Exhibit 10.2
OVERSTOCK.COM,
INC.
NON-EMPLOYEE
DIRECTORS
NONQUALIFIED DEFERRED
COMPENSATION PLAN
OVERSTOCK.COM,
INC.
NON-EMPLOYEE
DIRECTORS
NONQUALIFIED DEFERRED
COMPENSATION PLAN
Table of Contents
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Page
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Article 1 - Definitions
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1
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1.1
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Account
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1
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1.2
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Administrator
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1
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1.3
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Board
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1
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1.4
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Change-in-Control
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1
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1.5
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Code
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1
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1.6
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Compensation
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2
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1.7
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Deferrals
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2
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1.8
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Deferral Election
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2
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1.9
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Director
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2
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1.10
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Effective Date
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2
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1.11
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Eligible Director
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2
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1.12
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Investment Fund
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2
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1.13
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Participant
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2
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1.14
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Plan Sponsor
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2
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1.15
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Plan Year
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2
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1.16
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Retirement
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2
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1.17
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Separation from Service
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2
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1.18
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Trust
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2
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1.19
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Trustee
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3
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Article 2 - Participation
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3
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2.1
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Commencement of Participation
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3
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2.2
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Loss of Eligible Director Status
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3
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Article 3 - Contributions
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3
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3.1
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Deferral Elections - General
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3
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3.2
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Time of Election
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3
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3.3
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Distribution Elections
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4
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3.4
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Additional Requirements
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4
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3.5
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Crediting of Contributions
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4
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Article 4 - Vesting
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4
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4.1
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Vesting of Deferrals
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4
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Article 5 - Accounts
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4
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5.1
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Accounts
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4
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5.2
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Investments, Gains and Losses
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5
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Article 6 - Distributions
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5
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6.1
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Distribution Election
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5
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6.2
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Distributions Upon an In-Service Account
Triggering Date
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5
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6.3
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Distributions Upon Retirement
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6
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6.4
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Substantially Equal Annual
Installments
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6
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6.5
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Distributions upon Death
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6
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6.6
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Changes to Distribution Elections
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6
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6.7
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Acceleration or Delay in Payments
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7
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6.8
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Unforeseeable Emergency
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7
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6.9
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Domestic Relations Orders
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7
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6.10
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Minimum Distribution
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7
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6.11
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Form of Payment
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8
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Article 7 - Beneficiaries
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8
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7.1
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Beneficiaries
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8
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7.2
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Lost Beneficiary
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8
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Article 8 - Funding
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8
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8.1
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Prohibition Against Funding
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8
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8.2
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Deposits in Trust
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9
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8.3
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Withholding of Participant
Contributions
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9
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Article 9 - General
Provisions
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9
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9.1
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Administrator
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9
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9.2
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No Assignment
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9
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9.3
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Incompetence
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10
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9.4
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Identity
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10
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9.5
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Expenses
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10
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9.6
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Insolvency
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10
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9.7
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Amendment or Modification
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10
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9.8
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Plan Suspension
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11
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9.9
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Plan Termination
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11
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9.10
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Plan Termination due to a
Change-in-Control
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11
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9.11
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Construction
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11
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9.12
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Governing Law
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12
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9.13
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Severability
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12
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9.14
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Headings
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12
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9.15
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Terms
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12
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OVERSTOCK.COM,
INC.
NON-EMPLOYEE
DIRECTORS
NONQUALIFIED DEFERRED
COMPENSATION PLAN
Overstock.com, Inc., a Delaware
corporation, hereby adopts this Overstock.com, Inc.
Non-Employee Directors Nonqualified Deferred Compensation Plan (the
“Plan”) for the benefit of its non-employee members of
the Board of Directors. It is intended to comply with
Internal Revenue Code Section 409A.
Article 1 -
Definitions
1.1
Account
The sum of all the bookkeeping
sub-accounts as may be established for each Participant as provided
in Section 5.1 hereof.
1.2
Administrator
An administrative committee
appointed by the Board. The Plan Administrator shall serve as
the agent for the Plan Sponsor with respect to the
Trust.
1.3
Board
The Board of Directors of the Plan
Sponsor.
1.4
Change-in-Control
Provided that such term shall be
interpreted within the meaning of regulations promulgated under
Code Section 409A, a “Change-in-Control” of the
Plan Sponsor (which, for purpose of this Section 1.5 shall
mean Overstock.com, Inc. but not any of its affiliates or
subsidiaries) shall mean the first to occur of any of the
following:
(a)
the date that any one person or
persons acting as a group, other than Patrick M. Byrne, Dorothy M.
