Exhibit 10.40
BECKMAN COULTER, INC.
SUPPLEMENTAL PENSION PLAN
(Amended and Restated Effective
January 1, 2008)
Sections 415 and 401(a)(17) of the
Internal Revenue Code of 1986, as amended (the “Code”),
impose certain benefit and compensation limitations under the
Beckman Coulter, Inc. Pension Plan (the “Pension
Plan”). These limitations may adversely affect certain key
management and highly compensated employees of Beckman Coulter,
Inc. (the “Company”), and this Beckman Coulter, Inc.
Supplemental Pension Plan (the “Supplemental Plan”) is
intended to permit the total pension of such employees to be
determined without respect to such limitations.
In addition, the Tax Reform Act of
1986, as amended (“1986 TRA”), imposed new
requirements, effective January 1, 1989, which require changes
to the benefit formula under the Pension Plan. In order to
implement such changes, the Company has adopted Alternative II-D
from Notice 88-131 issued by the Internal Revenue Service and
clarified by Notice 89-92. Alternative II-D specifies that benefit
payments from the Pension Plan shall not, for certain highly
compensated employees under the circumstances described in Notice
88-131, exceed the benefit accrued as of December 31, 1988
(or, for individuals who first became highly compensated employees
during 1989, the benefit accrued as of December 31, 1989). The
Supplemental Plan is intended to provide retirement benefits to the
highly compensated employees whose benefits are so limited by
Alternative II-D, so that the benefits under this plan, when
combined with benefits under the Pension Plan, will not be less
than the benefits to which such highly compensated employees would
have been entitled but for the adoption of Alternative
II-D.
The Supplemental Plan is a
non-qualified plan which is unfunded and is maintained primarily
for the purpose of providing deferred compensation for a select
group of management or highly compensated employees. The Company
now wishes to amend and restate the Supplemental Plan to comply
with Section 409A of the Code and Treasury Regulations and
other guidance promulgated thereunder and to make certain other
technical amendments to the Plan. The Company therefore adopts the
following Supplemental Plan:
1. Administration . The
Supplemental Plan will be administered by the Committee appointed
under the Pension Plan (the “Committee”) in a manner
consistent with the administration of the Pension Plan. The
Committee is hereby granted full discretion to interpret, construe
and apply the terms of this Plan, and the Committee’s
decisions in such matters will be final.
2. Eligibility . Eligibility
under the Supplemental Plan is restricted to management or highly
compensated “Beckman Employees” whose pension benefits
under the Pension Plan are limited pursuant to Sections 401(a)(17)
or 415 of the Code or Alternative II-D of Notice 88-131 (each, a
“Participant”). A “Beckman Employee” shall
mean any person who is an “Employee” classified as a
“Beckman Employee” under the definition of
“Employee” contained in the Pension Plan.
“Coulter Employees,” as described in the definition of
“Employee” contained in the Pension Plan, are not
eligible to participate in the Supplemental Plan.
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3. Benefits . The Company
will supplement a Participant’s monthly pension payable under
the Pension Plan by the amount which is the difference, if any,
between the Participant’s monthly pension under the Pension
Plan, and the monthly pension which would have been payable under
the Pension Plan if the provisions of the Pension Plan were
administered without regard to Sections 401(a)(17) and 415 of the
Code. The Company will further supplement the Participant’s
monthly pension payable under the Pension Plan by the amount by
which the Participant’s monthly pension benefit payable from
the Pension Plan was reduced to comply with Alternative II-D of
Notice 88-131. Finally, the Company will supplement the
Participant’s monthly pension payable under the Pension Plan
to the extent that such benefit is lower than it otherwise would
have been because of an election made by the Participant pursuant
to a written bonus program or a written deferred compensation plan
of the Company which has the effect of reducing the amount of the
Participant’s compensation taken into account in determining
the Participant’s monthly pension payable from the Pension
Plan. The supplemental benefits provided hereunder shall include
such benefits as would, but for the limitations of the Code, Notice
88-131 and any other limitation described herein, be payable to the
spouse or beneficiary of the Participant under the Pension Plan,
according to the terms of the Pension Plan and the elections made
under the Pension Plan by the Participant.
