Exhibit (10)(iii)(A)(4)
CINCINNATI BELL
INC.
EXECUTIVE DEFERRED COMPENSATION
PLAN
(As amended and restated effective
as of January 1, 2005)
1. Introduction to Plan
.
1.1 Name and Sponsor of
Plan . The name of
this Plan is the Cincinnati Bell Inc. Executive Deferred
Compensation Plan, and its sponsor is CBI.
1.2 Purpose of Plan
. The purpose of the Plan
is to provide deferred compensation for a select group of
management and highly compensated employees of the Company (within
the meaning of title I of ERISA).
1.3 Effective Amendment Date
of Plan and Effect of Plan On Prior Deferrals .
(a) Deferred Compensation
Subject To Following Terms of This Document .
In order to conform the Plan to the
requirements of the American Jobs Creation Act of 2004, this
document amends and restates the Plan effective as of the Effective
Amendment Date (January 1, 2005). The provisions of sections 2
through 9 hereof apply to but only to:
(1) amounts that are attributable to
compensation that is deferred under section 3 hereof on or after
the Effective Amendment Date;
(2) amounts that are attributable to
compensation that was deferred under the provisions of the Prior
Plan prior to the Effective Amendment Date but was not earned and
vested (within the meaning of Section 1.409A-6(a)(2) of the
Treasury Regulations) prior to the Effective Amendment Date;
and
(3) amounts that are attributable to
compensation that was deferred under the provisions of the Prior
Plan prior to the Effective Amendment Date and was earned and
vested (within the meaning of Section 1.409A-6(a)(2) of the
Treasury Regulations) prior to the Effective Amendment Date, but
only if the provisions of the Prior Plan that apply to any such
compensation are materially modified (within the meaning of
Section 1.409A-6(a)(4) of the Treasury Regulations). This
document does not by itself materially modify such
provisions.
(b) Effective Date of
Following Terms of This Document When Applied To Pre-Effective
Amendment Date Deferred Compensation . Any amounts described in paragraph (a)(2) and
(3) of this subsection 1.3 shall, beginning as of the
Effective Amendment Date, be subject to the terms of sections 2
through 9 hereof as if this document had been in effect at the time
that such amounts were originally deferred under the provisions of
the Prior Plan.
(c) Incorporation of Terms of
Prior Plan . Notwithstanding any other provision of the
Plan, except as provided in paragraph (a)(2) and (3) of this
subsection 1.3, all rules (including rules as to assumed
investments and distributions) that relate to amounts deferred
under the Prior Plan, adjusted by assumed earnings and losses
thereon as determined under the provisions of the Prior Plan, shall
be governed solely by the terms of the Prior Plan (which terms are
incorporated herein by reference).
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2. General Definitions .
For all purposes of the Plan, the
following terms shall have the meanings hereinafter set forth,
unless the context clearly indicates otherwise.
2.1 “Account” means,
with respect to any Participant, the bookkeeping account maintained
for the Participant under the terms of this Plan and to which
amounts are credited or otherwise allocated under section 4 hereof
in order to help determine the Participant’s benefits under
the Plan.
2.2 “Beneficiary” means,
with respect to any Participant, the person or entity designated by
the Participant, on forms furnished and in the manner prescribed by
the Committee, to receive any benefit payable under the Plan after
the Participant’s death. If a Participant fails to designate
a beneficiary or if, for any reason, such designation is not
effective, his or her “Beneficiary” shall be deemed to
be his or her surviving spouse or, if none, his or her
estate.
2.3 “Board” means the
Board of Directors of CBI.
2.4 “CBI” means
Cincinnati Bell Inc. (and, except for purposes of determining
whether a Change in Control has occurred, any legal successor to
Cincinnati Bell Inc. that results from a merger or similar
transaction).
2.5 “Change in Control”
means the occurrence of any of the events described in paragraphs
(a), (b), and (c) of this subsection 2.5. All of such events
shall be determined under and, even if not so indicated in the
following paragraphs of this subsection 2.5, shall be subject to
all of the terms of Section 1.409A-3(i)(5) of the Treasury
Regulations.
