COMPASS BANCSHARES, INC.
EMPLOYEE STOCK OWNERSHIP BENEFIT RESTORATION PLAN
AS AMENDED AND RESTATED AS OF JANUARY 1, 2005
ARTICLE I
Purpose and Adoption of Plan
1.1
Adoption: Compass Bancshares, Inc. (the
“Company”) adopted and established the Compass
Bancshares, Inc. Employee Stock Ownership Benefit Restoration Plan
(the “Plan”) effective as of May 1, 1997. The Plan
is an unfunded deferred compensation arrangement whose benefits
shall be paid solely from the general assets of the Employing
Companies. The Plan as amended and restated is adopted as of
January 1, 2005.
1.2
Purpose: The Plan is designed to permit a select group of
management or highly compensated employees to elect to defer a
portion of their Compensation until their death or termination of
employment from their Employing Company and to provide benefits
equal to the employer matching contributions that would have been
made for such employees under the Compass Bancshares, Inc. Employee
Stock Ownership Plan (the “Compass Bancshares ESOP”),
but for limitations imposed by the federal income tax
laws.
1.3 Purpose of
the 2005 Amendment and Restatement: The purpose of the
amendment and restatement of the Plan is to comply fully with
Section 409A of the Code and the Treasury regulations and
other guidance with respect to Post-2004 Deferrals and to preserve
the terms of the Plan prior to this amendment and restatement with
respect to the Pre-2005 Deferrals.
For purposes of
the Plan the following terms shall have the following meanings
unless a different meaning is plainly required by the
context:
2.1
“Account” shall mean the account or accounts
established and maintained by the Company for bookkeeping purposes
to reflect the interest of a Participant in the Plan resulting from
a Participant’s deferred Compensation, Employer Contributions
made on behalf of a Participant, and adjustments thereto to reflect
deemed income, gains, losses, and other credits or charges less any
distributions. This Account shall be a bookkeeping entry only and
shall be utilized solely as a device for the measurement and
determination of the amounts to be paid to a Participant under the
Plan. The Account shall be maintained so that a Participant’s
Pre-2005 Deferrals and Post-2004 Deferrals are separately accounted
for including deemed investment earnings and losses attributable
thereto.
2.2
“Administrative Committee” shall mean the Compensation
Committee of the Board of Directors.
2.3
“Beneficiary” shall mean any person, estate, trust, or
organization entitled to receive any payment under the Plan upon
the death of a Participant. The Participant shall designate his
Beneficiary on a form provided by the Administrative
Committee.
2.4 “Board
of Directors” shall mean the Board of Directors of the
Company or the Compensation Committee thereof.
2.5 “Change
in Control for Pre-2005 Deferrals” shall mean, for this
purpose, (i) the acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of
the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of more than 50% of either the then outstanding
shares of common stock of the Company (the “Outstanding
Common Stock”) or the combined voting power of the then
outstanding voting securities of the Company entitled to vote
generally in the election of directors (the “Outstanding
Voting Securities”), or (ii) consummation by the Company
of a reorganization, merger or consolidation, or sale or other
disposition of all or substantially all of the assets of the
Company, unless, following such acquisition of beneficial ownership
or transaction, (a) more than 60% of the then outstanding
shares of common stock of the Person resulting from such
reorganization, merger or consolidation, or (b) more than 60%
of the then outstanding shares of common stock of the Person
acquiring such beneficial ownership or assets, and the combined
voting power of the then Outstanding Voting Securities of such
Person entitled to vote generally in the election of directors of
such Person, is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals and entities who were
the beneficial owners, respectively, of Outstanding Common Stock
and Outstanding Voting Securities immediately prior to such
acquisition or transaction, in substantially the same proportions
as their ownership of Outstanding Common Stock and Outstanding
Voting Securities prior to such event.
“Change in
Control for Post-2004 Deferrals” shall mean a change in the
ownership of the Company, a change in effective control of the
Company or a change in the ownership of a . substantial portion of
the assets of the Company as provided under Code Section 409A
and any Internal Revenue Service guidance, including any Treasury
regulations issued in connection with Code
Section 409A.
2.6 “Closing
Price” shall mean the closing price on any trading day of a
share of the Common Stock based on consolidated trading as defined
by the Consolidated Tape Association and reported as part of the
consolidated trading prices of stock exchange on which the Common
Stock is traded.
2.7
“Code” shall mean the Internal Revenue Code of 1986, as
amended, including any successor statute.
2.8 “Common
Stock” shall mean the common stock of the Company.
2.9
“Company” shall mean Compass Bancshares,
Inc.
