan Year
that the Participant defers under Section 3.01 of the Plan for the Plan Year the amount of
Discretionary Bonus payable to the Participant during the Plan Year that the Participant defers
under Section 3.01 of the Plan for the Plan Year, and (B) is five percent of the amount of the
Participants Gross Compensation in excess of the sum of the applicable limitation under section
401(a)(17) of the Code for the Plan Year and the amount of the Participants deferrals under
Section 3.01 for the Plan Year. For this purpose, Gross Compensation means the sum of the
Participants Base Compensation for the Plan Year, the Bonus payable to the Participant during the
Plan Year, and the Discretionary Bonus payable to the Participant during the Plan Year (in each
case, whether or not deferred under the Thrift Plan or the Plan).
Company Basic Deferrals made on a Participants behalf pursuant to this Section 4.01 shall be
credited to such Participants Company Basic Deferral Account in one or more installments, as
determined by the Plan Administrator, as of a date or dates within the Plan Year.
4.02 Company Base Thrift Deferrals. For each payroll period, the Company shall defer an
amount on behalf of such Participant who is entitled to an allocation of Company Base
Contributions under the Thrift Plan for such payroll period. The amount of each such Company
Deferral shall be a percentage of the Participants Ineligible Thrift Plan Compensation, if any,
for such payroll period, with such percentage being equal to the percentage utilized under the
Thrift Plan to determine the Participants Company Base Contribution for such payroll period
under the Thrift Plan. Company Base Thrift Deferrals on behalf of a Participant pursuant to this
Section 4.02 shall be credited to such Participants Company Base Thrift Deferral Account in
accordance with the procedures established from time to time by the Plan Administrator.
4.03 Company Pension Deferrals. For each payroll period, the Company shall defer an amount
on behalf of such Participant equal to the percentage of such Participants Ineligible Pension Plan
Compensation, if any, for such payroll period, with such percentage being equal to the percentage
utilized under the Pension Plan to determine the Participants Contribution Credit Rate for such
payroll period under the Pension Plan. Company Pension Deferrals on behalf of a Participant
pursuant to this Section 4.03 shall be credited to such Participants Company Pension Deferral
Account in accordance with the procedures established from time to time by the Plan Administrator.
4.04 Company Discretionary Deferrals. As of any date selected by the Company, the Company may
credit a Participants Company Discretionary Deferral Account with Company Discretionary Deferrals
in such amount, if any, as the Company shall determine in its sole discretion. Such credits may be
made on behalf of some Participants but not others, and such credits may vary in amount among
individual Participants.
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4.05 Time and Form of Payment Elections for Company Deferrals. A Participant who does not
have a time and form of payment election in effect pursuant to Section 3.06 for a given Plan Year
shall make a time and form of payment election, as provided in Sections 9.03 and 9.05 (Sections
9.02 and 9.04 with respect to Grandfathered Amounts), for Company Base Thrift Deferrals, Company
Basic Deferrals, Company Pension Deferrals, and Company Discretionary Deferrals for such Plan Year.
Such election shall be made in accordance with the same procedures as apply to Participant
Deferral elections under Section 3.06. A Participant who had made a time and form of payment
election pursuant to this Section 4.05 may change his election for future Company Base Thrift
Deferrals, Company Pension Deferrals, and Company Discretionary Deferrals as of the Entry Date of
any subsequent Plan Year, by effecting a new election prior to the Entry Date of such Plan Year, in
the form and within the time period prescribed by the Plan Administrator. Each Participants
Accounts shall be divided into subaccounts to reflect the Participants various elections
respecting time and form of payment. Once an election as to time and form of payment has been made
for a Plan Year, the election may not be changed by the Participant or former Participant except as
specified in Section 3.07, or Section 3.08, as applicable.
ARTICLE V
VALUATION OF ACCOUNTS
VALUATION OF ACCOUNTS
All amounts allocated to the Accounts of a Participant shall be deemed to be invested as of
the date of such allocation, and the balance of each Account shall reflect the result of daily
pricing of the assets in which such Account is deemed to be invested from the time of such
allocation until the time of distribution.
ARTICLE VI
DEEMED INVESTMENT OF FUNDS
DEEMED INVESTMENT OF FUNDS
Participants and former Participants Accounts shall be deemed to be credited with earnings
and losses. For the purpose of determining the earnings or losses to be credited to the
Participants or former Participants Accounts under the Plan, the Plan Administrator shall assume
that the Participants or former Participants Accounts are invested in units or shares of the
Funds in the proportions selected by the Participant or former Participant in accordance with
procedures established by the Plan Administrator. This amount accrued by the Plan Administrator as
additional deferred compensation shall be a part of the Companys obligation to the Participant or
former Participant. The determination of deemed earnings and losses on amounts deemed credited to
the Participants or former Participants Account shall in no way affect the ability of the general
creditors of the Company to reach the assets of the Company (including any rabbi trust maintained
in connection with the Plan) in the event of the insolvency or bankruptcy of the Company or place
the Participants or former Participants in a secured position ahead of the general creditors of the
Company. Although a Participants or former Participants investment selections made in accordance
with the terms of the Plan and such procedures as may be established by the Plan Administrator
shall be relevant for purposes of determining the Companys obligation to the Participant or former
Participant under the Plan, there is no requirement that any assets of the Company (including those
held in any rabbi trust) shall be invested in accordance with the Participants or former
Participants investment
13
selections.