(a) A change in the ownership of CBI
(within the meaning of Section 1.409A-3(i)(5)(v) of the
Treasury Regulations). In very general terms,
Section 1.409A-3(i)(5)(v) of the Treasury Regulations provides
that a change in the ownership of CBI occurs when a person or more
than one person acting as a group acquires outstanding voting
securities of CBI that, together with stock held by such person or
group, constitutes more than 50 percent of the total fair market
value or total voting power of the stock of CBI.
(b) A change in the effective
control of CBI (within the meaning of
Section 1.409A-3(i)(5)(vi) of the Treasury Regulations). In
very general terms, Section 1.409A-3(i)(5)(vi) of the Treasury
Regulations provides that a change in the effective control of CBI
occurs either:
(1) when a person or more than one
person acting as a group acquires (or has acquired during the
twelve-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock of CBI
possessing 30% or more of the total voting power of the stock of
CBI; or
(2) when a majority of members of
the Board is replaced during any twelve-month period by directors
whose appointment or election is not endorsed by a majority of the
members of the Board prior to the date of the appointment or
election.
(c) A change in the ownership of a
substantial portion of the assets of CBI (within the meaning of
Section 1.409A-3(i)(5)(vii) of the Treasury Regulations). In
very general
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terms, Section 1.409A-3(i)(5)(vii) of the
Treasury Regulations provides that a change in the ownership of a
substantial portion of the assets of CBI occurs when a person or
more than one person acting as a group acquires (or has acquired
during the twelve-month period ending on the date of the most
recent acquisition by such person or persons) assets from CBI that
have a total gross fair market value equal to or more than 40% of
the total gross fair market value of all of the assets of CBI
immediately prior to such acquisition or acquisitions.
2.6 “Code” means the
Internal Revenue Code of 1986, as it exists as of the Effective
Amendment Date and as it may thereafter be amended. A reference to
a specific section of the Code shall be deemed to be a reference
both (i) to the provisions of such section as it exists as of
the Effective Amendment Date and as it is subsequently amended,
renumbered, or superseded (by future legislation) and (ii) to
the provisions of any section of the Treasury Regulations that is
issued under such section.
2.7 “Committee” means
the committee appointed to administer the Plan under the provisions
of subsection 6.1 hereof.
2.8 “Common Shares”
means common shares, par value $0.01 per share, of CBI.
2.9 “Company” means all
of the Employers considered collectively.
2.10 “Effective Amendment
Date” means January 1, 2005.
2.11 “Employee” means
any person who is a common law employee of the Company (
i.e. , a person whose work procedures are subject to control
by the Company) and is treated as an employee on an employee
payroll of the Company.
2.12 “Employer” means
each of: (i) CBI; and (ii) each other corporation or
other organization that is deemed to be a single employer with CBI
under Section 414(b) or (c) of the Code ( i.e. ,
as part of a controlled group of corporations that includes CBI or
under common control with CBI).
2.13 “ERISA” means the
Employee Retirement Income Security Act of 1974, as it exists as of
the Effective Amendment Date and as it may thereafter be amended. A
reference to a specific section of ERISA shall be deemed to be a
reference both (i) to the provisions of such section as it
exists as of the Effective Amendment Date and as it is subsequently
amended, renumbered, or superseded (by future legislation) and
(ii) to the provisions of any government regulation that is
issued under such section as of the Effective Amendment Date or as
of a later date.
2.14 “Key Employee”
means, as of any date, an Employee (i) whose annual rate of
base pay and targeted bonus in effect at the start of the calendar
year in which such date occurs (or, if such date occurs in the same
calendar year in which the Employee’s first day of employment
with the Company falls, an Employee whose annual rate of base pay
and targeted bonus in effect on his or her first day of employment
by the Company) exceed the Tax-Qualified Plan Annual Compensation
Limit that applies to such calendar year and (ii) to whom
participation in the Plan has been offered by any Employer on or
prior to such date.
