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CNA SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Addendum or Modifications

CNA SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN | Document Parties: CNA Financial Corporation | CONTINENTAL CASUALTY COMPANY You are currently viewing:
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Title: CNA SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Governing Law: Illinois     Date: 1/6/2005
Industry: Insurance (Prop. and Casualty)     Sector: Financial

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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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