Each Participant or former Participant shall designate, in accordance with the procedures
established from time to time by the Plan Administrator, the manner in which the amounts allocated
to his Accounts shall be deemed to be invested from among the Funds made available from time to
time for such purpose by the Plan Administrator. Such Participant or former Participant may
designate one of such Funds for the deemed investment of all such amounts allocated to his Accounts
or he may split the deemed investment of such amounts allocated to his Accounts among such Funds in
such increments as the Plan Administrator may prescribe. If a Participant or former Participant
fails to make a proper designation, then his Accounts shall be deemed to be invested in the Fund or
Funds designated in a uniform and nondiscriminatory manner by the Plan Administrator from time to
time.
A Participant may change his deemed investment designation for future deferrals to be
allocated to his Accounts. Any such change shall be made in accordance with the procedures
established by the Plan Administrator, and the frequency of such changes may be limited by the Plan
Administrator.
A Participant or former Participant may elect to convert his deemed investment designation
with respect to the amounts already allocated to his Accounts. Any such conversion shall be made in
accordance with the procedures established by the Plan Administrator, and the frequency of such
conversions may be limited by the Plan Administrator.
ARTICLE VII
DETERMINATION OF VESTED INTEREST AND FORFEITURES
DETERMINATION OF VESTED INTEREST AND FORFEITURES
7.01 Vested Interest. A Participant or former Participant shall have a 100% Vested Interest
in amounts credited to his Participant Deferral Account and his Company Basic Deferral Account at
all times. A Participant or former Participant shall have a Vested Interest in the amounts
credited to his Company Base Thrift Deferral Account and Company Discretionary Deferral Account
equal to his nonforfeitable interest in his Company Non-Matching Accounts under the Thrift Plan.
A Participant or former Participant shall have a Vested Interest in the amounts credited to his
Company Pension Deferral Account equal to his nonforfeitable interest in his account under the
Pension Plan. Further, a Participant or former Participant shall have a 100% Vested Interest in
amounts credited to his Company Base Thrift Deferral Account, Company Pension Deferral Account, and
Company Discretionary Deferral Account upon such Participants or former Participants Termination
of Employment after attainment of his Retirement Date or by reason of death. If a Change in
Control occurs, a Participant who has not incurred a Separation From Service prior to the date of
the Change in Control shall have a 100% Vested Interest in amounts credited to his Company Base
Thrift Deferral Account, Company Discretionary Deferral Account and Company Pension Deferral
Account upon the occurrence of the Change in Control.
7.02 Forfeitures. A Participant or former Participant who incurs a Termination of Employment
with a Vested Interest in amounts credited to his Company Base Thrift Deferral Account, Company
Pension Deferral Account, and Company Discretionary Deferral Account
14
that is less than 100% (determined after giving effect to any provision in Section 7.01 that
may provide for an increase in such Participants Vested Interest upon a Termination of Employment)
shall forfeit to the Company the nonvested portion of amounts credited to his Company Base Thrift
Deferral Account, Company Pension Deferral Account, and Company Discretionary Deferral Account as
of the date of such Termination of Employment.
ARTICLE VIII
ACCELERATED DISTRIBUTIONS
ACCELERATED DISTRIBUTIONS
8.01 Restrictions on In-Service Distributions and Loans. Except as provided in Section 8.02,
or as elected by a Participant pursuant to Section 3.06 or Section 4.05 (as such election may be
changed pursuant to Section 3.07 or Section 3.08) Participants shall not be permitted to make
withdrawals from, or to receive distributions under, the Plan while they are employed by the
Company or an Affiliate. Participants shall not, at any time, be permitted to borrow from the
Trust Fund. Except as provided in Sections 8.02 and 14.04, all benefits under the Plan shall be
paid in accordance with the provisions of Article IX.
8.02 Emergency Benefit. In the event that the Plan Administrator, upon written petition of a
Participant who has not incurred a Termination of Employment, determines in its sole discretion
that such Participant has suffered an Unforeseeable Financial Emergency, such Participant shall be
entitled to a distribution in an amount not to exceed the lesser of (a) the amount determined by
the Plan Administrator as necessary to meet such Participants needs created by the Unforeseeable
Financial Emergency or (b) the then value of such Participants Vested Interest in his Accounts.
Such benefit shall be paid in a single lump sum payment as soon as administratively practicable
after the Plan Administrator has made its determinations with respect to the availability and
amount of such benefit. If a Participants Accounts are deemed to be invested in more than one
Fund, such benefit shall be distributed pro rata from each Fund in which such Accounts are deemed
to be invested. If a Participants Accounts contain more than one distribution subaccount, such
benefit shall be considered to have been distributed, first, from the subaccount with respect to
which the earliest distribution would be made, then, from the subaccount with respect to which the
next earliest distribution would be made, and continuing in such manner until the amount of such
distribution has been satisfied. A distribution under this Section 8.02 shall in any event be made
within 90 days after the Participant incurs an Unforeseeable Financial Emergency. The Participant
shall not be permitted to elect the taxable year in which any payment under this Section 8.02 shall
be made.
15
ARTICLE IX
PAYMENT OF BENEFITS
PAYMENT OF BENEFITS
9.01 Amount of Benefit. Upon the expiration of the Deferral Period, the Participant (or, in
the event of the death of the Participant while employed by the Company or an Affiliate, the
Participants designated beneficiary) or former Participant shall be entitled to a benefit equal in
value to the Participants or former Participants Vested Interest in the balance in his Accounts
as of the date the payment of such benefit is to commence pursuant to Section 9.02 and/or Section
9.03 (adjusted for subsequent deemed investment gains or losses in the case of benefits paid in the
form of installments).