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2.15 “Participant” means
a person who as a Key Employee elects or elected to defer any
amounts under this Plan. Such person shall remain a Participant
until the amounts allocated to his or her Account have been fully
paid and/or forfeited, as the case may be.
2.16 “Performance-Based
Compensation” means, with respect to any Key Employee, any
compensation provided by an Employer to the Key Employee
(i) where the amount of, or entitlement to, the compensation
is contingent on the satisfaction of preestablished organizational
or individual performance criteria relating to a performance period
of at least twelve months in which the Key Employee performs
services for the Company and (ii) which constitutes
“performance-based compensation” within the meaning of,
and in accordance with the rules of, Section 1.409A-1(e) of
the Treasury Regulations.
2.17 “Plan” means the
Cincinnati Bell Inc. Executive Deferred Compensation Plan. This
document amends and restates the Plan effective as of the Effective
Amendment Date to the extent indicated by subsection 1.3
hereof.
2.18 “Prior Plan” means
the versions of the Plan that were in effect before the Effective
Amendment Date.
2.19 “Tax-Qualified Plan
Annual Compensation Limit” means, with respect to any
calendar year, the annual compensation limit that, for any plans
that are subject to Code Section 401(a), applies for plan
years beginning in such calendar year under Section 401(a)(17)
of the Code (as such limit is adjusted for such plan years under
Section 401(a)(17)(B) of the Code).
2.20 “Tax Year” means,
with respect to any Key Employee, the Key Employee’s taxable
year for federal income tax purposes. Unless the Company or the
Committee is notified otherwise by the Key Employee, the Company
and the Committee may assume for purposes of this Plan that a Key
Employee’s Tax Year is a calendar year.
2.21 “Treasury
Regulations” means all final regulations issued by the U.S.
Department of the Treasury under the Code, as such regulations
exist as of the date on which this document is executed on its
final page by an officer or representative of CBI and as they are
subsequently amended, renumbered, or superseded. A reference to a
specific section or paragraph of the Treasury Regulations shall be
deemed to be a reference to the provisions of such section or
paragraph as it exists as of the date on which this document is
executed on its final page by an officer or representative of CBI
and as it is subsequently amended, renumbered, or
superseded.
3. Deferral Elections and
Company Match .
3.1 Election of Deferrals of
Basic Salary and Cash Awards .
(a) Initial Deferral
Election .
(1) Subject to such administrative
rules as the Committee may prescribe, a Key Employee may elect for
any Tax Year (for purposes of this paragraph (a), the
“subject Tax Year”), by completing a deferral form or
forms and filing such form or forms with the Committee but not in
any event after the last day of the immediately preceding Tax Year
(or, if the subject Tax Year is the Tax Year in which he or she
first becomes a Key Employee, not in any event beyond 30 days after
the date on which he or she or she first becomes a Key Employee),
to defer the receipt of:
(A) any whole percent or whole
dollar amount (but not a percent or amount that is in excess of
75%, or such larger percentage as may be prescribed by the
Committee) of his or her Basic Salary that is earned by him or her
in the subject Tax Year or in the portion of the subject Tax Year
that is designated by him or her in his or her deferral election
(and also, if the subject Tax Year is the Tax Year in which he or
she first becomes a Key Employee, that is earned by him or her
after his or her deferral election is filed with the Committee);
and/or
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(B) any whole percent (up to 100%)
or any whole dollar amount (not less than $1,000) of his or her
Cash Awards that are earned by him or her in the subject Tax Year
or in the portion of the subject Tax Year that is designated by him
or her in his or her deferral election (and also, if the subject
Tax Year is the Tax Year in which he or she first becomes a Key
Employee, that are earned by him or her after his or her deferral
election is filed with the Committee).
(2) Subject to such administrative
rules as the Committee may prescribe, a Key Employee may change, or
terminate and thereby void, any deferral election that he or she
has made for the subject Tax Year under the provisions of
subparagraph (1) of this paragraph (a), by completing an
appropriate form and filing such form with the Committee, up to but
not after the latest day by which he or she could still make a
deferral election for the subject Tax Year under the provisions of
subparagraph (1) of this paragraph (a) (and provided
that, if the subject Tax Year is the Tax Year in which he or she
first becomes a Key Employee, prior to his or her initial deferral
election being used to defer the receipt of any Basic Salary or
Cash Awards of the Key Employee).
