DELTIC TIMBER CORPORATION SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Exhibit 10.20

DELTIC TIMBER CORPORATION

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

As Amended and Restated

Effective as of January 1, 2005

DELTIC TIMBER CORPORATION

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

As Amended and Restated Effective as of January 1, 2005

Table of Contents

 

DELTIC TIMBER CORPORATION

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

As Amended and Restated Effective as of January 1, 2005

PURPOSE

Deltic Timber Corporation (the “Company”) hereby amends and restates the Deltic Timber Corporation Supplemental Executive Retirement Plan, effective as of January 1, 2005 (the “Plan”). The purpose of this Plan is to restore Pension Plan and Thrift Plan benefits that cannot be paid under the Pension Plan and the Thrift Plan due to limitations imposed by the Code, and to comply with the terms of any agreements to provide Supplemental Plan Benefits under Article VI.

The Plan is being amended and restated to comply with the requirements of Code Section 409A and the regulations issued thereunder, with respect to amounts deferred on and after January 1, 2005. Any changes made to the Plan through this amendment and restatement that relate to such requirements shall be effective as of January 1, 2005. The provisions of the Plan relating to amounts deferred prior to January 1, 2005 shall not be affected in any way by the changes being made through this restatement, it being expressly intended that such amounts shall remain exempt from the requirements of Code Section 409A. To the extent required under Code Section 409A and applicable regulations, any new payment event or form of payment adopted during 2006 in conjunction with this amendment and restatement shall not cause a payment to be made to a Participant during 2006 that was not otherwise scheduled to be paid in 2006, nor cause a payment otherwise payable in 2006 to be paid in a subsequent year; in the event such new payment event would provide for payment during 2006, no payment shall be made in accordance with the event until January 1, 2007.

The Plan constitutes an unsecured promise by the Company or an Adopting Employer to pay benefits in the future. Participants in the Plan shall have the status of general unsecured creditors of the Company or the Adopting Employer, as applicable. Each Adopting Employer shall be solely responsible for payment of the benefits of its employees and their beneficiaries. The Plan is unfunded for Federal tax purposes and for purposes of Title I of the Employee Retirement Income Security Act of 1974. Any amounts set aside to defray the liabilities assumed by the Company or an Adopting Employer will remain the general assets of the Company or an Adopting Employer and shall remain subject to the claims of the Company’s or the Adopting Employer’s creditors until such amounts are distributed to the Participants.

ARTICLE I

Definitions

(a) “Account or Accounts” shall mean a Participant’s Deferred Compensation Account, Employer Matching Account, or Grandfathered Account.

(b) “Actuarial Equivalent” or “Actuarially Equivalent” shall mean equality in value of the aggregate amounts expected to be received under different manners of payment applying reasonable interest rate and mortality assumptions.

(c) “Adopting Employer” shall mean a Related Employer that has elected, with the consent of the Board of Directors of the Company, to adopt the Plan.

(d) “Applicable Code Provisions” shall mean any and all limitations imposed under Code Sections 401(a)(4), 401(a)(17), 402(g), 401(k), 401(m), and 415.

(e) “Basic Pension Plan Benefit” shall mean the amount of pension payable in the normal form to the Participant under the Pension Plan after reduction to comply with the Applicable Code Provisions.

(f) “Beneficiary” shall mean the person or persons designated by a Participant upon such forms as shall be provided by the Committee, to receive any benefits payable under the Plan after the Participant’s death. If the Participant shall fail to designate a Beneficiary, or if for any reason such designation shall be ineffective, or if such Beneficiary shall predecease the Participant or die simultaneously with the Participant, then the Beneficiary shall be, in the following order of preference (i) the Participant’s surviving spouse, or (ii) the Participant’s estate. In the event of any dispute as to the entitlement of any Beneficiary, the Committee’s determination shall be final, and the Committee may withhold any payment until such dispute has been resolved.

(g) “Board” or “Board of Directors” shall mean the board of directors of a Participating Employer.