9.02 Time of Payment of Grandfathered Amounts. Payment of a Participants or former
Participants benefit under Section 9.01 shall be made or shall commence, with respect to such
Participants or former Participants Accounts, or with respect to such Participants or former
Participants subaccounts established pursuant to Section 3.06 and/or Section 4.05 separately and
respectively, as follows. To the extent that the Participant or former Participant elected to have
his Accounts or subaccounts paid upon his Termination of Employment, the Participants or former
Participants benefit shall be paid or commence to be paid as soon as administratively practicable
after the last day of the calendar year coincident with or next following the date the Participant
or former Participant incurs a Termination of Employment. To the extent that the Participant or
former Participant elected to have his Accounts or subaccounts paid after a specified term, the
Participants or former Participants benefit shall be paid or commence to be paid as soon as
administratively practicable after the expiration of such specified term. With respect to any
portion of a Participants or former Participants benefit for which no time of payment election is
in effect, payment of such amount shall be made or commence as soon as administratively practicable
after the last day of the calendar year coincident with or next following the date the Participant
or former Participant incurs a Termination of Employment. A Participants or former Participants
benefit shall not, however, be paid or commence prior to the date that all Participant Deferrals
and Company Deferrals made pursuant to the Plan have been allocated to such Participants or former
Participants Accounts.
9.03 Time of Payment of Amounts Other Than Grandfathered Amounts. Payment of a Participants
or former Participants benefit under Section 9.01 shall be made or shall commence, with respect to
such Participants or former Participants Accounts, or with respect to such Participants or
former Participants subaccounts established pursuant to Section 3.06 and/or Section 4.05
separately and respectively, as follows. To the extent that the Participant or former Participant
elected to have his Accounts or subaccounts paid upon his Separation From Service, the
Participants or former Participants benefit shall be paid or commence to be paid on the later of
(1) the first day of the month coincident with or next following the date that is six months after
the date of the Separation From Service or (2) the first day of the Plan Year next following the
date of the Participants or former Participants Separation From Service. To the extent that the
Participant or former Participant elected to have his Accounts or subaccounts paid after a
specified term, the Participants or former Participants benefit shall be paid or commence to be
paid upon the expiration of such specified term. With respect to any portion of a Participants or
former Participants benefit for which an election was not made in accordance with Section 3.06 or
Section 4.05, payment of such amount shall be made or commence on the later of (1) the first day of
the month coincident with or next following the date that is six months
16
after the date of the Participants or former Participants Separation From Service or (2) the
first day of the Plan Year next following the date of the Participants or former Participants
Separation From Service.
9.04 Alternative Forms of Benefit Payments for Grandfathered Amounts. A Participants or
former Participants benefit under Section 9.01 shall be paid, with respect to such Participants
or former Participants Grandfathered Amounts, or with respect to such Participants or former
Participants subaccounts established pursuant to Section 3.06 and/or Section 4.05 that are
attributable to his Grandfathered Amounts separately and respectively, in one of the following
forms irrevocably elected by such Participant or former Participant pursuant to Section 3.06 and/or
Section 4.05:
(a) A single lump sum payment; or
(b) Any number (from two to 20 as designated by such Participant or former Participant)
of annual installment payments and, in the event of such Participants or former
Participants death prior to the receipt of all of the elected installment payments, the
remaining installments shall be paid to such Participants or former Participants
designated beneficiary as provided in Section 9.08. The amount of each annual installment
shall be computed by dividing the Vested Interest in the unpaid balance in the Participants
or former Participants Accounts as of the date of payment of such annual installment by the
number of annual installments remaining.
With respect to any portion of a Participants or former Participants benefit
attributable to the Participants or former Participants Pre-2009 Accounts for which an
election was not made in accordance with Section 3.06 or Section 4.05, such amount shall be
paid in the form of 15 annual installment payments to such Participant or former Participant
or, in the event of such Participants or former Participants death prior to his receipt of
all such installments, to his designated beneficiary as provided in Section 9.08; provided,
however, that with respect to Grandfathered Amounts, the Plan Administrator may, in its sole
discretion, elect to make such benefit payment in any other available form. If a
Participant or former Participant dies prior to the date the payment of his benefit begins
and if no form of payment election is in effect for any portion of such Participants or
former Participants benefit, such amount shall be paid to the Participants or former
Participants designated beneficiary in the form described in the preceding sentence. If a
Participant or former Participant dies prior to the date the payment of his benefit begins
with a form of payment election in effect, then benefit payments shall be made to the
Participants or former Participants designated beneficiary in the form elected by the
Participant or former Participant.
9.05 Alternative Forms of Benefit Payments for Amounts Other Than Grandfathered Amounts.
A Participants or former Participants benefit under Section 9.01 shall be paid, with
respect to such Participants or former Participants Accounts other than his Grandfathered
Amounts, or with respect to such Participants or former Participants subaccounts
established pursuant to Section 3.06 and/or Section 4.05 that are not
17
attributable to his Grandfathered Amounts separately and respectively, in one of the
following forms irrevocably elected by such Participant or former Participant pursuant to
Section 3.06 and/or Section 4.05:
(a) A single lump sum payment; or
(b) Any number (from two to 20 as designated by such Participant or former Participant)
of annual installment payments and, in the event of such Participants or former
Participants death prior to the receipt of all of the elected installment payments, the
remaining installments shall be paid to such Participants or former Participants
designated beneficiary as provided in Section 9.08. The amount of each annual installment
shall be computed by dividing the Vested Interest in the unpaid balance in the Participants
or former Participants Accounts as of the date of payment of such annual installment by the
number of annual installments remaining.