(b) Basic Salary and Cash
Award Definitions . For purposes of the Plan and with respect to any
Key Employee: (i) “Basic Salary” means the basic
salary (not including awards, bonuses, or any other remuneration
not treated by the Company as part of the Key Employee’s base
rate of salary) payable to the Key Employee by the Company; and
(ii) a “Cash Award” means an award or bonus
payable in cash to the Key Employee by the Company, but not
including any cash award that constitutes Performance-Based
Compensation or that is issued under CBI’s 1997 Long Term
Incentive Plan, 2007 Long Term Incentive Plan, or Short Term
Incentive Plan.
3.2 Election of Deferrals of
Performance-Based Awards .
(a) Initial Deferral
Election .
(1) Subject to such administrative
rules as the Committee may prescribe, a Key Employee may elect to
defer the receipt of any part of a Performance-Based Award granted
to him or her, by completing a deferral form and filing such form
with the Committee while the Key Employee is still a Key Employee
and at least six months before the end of the performance period
that relates to the portion of such award that is being deferred,
provided that in no event may such election be made after the
amount of compensation attributable to such award has become both
substantially certain to be paid and readily
ascertainable.
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(2) Subject to such administrative
rules as the Committee may prescribe, a Key Employee may terminate
and thereby void any deferral election that he or she has made with
respect to a Performance-Based Award under the provisions of
subparagraph (1) of this paragraph (a), by completing an
appropriate form and filing such form with the Committee, up to but
at least six months before the end of the performance period that
relates to the portion of such award that is being
deferred.
(b) Special Deferral Election
Rule for Performance-Based Restricted Common Share Award
.
(1) When a Participant’s
Performance-Based Award is a restricted stock award, an election
made by the Participant to surrender to CBI any of the restricted
Common Shares subject to such award (on a deferral form that is
filed with the Committee while the Key Employee is still a Key
Employee and at least six months before the end of the performance
period that relates to such surrendered restricted Common Shares)
shall be deemed to be an election to defer the receipt of such part
of the award for all purposes of this subsection 3.2 and the other
provisions of the Plan.
(2) Notwithstanding the provisions
of subparagraph (1) of this paragraph (b) or any other
provision of the Plan, a Key Employee may not elect to defer the
receipt of any part of a Performance-Based Award that is a
restricted stock award (pursuant to the provisions of subparagraph
(1) of this paragraph (b) or otherwise) when such award
is granted to the Key Employee after December 31,
2005.
(3) For purposes of the Plan and
with respect to any Key Employee, a “restricted stock
award” means an award under which Common Shares are issued to
the Key Employee by the Company pursuant to an agreement that
restricts the right of the Key Employee to dispose of such shares
(and that makes such shares forfeitable) until and unless certain
conditions are met. In this regard, a Performance-Based Award that
constitutes the right of a Key Employee to receive a number of
Common Shares (or a cash payment based on the value of a number of
Common Shares) in the future if and when certain conditions are met
shall not be considered under this Plan as a restricted stock award
and thus is not affected by the provisions of this paragraph
(b).
(c) Conditions on Validity of
Deferral Election . Notwithstanding any other provision of the Plan,
any election that a Key Employee makes under the foregoing
provisions of this subsection 3.2 to defer the receipt of any part
of a Performance-Based Award shall be deemed to be void and of no
effect in the event and when the Key Employee forfeits any right to
receive such Performance-Based Award part ( e.g. , if and
when the Participant fails to satisfy the conditions necessary to
ever become entitled to receive such Performance-Based Award part
or if and when the performance criteria applicable to such
Performance-Based Award part are not satisfied) and in such case no
amounts attributable to such Performance-Based Award part shall be
credited to the Account of the Key Employee under the
Plan.
