Exhibit 10.1
THE MANITOWOC COMPANY,
INC.
DEFERRED COMPENSATION
PLAN
Effective June 30,
1993
and
Amended and Restated Through
December 31, 2008
Table of Contents
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Page
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ARTICLE 1
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PURPOSE AND EFFECTIVE
DATE
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1
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ARTICLE 2
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DEFINITIONS
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2
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ARTICLE 3
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AGREEMENTS AND ELECTIONS TO
DEFER
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8
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ARTICLE 4
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INVESTMENT DIRECTIONS
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10
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ARTICLE 5
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DISTRIBUTIONS
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11
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ARTICLE 6
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ACCOUNTS
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13
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ARTICLE 7
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EMPLOYER CONTRIBUTIONS
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14
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ARTICLE 8
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MANITOWOC STOCK
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15
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ARTICLE 9
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GENERAL PROVISIONS
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16
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December 31, 2008
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Amended for 409A
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ARTICLE 1
PURPOSE AND EFFECTIVE
DATE
Section 1.1
Purpose .
The purpose of
The Manitowoc Company, Inc. Deferred Compensation Plan (the
“Plan”) is to promote the best interests of The
Manitowoc Company, Inc. (the “Company”) and its
subsidiaries and affiliates and the stockholders of the Company by
(1) attracting and retaining well-qualified persons for
service as non-employee directors of the Company and promoting
identity of interest between directors and stockholders of the
Company; and (2) attracting and retaining key management
employees possessing a strong interest in the successful operation
of The Manitowoc Company, Inc. and its subsidiaries and
affiliates (collectively referred to herein as the
“Employer”) and encouraging their continued loyalty,
service, and counsel to the Employer. It is intended that the
Plan will allow participants to elect voluntarily to defer and
convert, in the case of non-employee directors, all or a portion of
their retainer and meeting fees for services as a director and, in
the case of key employees, a portion of their compensation, into
Manitowoc Stock and other investments for payment upon retirement,
death, disability, or designated distribution date.
Section 1.2
Effective Date of Plan and Prior Amendments .
The effective
date of the Plan is June 30, 1993. The Plan was amended
and restated on May 7, 1996, to permit participation by key
employees of subsidiaries adopting the Plan and on
February 18, 1997, to conform to Rule 16b-3. The
Plan was further amended as of March 31, 2002, to modify
investment options under the Plan and to simplify
rules pertaining to distribution elections.
Section 1.3
Grandfathered Accounts and Code Section 409A
.
Effective December 31, 2008,
the Plan was amended and restated to reflect the requirements of
Code Section 409A, the Company’s good faith compliance
with Code Section 409A between October 3, 2004 and
December 31, 2008 and other interim Plan amendments. All
benefits that were earned and vested on or before December 31,
2004 are “grandfathered” within the meaning of IRS
Notice 2005-1 and any provision in this restated Plan document that
would otherwise cause such grandfathered amounts to be
“materially modified” at anytime after October 3,
2004 shall be deemed amended or deleted to the extent necessary to
ensure that those amounts do not become subject to Code
Section 409A.
1
ARTICLE 2
DEFINITIONS
The following terms have the
following meanings unless the context clearly indicates
otherwise:
Section 2.1
Administrator .
“Administrator” means a
committee of the Board composed of not less than two directors,
each of whom shall qualify as a “Non-Employee Director”
within the meaning of Rule 16b-3, or such other committee or
officer of the Company designated by the Board.
Section 2.2
Agreement .
“Agreement” means the
agreement (as approved as to form by the Administrator) entered
into between the Employer and a Participant, whereby the
Participant agrees to defer a portion of the Participant’s
Compensation pursuant to the provisions of the Plan and the
Employer agrees to make benefit payments in accordance with the
terms of the Plan. An Agreement may be an “Initial
Agreement” applicable to a Participant or a “Modified
Agreement.”
Section 2.3
Beneficiary .
“Beneficiary” means the
person or entity designated by the Participant to be the
beneficiary of the Deferred Compensation Account of the
Participant. If a valid designation of Beneficiary is not in
effect at the time of the death of a Participant, the estate of the
Participant is deemed to be the sole Beneficiary of such
Account. If a Participant dies before receiving full
distribution of such Participant’s Account, any remaining
distributions shall be made to the Beneficiary. If a
Beneficiary dies while entitled to receive distributions from the
Plan, any remaining payments shall be paid to the estate of the
Beneficiary. Beneficiary designations shall be in writing,
filed with the Administrator, and in such form as the Administrator
may prescribe for this purpose.