In the case of any employee
identified under Section III of Appendix IV of the Pension Plan,
the supplement provided by the Company under this Supplemental Plan
shall be calculated as follows. For each such employee, the
supplement that would have been provided under this Supplemental
Plan if the benefit increases under Appendix IV of the Pension Plan
had not been adopted shall be calculated (such amount shall be
referred to as the “Gross Supplement”). The supplement
to be provided by the Company under this Supplemental Plan shall be
the Gross Supplement reduced by the increase to such
employee’s Pension Plan benefit
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provided under Appendix IV of the Pension Plan.
The increase provided under Appendix IV of the Pension Plan shall
be the increase provided after taking into account any applicable
limitation on such increase under Section 4.15 of the Pension
Plan.
4. Payment of Benefits . This
Section 4 reflects the rules governing distributions of
benefits made under the Supplemental Plan with respect to
Participants who incur a Separation from Service with the Company
on or after January 1, 2008. For distributions with respect to
Participants who incurred a Separation from Service (or other event
triggering distributions hereunder) prior to that date, see the
applicable provisions of the Supplemental Plan in effect as of the
date of such Separation from Service (or other event). Prior to
January 1, 2009, certain Participants were also permitted to
make distribution elections in accordance with certain transition
rules set forth in Treasury Regulations and other guidance
promulgated under Section 409A of the Code.
(a) A Participant’s benefits
under the Supplemental Plan shall be paid to the Participant in
cash in a lump sum as soon as administratively practical following
the date that is six (6) months after the Participant’s
Separation from Service for any reason; provided, however, that if
the Participant’s aggregate benefits under the Supplemental
Plan exceed $500,000, the Participant’s benefits shall be
payable in (i) a lump sum payment of $500,000 as soon as
administratively practical following the date that is six
(6) months after the Participant’s Separation from
Service for any reason, and (ii) a lump sum payment equal to
the amount by which the Participant’s benefits exceed
$500,000 as soon as administratively practical after the
January 1 which follows the calendar year during which the
initial $500,000 payment was made. Subject to Section 4(b),
the aggregate amount of the payment or payments to be made pursuant
to this Section 4(a) shall be the actuarial equivalent of the
Participant’s benefits under the Supplemental Plan as
determined in accordance with Section 3. For these purposes,
the term “actuarial equivalent” shall have the same
meaning as specified under the Pension Plan.
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(b) With respect to any payment of
benefits made pursuant to Section 4(a), the Participant shall
be entitled to receive interest on each such payment for the period
commencing on the date of the Participant’s Separation from
Service and ending on the date such payment is made. For these
purposes, interest shall be credited based on the interest rate
used to calculate lump-sum distributions under the Pension Plan for
the year in which the Participant’s Separation from Service
occurs in accordance with Section 1.2(b) of the Pension
Plan.
(c) For purposes of the Supplemental
Plan, “Separation from Service” means, as to a
particular Participant, a termination of services provided by the
Participant to his or her Employer (as defined below), whether
voluntarily or involuntarily, as determined by the Committee in
accordance with Section 409A of the Code and Treasury
Regulation Section 1.409A-1(h). In determining whether a
Participant has experienced a Separation from Service, the
following provisions shall apply:
(i) For a Participant who provides
services to an Employer as an employee, except as otherwise
provided in clause (iii) below, a Separation from Service
shall occur when the Participant has experienced a termination of
employment with the Employer. A Participant shall be considered to
have experienced a termination of employment for this purpose when
the facts and circumstances indicate that the Participant and his
or her Employer reasonably anticipate that either (A) no
further services will be performed by the Participant for the
Employer after the applicable date, or (B) that the level of
bona fide services the Participant will
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perform for the Em