(d) Performance-Based Award
Definition . For
purposes of the Plan and with respect to any Key Employee, a
“Performance-Based Award” means an award or bonus
granted to the Key Employee by an Employer (including any
performance unit award or performance share award granted under
CBI’s 1997 Long Term Incentive Plan or 2007 Long Term
Incentive Plan and any award granted under CBI’s Short Term
Incentive Plan and
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regardless of whether or not any such award is
otherwise payable in cash or Common Shares) that constitutes
Performance-Based Compensation, provided that the Key Employee
performs services for the Company continuously from a date no later
than the date upon which the performance criteria applicable to
such award are established through the date upon which the Key
Employee makes an initial deferral election with respect to any
part of such award under paragraph (a) or (b) of this
subsection 3.2. Notwithstanding the foregoing provisions of this
paragraph (d), in no event shall stock option or stock appreciation
right awards (or restricted stock awards granted after
December 31, 2005), including those granted under CBI’s
1997 Long Term Incentive Plan or 2007 Long Term Incentive Plan, be
considered Performance-Based Awards under this Plan.
3.3 Special Pre-March 15,
2005 Deferral Election Right . Notwithstanding any other provision of the Plan
and pursuant to and in accordance with the terms of Q&A-21 of
Internal Revenue Service Notice 2005-1, the requirements of
subsections 3.1 and 3.2 hereof relating to the timing of deferral
elections shall not be applicable to any election that is made by a
Key Employee on or before March 15, 2005 to defer the receipt
of any compensation that both is subject to the terms of this Plan
under the provisions of subsection 1.3 hereof and relates to
services performed by the Key Employee on or before
December 31, 2005, provided that (i) the compensation to
which the deferral election relates has not or had not been paid or
become payable by the time of the election and (ii) the
election to defer is or was made in accordance with the terms of
the Plan or the Prior Plan that at the time of the election were
then in effect.
3.4 Company Match
.
(a) Right To Company Match
. As of each day (for
purposes of this subsection 3.4, a “Deferral Date”) on
which Basic Salary or Cash Award deferrals are credited under
subsection 4.1(a) hereof to the Account of a Key Employee, there
shall also be credited, to such Account under subsection 4.1(d)
hereof, an amount computed in accordance with the provisions of
paragraph (b) of this subsection 3.4 (which amount shall be
referred to in the Plan as a “Company
match”).
(b) Amount of Company
Match . The Company
match to be credited to a Key Employee’s Account on any
Deferral Date shall be the lesser of:
(1) 66-
2 / 3 % (or such lesser percentage as
may be prescribed by the Committee) of the Key Employee’s
Basic Salary and Cash Awards deferred under this Plan on the
Deferral Date; or
(2) 4% (or such lesser percentage as
may be prescribed by the Committee) of the sum of (i) the Key
Employee’s Basic Salary and Cash Awards deferred under this
Plan on the Deferral Date plus (ii) the portion, if any, of
the Key Employee’s Basic Salary and Cash Awards that are
payable on the Deferral Date but are not deferred under this Plan
and that, combined with the Key Employee’s aggregate Basic
Salary and Cash Awards that were payable in the portion of the
calendar year in which the Deferral Date falls that occurs prior to
such date but were not deferred under this Plan, exceeds the
Tax-Qualified Plan Annual Compensation Limit that applies to such
calendar year.
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4. Maintenance and Valuation of Accounts
.
4.1 Accounts .
An Account shall be established for
each Participant in accordance with the following paragraphs of
this subsection 4.1 to reflect the amounts of (i) his or her
Basic Salary, Cash Awards, Performance-Based Awards, and Company
matches that are to be credited to such Account under the
provisions of paragraphs (a), (b), (c), and/or (d) of this
subsection 4.1 and (ii) the assumed investment of such
amounts. The Committee shall create subaccounts under any
Participant’s Account to the extent needed administratively (
e.g. , to account for different distribution rules that
apply to different portions of the Participant’s Account).