2.10
“Compensation” shall mean an Employee’s base
wages or salary paid by any Employing Company to an Employee,
including amounts contributed by an Employing Company to the
Compass Bancshares ESOP as salary deferral contributions pursuant
to the Employee’s exercise of his deferral option made in
accordance with Section 401(k) of the Code, amounts contributed by
an Employing Company to the Compass Bancshares, Inc. Flexible
Benefits Plan (“Superflex”) on behalf of the Employee
pursuant to his salary reduction election
under such plan
and in accordance with Section 125 of the Code, amounts
contributed to a qualified parking plan under Section 132(f) of the
Code, and any amounts contributed by the Employee on a pre-tax
basis to any other qualified or non-qualified deferred compensation
plans of the Company; but disregarding overtime, bonuses, other
forms of incentive pay paid in cash and such amounts which are
reimbursements to an Employee paid by any Employing Company
including, but not limited to, reimbursement for such items as
moving expenses, automobile expenses, tax preparation expenses,
travel and entertainment expenses, and health and life insurance
premiums. Notwithstanding the foregoing and solely in the case of
Participants specified on Exhibit “A” hereto the
term “Compensation” shall also include bonuses and
other forms of incentive pay paid in cash.
2.11
“Deferral Election” shall mean the Participant’s
written election to defer a portion of his Compensation pursuant to
Article VI.
2.12
“Effective Date” shall mean the first day of the first
payroll period the Administrative Committee shall permit a
Participant to defer Compensation under the Plan but in no event
later than thirty (30) days following the date the Employee is
notified by the Administrative Committee, or its designee, that the
Employee is eligible to participate in the Plan for Compensation
earned after the date a Deferral Election form is filed with the
Company.
2.13
“Employee” shall mean any person who is currently
employed by an Employing Company.
2.14
“Employer Contributions” shall mean the amounts
credited a Participant’s Account under Article VII of
the Plan.
2.15
“Employer Matching Contributions” shall have the
meaning ascribed to that term in the Compass Bancshares
ESOP.
2.16
“Employing Company” shall mean the Company or any
affiliate or subsidiary (direct or indirect) of the
Company.
2.17
“Enrollment Date” shall mean the Effective Date,
January 1 of each Plan Year and such other dates as may be
determined from time to time by the Administrative
Committee.
2.18
“ERISA” shall mean the Employee Retirement Income
Security Act of 1974, as amended.
2.19
“Investment Request” shall mean the Participant’s
written request to have his Account invested pursuant to
Sections 8.1 or 8.2 and which is accepted by the
Administrative Committee.
2.20 “Key
Employee” shall mean, for purposes of this Plan and in
accordance with Section 409A of the Code, a key employee as
defined in Section 416(i) of the Code, without regard to paragraph
(5) thereof.
2.21
“Participant” shall mean an Employee or former Employee
of an Employing Company who is eligible to receive benefits under
the Plan.
2.22
“Performance-Based Compensation” shall mean
Compensation that meets the requirements of performance-based
compensation specified in Section 409A(a)(4)(B)(iii) of the
Code and regulations and other guidance promulgated thereunder.
Performance-Based Compensation shall be designated as such by the
Company and must relate to services performed by the Participant
during a designated incentive period of at least twelve
(12) months and must be variable and contingent on the
satisfaction of pre-established organizational or individual
performance criteria and not readily ascertainable at the
time.
2.23
“Plan” shall mean Compass Bancshares, Inc. Employee
Stock Ownership Benefit Restoration Plan, as amended from time to
time.
2.24 “Plan
Year” shall mean the twelve (12) month period commencing
January 1st and ending on the last day of December.
2.25
“Post-2004 Deferrals” shall mean the portion of the
Participant’s Account other than Pre-2005
Deferrals.
2.26
“Pre-2005 Deferrals” shall mean the portion of the
Participant’s Account determined as of the end of
December 31, 2004, the right to which was earned and vested as
of the end of December 31, 2004, plus deemed investment earnings
and losses attributable to such amounts.
2.27
“Separation from Service” shall mean a
Participant’s separation from service as an Employee with the
Company for purposes of Section 409A of the Code other than
for death or leave of absence. A transfer of employment within or
among the Company and any member of a controlled group, as provided
in Code Section 409A(d)(6) shall not be deemed a Separation
from Service.
2.28
“Unforeseeable Emergency” for Pre-2005 Deferrals shall
mean an event beyond the control of the Participant and that would
result in severe financial hardship if early withdrawal was not
permitted.
