THEBLACK & DECKER SUPPLEMENTALEXECUTIVE RETIREMENT PLAN Amendedand Restated Effective as of January1, 2008 THEBLACK & DECKER SUPPLEMENTALEXECUTIVE RETIREMENT PLAN TABLE OFCONTENTS

Amended and Restated Effective as of

January 1, 2008

 

 

This Plan provides certain supplemental retirement benefits for selected executive employees of The Black & Decker Corporation and its subsidiaries and affiliates.  This Plan is intended to provide supplemental retirement benefits primarily for a select group of management or highly paid executive employees.  This document amends and fully restates The Black & Decker Supplemental Executive Retirement Plan effective as of January 1, 2008.  The terms of this amended and restated document shall apply to Participants whose Separation from Service occurs on or after January 1, 2008.  The benefits under this Plan with respect to any Participant whose Separation from Service occurred prior to January 1, 2008 shall be determined under the terms of this Plan in effect on the date of such Participant’s Separation from Service without regard to amendments made to this Plan thereafter.

Each of the following terms in this Plan has the meaning indicated, unless a different meaning is plainly implied by the context:

“Accelerated Payment Method” means one of the methods of payment described in Section 7(c).

“Actuarial Equivalent” means a benefit having the same actuarial value, based on the actuarial assumptions used in calculating benefits under The Black & Decker Pension Plan, and such other reasonable actuarial assumptions and methods that may be adopted by the Committee from time to time, in its sole discretion, for use in determining benefits under this Plan. Notwithstanding the foregoing, in the event a Participant has elected to receive an Accelerated Payment Method, the amount of the lump sum payment or installment payments (including the spouse’s benefit) shall be calculated (A) using (i) an interest rate equal to four and one-half percent (4.5%) and (ii) the 1994 Group Annuity Reserving Table (determined on a unisex basis and projected to 2002, all as described in IRS Revenue Ruling 2001-62); (B) assuming that (i) the Participant will earn no wages subject to the Social Security Act, (ii) the Participant will not further accrue any Other Retirement Benefits after his or her Benefit Determination Date, (iii) the Participant’s retirement benefits under the Social Security Act and all Other Retirement Benefits will begin at the earliest date they are available after the Participant’s Benefit Determination Date, and (iv) the Participant, if married, will elect the form of payment for the Other Retirement Benefits that provides his or her spouse the largest benefit following the Participant’s death; and (C) using such other reasonable actuarial assumptions and methods that may be adopted by the Committee from time to time, in its sole discretion, for this purpose.

“Benefit Determination Date” means the later of the first day of the calendar month coincident with or next following the Participant’s Termination Date or the Participant’s Early Retirement Date.  Notwithstanding the foregoing, if a Participant’s Separation from Service occurs due to Disability prior to the Participant’s Normal Retirement Date, the Participant’s Benefit Determination Date shall mean the Participant’s Normal Retirement Date.

“Black & Decker” means the Corporation and all of its direct and indirect subsidiaries and its affiliates.

“Change in Control of the Corporation” means a change in control of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A promul­gated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), whether or not the Corporation is in fact required to comply therewith, provided that, without limitation, such a change in control shall be deemed to have occurred if (A) any “person” (as that term is used in Sections 13(d) and 14(d) of the Exchange Act), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Corpo­ration or any of its subsidiaries or a corporation owned, directly or indirectly, by the stockholders of the Corporation in substantially the same pro­portions as their ownership of stock of the Corporation, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Corporation representing 35% or more of the combined voting power of the Corporation’s then outstanding securities; (B) during any period of two consecutive years, individuals who at the beginning of that period constitute the Board and any new direc­tor (other than a director designated by a person who has entered into an agreement with the Corporation to effect a transaction described in clauses (A) or (D) of this Section) whose election by the Board or nomination for election by the Corporation’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved cease for any reason to const­itute a majority of the Board; (C) the Corporation enters into an agreement, the consummation of which would result in the occur­rence of a Change in Control of the Corporation; or (D) the stockholders of the Corporation approve a merger, share exchange or consolidation of the Corporation with any other corporation or entity, other than a merger, share exchange or consolidation that would result in the voting securi­ties of the Corporation outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 60% of the combined voting power of the voting securi­ties of the Corporation or the surviving entity outstanding immediately after the merger, share exchange or consolidation, or the stock­holders of the Corporation approve a plan of complete liquidation of the Corporation or an agreement for the sale or disposition by the Corporation of all or substantially all the Corporation’s assets.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor to that statute.