For purposes of this Plan, the net investment returns and losses of
the assumed investment of any credits made to a Participant’s
Account, or any Company match that relates to any deferred Basic
Salary or Cash Award credits made to the Participant’s
Account, shall be deemed to be “attributable” to the
portion of such Account that reflects such credits.
(a) Crediting To Account of
Basic Salary or Cash Award . Subject to such administrative rules as the
Committee may prescribe, any amount of Basic Salary or a Cash Award
deferred by a Participant under the Plan pursuant to the provisions
of section 3.1 hereof shall be credited to the Account of the
Participant as of the day on which such deferred amount would
otherwise have been paid to the Participant.
(b) Crediting To Account of
Performance-Based Award . Subject to such rules as the Committee may
prescribe, any part of a Performance-Based Award deferred by a
Participant under the Plan under the provisions of subsection 3.2
hereof shall be credited to the Account of the Participant as of
the latest of (i) the day on which the performance period
applicable to such award part ends, (ii) the first day on
which the Participant has no substantial risk of forfeiture (within
the meaning of Section 1.409A-1(d) of the Treasury
Regulations) with respect to such Performance-Based Award part and
the amount of such part has become readily ascertainable, or
(iii) the first day on which any portion of such
Performance-Based Award part would otherwise (but for the deferral
election) have been paid to the Participant or his or her
Beneficiary (except that this clause (iii) shall not apply to
any Performance-Based Award part that constitutes a restricted
stock award granted prior to January 1, 2006).
(c) Determination of Common
Share Value Credited To Account . When any part of a Performance-Based Award that
is deferred by a Participant under the Plan and credited to the
Account of the Participant is otherwise payable in Common Shares
(or represents a restricted stock award granted prior to
January 1, 2006), the amount credited to the Account as of the
day determined under the provisions of paragraph (b) of this
subsection 4.1 shall equal the fair market value (determined as of
such day) of the number of Common Shares that would otherwise be
paid to the Participant (or that would otherwise have their
restrictions lapse under such award part).
(d) Crediting To Account of
Company Match . Subject to such rules as the Committee may
prescribe, any amount of a Company match applicable to a
Participant under the provisions of section 3.4 hereof shall be
credited to the Account of the Participant as of the day on which
the deferred Basic Salary or Cash Award to which the Company match
relates would otherwise have been paid to the
Participant.
(e) Assumed Investment of
Account . Any amounts
credited to the Account of a Participant under paragraphs (a), (b),
(c), and/or (d) of this subsection 4.1 shall be
assumed
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to have been invested in the investments
designated or deemed to be designated by the Participant on a form
provided by and filed with the Committee, and adjusted by reason of
such assumed investments, in accordance with the provisions of
subsection 4.2 hereof.
4.2 Assumed Investments
. The Committee shall
designate in notices or other documents provided to Participants a
limited number of “assumed investments” for purposes of
the Plan. Such assumed investments will generally be (but will not
be required to be) limited to mutual funds or similar types of
investments but may and generally will include an assumed
investment in Common Shares. Some or all of the assumed investments
designated for the Plan may be changed by the Committee to other
assumed investments, effective as of any date, in which case prior
written notice of such change shall be provided by the Committee to
all Participants.
(a) General Rules on
Participant Designations of Assumed Investments .
The credits to any
Participant’s Account made in accordance with subsection 4.1
hereof shall be assumed to have been invested among such assumed
investments, and in such proportions, as is elected in a writing
filed by the Participant with the Committee, except that any
investment direction of the Participant is subject to such
reasonable administrative rules concerning such assumed investment
directions as are adopted or used by the Committee.
(b) Initial Assumed Investment
Election . The
Participant must elect on or before the first date a credit is made
to the Account established for him or her under the provisions of
subsection 4.1 hereof the assumed investments in which his or her
Account credits are to be initially assumed to be invested and the
proportions of each credit initially assumed to be invested in each
designated assumed investment. Otherwise, the Participant shall be
deemed to have elected that his or her Account credits will not be
assumed to be invested in any investment until he or she makes an
investment election under the provisions of this subsection 4.2
(or, if the Committee in its discretion so decides, the Participant
shall be deemed to have elected that his or her Account credits
will be assumed to be initially invested in an investment or
investments chosen by the Committee).