“Unforeseeable
Emergency” for Post-2004 Deferrals shall mean (a) a
severe financial hardship to the Participant resulting from an
illness or accident of the Participant, the Participant’s
spouse or a dependent (as defined in Code Section 152(a)) of
the Participant, (b) loss of the Participant’s property
due to casualty, or (c) other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond
the control of the Participant, each as determined to exist by the
Administrative Committee, in its sole and absolute discretion as
defined by Section 409A of the Code and the Treasury
regulations and other guidance thereunder.
The words in the
masculine gender shall include the feminine and neuter genders and
words in the singular shall include the plural and words in the
plural shall include the singular.
ARTICLE III
Administration of Plan
3.1 The
Administrative Committee shall be responsible for the general
administration of the Plan. The Administrative Committee may select
a chairman and may select a secretary (who may, but need not, be a
member of the Administrative Committee) to keep its records or to
assist it in the discharge of its duties. A majority of the members
of the Administrative Committee shall constitute a quorum for the
transaction of business at any meeting. Any determination or action
of the Administrative Committee may be made or taken by a majority
of the members present at any meeting thereof, or without a meeting
by resolution or written memorandum concurred in by a majority of
the members.
3.2 No member of
the Administrative Committee shall receive any compensation from
the Plan for his service.
3.3 The
Administrative Committee shall administer the Plan in accordance
with its terms and shall have all powers necessary to carry out the
provisions of the Plan more particularly set forth herein. It shall
have the full discretion to interpret the Plan and determine all
questions arising in the administration, interpretation and
application of the Plan. Any such determination by it shall be
conclusive and binding on all persons. It may adopt such
regulations as it deems desirable for the conduct of its affairs.
It may appoint such accountants, counsel, actuaries, specialists
and other persons as it deems necessary or desirable in connection
with the administration of this Plan, and shall be the agent for
the service of process.
3.4 The
Administrative Committee shall be reimbursed by the Company for all
reasonable expenses incurred by it in the fulfillment of its
duties. Such expenses shall include any expenses incident to its
functioning, including, but not limited to, fees of accountants,
counsel, actuaries, and other specialists, and other costs of
administering the Plan.
3.5 (a) The
Administrative Committee is responsible for the daily
administration of the Plan. It may appoint other persons or
entities to perform any of its fiduciary and/or administrative
functions. The Administrative Committee and any such appointee may
employ advisors and other persons necessary or convenient to help
it carry out its duties, including its fiduciary duties. The
Administrative Committee shall have the right to review the work
and performance of each such appointee as it deems necessary or
appropriate, and shall have the right to remove any such appointee
from his position. Any person, group of persons or entity may serve
in more than one fiduciary capacity.
(b) The
Administrative Committee shall maintain accurate and detailed
records and accounts of Participants and of their rights under the
Plan and of all receipts, disbursements, transfers and other
transactions concerning the Plan. Such accounts, books and records
relating thereto shall be open at all reasonable times to
inspection and audit by the Board of Directors and by persons
designated thereby.
(c) The
Administrative Committee shall take all steps necessary to ensure
that the Plan complies with the law at all times. These steps shall
include such items as the preparation and filing of all documents
and forms required by any governmental agency;
maintaining of
adequate Participants’ records; withholding of applicable
taxes and filing of all required tax forms and returns; recording
and transmission of all notices required to be given to
Participants and their Beneficiaries; the receipt and
dissemination, if required, of all reports and information received
from an Employing Company; and doing such other acts necessary for
the proper administration of the Plan. The Administrative Committee
shall keep a record of all of its proceedings and acts, and shall
keep all such books of account, records and other data as may be
necessary for proper administration of the Plan. The Administrative
Committee shall notify the Company upon its request of any action
taken by it, and when required, shall notify any other interested
person or persons.
3.6 The procedures
for filing claims for payments under the Plan are described
below:
(a) Submission
of Claim. It is the intent of the Company to make payments under
the Plan without the Participant having to complete or submit any
claim forms. However, any Participant or Beneficiary or a duly
authorized representative thereof (“claimant”) who
believes he or she is entitled to a payment under the Plan may
submit a claim for payment to the Administrative Committee. Any
claim for payments under the Plan must be made by the claimant in
writing and state the claimant’s name and nature of benefits
payable under the Plan. The claimant’s claim shall be deemed
to be filed when delivered to a member of the Administrative
Committee which shall make all determinations as to the right of
any person to benefits hereunder.
(b) Notice
of Denial of Claim. If the claim is wholly or partially denied, the
Administrative Committee shall provide written or electronic notice
thereof to the claimant within a reasonable period of time, but not
later than ninety (90) days after receipt of the claim. An
extension of time for processing the claim for benefits is
allowable if special circumstances require an extension, but such
an extension shall not extend beyond one hundred eighty
(180) days from the date the claim for benefits is received by
the Administrative Committee. Written notice of any extension of
time shall be delivered or mailed within ninety (90) days
after receipt of the claim and shall include an explanation of the
special circumstances requiring the extension and the date by which
the Administrative Committee expects to render the final
decision.