 

“Committee” means the Compensation Committee of the Board.

“Credited Service” means all Benefit Service Credit as defined in and credited to the Participant under The Black & Decker Pension Plan (or that would have been credited for any period of employment by Black & Decker, if the Participant had been eligible to participate in

that plan), plus the Participant’s Salary Continuance Period.  Except as credited under The Black & Decker Pension Plan or unless otherwise determined by the Committee in its sole discretion, Credited Service under this Plan shall not include any period of employment with any company during any period when that company was not a subsidiary or affiliate of the Corporation. Credited Service also includes all periods of Disability beginning while the Participant is employed by Black & Decker and continuing as long as the Disability continues up until the Participant’s Normal Retirement Date.

 

“Effective Date” means January 1, 2008, the effective date of this amended and restated Plan. This Plan was originally effective as of January 1, 1984.

“Employee” means any person rendering personal services to Black & Decker as an employee.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

“Final Average Pay” means the average monthly amount of the Participant’s Pay for the three years (whether or not consecutive) in which the Participant’s Pay was the highest out of each of the seven-year periods that end on the following dates, whichever seven-year period produces the highest average monthly amount:

(A)

the Participant’s Termination Date;

(B)

if the Participant’s Termination Date is not December 31st of any given year, the December 31st immediately preceding the Participant’s Termination Date;

(C)

the last day of the Participant’s Salary Continuance Period, if applicable;

(D)

if the last day of the Participant’s Salary Continuance Period is not December 31st of any given year, the December 31st immediately preceding the last day of the Participant’s Salary Continuance Period, if applicable;

(E)

in the case of a Protected Participant only, the date of the applicable Change in Control of the Corporation; and

(F)

in the case of a Protected Participant only, if the date of the applicable Change in Control of the Corporation is not December 31st of any given year, the December 31st immediately preceding the date of the applicable Change in Control of the Corporation.

deferral, amounts deferred by the Participant under any non­qualified deferred compensation plan (such as The Black & Decker Supplemental Retirement Savings Plan), (C) salary continuation payments during sick leave and other authorized leaves of absence (other than long-term disability benefits) and (D) the Participant’s Salary Continuance Payments credited as Pay ratably over the Participant’s Salary Continuance Period.  The term “Pay” does not include any (A) amounts paid pursuant to any long-range performance compensation plan, including The Black & Decker Performance Equity Plan, The Black & Decker Long-Term Incentive Plan, and The Black & Decker 2008 Executive Long-Term Incentive/Retention Plan, and The Black & Decker Long-Term Management Compensation Plan; (B) any non-cash remuneration, imputed income, perquisites and other cash or non-cash fringe benefits, such as (but not limited to) reimbursements or allowances for expenses (such as automobile, moving or relocation, country club, financial or tax counseling, tax preparation, overseas housing, educational and similar expense allowances), (C) stock bonuses, income attributable to discount stock purchases, stock options, restricted stock, restricted stock units, dividends, dividend equivalents or stock appreciation rights, (D) any other income attributable to the vesting of restricted property or benefits under any plan or arrangement, and (E) unless specifically included as Pay in the immediately preceding sentence, contributions to or benefits under any employee pension or welfare benefit plan or payments received by a Participant under any non-qualified deferred compensation plan (such as The Black & Decker Supplemental Retirement Savings Plan). For any period during which the Participant is entitled to Credited Service by reason of a Disability, the Participant’s Pay is deemed to continue during that Disability period at a monthly rate equal to 1/12th of (i) the Participant’s base salary (before any salary reduction for contributions to any employee benefit plan pursuant to a salary reduction agreement with the Participant) at the Participant’s annual salary rate in effect at the date that the Disability began, plus (ii) all items (other than base salary and such salary reduction contributions) included in the Participant’s actual Pay during the 12-month period ending on the date that the Disability began.