With respect to any portion of a Participants or former Participants benefit for
which an election was not made in accordance with Section 3.06 or Section 4.05, other than
amounts attributable to the Participants or former Participants Pre-2009 Accounts, such
amount shall be paid in the form of single sum payment to such Participant or former
Participant. If no form of payment election is in effect for any portion of such
Participants or former Participants benefit, and the Participant or former Participant
dies prior to the date such amount is paid, such amount shall be paid to the Participants
or former Participants designated beneficiary in the form described in the preceding
sentence. If a Participant or former Participant dies prior to the date the payment of his
benefit begins with a form of payment election in effect, then benefit payments shall be
made to the Participants or former Participants designated beneficiary in the form elected
by the Participant or former Participant.
9.06 Accelerated Pay-Out of Certain Grandfathered Amounts. Notwithstanding any provision of
the Plan to the contrary, if a Participants or former Participants benefit payments respecting
Grandfathered Amounts credited to any one subaccount established pursuant to Section 3.06 or
Section 4.05 are to be paid in a form other than a single lump sum payment and the aggregate
Grandfathered Amounts credited to such subaccount at the time of commencement of such payments is
less than $50,000, then the Plan Administrator may, in its sole discretion, elect to cause such
Grandfathered Amounts credited to such subaccount to be paid in a single lump sum payment.
9.07 Accelerated Pay-Out of Certain Amounts, Including Grandfathered Amounts. Notwithstanding
any other provision of the Plan to the contrary, if the aggregate amount of the Participants or
former Participants Account balances under the Plan (including Grandfathered Amounts) does not
exceed the Cashout Amount (as defined below), the amounts credited to the Participants or former
Participants Account shall be distributed to him immediately in the form of a single lump sum
payment; provided, however, that no such payment shall be made to a Participant or former
Participant prior to the later of (1) the first day of the month coincident with or next following
the date that is six months after the date of the Participants or former Participants Separation
From Service and (2) the first day of the Plan Year next following the date of the Participants or
former Participants Separation From
18
Service; and provided further that the payment results in the termination and liquidation of
the entirety of the Participants or former Participants interest under the Plan and all
arrangements that are treated as having been deferred under a single nonqualified deferred
compensation plan under Department of Treasury Regulation section 1.409A-1(c)(2). For purposes of
this Section 9.07, the term Cashout Amount means the applicable dollar amount under section
402(g)(1)(B) of the Code in effect during the Plan Year.
9.08 Designation of Beneficiaries.
(a) Each Participant or former Participant shall have the right to designate the
beneficiary or beneficiaries to receive payment of his benefit in the event of his death.
Each such designation shall be made by executing the beneficiary designation form prescribed
by the Plan Administrator and filing same with the Plan Administrator. Any such designation
may be changed at any time by execution of a new designation in accordance with this
Section.
(b) If no such designation is on file with the Plan Administrator at the time of the
death of the Participant or former Participant or such designation is not effective for any
reason as determined by the Plan Administrator, then the designated beneficiary or
beneficiaries to receive such benefit shall be as follows:
(i) If a Participant or former Participant leaves a surviving spouse, his
benefit shall be paid to such surviving spouse;
(ii) If a Participant or former Participant leaves no surviving spouse, his
benefit shall be paid to such Participants or former Participants executor or
administrator, or to his heirs at law if there is no administration of such
Participants or former Participants estate.
9.09 Payment of Benefits. To the extent the Trust Fund has sufficient assets, the Trustee
shall pay benefits to Participants or former Participants or their respective beneficiaries, except
to the extent the Company pays the benefits directly and provides adequate evidence of such payment
to the Trustee. To the extent the Trustee does not or cannot pay benefits out of the Trust Fund,
the benefits shall be paid by the Company. Any benefit payments made to a Participant, or former
Participant, or for his benefit pursuant to any provision of the Plan shall be debited to such
Participants or former Participants Accounts. All benefit payments shall be made in cash to the
fullest extent practicable.
9.10 Unclaimed Benefits. In the case of a benefit payable on behalf of a Participant or
former Participant, if the Plan Administrator is unable, after reasonable efforts, to locate the
Participant, the former Participant or the beneficiary to whom such benefit is payable, upon the
Plan Administrators determination thereof, such benefit shall be forfeited to the Company.
Notwithstanding the foregoing, if subsequent to any such forfeiture the Participant, the former
Participant or beneficiary to whom such benefit is payable makes a valid claim for such benefit,
such forfeited benefit (without any adjustment for earnings or loss) shall be restored to the Plan
by the Company and paid in accordance with the Plan.
19
9.11 Plan Administrator Determination of Pay-Out of Certain Benefits. Notwithstanding any
provision in Section 3.06 to the contrary, the form of payment of a Participants or former
Participants benefits with respect to the portion of his Account attributable to the amount, if
any, credited to his Account on December 31, 1994, under the Plan as in effect immediately prior to
the January 1, 1995 restatement of the Plan, and the earnings and losses allocated with respect
thereto may, in the sole discretion of the Plan Administrator, be changed from the form elected by
such Participant or former Participant pursuant to the provisions of the Plan as in effect
immediately prior to the January 1, 1995 restatement of the Plan to one or more other forms
provided in Section 9.04. In making its determination as to the form(s) of payment, the Plan
Administrator may consider the age, family status, health, financial status, or such other facts as
it deems relevant respecting the Participant or former Participant. The Participant or former
Participant may, but shall not be required to, express his preference to the Plan Administrator as
to such form(s) of payment, but the Plan Administrator shall be under no obligation to follow such
preference. Any such change shall be prior to the time such portion becomes payable to such
Participant or former Participant.
9.12 Statutory Benefits. If any benefit obligations are required to be paid under the Plan to
a Participant or former Participant in conjunction with severance of employment under the laws of
the country where the Participant or former Participant is employed or under federal, state or
local law, the benefits paid to a Participant or former Participant pursuant to the provisions of
the Plan will be deemed to be in satisfaction of any statutorily required benefit obligations.