(h) “Change in Control” shall mean (i) a change in the ownership of the Corporation occurring as the result of a person, or more than one person acting as a group, acquiring ownership of stock of the Corporation which, when combined with stock held by such person or group, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the Corporation, provided the person or group was not considered as owning more than fifty percent (50%) of the value or voting power prior to the acquisition, (ii) a change in the effective control of the Corporation occurring (A) as the result of a person, or more than one person acting as a group, acquiring ownership of stock of the Corporation possessing thirty-five percent (35%) or more of the total voting power of stock of the Corporation, or (B) as the result of the replacement of a majority of the members of the Board during a twelve (12) month period by directors whose appointment or election is not endorsed by a majority

 

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of the members of the Board prior to the date of the appointment or election, or (iii) a change in the ownership of a substantial portion of the assets of the Corporation occurring as the result of a person, or more than one person acting as a group, acquiring assets from the Corporation that have a total gross fair market value equal to or more than forty percent (40%) of the total gross fair market value of all the assets of the Corporation immediately prior to such acquisition. Whether a Change in Control has occurred shall be governed by regulations issued under Code Section 409A.

(i) “Code” shall mean the Internal Revenue Code of 1986, as amended.

(j) “Committee” shall mean the persons designated by the Board of the Company as the Administrative Committee for the Plan pursuant to Article II.

(k) “Company” shall mean Deltic Timber Corporation, a Delaware corporation, and its successors.

(l) “Compensation” shall mean the Participant’s compensation as that term is defined under the Thrift Plan for purposes of elective deferrals to such plan.

(m) “Corporation” shall mean, for purposes of determining whether a Change in Control event has occurred, (i) the corporation for whom the Participant is performing services; (ii) the corporation that is liable for the payment of the deferred compensation to the Participant (or all corporations so liable if more than one corporation is liable); or (iii) a corporation that owns more than fifty percent (50%) of the total fair market value and total voting power of the corporation described in (i) or (ii), or any corporation in a chain of corporations in which each corporation owns more than fifty percent (50%) of such value and voting power of another corporation in the chain, ending in a corporation described in (i) or (ii).

(n) “Deferred Compensation Account” shall mean an account established to record any Compensation deferred by a Participant to this Plan on or after January 1, 2005, and any hypothetical earnings on such amounts.

(o) “Disability” shall mean a Participant (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Participating Employer. The Participant shall be deemed to have incurred a Disability if the Participant is determined to be totally disabled by the Social Security Administration.

(p) “Employer” shall mean the Company and any Related Employer.

 

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(q) “Employer Matching Account” shall mean an account established to record any employer matching contributions credited for a Participant under the Plan with respect to amounts deferred to the Plan on or after January 1, 2005, and any hypothetical earnings on such amounts.

(r) “Fixed Date” shall mean the first day of a calendar year specified by a Participant in his deferral election form, upon which a distribution of the Restored Thrift Plan Benefit may be made to the Participant.

(s) “Grandfathered Account” shall mean any amounts deferred by a Participant prior to January 1, 2005, or credited for his benefit as employer matching contributions with respect to such deferrals, and any hypothetical earnings on such amounts. The Grandfathered Account shall include any account-balance-type benefits transferred to the Plan from the Murphy Oil Corporation Supplemental Executive Retirement Plan.

(t) “Grandfathered Benefit” shall mean the benefit, if any, provided under Article V that was earned and vested as of December 31, 2004, including any benefit transferred to the Plan from the Murphy Oil Corporation Supplemental Executive Retirement Plan. The Grandfathered Benefit shall be equal to the present value as of December 31, 2004, of the Pension Plan Benefit which the Participant would have been entitled to receive under the Plan if the Participant had voluntarily terminated services with the Employer without cause on December 31, 2004 and received payment of the benefits with the maximum value available from the Plan on the earliest possible date allowed under the Plan to receive a payment of benefits following the termination of services. Such Grandfathered Benefit shall be increased for any subsequent calendar year to equal the present value of the benefit the Participant actually becomes entitled to receive, determined under the terms of the Plan as in effect on October 3, 2004, without regard to any further services rendered by the Participant after December 31, 2004.