Section 2.4
Board .
“Board” means the Board
of Directors of the Company.
Section 2.5
Change of Control .
“Change of Control”
means, for Grandfathered Accounts, the first to occur of the
following:
(a)
The acquisition by any person or entity, or group thereof acting in
concert, of beneficial ownership of securities of the Company
which, together with securities previously owned, confer upon the
holder the voting power, on all matters brought to a vote of
stockholders, of thirty percent (30%) or more of all the then
outstanding shares of the Company.
2
(b)
The sale, assignment or transfer of assets (or earning power) of
the Company or any subsidiary or subsidiaries, in a transaction or
series of transactions, to a twenty percent (20%) stockholder (as
herein defined) or any affiliate of a twenty percent (20%)
stockholder, if the aggregate market value thereof exceeds fifty
percent (50%) of the aggregate book value, determined by the
Company in accordance with generally accepted accounting
principles, of all the assets (or earning power) of the Company
determined on a consolidated basis before such transaction or the
first of such transactions, unless the Board approved such
transaction or transactions before the date on which the twenty
percent (20%) stockholder became a twenty percent (20%)
stockholder. For purposes of this definition of Change of
Control, a twenty percent (20%) stockholder means any person,
entity, or group of persons and/or entities acting in concert, who
or which, together with such stockholder, and its or their
affiliates and associates, is the beneficial owner of securities of
the Company which confer upon the holder the voting power, on all
matters brought to a vote of stockholders, of twenty percent (20%)
or more of all the then outstanding shares of the
Company.
(c)
The merger or consolidation of the Company (or of one or more
subsidiaries of the Company, in a transaction or series of
transactions, if the aggregate book value of the assets thereof
exceeds fifty percent (50%) of the aggregate book value of all the
assets of the Company determined on a consolidated basis before
such transaction or the first of such transactions), with or into a
twenty percent (20%) stockholder or any affiliate of a twenty
percent (20%) stockholder, unless the Board approved such merger or
consolidation before the date on which the twenty percent (20%)
stockholder first became a twenty percent (20%)
stockholder.
(d)
The dissolution of the Company, unless the Board approved such
dissolution before the date on which the twenty percent (20%)
stockholder first became a twenty percent (20%)
stockholder.
(e)
Change in the composition of the Board after which a majority of
the members thereof are not continuing directors. Continuing
director, for this purpose, means (i) any member of the Board
while such person is a member of the Board, who is not an acquiring
person, or an affiliate or associate of an acquiring person, or a
representative of an acquiring person or of any such affiliate or
associate, and was a member of the Board prior to July 4,
1993, or (ii) any person who subsequently becomes a member of
the Board, who is not an acquiring person, or an affiliate or
associate of an acquiring person, or a representative of an
acquiring person or of any such affiliate or associate, if such
person’s nomination for election or election to the Board is
recommended or approved by a majority of the continuing
directors. As used herein, affiliate and associate shall have
the respective meanings ascribed to such terms in Rule 12b-2
under the Exchange Act.
(f)
The commencement (within the meaning of Rule 14d-2 of the
General Rules and Regulations under the Exchange Act) of a
tender or exchange offer which, if successful, would result in a
change of control of the Company.
(g)
A determination by the Board, in view of then current circumstances
or impending events, that a change of control of the Company has
occurred or is imminent, which determination shall be made for the
specific purpose of triggering the operative provisions of the
Company’s contingent employment agreements.
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For Non-Grandfathered Accounts, a
“Change of Control” means the first event that would be
a “Change of Control” for a Grandfathered Account
and which would also satisfy the requirements of Code
Section 409A(a)(2)(A)(v).
Section 2.6
Company .
“Company” means The
Manitowoc Company, Inc., a Wisconsin corporation, or any
successor corporation.
Section 2.7
Code .
“Code” means the
Internal Revenue Code of 1986, as interpreted by regulations and
rulings issued pursuant thereto, all as amended and in effect from
time to time.
Section 2.8
Compensation .
“Compensation” means
(i) for non-employee director Participants, the Retainer Fee
and (ii) for key employee Participants,
“Compensation” has the same meaning as the term
“eligible compensation,” as defined in The Manitowoc
Company, Inc. 401(k) Retirement Plan and incorporated
herein by this reference, without regard to the dollar limits
applied to that definition by Code Section 401(a)(17), and
without regard to whether such Participants are eligible to
participate in the 401(k) Retirement Plan.