(c) Change in Assumed
Investment Election . Further, the Participant may request a change
in the assumed investments of his or her Account and the
proportions of his or her new Account credits assumed to be
invested in each designated investment to other assumed investments
and/or proportions effective as of any January 1, or as of any
other date as the Committee may provide in its discretion, upon
written notice to the Committee prior to such date (or such earlier
date as may be established by the Committee).
(d) Adjustment of Account for
Assumed Investment Returns and Losses . The amounts credited to any Participant’s
Account shall be adjusted as of each December 31, and as of
such other dates as the Committee may provide in its discretion, to
reflect the assumed investment returns or losses (since the last
prior adjustment in the Account) that are attributable to the
assumed investments in which his or her Account is deemed to be
invested.
(e) Special Assumed Investment
Rule for Restricted Common Shares . Notwithstanding any other provision of the Plan,
when any amounts credited to a Participant’s Account reflect
any part of a deferred Performance-Based Award that is a restricted
stock award granted prior to January 1, 2006, the Participant
shall be deemed to have designated such credits to be assumed to be
invested solely in Common Shares from the day such amounts are
credited to the Account until the day that is six months after the
day the Participant satisfied all of the conditions necessary to
become entitled to receive such award part.
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4.3 Nonvested Company Match
Amounts .
(a) Vesting Conditions on
Company Match . In
its discretion, the Committee may, by notice to a Participant on or
prior to the date on which a Company match is credited to the
Account of the Participant, condition the right to receive payments
with respect to all or a portion of the part of such Account that
reflects such Company match on the Participant’s completing a
minimum period of service with the Company. If the Committee does
so, then, until the Participant satisfies such condition, the
amounts allocated to the part of such Account that is subject to
such condition shall be considered to be
“nonvested.”
(b) Effect of Nonvested Status
of Company Match . Any portion of the Account of a Participant that
is at any time nonvested under the provisions of paragraph
(a) of this subsection 4.3 shall not in any event, even when
the provisions of section 5 hereof would otherwise permit a
distribution of such Account portion at such time and
notwithstanding any provision of section 5 hereof which may be read
to the contrary, be able to be distributed to the Participant or
any other party claiming through the Participant until such Account
portion is no longer nonvested (and any distribution of such
Account portion otherwise called for under section 5 hereof shall
to the extent necessary be deferred until, and shall be made as of,
the date such portion is no longer nonvested).
(1) Consistent with the rule set
forth in the foregoing provisions of this paragraph (b) and
notwithstanding any other provision of section 5 hereof, any
reference in any provision of section 5 hereof to the amounts
allocated to a portion of the Account of a Participant at any time
shall be deemed not to include the amounts allocated to any part of
such Account portion that is then nonvested and such part shall be
treated as if it were a separate class of Account until it is no
longer nonvested.
(2) Further, if a Participant
separates from service with the Company (other than by reason of
his or her death) when any portion of the Account established for
him or her is nonvested, he or she shall never be entitled to
receive the amounts allocated to such Account portion and such
amounts shall be forfeited on the date he or she so separates from
service with the Company.
4.4 Valuation
.
(a) Valuation of Account
. The balance of the
Account of a Participant shall be determined periodically (under
procedures adopted by the Committee) to reflect all amounts
credited to the Account under the foregoing provisions of this
section 4 since the latest preceding date on which the Account
balance was determined, any gains and losses in the value of the
Account’s assumed investments since the latest date on which
the Account balance was determined, and any payments or forfeitures
since the latest preceding date on which the Account balance was
determined.
(b) Account Statements
. As soon as practical
following the end of each calendar year, each Participant (or, in
the event of his or her death, his or her Beneficiary) shall be
furnished a statement as of December 31 of such calendar year
showing the balance of the
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Participant’s Account, the total increases
and reductions made in the balance of such Account during such
calendar year, and, if amounts allocated to such Account are
assumed to have been invested in securities, a description of such
securities including the number of shares assumed to have been
purchased by the amounts allocated to such Account.