Byrne or John J. Byrne or an individual or entity that directly, or
indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with Patrick M. Byrne,
Dorothy M. Byrne and/or John J. Byrne, acquires ownership of Plan
Sponsor stock constituting more than fifty percent (50%) of the
total voting power of the Plan Sponsor;
(b)
the date that any one person or
persons acting as a group acquires substantially all of the assets
of the Plan Sponsor; or
(c)
the date that a majority of members
of the Plan Sponsor’s Board is replaced during any 12-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 elections.
1.5
Code
The Internal Revenue Code of 1986,
as amended.
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1.6
Compensation
The Participant’s earned
director fee remuneration for serving as a Director, as defined
herein.
1.7
Deferrals
The portion of Compensation that a
Participant elects to defer in accordance with Section 3.1
hereof.
1.8
Deferral Election
The separate agreement, submitted to
the Administrator, by which an Eligible Director agrees to
participate in the Plan and make Deferrals thereto for a Plan
Year.
1.9
Director
Any person serving on the
Board.
1.10
Effective Date
January 1, 2010.
1.11
Eligible Director
Each non-employee member of the
Board.
1.12
Investment Fund
Each investment(s) which serves
as a means to measure value, increases or decreases with respect to
a Participant’s Accounts.
1.13
Participant
An Eligible Director who is a
Participant as provided in Article 2.
1.14
Plan Sponsor
Overstock.com, Inc.
1.15
Plan Year
Calendar year.
1.16
Retirement
Retirement shall mean a
Participant’s Separation from Service from the Board of
Directors.
1.17
Separation from
Service
Provided that such term shall be
interpreted within the meaning of regulations promulgated under
Code Section 409A, a Participant shall incur a Separation from
Service with the Service Recipient upon his or her cessation of
service as a member of the Board.
1.18
Trust
The agreement between the Plan
Sponsor and the Trustee, under which the assets of the Plan are
held, administered and managed.
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1.19
Trustee
U.S. Bank National Association or
such other successor that shall become Trustee pursuant to the
terms of the Trust.
Article 2 -
Participation
2.1
Commencement of
Participation
Each Eligible Director shall become
a Participant as of the date on which his or her Deferral Election
first becomes effective.
2.2
Loss of Eligible Director
Status
A Participant who is no longer an
Eligible Director shall not be permitted to submit a Deferral
Election and all Deferrals for such Participant shall cease as of
the end of the Plan Year in which such Participant is determined to
no longer be an Eligible Director. Amounts credited to the
Account of a Participant who is no longer an Eligible Director
shall continue to be held pursuant to the terms of the Plan and
shall be distributed as provided in Article 6.
Article 3 -
Contributions
3.1
Deferral Elections -
General
A Participant’s Deferral
Election for a Plan Year is irrevocable for that applicable Plan
Year; provided, however that a Deferral Election for a Plan Year
may be canceled if required under Section 6.8 (Unforeseeable
Emergency) of this Plan. Such amounts deferred under the Plan
shall not be made available to such Participant, except as provided
in Article 6, and shall reduce such Participant’s
Compensation from the Plan Sponsor in accordance with the
provisions of the applicable Deferral Election; provided, however,
that all such amounts shall be subject to the rights of the general
creditors of the Plan Sponsor as provided in Article 8.
The Deferral Election, in addition to the requirements set forth
below, must designate: (i) the amount of Compensation to be
deferred, (ii) the time of the distribution, and (iii) the
form of the distribution.
3.2
Time of Election
A Deferral Election shall be void if
it is not made in a timely manner as follows:
(a)
A Deferral Election with respect to
any Compensation must be submitted to the Administrator before the
beginning of the calendar year during which the amount to be
deferred will be earned. As of December 31 of each
calendar year, said Deferral Election is irrevocable for the
calendar year to which it relates.
(b)
Notwithstanding the foregoing and in
the discretion of the Plan Sponsor, in a year in which an Eligible
Director is first eligible to participate, and provided that such
Eligible Director is not eligible to participate in any other
similar account balance arrangement subject to Code
Section 409A, such Deferral Election may be submitted within
thirty (30) days after the date on which the Eligible Director is
first eligible to participate, and such Deferral
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Election shall apply to Compensation to be paid
for services to be performed during the remainder of the calendar
year after such election is made.