Section 2.9
Date .
“Date” means the date an
Initial Agreement, a Modified Agreement, or a Form is received
by the Administrator.
Section 2.10
Deferred Compensation Account; Account; Sub-Account
.
“Deferred Compensation
Account” generally refers to a Participant’s entire
interest in the Plan. “Account” generally refers
to a Participant’s entire interest in Program A and Program
B, separately. “Sub-Account” means the separate
accounts maintained under Program B.
Section 2.11
Disability .
“Disability” means:
(a) for Grandfathered Accounts, a disability as set forth in
Code Section 22(e)(3); and (b) for Non-Grandfathered
Accounts, a situation that would allow a distribution under Code
Section 409A(a)(2)(A)(ii). Code Sections
409A(a)(2)(A)(ii) and 409A(a)(2)(C) provide that a
Participant shall be considered “disabled” only when he
or she: (a) 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 12
months; or (b) 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 12 months, receiving income replacement benefits for a
period of not less than 3 months under an accident and health plan
covering employees of the Employer.
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Section 2.12
Distribution Date .
“Distribution Date”
means the date designated by a Participant in the
Participant’s Distribution Election Form for the
commencement of payment of amounts credited to the
Participant’s Accounts.
Section 2.13
Employer .
“Employer” means the
Company and each subsidiary and affiliate of the Company which
adopts this Plan.
Section 2.14
Employer Contribution .
“Employer Contribution”
means the amount of contribution which may be made each year on
behalf of key employee Participants, as described in
Article 7.
Section 2.15
Exchange Act .
“Exchange Act” means the
Securities Exchange Act of 1934, as amended from time to
time.
Section 2.16
Forms .
Each of the
following, as approved by the Administrator and properly completed
by the Participant, is a “Form” under the
Plan:
(a)
“Beneficiary Designation Form” is used to designate a
Participant’s Beneficiaries. A Beneficiary Designation
may, but is not required, to specify the form of payment from those
available under the Plan. A Beneficiary Designation may, but
is not required, to designate contingent Beneficiaries.
(b)
“Distribution Election Form” is used to designate the
form and timing of distributions to be made to a Participant from
the Participant’s Accounts in the Plan. Separate
Distribution Election Forms may be filed for a Participant’s
Program A Account and Program B Account. If only one
Distribution Election Form is on file with the Plan it shall
apply to Accounts of the Participant in both Program A and Program
B. No Distribution Election Form other than the
Form filed at the commencement of Plan participation can be
given effect until it has been on file with the Administrator for
12 months. For Non-Grandfathered Accounts, a new or modified
Distribution Election Form must either: (i) meet one of
the exemptions set forth in IRS Notice 2007-86, Notice 2006-79 or
Notice 2005-1; or (ii) further delay the commencement of any
amount previously deferred by a minimum of 5 additional
years.
(c)
“Hardship Distribution Request Form” is used to request
a hardship distribution of amounts credited to a
Participant’s Accounts. Hardship distributions shall be
drawn from Program B and then Program A Accounts, in that
order.
(d)
“New Investment Direction Form” is used to change
investment directions prospectively under the Plan as to new
deferral amounts.
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(e)
“Investment Transfer Form” is used to transfer funds
from one Program B Sub-Account to another. Investment
Transfer Forms cannot be used in Program A effective March 31,
2002.
Section 2.18
Grandfathered Account .
“Grandfathered Account”
refers to all or any part of a Participant’s Account that was
earned and fully vested as of December 31, 2004. If, at
any time, this Plan, any Agreement, any Form or any other
administrative policy is amended or interpreted to cause a
“material modification” that would cause a
Grandfathered Account to be subject to Code Section 409A, such
amendment, interpretation or change shall be deemed amended or
modified to the extent that no Grandfathered Amount will be subject
to Code Section 409A. If necessary to avoid the
application of Code Section 409A or to provide guidance as the
result of the application of the preceding provisions, the terms of
the Plan, as in effect on October 3, 2004, shall apply to all
Grandfathered Accounts.
Section 2.19
Manitowoc Stock .
“Manitowoc Stock” means
the common stock, $.01 par value, of the Company.
Section 2.20
Non-Grandfathered Account .