9.13 Payment to Alternate Payee Under Domestic Relations Order. Plan benefits that are
awarded to an Alternate Payee in a Domestic Relations Order shall be paid to the Alternate Payee at
the time and in the form directed in the Domestic Relations Order. The Domestic Relations Order
may provide for an immediate lump sum payment to an Alternate Payee. A Domestic Relations Order
may not otherwise provide for a time or form of payment that is not permitted under the Plan. A
Domestic Relations Order will be disregarded to the extent it awards an Alternate Payee benefits in
excess of the applicable Participants or former Participants Vested Interest.
ARTICLE X
ADMINISTRATION OF THE PLAN
ADMINISTRATION OF THE PLAN
10.01 Plan Administrator. Baker Hughes shall be the Plan Administrator and the named
fiduciary for purposes of ERISA and shall be subject to service of process on behalf of the Plan.
10.02 Resignation and Removal. The members of a Committee serving as Plan Administrator shall
serve at the pleasure of the Board; they may be officers, directors, or Employees of the Company or
any other individuals. At any time during his term of office, any member of a Committee or any
individual serving as Plan Administrator may resign by giving written notice to the Board, such
resignation to become effective upon the appointment of a substitute or, if earlier, the lapse of
thirty days after such notice is given as herein provided. At
20
any time during its term of office, and for any reason, any member of a Committee or any
individual serving as Plan Administrator may be removed by the Board.
10.03 Records and Procedures. The Plan Administrator shall keep appropriate records of its
proceedings and the administration of the Plan and shall make available for examination during
business hours to any Participant, former Participant or the beneficiary of any Participant or
former Participant such records as pertain to that individuals interest in the Plan. If a
Committee is performing duties as the Plan Administrator, the Committee shall designate the
individual or individuals who shall be authorized to sign for the Plan Administrator and, upon such
designation, the signature of such individual or individuals shall bind the Plan Administrator.
10.04 Self-Interest of Plan Administrator. Neither the members of a Committee nor any
individual Plan Administrator shall have any right to vote or decide upon any matter relating
solely to himself under the Plan or to vote in any case in which his individual right to claim any
benefit under the Plan is particularly involved. In any case in which any Committee member or
individual Plan Administrator is so disqualified to act, the other members of the Committee shall
decide the matter in which the Committee member or individual Plan Administrator is disqualified.
10.05 Compensation and Bonding. Neither the members of a Committee nor any individual Plan
Administrator shall receive compensation with respect to their services on the Committee or as Plan
Administrator. To the extent required by applicable law, or required by the Company, neither the
members of a Committee nor any individual Plan Administrator shall furnish bond or security for the
performance of their duties hereunder.
10.06 Plan Administrator Powers and Duties. The Plan Administrator shall supervise the
administration and enforcement of the Plan according to the terms and provisions hereof and shall
have all powers necessary to accomplish these purposes, including, but not by way of limitation,
the right, power, and authority:
(a) to make rules, regulations, and bylaws for the administration of the Plan that are
not inconsistent with the terms and provisions hereof, and to enforce the terms of the Plan
and the rules and regulations promulgated thereunder by the Plan Administrator;
(b) to construe in its discretion all terms, provisions, conditions, and limitations of
the Plan;
(c) to correct any defect or to supply any omission or to reconcile any inconsistency
that may appear in the Plan in such manner and to such extent as it shall deem in its
discretion expedient to effectuate the purposes of the Plan;
(d) to employ and compensate such accountants, attorneys, investment advisors, and
other agents, employees, and independent contractors as the Plan Administrator may deem
necessary or advisable for the proper and efficient administration of the Plan;
(e) to determine in its discretion all questions relating to eligibility;
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(f) to determine whether and when a Participant has incurred a Separation From Service
or Termination of Employment, and the reason for such termination;
(g) to make a determination in its discretion as to the right of any individual to a
benefit under the Plan and to prescribe procedures to be followed by distributees in
obtaining benefits hereunder;
(h) to receive and review reports from the Trustee as to the financial condition of the
Trust Fund, including its receipts and disbursements; and
(i) to establish or designate Funds as deemed investment options as provided in Article
VI.
10.07 Reliance on Documents, Instruments, etc. The Plan Administrator may rely on any
certificate statement or other representation made on behalf of the Company, any Employee or any
Participant, which the Plan Administrator in good faith believes to be genuine, and on any
certificate, statement, report or other representation made to it by any agent or any attorney,
accountant or other expert retained by it or the Company in connection with the operation and
administration of the Plan.
10.08 Claims Review Procedures; Claims Appeals Procedures.
(a) Claims Review Procedures. When a benefit is due, the Participant, or the
person entitled to Benefits under Section 9.08, should submit a claim to the office
designated by the Plan Administrator to receive claims. Under normal circumstances, the Plan
Administrator will make a final decision as to a claim within 90 days after receipt of the
claim. If the Plan Administrator notifies the claimant in writing during the initial 90-day
period, it may extend the period up to 180 days after the initial receipt of the claim. The
written notice must contain the circumstances necessitating the extension and the
anticipated date for the final decision. If a claim is denied during the claims period, the
Plan Administrator must notify the claimant in writing, and the written notice must set
forth in a manner calculated to be understood by the claimant:
(1) the specific reason or reasons for the denial;
(2) specific reference to the Plan provisions on which the denial is based;
(3) a description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or information
is necessary; and
(4) an explanation of the Plan claims review procedures and time limits, including a
statement of the claimants right to bring a civil action under section 502(a) of
ERISA.
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If a decision is not given to the Participant within the claims review period, the claim is treated
as if it were denied on the last day of the claims review period.
