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EXHIBIT 99.2
CNA SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Restated as of January 1, 2003
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CNA SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
TABLE OF CONTENTS
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ARTICLE I GENERAL
PROVISIONS......................................................................................1
1.1
Purpose...................................................................................................1
1.2 Effective
Date............................................................................................1
1.3 Company and
Employers.....................................................................................1
1.4 Plan
Year.................................................................................................1
1.5 Definitions and Rules of
Construction.....................................................................1
ARTICLE II ELIGIBILITY AND
BENEFITS...............................................................................4
2.1
Eligibility...............................................................................................4
2.2
Benefits..................................................................................................4
2.3
Vesting...................................................................................................5
2.4 Time and Form of
Payment..................................................................................5
2.5 Death
Benefits............................................................................................5
ARTICLE III PAYMENT OF
BENEFITS...................................................................................7
3.1 Source of
Payment.........................................................................................7
3.2 Establishment of
Trust....................................................................................7
3.3 Withholding and Payroll
Taxes.............................................................................7
3.4 Payment on Behalf of Disabled or Incompetent
Persons......................................................7
3.5 Missing Participants or
Beneficiaries.....................................................................8
ARTICLE IV
ADMINISTRATION.........................................................................................9
4.1 Plan
Administrator........................................................................................9
4.2 Administrator's
Powers....................................................................................9
4.3 Binding Effect of
Rulings................................................................................10
4.4 Claims
Procedure.........................................................................................10
4.5
Indemnity................................................................................................12
ARTICLE V AMENDMENT AND TERMINATION OF
PLAN......................................................................13
5.1
Amendment................................................................................................13
5.2
Termination..............................................................................................13
ARTICLE VI
MISCELLANEOUS.........................................................................................14
6.1 Status of
Plan...........................................................................................14
6.2
Nonassignability.........................................................................................14
6.3 No Contract of
Employment................................................................................14
6.4 Participant
Litigation...................................................................................14
6.5 Participant and Beneficiary
Duties.......................................................................14
6.6 Governing
Law............................................................................................15
6.7
Validity.................................................................................................15
6.8
Notices..................................................................................................15
6.9
Successors...............................................................................................15
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CNA SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
ARTICLE I
GENERAL PROVISIONS
1.1 Purpose. The purpose of this CNA Supplemental Executive
Retirement
Plan (the "Plan") is to enable selected Employees and former
senior Employees of
CNA Financial Corporation (the "Company") or its subsidiaries
(the "Employers")
to receive additional retirement benefits, to compensate them
for the
limitations imposed upon their benefits under the CNA Employees
Retirement Plan
in order to comply with the requirements of the Internal Revenue
Code (the
"Code"), and also to permit the Employers to provide additional
benefits for
other key Employees and former Employees.
1.2 Effective Date. Except as otherwise explicitly provided
below, the
rights of a Participant whose employment terminated, or who
otherwise became
entitled to receive benefits, under the Plan prior to January 1,
2003, shall be
determined under the terms of the Plan as in effect at such
time.
1.3 Company and Employers. The Plan is adopted for the benefit
of
selected Employees and former Employees of the Company and the
Employers. As of
the effective date of this restatement, Continental Casualty
Company is the only
Employer other than the Company participating in the Plan. The
Administrator may
permit any other company that is an affiliate or subsidiary of
the Company to
participate in the Plan in such manner as the Administrator may
determine. Each
Employer is liable for the payment of benefits to a Participant
that is or was
an Employee of such Employer. The Company is the sponsor of the
Plan for
purposes of ERISA and the issuer of all interests in the Plan
for securities
laws purposes.
1.4 Plan Year. The Plan Year of the Plan shall coincide with
the
calendar year, except as the Administrator shall otherwise
determine.
1.5 Definitions and Rules of Construction. As used in this
Plan,
certain capitalized terms shall have the meanings set forth
below. Capitalized
terms not defined herein shall have the meaning set forth in the
Retirement
Plan, if applicable. Nouns and pronouns which are of one gender
shall be
construed to include all genders, and the singular shall include
the plural and
vice-versa, except as the context otherwise clearly requires.
Article and
Section headings are for ease of reference only and shall have
no substantive
meaning.
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(a) "Administrator" means the Company or such other person as
the
Company shall designate pursuant to Section 4.1.
(b) "Benefits Committee" means a committee appointed by the
Administrator, and consisting of such persons as the
Administrator may
determine, for the purpose of determining the form in which
benefits under the
Plan are to be paid as provided in Section 2.4. In lieu of
appointing a separate
committee, the Administrator may designate another committee
established to
administer any aspects of the Company's retirement plans to act
as the Benefits
Committee, in which case such committee shall be the Benefits
Committee for
purposes of this Plan.