(u) “Identification Date” shall mean December 31 of any calendar year.

(v) “Participant” shall mean any employee of a Participating Employer who is covered by this Plan as provided in Article III.

(w) “Participating Employer” shall mean the Company and each Adopting Employer.

(x) “Pension Plan” shall mean the Retirement Plan of Deltic Timber Corporation, as it may be amended from time to time.

(y) “Plan” shall mean the Deltic Timber Corporation Supplemental Executive Retirement Plan, originally effective as of January 1, 1997, as it has been or may be amended from time to time.

(z) “Plan Year” shall mean the 12-month period ending on December 31.

 

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(aa) “Related Employer” shall mean any entity that is part of a controlled group of corporations that includes the Company within the meaning of section 414(b) of the Code or that is part of a group of trades or businesses under common control with the Company within the meaning of section 414(c) of the Code.

(bb) “Restored Pension Plan Benefit” shall mean the benefit, if any, provided under Article V, including any applicable Grandfathered Benefit.

(cc) “Restored Thrift Plan Benefit” shall mean the benefit, if any, provided under Article IV.

(dd) “Separation from Service” shall mean the voluntary or involuntary termination of employment of the Participant from the Employer. A Separation from Service shall not have occurred (i) if the Participant is on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six months, (ii) if the Participant has a right to reemployment with the Employer pursuant to statute or contract, or (iii) if the Employee and Employer intend that the Employee continue to provide more than insignificant services to the Employer.

(ee) “Specified Employee” shall mean a key employee (as defined in Code Section 416(i) without regard to Code Section 416(i)(5)) of the Employer if, as of the date the employee Separates from Service with the Employer, any stock of the Employer is publicly traded on an established securities market or otherwise. An Employee shall be a Specified Employee only if the Employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii) or (iii) (applied in accordance with the regulations thereunder and disregarding Section 416(i)(5)) at any time during the 12-month period ending on the Identification Date, and only for the 12-month period beginning on the first day of the fourth month following the applicable Identification Date.

(ff) “Supplemental Plan Benefits” shall mean the benefits, if any, provided under Article VI hereof.

(gg) “Thrift Plan” shall mean the Thrift Plan of Deltic Timber Corporation, as it may be amended from time to time.

(hh) “Trust” shall mean a trust agreement established by the Company to hold assets for the purpose of defraying its obligations to Participants in accordance with Section VIII(a), if any.

(ii) “Trustee” shall mean the persons or entity appointed to serve as the trustee of the Trust.

(jj) “Unforeseeable Emergency” shall mean a severe financial hardship of the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in section 152(a) of the Code) of the Participant, loss of the Participant’s property due to casualty (including the need to rebuild a home following damage to a home not otherwise covered by insurance, for example, as a

 

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result of a natural disaster), or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. No Unforeseeable Emergency shall be deemed to exist for purposes of the Plan if the emergency can be relieved through reimbursement or compensation from insurance or otherwise, by liquidation of the Participant’s assets (to the extent such liquidation would not cause severe financial hardship), or by cessation of deferrals to the Plan.

 

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ARTICLE II

Administration

(a) Administrative Committee. The Board of Directors of the Company shall appoint a committee to administer the Plan. If no such appointment has been made, the Company shall serve as the Committee. The Committee shall have complete control and discretion to manage the operation and administration of the Plan. Not in limitation, but in amplification of the foregoing, the Committee shall have the following powers:

(1) To determine all questions relating to the eligibility of employees to participate or continue to participate;

(2) To maintain all records and books of account necessary for the administration of the Plan;

(3) To interpret the provisions of the Plan and to make and to publish such interpretive or procedural rules as are not inconsistent with the Plan and applicable law;

(4) To compute, certify and arrange for the payment of benefits to which any Participant or beneficiary is entitled;

(5) To process claims for benefits under the Plan by Participants or beneficiaries;