3.3
Distribution Elections
At the time a Participant makes a
Deferral Election, he or she must also elect the time and form of
the distribution by establishing one or more In-Service
Account(s) or Retirement Account(s) as provided in
Sections 5.1 and 6.1. If the Participant fails to properly
designate the time and form of a distribution, the
Participant’s Account shall be designated as a Retirement
Account and shall be paid in a lump sum.
3.4
Additional Requirements
The Deferral Election, subject to
the limitations set forth in Sections 3.1 and 3.2 hereof, shall
comply with the following additional requirements, or as otherwise
required by the Administrator in its sole discretion:
(a)
Deferrals may be made in whole
percentages or stated dollar amounts with such limitations as
determined by the Administrator.
(b)
The maximum amount that may be
deferred each Plan Year is one-hundred percent (100%) of the
Participant’s Compensation.
(c)
The distribution year for an
In-Service Account must be at least two (2) Plan Years
subsequent to the Plan Year in which the Participant first
establishes the In-Service subaccount to be credited with
contributions.
3.5
Crediting of
Contributions
Deferrals shall be credited to a
Participant’s Account, and if applicable transferred to the
Trust, at such time as the Plan Sponsor shall determine.
Article 4 - Vesting
4.1
Vesting of Deferrals
A Participant shall be one-hundred
percent (100%) vested in his or her Account attributable to
Deferrals and any earnings or losses on the investment of such
Deferrals.
Article 5 -
Accounts
5.1
Accounts
The Administrator shall establish
and maintain a bookkeeping account in the name of each
Participant. The Administrator shall also establish
sub-accounts as provided in subsection (a) and (b), below, as
elected by the Participant pursuant to Article 3. A
Participant may have a maximum of ten (10) sub-accounts at any
time.
(a)
A Participant may establish one or
more Retirement Account(s) (“Retirement
sub-accounts”) by designating as such on the
Participant’s Deferral Election. Each
Participant’s Retirement sub-account shall be credited with
Deferrals (as specified in the
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Participant’s Deferral Election) and the
Participant’s allocable share of any earnings or losses on
the foregoing.
(b)
A Participant may establish one or
more In-Service Accounts (“In-Service sub-accounts”) by
designating as such in the Participant’s Deferral Election
the year in which payment shall be made. Each
Participant’s In-Service sub-account shall be credited with
Deferrals (as specified in the Participant’s Deferral
Election) and the Participant’s allocable share of any
earnings or losses on the foregoing.
5.2
Investments, Gains and
Losses
(a)
A Participant may direct that his or
her Retirement sub-accounts and or In-Service sub-accounts
established pursuant to Section 5.1 may be valued as if they
were invested in one or more Investment Funds as selected by the
Plan Sponsor in multiples of one percent (1%). The Plan
Sponsor may from time to time, at the discretion of the
Administrator, change the Investment Funds for purposes of this
Plan.
(b)
The Administrator shall adjust the
amounts credited to each Participant’s Account to reflect
Deferrals, investment experience, distributions and any other
appropriate adjustments. Such adjustments shall be made as
frequently as is administratively feasible.
(c)
A Participant may change his or her
selection of Investment Funds no more than six (6) times each
Plan Year with respect to his or her Account or sub-accounts by
filing a new election in accordance with procedures established by
the Administrator. An election shall be effective as soon as
administratively feasible following the date the change is
submitted on a form prescribed by the Administrator.
(d)
Notwithstanding the
Participant’s ability to designate the Investment Fund in
which his or her deferred Compensation shall be deemed invested,
the Plan Sponsor shall have no obligation to invest any funds in
accordance with the Participant’s election.
Participants’ Accounts shall merely be bookkeeping entries on
the Plan Sponsor’s books, and no Participant shall obtain any
property right or interest in any Investment Fund.
Article 6 -
Distributions
6.1
Distribution Election
Each Participant shall designate in
his or her Deferral Election the form and timing of his or her
distribution by indicating the type of sub-account as described
under Section 5.1, and by designating the form in which
payments shall be made from the choices available under
Section 6.2 and 6.3 hereof. Notwithstanding anything to
the contrary contained herein provided, no acceleration of the time
or schedule of payments under the Plan shall occur except as
permitted under this Plan, Code Section 409A and the
regulations thereunder.
6.2
Distributions Upon an In-Service
Account Triggering Date
In-Service sub-account distributions
shall begin as soon as administratively feasible but no later than
ninety (90) days following January 1 of the calendar year
designated by the
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Participant on a properly submitted Deferral
Election, and are payable in either a lump-sum payment or
substantially equal annual installments, as described in
Section 6.4 below, over a period of up to ten (10) years
as elected by