(c) "Board" means the Board of Directors of the Company.
(d) "Choice 1 Participant" means a Participant who is treated as
a
"Choice 1 Participant" under the Retirement Plan.
(e) "Choice 2 Participant" means a Participant who is treated as
a
"Choice 2 Participant" under the Retirement Plan.
(f) "Code" means the Internal Revenue Code of 1986, and any
treasury
regulations, rulings or other authoritative administrative
pronouncements
interpreting the Code. If any provision of the Code specifically
referred to
herein is amended or replaced, the reference shall be deemed to
be to the
provision as so amended, or to the new provision, if such
reference is
consistent with the purposes of the Plan.
(g) "Company" means CNA Financial Corporation, and any
successor
thereto that assumes the obligations of the Company under this
Plan.
(h) "Employee" means any person employed by any Employer and
classified
as an Employee by such Employer. The term "Employee" shall not
include a person
who is retained to provide services for an Employer as an
independent
contractor, or who provides services for an Employer pursuant to
an agreement or
understanding, written or unwritten, with a third party that
such person shall
be treated as an employee of the third partly, but who is
subsequently
determined to be an employee at common law, for purposes of any
federal or state
tax or employment law, or for any other purpose.
(i) "Employer" means the Company and any subsidiary of the
Company that
adopts the Plan and is the employer or former employer of a
Participant.
(j) "ERISA" means the Employee Retirement Income Security Act of
1974,
and any Labor Department regulations, rulings or other
authoritative
administrative pronouncements interpreting ERISA. If any
provision of ERISA
specifically referred to herein is amended or replaced, the
reference shall be
deemed to be to the provision as so amended, or to the new
provision, if such
reference is consistent with the purposes of the Plan.
(k) "Participant" means an Employee or former Employee
designated to
participate in the Plan pursuant to Section 2.1, while he has
the right to any
benefits under the Plan.
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(l) "Plan" means this CNA Supplemental Executive Retirement
Plan, as
amended from time to time.
(m) "Retirement Plan" means the CNA Retirement Plan, as amended
and
restated effective as of January 1, 1999, and including all
subsequent
amendments thereto.
(n) "SERP Accrued Pension Account" means a bookkeeping
account
established on behalf of a Choice 2 Participant to reflect the
amount of such
Participant's benefit under this Plan, as described more fully
in Section
2.2(b). Such accounts are for bookkeeping purposes only, and
shall not be
construed to require the segregation of any assets of the
Employer or to give a
Choice 2 Participant any rights greater that those of an
unsecured creditor.
(o) "SERP Agreement" means an agreement entered into between
an
Employer and a Participant pursuant to Section 2.1(c) providing
for the
Participant to receive benefits under this Plan which are
different from the
benefits received by Participants generally by reason of the
application of the
Tax Limits. A SERP Agreement may take the form of, or be
included within, an
employment agreement or settlement agreement.
(p) "Tax Limits" means the limitations imposed on a
Participant's
benefits under the Retirement Plan to satisfy the requirements
of ss.401(a)(17)
or ss.415 of the Code.
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ARTICLE II
ELIGIBILITY AND BENEFITS
2.1 Eligibility.
(a) Only selected management and highly compensated Employees
and
former Employees who are designated as provided herein shall be
eligible to
participate in the Plan. The Employees and former Employees who
are so
designated to participate in the Plan shall be referred to
herein as
"Participants."
(b) Initially, all Employees who are eligible to participate in
the
Retirement Plan and whose accrued benefit under the Retirement
Plan is
restricted by either or both of the Tax Limits, shall be
eligible to participate
in the Plan. Notwithstanding the foregoing, the Administrator
may, in its sole
discretion, determine at any time that any Employee or group of
Employees
described in the preceding sentence shall no longer be eligible
to participate;
provided that such determination shall not have the effect of
reducing a
Participant's benefit previously accrued under this Plan.
(c) Any Employer, with the consent of the Administrator, may
enter into
a SERP Agreement with any person, whether or not such person is
described in
paragraph (b), who may be either an Employee, a former Employee,
or a consultant
or independent contractor, providing for such person to receive
a nonqualified
retirement benefit pursuant to Section 2(c), and such person
shall thereupon
become a Participant. To the extent necessary or appropriate,
any reference in
this Plan to "employment" shall be modified and interpreted in
the case of a
former Employee or independent consultant in a manner consistent
with the intent
of the Plan.