“Payment Date” means the latest of the Participant’s Benefit Determination Date, the date that is six (6) months and one (1) day after the Participant’s Separation from Service or, if the Participant has elected to defer his or her Payment Date pursuant to Section 7(c), the Payment Date so elected by the Participant; except that (A) the death benefits payable to a Participant’s spouse shall be paid at the date specified in Section 5; and (B) in the case of a Participant whose Separation from Service occurs due to Disability prior to such Participant’s Normal Retirement Date, the Participant’s Payment Date shall be the Participant’s Normal Retirement Date.  Notwithstanding anything to the contrary, if the Committee reasonably determines that the making of any payment to a Participant under this Plan will violate federal securities laws or other applicable law, the Committee may delay a Participant’s Payment Date until the earliest date at which the Committee determines that the making of that payment will not violate those laws.

 

payment or periodically.  Notwithstanding anything to the contrary, a Participant’s Salary Continuance Period will be taken into account under this Plan only if the Participant is entitled to Salary Continuance Payments at the effective date of the Participant’s termination of employment with Black & Decker.

 

 

 

 

No benefits under this Plan are payable after the Participant’s death except as otherwise provided in this Section 5.

(a)           Eligibility for Death Benefit.  In the case of a Participant (other than a Protected Participant) who dies before attaining the Early Retirement Date, no benefits under this Plan are payable after the Participant’s death.  In the case of a Participant (other than a Protected Participant) who dies after attaining the Early Retirement Date, except as otherwise provided in Section 5(c), the Participant’s surviving spouse, if any, is entitled to receive the spouse’s death benefit described in Section 5(b).  In the case of any Protected Participant who dies at any time, except as otherwise provided in Section 5(c), the Protected Participant’s surviving spouse, if any, is entitled to receive the spouse’s death benefit described in Section 5(b).  The Participant’s spouse who is entitled to receive the payment(s) under this Section 5 shall be the person, if any, of the opposite sex to whom the Participant is legally married at the Participant’s Payment Date or the Participant’s death, which ever happens first.

(b)           Spouse’s Death Benefit.  The spouse’s death benefit under this Section 5(b) shall be a monthly payment for the spouse’s life beginning on the first day of the calendar month coincident with or immediately following the date of the Participant’s death (or, in the case of a Protected Participant only, the date that would have been the Protected Participant’s 55th birthday, if later than his or her date of death).  The amount of the spouse’s monthly payment shall be equal to (i) one-half (50%) of the monthly benefit (determined under Section 3, but before the offsets under Section 4) that the Participant was receiving or would have been entitled to receive as of the date of the Participant’s death minus (ii) the offsets under Section 4.

(c)           Death Benefit under Accelerated Payment Method. In the event a Participant had validly elected the Accelerated Payment Method and dies before his or her Separation from Service, the Participant’s spouse, if any, shall receive the Actuarial Equivalent of the spouse’s death benefit under Section 5(b), payable in five (5) annual installment payments, if the Participant died before reaching age 65, or in a lump sum payment, if the Participant died on or after his or her 65th birthday, with the payment(s) beginning on the date the spouse’s death benefit would have commenced under Section 5(b).  If the Participant dies before his or her Separation from Service and has no surviving spouse, then no benefit shall be payable to anyone under this Plan with respect to the Participant.  If the Participant dies after his or her Separation from Service but before receiving the lump sum payment or all of the five (5) annual installment payments as elected under Section 7(c), then that lump sum payment or the remaining installment payments shall be paid to the Participant’s spouse or, if the Participant has no surviving spouse, to the Participant’s estate, at the time those payments would have been paid to the Participant. The Participant’s spouse who is entitled to receive the payment(s) under this Section 5(c) shall be the person, if any, of the opposite sex to whom the participant is legally married at the Participant’s death.

