CommScope Deferred Compensation Plan

EX-10.41 3 comm-ex1041_1002.htm EX-10.41 comm-ex1041_1002.htm

 

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Table of Contents

 

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ARTICLE I INTRODUCTION

1.1Introduction and Purpose

The CommScope Deferred Compensation Plan (the “Plan”) is established by CommScope Holding Company, Inc. (the “Company”) for the purpose of providing deferred compensation for a select group of management or highly compensated employees who contribute materially to the continued growth, development and future business success of the Company and its subsidiaries. This Plan is intended to enhance the long-term performance and retention of such management or highly compensated employees selected to participate in this Plan.

The Plan is intended to constitute a nonqualified, unfunded plan for federal tax purposes and for purposes of Title I of the Employee Retirement Income Security Act of 1974, as amended from time to time (“ERISA”). Further, this Plan is intended to comply with Code Section 409A and is to be construed in accordance Code Section 409A, the Code Section 409A Regulations, and such additional regulatory and/or other guidance as may be issued by the Internal Revenue Service (“IRS”) or the U.S. Department of Treasury (“Treasury”) from time to time with respect to Code Section 409A.

Without affecting the validity of any other provision of the Plan, to the extent that any Plan provision does not meet the requirements of Code Section 409A and the Code Section 409A Regulations (including modifications and amendments thereto), the Plan shall be construed and administered as necessary to comply with such requirements until this Plan is appropriately amended to comply with such requirements.

This Plan shall function solely as a “top-hat” plan within the meaning of Sections 201(2), 301(a)(3), and 401(a)(1) of ERISA. Distributions required or contemplated by this Plan or actions required to be taken under this Plan shall not be construed as creating a trust of any kind or a fiduciary relationship between the Company and any Participant, any Participant’s designated beneficiary, or any other person.

This Plan is to be maintained according to the terms of this document and the Committee or its designee shall have the sole authority to construe, interpret and administer the Plan.

The Plan was originally effective October 1, 2012.  The Plan was subsequently amended in 2015 in connection with the Company’s acquisition of TE Connectivity, Ltd. on August 28, 2015.  The Plan has been further amended and restated effective as of January 1, 2017.

 

ARTICLE II DEFINITIONS

Wherever used in the Plan, the following terms have the meanings set forth below, unless otherwise expressly provided:

2.1 Account(s)

Account(s) means the separate accounts established for recordkeeping purposes only for each Participant comprised of the Base Salary Deferral Accounts, the Discretionary Bonus Award

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Accounts, the Annual Incentive Plan Award Accounts, and the Discretionary Credit accounts as further described in Article IV of the Plan.

2.2Active Participant

Active Participant means a Participant in the Plan (or similar plan(s) maintained by the Company subject to Code Section 409A and the Code Section 409A Regulations determined under the aggregation provisions) eligible to make deferrals or receive employer credits; even if he or she has not elected to defer compensation under the Plan terms or receive an employer credit under the Plan terms, other than earnings on amounts previously deferred or credited under the Plan terms.

2.3 Affiliated Company

Affiliated Company means (i) the Company, (ii) any other corporation which is a member of the controlled group of corporations which includes the Company, provided that in applying Code Section 1563(a)(1), (2), and (3) for purposes of determining a controlled group of corporations under Code Section 414(b) and determining trades or businesses under common control for purposes of Code Section 414(c) 50 percent (50%) is substituted for 80 percent (80%) each time used, and (iii) any other entity in which the Company has a significant equity interest or owns a substantial capital or profits interest.

2.4Base Salary Deferral Accounts

Base Salary Deferral Accounts means the separate accounts established by the Committee for recordkeeping purposes only in the name of each Participant in accordance with Section 4.1 of the Plan.

2.5Base Salary Deferral Credits

Base Salary Deferral Credits means the amounts credited to a Participant’s Base Salary Deferral Accounts in accordance with the Participant’s election pursuant to Section 4.2 of the Plan. For purposes of the Plan, deferrals by outside directors shall be treated as Base Salary Deferral Credits.

2.6Benefit Distribution Date

Benefit Distribution Date means the specific distribution date elected by the Participant as described in Section 6.3 of the Plan.

2.7BNS Participant

A Participant who (i) had an account balance under the Tyco Nonqualified Plan and (ii) became an employee of the Company as a result of the Company’s acquisition of the Broadband Network Services division of TE Connectivity Ltd. on the Closing Date without experiencing a Separation from Service.

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2.8Change in Control

Change in Control means the occurrence of any of the following events described below. Whether a Change in Control has occurred shall be objectively determinable and not subject to the discretion of the Committee, the board of directors or any other person. In all events, a transaction shall be deemed to constitute a Change in Control only to the extent consistent with the requirements of Section 409A of the Code.