4.5 Common Shares Adjustment
Rules . To the extent
a Participant’s Account is assumed to have been invested in
Common Shares, the following provisions of this subsection 4.5
shall apply.
(a) Cash Dividends
. Whenever any cash
dividends are paid with respect to Common Shares, additional
amounts shall be allocated to the Participant’s Account as of
the dividend payment date. The additional amount to be allocated to
the Account shall be determined by multiplying the per share cash
dividend paid with respect to the Common Shares on the dividend
payment date by the number of assumed Common Shares allocated to
the Account on the day preceding the dividend payment date. Subject
to such administrative rules as the Committee may prescribe, such
additional amount allocated to the Participant’s Account
shall be assumed to have been invested in additional Common Shares
on the day on which such dividends are paid.
(b) Changes in Common
Shares . If there is
any change in Common Shares through the declaration of a stock
dividend or a stock split, through a recapitalization resulting in
a stock split, or through a combination or a change in shares, the
number of shares assumed to have been allocated to each Account
shall be appropriately adjusted.
4.6 Fair Market Value of
Common Shares . Whenever Common Shares are to be valued for
purposes of the Plan as of any date (such as a date on which
distribution of such shares is to be made by the Company), the
value of each such share shall be: (i) when such date occurs
prior to January 1, 2007, the average of the high and low
price per share as reported on the New York Stock Exchange on the
latest business day preceding the subject date for which the
valuation is being made; or (ii) when such date occurs on or
after January 1, 2007, the closing price of a Common Share on
the New York Stock Exchange on the latest date preceding the
subject date on which Common Shares were traded on such exchange.
Notwithstanding the foregoing, if Common Shares are not listed on
the New York Stock Exchange on the subject date, then the fair
market value of a Common Share on the subject date shall be
determined by the Committee in good faith pursuant to methods and
procedures established by the Committee.
4.7 Convergys Shares
. Effective on or about
December 31, 1998, CBI distributed to its shareholders one
common share of Convergys Corporation (for purposes of this
subsection 4.7, a “Convergys share”) for each Common
Share owned by its shareholders on the record date of such
distribution. Upon such distribution, any Participant who had an
account under the Prior Plan had such account credited for assumed
investment purposes with one Convergys share for each Common Share
then assumed to be held under such account. The following
paragraphs of this subsection 4.7 shall apply to each such
Participant.
(a) Right To Switch Assumed
Investment From Convergys Shares . The Participant has had under the terms of the
Prior Plan prior to the Effective Amendment Date and, unless and
except to the extent his or her Prior Plan account’s assumed
investment in Convergys shares was changed prior to the Effective
Amendment Date, shall continue to have on and after such date the
option of retaining such assumed Convergys shares investment for
his or her
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Account or converting all or a portion of such
assumed investment into any other assumed investments available
under the Plan (in accordance with the provisions of subsection 4.2
hereof); except that any Convergys share credited for assumed
investment purposes to his or her Account by reason of a restricted
stock award granted prior to January 1, 2006 shall be subject
to the same restrictions (including restrictions on switching to
other assumed investments) as apply under such restricted stock
award.
(b) Convergys Shares
Adjustment Rules . In addition, to the extent a
Participant’s Account is assumed to have been invested in
Convergys shares, the provisions of subsections 4.5 and 4.6 hereof
shall apply but as if each reference in such subsections to Common
Shares were instead a reference to Convergys shares.
4.8 Deduction of Payments or
Forfeitures from Account and Cancellation of Account
.
(a) Deduction of Payments and
Forfeitures From Account . Any payment, including an annual installment
payment, or forfeiture of any portion of a Participant’s
Account under the provisions of the Plan shall be charged, as of
the date such payment or forfeiture is deemed to be made under the
other provisions of this Plan, to such Account portion (or, in
other words, deducted from the amounts then allocated to such
Account portion). Except as is otherwise provided under
administrative policies adopted by the Committee, any such payment
or forfeit