 

 

 

of a Participant under any other benefit plan provided by Black & Decker, and the rights and interests of a Participant to any benefits or as a participant or beneficiary in or under any or all such plans shall continue in full force and effect unimpaired, subject nonetheless to the eligibility requirements and other terms of each such plan. This Section shall not be interpreted as modifying in any way the effect that the Participant’s termination of employment and retirement has upon the Participant’s rights under such other plans. The benefits provided under this Plan are not to be applied as an offset against any other retirement or deferred compensation benefits or payments that are otherwise to be provided by Black & Decker to the Participant or the Participant’s beneficiaries; and those benefits or payments are to be calculated first, ignoring this Plan’s existence.  In no event shall any benefits payable under this Plan be treated as salary or other compensation to a Participant for the purpose of computing benefits to which the Participant may be entitled under any other benefit plan of Black & Decker.

This Plan shall not be construed as conferring any legal rights upon any Participant for continuation of employment, nor shall it interfere with the rights of Black & Decker to discharge a Participant and to treat the Participant without regard to the effect which such treatment might have upon the Participant under this Plan.

Each Participant (and surviving spouse) shall perform any and all reasonable acts and execute any and all reasonable documents and papers that are necessary or desirable for carrying out this Plan or any of its provisions.

 

 respect of this Plan shall be binding and conclusive on all persons for all purposes, subject only to review by an arbitrator in accordance with the provisions and standards set forth in Section 13(b).  It is intended that this Plan comply with Section 409A of the Code and any regulations or guidance issued thereunder and shall be interpreted accordingly. Notwithstanding the amendment pro­visions of Section 16, this Plan may be amended by the Board at any time, retroactively if required, if found necessary, in the opinion of the Board, to conform this Plan to the provisions and requirements of Section 409A of the Code. No such amendment shall be considered prejudicial to any interest of a Participant or his or her spouse. Any provision of this Plan not in conformance with Section 409A of the Code shall be void.

(c)           Committee’s Liability and Indemnification.  Neither the Committee nor any person acting on its behalf shall be liable to any person for any action taken or omitted in connection with the interpretation and administration of this Plan unless attributable to gross negligence or willful misconduct. In addition to such other rights of indemnification they may have as directors, officers or employees of the Corporation, each member of the Committee shall be indemnified by the Corporation against the reasonable expenses, including attorneys’ fees, actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal therein, to which such member may be a party by reason of any action taken or omitted under or in connection with this Plan, and against all amounts paid in settlement thereof, provided such settlement is approved by independent legal counsel selected by the Corporation, or paid by such member in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such member is liable for gross negligence or willful misconduct in such member’s duties; provided that within 60 days after the institution of such action, suit or proceeding the member shall in writing offer the Corporation the opportunity, at its own expense, to handle and defend the same.

(d)           Self-Dealing.  If a Participant is also a member of the Committee, the Participant may not vote or act upon matters relating specifically to such member’s participation in this Plan.

The Board reserves the right at any time and from time to time to the extent permissible under law, to amend or terminate this Plan, prospectively or retroactively, in whole or in part; provided, however, that no such amendment or termination shall (A) have the effect of accelerating or permitting the acceleration of any payment under this Plan, except to the extent that such acceleration would be permitted under Section 409A of the Code, or (B) without the Participant’s written agreement, reduce or impair (i) the benefits or rights of any Participant (or spouse) whose Benefit Determination Date occurred before the date the amendment is adopted or this Plan is terminated, (ii) the vested benefits and rights of any Participant who is then employed by Black & Decker or (iii) the right of any Protected Participant and/or his or her surviving spouse to receive benefits under this Plan determined as if that Plan termination or amendment had not occurred.  Any amendment or termination shall be adopted by resolution of the Board.