(b) Claims Appeals Procedures. For purposes of this section the Participant or
the person entitled to Benefits under Section 10 is referred to as the claimant. If a
claimants claim made pursuant to Section 10.08(a) is denied and he wants a review, he must
apply to the Plan Administrator in writing. That application can include any arguments,
written comments, documents, records, and other information relating to the claim for
benefits. In addition, the claimant is entitled to receive on request and free of charge
reasonable access to and copies of all information relevant to the claim. For this purpose,
relevant means information that was relied on in making the benefit determination or that
was submitted, considered or generated in the course of making the determination, without
regard to whether it was relied on, and information that demonstrates compliance with the
Plans administrative procedures and safeguards for assuring and verifying that Plan
provisions are applied consistently in making benefit determinations. The Plan
Administrator must take into account all comments, documents, records, and other information
submitted by the claimant relating to the claim, without regard to whether the information
was submitted or considered in the initial benefit determination. The claimant may either
represent himself or appoint a representative, either of whom has the right to inspect all
documents pertaining to the claim and its denial. The Plan Administrator can schedule any
meeting with the claimant or his representative that it finds necessary or appropriate to
complete its review.
The request for review must be filed within 90 days after the denial. If it is not, the
denial becomes final. If a timely request is made, the Plan Administrator must make its
decision, under normal circumstances, within 60 days of the receipt of the request for
review. However, if the Plan Administrator notifies the claimant prior to the expiration of
the initial review period, it may extend the period of review up to 120 days following the
initial receipt of the request for a review. All decisions of the Plan Administrator must be
in writing and must include the specific reasons for its action, the Plan provisions on
which its decision is based, and a statement that the claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all documents, records, and
other information relevant to the claimants claim for benefits, and a statement of the
claimants right to bring an action under section 502(a) of ERISA If a decision is not
given to the claimant within the review period, the claim is treated as if it were denied on
the last day of the review period.
Within 60 days of receipt by a claimant of a notice denying a claim under the preceding
paragraph, the claimant or his or her duly authorized representative may request in writing
a full and fair review of the claim by the Plan Administrator. The Plan Administrator may
extend the 60-day period where the nature of the benefit involved or other attendant
circumstances make such extension appropriate. In connection with such review, the claimant
or his or her duly authorized representative may review pertinent documents and may submit
issues and comments in writing. The Plan Administrator shall make a decision promptly, and
not later than 60 days after the Plans receipt of a request for review, unless special
circumstances (such as the need to hold a hearing) require an extension of time for
processing, in which case a decision shall be rendered as
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soon as possible, but not later than 120 days after receipt of a request for review.
The decision on review shall be in writing and shall include specific reasons for the
decision, written in a manner calculated to be understood by the claimant, and specific
references to the pertinent Plan provisions on which the decision is based.
10.09 Company to Supply Information. The Company shall supply full and timely information to
the Plan Administrator, including, but not limited to, information relating to each Participants
Base Compensation, Bonus, Discretionary Bonus, Ineligible Thrift Plan Compensation, Ineligible
Pension Plan Compensation, age, Retirement, death, or other cause of Termination of Employment and
such other pertinent facts as the Plan Administrator may require. The Company shall advise the
Trustee of such of the foregoing facts as are deemed necessary for the Trustee to carry out the
Trustees duties under the Plan and the Trust Agreement. When making a determination in connection
with the Plan, the Plan Administrator shall be entitled to rely upon the aforesaid information
furnished by the Company.
10.10 Indemnity. To the extent permitted by applicable law, the Company shall indemnify and
save harmless the Board, each member of the Committee, each delegate of the Committee or the Board
and the Plan Administrator against any and all expenses, liabilities and claims (including legal
fees incurred to investigate or defend against such liabilities and claims) arising out of their
discharge in good faith of responsibilities under or incident to the Plan. Expenses and
liabilities arising out of willful misconduct shall not be covered under this indemnity. This
indemnity shall not preclude such further indemnities as may be available under insurance purchased
by the Company or provided by the Company under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, as such indemnities are permitted under applicable law.
Notwithstanding any other provision of this Agreement, to the extent that any payment made pursuant
to this Section 10.10 is not exempt from Section 409A pursuant to the application of Department of
Treasury Regulation Section 1.409A-1(b)(10) or other
applicable exemption (a 409A Payment) the
following provisions of this Section 10.10 shall apply with respect to such 409A Payment. The
Company shall make a 409A Payment due under this Section 10.10 by the last day of the taxable year
of the indemnitee following the taxable year in which the applicable legal fees and expenses were
incurred. The legal fees or expenses that are subject to reimbursement pursuant to this Section
10.10 shall not be limited as a result of when the fees or expenses are incurred. The amounts of
legal fees or expenses that are eligible for reimbursement pursuant to this Section 10.10 during a
given taxable year of the indemnitee shall not affect the amount of expenses eligible for
reimbursement in any other taxable year. The right to reimbursement pursuant to this Section 10.10
is not subject to liquidation or exchange for another benefit.
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ARTICLE XI
ADMINISTRATION OF FUNDS
ADMINISTRATION OF FUNDS
11.01 Payment of Expenses. All expenses incident to the administration of the Plan and Trust,
including but not limited to, legal, accounting, Trustee fees, and expenses of the Plan
Administrator, may be paid by the Company and, if not paid by the Company, shall be paid by the
Trustee from the Trust Fund, if any.