“Non-Grandfathered
Account” refers to all or any part of a Participant’s
Account that was not earned and fully vested as of
December 31, 2004. Non-Grandfathered Accounts are
subject to Code Section 409A and the provisions of this Plan
shall be interpreted and applied with the intent to ensure that no
benefits are subject to taxation before the date when such benefits
are paid to a Participant or Beneficiary. Nothing in this
Plan, any Agreement, any Form or related document shall be
construed or interpreted as a guarantee of any particular tax
consequences.
Section 2.21
Participant .
“Participant” means any
non-employee member of the Board and any eligible employee of an
Employer who has executed an Agreement. Key employee status
for a Plan Year is determined as of the last day of the immediately
preceding Plan Year, or, as to newly-hired employees in their first
year of employment, at time of hire based on current base rate of
pay. Key employees, for all Plan purposes, include only
elected officers of the Company and other “highly compensated
employees.” For purposes of this Section, “highly
compensated employees” means any employee of an Employer
who: (a) for all Plan Years beginning on or after
January 1, 2004, has been employed by one or more
Employer(s) for at least one year at a salary grade of 210 or
higher and who continues to be employed by an Employer at such a
salary grade on the last day of the preceding Plan Year; or
(b) for all Plan Years beginning before January 1, 2004,
received Compensation in a Plan Year equal to or greater than the
indexed amount described in Code Section 414(q)(1).
Notwithstanding the preceding sentence, any employee who was an
eligible highly compensated employee and who made contributions to
the Plan during the 2003 Plan Year, shall continue to remain a key
employee for so long as the individual would have continued to
satisfy the eligibility requirements that were in effect prior to
January 1, 2004. An individual who temporarily continues
eligibility under this transition rule
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and who later ceases to satisfy the prior
requirements must satisfy the new requirements in order to again be
eligible to participate in the Plan. A Participant who ceases
to be a non-employee director or a key employee shall cease making
deferrals as of the first day of the Plan Year following such loss
of eligibility, but shall remain an inactive Participant until all
amounts due such person under the Plan have been distributed in
full. Plan Year
Section 2.22
Plan Year .
“Plan Year” means the
fiscal year of the Company.
Section 2.23
Program A .
“Program A,” effective
March 31, 2002, is deemed to be solely invested in Manitowoc
Stock. Any dividends paid on shares of Manitowoc Stock deemed
to be held under Program A are deemed to be reinvested in Manitowoc
Stock under Program A, in accordance with rules and procedures
established by the Administrator. There are no investment
options in Program A. Effective March 31, 2002, the
funds in Program A cannot be transferred at any time to Program
B. All distributions under the Plan from Program A must be
made in Manitowoc Stock, except fractional shares may be paid in
cash. Any Manitowoc Stock that may be held in trust pursuant
to the Plan in connection with Program A will be held in a trust
that is completely separate from any trust that may hold assets
pursuant to the Plan in connection with Program B.
Section 2.24
Program B .
“Program B,” effective
March 31, 2002, is deemed to consist of Sub-Accounts, each of
which is deemed to be invested in a designated mutual fund.
Any dividends paid on such mutual funds shall be deemed to be
reinvested in the applicable Sub-Account. Manitowoc Stock is
not an investment option in Program B. Funds deemed to be
invested pursuant to Program B cannot be transferred at any time to
Program A. All distributions from Program B must be made in
cash. Any assets that may be held in trust pursuant to the
Plan in connection with Program B will be held in a trust that is
completely separate from any trust that may hold assets pursuant to
the Plan in connection with Program A.
Section 2.25
Retainer Fee .
“Retainer Fee” means
those fees paid by the Company to non-employee directors for
services rendered on the Board or any committee of the Board,
including attendance fees and fees for serving as committee
chair. Any Retainer Fee payable for services during a month
is deemed to accrue to the non-employee director on the first day
of such month for Plan purposes.
Section 2.26
Rule 16b-3 .
“Rule 16b-3” means
Rule 16b-3 of the General Rules and Regulations under the
Exchange Act as promulgated by the Securities Exchange Commission
or its successor, as amended and in effect from time to
time.
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Section 2.27
Separation .
“Separation” means a
“separation from service” within the meaning of Code
Section 409A(2)(A)(i).
ARTICLE 3
AGREEMENTS AND ELECTIONS TO
DEFER
Section 3.1
Initial Deferrals .
Each new non-employee director and
new key employee shall be entitled to defer Compensation accruing
on and after the first day of the month following such
person’s Initial Agreement Date, provided such Initial
Agreement Date is not more than thirty (30) days after the
D