The
notice of adverse benefit determination shall (i) specify the
reason for the denial; (ii) reference the provisions of this Plan
on which the denial is based; (iii) describe the additional
material or information, if any, necessary for the claimant to
receive benefits and explain why such information is necessary;
(iv) indicate the steps to be taken by the claimant if a
review of the denial is desired, including the time limits
applicable thereto; and (v) contain a statement of the
claimant’s right to bring a civil action under ERISA in the
event of an adverse benefit determination on review. If notice of
the adverse benefit determination is not furnished in accordance
with the preceding provisions of this Section, the claim shall be
deemed denied and the claimant shall be permitted to exercise his
right to review as set forth below.
(c) Review
of Denied Claim. If a claim is denied and a review is desired, the
claimant shall notify the Administrative Committee in writing
within sixty (60) days after receipt of written notice of a
denial of a claim. In requesting a review, the claimant may submit
any written comments, documents, records, and other information
relating to the claim, the claimant feels are appropriate. The
claimant shall, upon request and free of charge, be
provided
reasonable
access to, and copies of, all documents, records and other
information “relevant” to the claimant’s claim
for benefits. The Administrative Committee shall review the claim
taking into account all comments, documents, records and other
information submitted by the claimant, without regard to whether
such information was submitted or considered in the initial benefit
determination.
(d) Decision
on Review. The Administrative Committee shall provide the claimant
with written notice of its decision on review within a reasonable
period of time, but not later than sixty (60) days after receipt of
a request for review. An extension of time for making the decision
on the request for review is allowable if special circumstances
shall occur, but such an extension shall not extend beyond one
hundred twenty (120) days from the date the request for a
review is received by the Administrative Committee. Written notice
of the extension of time shall be delivered or mailed within sixty
(60) days after receipt of the request for review, indicating
the special circumstances requiring an extension and the date by
which the Administrative Committee expects to render a
determination.
In
the event of an adverse benefit determination on review, the notice
thereof shall (i) specify the reason or reasons for the adverse
benefit determination; (ii) reference the specific provisions
of this Plan on which the benefit determination is based;
(iii) contain 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 claimant’s claim for benefits;
and (iv) inform the claimant of the right to bring a civil
action under the provisions of ERISA.
For
purposes hereof, any document, record and item of information shall
be considered “relevant” to the claimant’s claim
if it (i) was relied upon in making the benefit determination,
(ii) was submitted, considered, or generated in the course of
making the benefit determination, whether or not actually relied
upon in making the determination; or (iii) demonstrates
compliance with the administrative processes and safeguards of this
claims procedure.
(e) Preservation
of Remedies. After exhaustion of the claims procedure as provided
herein, nothing shall prevent the claimant from pursuing any other
legal or equitable remedy otherwise available, including the right
to bring a civil action under Section 502(a) of ERISA, if
applicable. Notwithstanding the foregoing, no legal action may be
commenced or maintained against the Company, any Employing Company
or the Administrative Committee more than ninety (90) days
after the claimant has exhausted the administrative remedies set
forth in this Section 3.6.
4.1 Any
controversy relating to a claim arising out of or relating to this
Plan, including, but not limited to claims for benefits due under
this Plan, claims for the enforcement of ERISA, claims based on the
federal common law of ERISA, claims alleging discriminatory
discharge under ERISA, claims based on state law, and assigned
claims relating to this Plan shall be settled by arbitration in
accordance with the then current Employee Benefit Claims
Arbitration
Rules of the American Arbitration Association (AAA) or any
successor rules which are hereby incorporated into the Plan by this
reference; provided, however, both the Company and the Participant
shall have the right at any time to seek equitable relief in court
without submitting the issue to arbitration.
4.2 Neither the
Participant (or his beneficiary) nor the Plan may be required to
submit any such claim or controversy to arbitration until the
Participant (or his beneficiary) has first exhausted the
Plan’s internal appeals procedures set forth in
Section 3.6. However, if the Participant (or his beneficiary)
and the Company agree to do so, they may submit the claim or
controversy to arbitration at any point during the processing of
the dispute.
4.3 The Company
will bear all costs of arbitration, except that the Participant
will pay the filing fee set by the AAA and the arbitrator shall
have the power to apportion among the parties expenses such as
pre-hearing discovery, travel, experts’ fees,
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