11.02 Trust Fund Property. All income, profits, recoveries, contributions, forfeitures and
any and all moneys, securities and properties of any kind at any time received or held by the
Trustee, if any, shall be held for investment purposes as a commingled Trust Fund pursuant to the
terms of the Trust Agreement. The Plan Administrator shall maintain one or more Accounts in the
name of each Participant or former Participant, but the maintenance of an Account designated as the
Account of a Participant or former Participant shall not mean that such Participant or former
Participant shall have a greater or lesser interest than that due him by operation of the Plan and
shall not be considered as segregating any funds or property from any other funds or property
contained in the commingled fund. No Participant or former Participant shall have any title to any
specific asset in the Trust Fund, if any.
ARTICLE XII
ADOPTION OF PLAN BY OTHER EMPLOYERS
ADOPTION OF PLAN BY OTHER EMPLOYERS
12.01 Adoption Procedure.
(a) With the written approval of the Plan Administrator, any entity that is an
Affiliate may adopt the Plan by appropriate action of its board of directors or noncorporate
counterpart, as evidenced by a written instrument executed by an authorized officer of such
entity or an executed adoption agreement (approved by the board of directors or noncorporate
counterpart of the Affiliate), agreeing to be bound by all the terms, conditions and
limitations of the Plan except those, if any, specifically described in the adoption
instrument, and providing all information required by the Plan Administrator. The Plan
Administrator and the adopting Affiliate may agree to incorporate specific provisions
relating to the operation of the Plan that apply to the adopting Affiliate only and shall
become, as to such adopting Affiliate and its employees, a part of the Plan.
(b) The provisions of the Plan may be modified so as to increase the obligations of an
adopting Affiliate only with the consent of such Affiliate, which consent shall be
conclusively presumed to have been given by such Affiliate unless the Affiliate gives the
Company written notice of its rejection of the amendment within 30 days after the adoption
of the amendment.
(c) The provisions of the Plan shall apply separately and equally to each adopting
Affiliate and its employees in the same manner as is expressly provided for the Company and
its employees, except that the power to appoint or otherwise affect the Plan Administrator
and the power to amend or terminate the Plan shall be exercised by the
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Company. The Plan Administrator shall act as the agent for each Affiliate that adopts
the Plan for all purposes of administration thereof.
(d) Any adopting Affiliate may, by appropriate action of its board of directors or
noncorporate counterpart, terminate its participation in the Plan. Moreover, the Plan
Administrator may, in its discretion, terminate an Affiliates participation in the Plan at
any time.
(e) The Plan will terminate with respect to any Affiliate that has adopted the Plan
pursuant to this Section if the Affiliate ceases to be an Affiliate or revokes its adoption
of the Plan by resolution of its board of directors or noncorporate counterpart evidenced by
a written instrument executed by an authorized officer of the Affiliate. If the Plan
terminates with respect to any Affiliate, the employees of that Affiliate will no longer be
eligible to be Participants in the Plan.
(f) For purposes of the Code and ERISA, the Plan as adopted by the Affiliates shall
constitute a single plan rather than a separate plan of each Affiliate.
12.02 No Joint Venture Implied. The document which evidences the adoption of the Plan by an
Affiliate shall become a part of the Plan. However, neither the adoption of the Plan by an
Affiliate nor any act performed by it in relation to the Plan shall ever create a joint venture or
partnership relation between it and any other Affiliate.
ARTICLE XIII
NATURE OF THE PLAN
AND ESTABLISHMENT OF THE TRUST
NATURE OF THE PLAN
AND ESTABLISHMENT OF THE TRUST
13.01 Nature of the Plan. The Company intends and desires by the adoption of the Plan to
recognize the value to the Company of the past and present services of employees covered by the
Plan and to encourage and assure their continued service with the Company by making more adequate
provision for their future retirement security. The establishment of the Plan is, in part, made
necessary by certain benefit limitations which are imposed on the Thrift Plan and the Pension Plan
by the Code. The Plan is intended to constitute an unfunded, unsecured plan of deferred
compensation for a select group of management or highly compensated employees of the Company. Plan
benefits herein provided are a contractual obligation of the Company which shall be paid out of the
Companys general assets. Nevertheless, subject to the terms hereof and of the Trust Agreement,
the Company may transfer money or other property to the Trustee to provide Plan benefits hereunder,
and the Trustee shall pay Plan benefits to Participants, former Participants and their
beneficiaries out of the Trust Fund. To the extent the Company transfers assets to the Trustee
pursuant to the Trust Agreement, the Plan Administrator may, but need not, establish procedures for
the Trustee to invest the Trust Fund in accordance with each Participants or former Participants
designated deemed investments pursuant to Article VI respecting the portion of the Trust Fund
assets equal to such Participants or former Participants Accounts.
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13.02 Establishment of the Trust. The Board, in its sole discretion, may establish the Trust
and direct Baker Hughes, for and on behalf of each Company, to enter into the Trust Agreement. In
such event, the Company shall remain the owner of all assets in the Trust Fund and the assets shall
be subject to the claims of the Companys creditors if the Company ever becomes insolvent. For
purposes hereof, the Company shall be considered insolvent if (a) the Company is unable to pay
its debts as they become due or (b) the Company is subject to a pending proceeding as a debtor
under the United States Bankruptcy Code (or any successor federal statute). The chief executive
officer of the Company and its board of directors shall have the duty to inform the Trustee in
writing if the Company becomes insolvent. Such notice given under the preceding sentence by any
party shall satisfy all of the parties duty to give notice. When so informed, the Trustee shall
suspend payments to the Participants and former Participants and hold the assets for the benefit of
the Companys general creditors. If the Company subsequently alleges that it is no longer
insolvent or if the Trustee receives a written allegation from a third party that the Company is
insolvent, the Trustee shall suspend payments to the Participants and former Participants and hold
the Trust Fund for the benefit of the Companys general creditors, and shall determine in
accordance with the Trust Agreement whether the Company is insolvent. If the Trustee determines
that the Company is not insolvent, the Trustee shall resume payments to the Participants and former
Participants. No Participant, former Participant or beneficiary shall have any preferred claim to,
or any beneficial ownership interest in, any assets of the Trust Fund, and, upon commencement of
participation in the Plan, each Participant and former Participant shall have agreed to waive his
priority credit position, if any, under applicable state law with respect to the assets of the
Trust Fund.