2.2 Benefits.
(a) Each Choice 1 Participant who retires and becomes eligible
to
receive a benefit under the Retirement Plan, whether a normal,
early, late,
disability, or deferred vested benefit, shall receive a benefit
from this Plan
equal to the excess, if any, of the amount the Participant would
have received
from the Retirement Plan if neither of the Tax Limits applied
over the
Participant's actual Retirement Plan benefit. The amount of the
benefit the
Participant would have received under the Retirement Plan shall
be determined on
the same basis as the Participant's actual Retirement Plan
benefit, taking into
account the Participant's age, compensation history, service,
and form of
benefit elected under the Retirement Plan, but shall not be
subject to any
actuarial adjustment solely by reason of the fact that the
Participant retired
after his normal retirement age.
(b) A Choice 2 Participant who becomes entitled to a benefit
under the
Retirement Plan shall receive a benefit under this Plan equal to
the balance in
his SERP Accrued Pension Account. The SERP Accrued Pension
Account of each
Choice 2 Participant was initially established as of December
31, 1999 (or, in
the case of a Choice 2 Participant who was an Employee of RSKCO
Claims Services,
Inc., December 31, 1998), in an amount equal to the excess, if
any, of the
amount of the Accrued Pension Account that would have been
established for such
Participant under the Retirement Plan if his accrued benefit had
not been
subject to either of the Tax Limits, and such SERP Accrued
Pension Account shall
be credited with interest
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not less often than annually at the annual rate of interest on
30-year Treasury
securities for the month of November preceding the Plan Year as
of which the
interest is being credited in the manner specified in the
Retirement Plan.
(c) The benefit provided to a Participant who becomes a
Participant by
virtue of a SERP Agreement shall be determined as provided in
the applicable
SERP Agreement. In general, it is intended that SERP Agreements
shall provide
such Participants with benefits computed in the manner provided
in the
Retirement Plan, but which cannot be provided under the
Retirement Plan for
reasons other than the Tax Limits. By way of illustration and
not limitation, a
SERP Agreement may provide for a Participant hired after
December 31, 1999, to
receive a benefit computed as if he were a participant in the
Retirement Plan,
or may provide for a Participant to receive a supplemental
benefit determined as
if he were credited with additional service under the Retirement
Plan.
2.3 Vesting. Except as otherwise provided in a SERP Agreement,
a
Participant's benefit under this Plan shall be vested if, and
only if, his
benefit under the Retirement Plan is vested.
2.4 Time and Form of Payment.
(a) Except as otherwise provided below, or in a SERP Agreement,
a
Participant's benefit under this Plan shall be paid in the same
manner as his
Retirement Plan benefit, and shall take the form of a
supplemental monthly
payment directly from his Employer; provided that if the monthly
amount of the
Participant's benefit under this Plan paid in such form does not
exceed $250.00
per month, it shall be paid in a single lump sum equal to the
actuarial
equivalent of his benefit.
(b) The Benefits Committee may elect to pay a Choice 1
Participant a
single lump sum equal to the actuarial equivalent of his benefit
under this
Plan, and may also decide to pay a Choice 2 Participant an
annuity in any of the
forms of annuity available under the Retirement Plan that are
actuarially
equivalent. The Benefits Committee may also elect to pay a
benefit that would
otherwise be payable in a lump sum in the form of a monthly
annuity, and may
establish a different standard for payment of benefits in a lump
sum, which may
be either more or less than $250.00 per month. All
determinations by the
Benefits Committee as to the form of payment shall be made by
the Benefits
Committee in its sole and absolute discretion, which may be
exercised in an
arbitrary and capricious manner, and in no event shall any
Participant be
considered to have a vested interest in the payment of his
benefit in any
particular form. Actuarial equivalence shall be determined in
accordance with
the applicable actuarial assumptions provided under the
Retirement Plan. Payment
of a Participant's benefit in the form of a lump sum shall fully
discharge all
amounts owed to the Participant and to his heirs or
beneficiaries under the
Plan.
2.5 Death Benefits.
(a) A surviving spouse or other beneficiary of a deceased Choice
1
Participant shall be entitled to a survivorship pension if, and
only if, the
form of benefit payable to the Participant under the Retirement
Plan provided
for survivorship rights. If a Choice 1 Participant
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dies prior to his Annuity Starting Date (as defined in the
Retirement Plan), his
surviving spouse shall be entitled to a survivorship pension if,
and only if,
the spo
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