ARTICLE XIV
MISCELLANEOUS
MISCELLANEOUS
14.01 Plan Not Contract of Employment. The adoption and maintenance of the Plan shall not be
deemed to be a contract between the Company and any individual or to be consideration for the
employment of any individual. Nothing herein contained shall be deemed to (a) give any individual
the right to be retained in the employ of the Company, (b) restrict the right of the Company to
discharge any individual at any time, (c) give the Company the right to require any individual to
remain in the employ of the Company, or (d) restrict any individuals right to terminate his
employment at any time.
14.02 Alienation of Interest Forbidden. The interest of a Participant, former Participant or
his beneficiary or beneficiaries hereunder may not be sold, transferred, assigned, or encumbered in
any manner, either voluntarily or involuntarily, and any attempt so to anticipate, alienate, sell,
transfer, assign, pledge, encumber, or charge the same shall be null and void; neither shall the
benefits hereunder be liable for or subject to the debts, contracts, liabilities, engagements or
torts of any individual to whom such benefits or funds are payable, nor shall they be an asset in
bankruptcy or subject to garnishment, attachment or other legal or equitable proceedings. The
provisions of this Section 14.02 shall not apply to a Domestic Relations Order.
14.03 Withholding. All credits to a Participants or former Participants Accounts and
payments provided for hereunder shall be subject to applicable withholding and other deductions as
shall be required of the Company under any applicable local, state or federal law.
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14.04 Amendment and Termination. The Board, may from time to time, in its discretion, amend,
in whole or in part, any or all of the provisions of the Plan on behalf of any Company; provided,
however, that no amendment may be made that would impair the rights of a Participant or former
Participant with respect to amounts already credited to his Accounts. The Board may terminate the
Plan at any time. If the Plan is terminated, (a) the Grandfathered Amounts credited to a
Participants or former Participants Account shall be paid to such Participant, or former
Participant, or his designated beneficiary in the manner specified by the Plan Administrator, which
may include the payment of a single lump sum payment in full satisfaction of all of such
Participants, former Participants or beneficiarys benefits hereunder, and (b) any other amounts
credited to the Participants or former Participants Account shall be paid to such Participant, or
former Participant, or his designated beneficiary at the time(s) and in the form(s) elected by the
Participant or former Participant under Sections 3.06 and 4.05 (as such elections may have been
changed pursuant to Section 3.07 or 3.08).
14.05 Severability. If any provision of the Plan shall be held illegal or invalid for any
reason, said illegality or invalidity shall not affect the remaining provisions hereof; instead,
each provision shall be fully severable and the Plan shall be construed and enforced as if said
illegal or invalid provision had never been included herein.
14.06 Arbitration. Any controversy arising out of or relating to the Plan, including without
limitation, any and all disputes, claims (whether in tort, contract, statutory or otherwise) or
disagreements concerning the interpretation or application of the provisions of the Plan, the
Companys employment of the Participant, or former Participant, and the termination of that
employment, shall be resolved by arbitration in accordance with the Employee Benefit Plan Claims
Arbitration Rules of the American Arbitration Association (the AAA) then in effect. No
arbitration proceeding relating to the Plan may be initiated by either the Company or the
Participant, or former Participant, unless the claims review and appeals procedures specified in
Section 10.08 have been exhausted. Within ten (10) business days of the initiation of an
arbitration hereunder, the Company and the Participant, or former Participant, will each separately
designate an arbitrator, and within twenty (20) business days of selection, the appointed
arbitrators will appoint a neutral arbitrator from the panel of AAA National Panel of Employee
Benefit Plan Claims Arbitrators. The arbitrators shall issue their written decision (including a
statement of finding of facts) within thirty (30) days from the date of the close of the
arbitration hearing. The decision of the arbitrators selected hereunder will be final and binding
on both parties. This arbitration provision is expressly made pursuant to and shall be governed by
the Federal Arbitration Act, 9 U.S.C. Sections 1-16 (or replacement or successor statute).
Pursuant to Section 9 of the Federal Arbitration Act, the Company and any Participant agrees that
any judgment of the United States District Court for the District in which the headquarters of
Baker Hughes is located at the time of initiation of an arbitration hereunder shall be entered upon
the award made pursuant to the arbitration. Nothing in this Section 14.06 shall be construed to,
in any way, limit the scope and effect of Article X. In any arbitration proceeding full effect
shall be given to the rights, powers, and authorities of the Plan Administrator under Article X.
14.07 Compliance With Section 409A. Except with respect to Grandfathered Amounts, the Plan is
intended to comply with Section 409A and the Plan shall be interpreted and operated in a manner
consistent with this intention.
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14.08 Governing Law. All provisions of the Plan shall be construed in accordance with the
laws of Texas, except to the extent preempted by federal law and except to the extent that the
conflicts of laws provisions of the State of Texas would require the application of the relevant
law of another jurisdiction, in which event the relevant law of the State of Texas will nonetheless
apply, with venue for litigation being in Houston, Texas.
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IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its duly
authorized officer this 22nd day of July, 2010.
BAKER HUGHES INCORPORATED |
||||
By: | /s/ Didier Charreton | |||
Title: Vice President, Human Resources | ||||
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