(a)Change in Ownership of the Company. The acquisition by any person, entity or group of stock of the Company that, together with the stock already held by such person, entity or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company; provided that if any one person, entity or group is considered to own more than 50% of the total fair market value or total voting power of the stock of the Company, the acquisition of additional stock by the same person, entity or group shall not be considered to cause a change in ownership of the Company under this Section, or a change in effective control of the Company under subsection (b) below. An increase in the percentage of stock owned by any person, entity or group, as a result of a transaction in which the Company acquires its stock in exchange for property shall be treated as an acquisition of stock for purposes of this Section. This Section shall only apply when there is a transfer of Company stock (or issuance of Company stock) and stock of the Company remains outstanding after the transaction.

(b)Change in Effective Control of the Company. During any 12-month period, (i) the acquisition by any person, entity or group of stock of the Company that constitutes 30% or more of the total voting power of the stock of the Company, or (ii) a majority of the members of the board of directors is replaced by directors whose appointment or election is not endorsed by a majority of the members of the board of directors as constituted prior to the date of such appointment or election; provided that if any person, entity or group is considered to effectively control the Company within the meaning of this Section, the acquisition of additional control of the Company shall not be considered to cause a change in effective control of the Company under this Section, or a change ownership of the Company under subsection (a).

(c)Change in Ownership of a Substantial Portion of the Company’s Assets. During any 12-month period, the acquisition by any person, entity or group of assets of the Company that have a total gross fair market value equal to more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition. For purposes of this Section, “gross fair market value” means the value of the Company’s total assets or the value of the assets being disposed of, determined without regard to any associated liabilities. Notwithstanding the foregoing, a Change in Control shall not occur under this Section where there is a transfer of assets to an entity that is controlled by the shareholders of the Company immediately after the transfer, including:

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(d)For purposes of Section 2.8, the following rules shall apply:

2.9 Closing Date

Closing Date means August 28, 2015.  

2.10 Code

Code means the Internal Revenue Code of 1986, as amended. Where reference is made to “Code Section 409A Regulations,” this is intended to refer to Treasury Regulation Sections 1.409A-1 through –6, as such regulations may be modified, amended or supplemented by the Treasury from time to time.

2.11 Committee

Committee means the Company’s Benefits Committee, which will be responsible for the administration of the Plan pursuant to Article IX.

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2.12 Company

Company means CommScope Holding Company, Inc., a Delaware corporation, and any Affiliated Company or subsidiary.  

2.13 Compensation

Compensation means (a) with respect to Eligible Individuals who are employees, cash compensation that is compensation as defined in the CommScope, Inc. Retirement Savings Plan without regard to Code Section 401(a)(17), and (b) with respect to Eligible Individuals who are outside directors, cash compensation paid by the Company. In no event, however, shall a Participant’s Compensation include, for purposes of the Plan, any item of compensation paid or distributed to the Participant after a period of deferral, whether under this Plan or any other program of deferred compensation maintained by the Company or any Affiliated Company.

2.14 Declining Balance

Declining Balance means the method for calculating each installment payment by dividing the value of the Participant’s Accounts on the Valuation Date of each distribution by the number of installment payments remaining to be made, in accordance with rules established by the Committee.

2.15 Deferral Election

Deferral Election means the Written or electronic salary reduction agreement entered into by an Eligible Individual and the Committee pursuant to this Plan and which is made on a form and manner described in Section 4.3 of the Plan.

2.16 Disability

A Participant shall be deemed to have a condition that constitutes a “Disability” if the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.

The determination of whether a Participant is disabled may be made by any person, at the Committee’s discretion, including the administrator of a disability insurance program and the Committee itself.

2.17 Discretionary Bonus Award Accounts

Discretionary Bonus Award Accounts means the separate accounts established by the Committee for recordkeeping purposes only in the name of each Participant in accordance with Section 4.1 of the Plan.

2.18 Discretionary Bonus Award Credits

Discretionary Bonus Award Credits means the amounts previously deferred by the Participant and credited to a Participant’s Discretionary Bonus Award Accounts.

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2.19 Effective Date

Effective Date means January 1, 2017.  The original effective date of the Plan was October 1, 2012.

2.20 Eligible Individual

Eligible Individual means (a) a select group of management and other highly compensated employees of the Company and its subsidiaries as determined by the Committee, and (b) outside directors of the Company.

2.21 ERISA

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

2.22 Installment(s)

Installment(s) means an aggregate single payment for the purpose of subsequent deferral rules according to Code Section 409A and the regulations thereunder.

2.23 Investment Funds

Investment Funds means one or more notional investment alternatives made available under the Plan by the Company for designation by Participants under the Plan for purposes of determining investment earnings and losses. Unless determined otherwise by the Committee, the Investment Funds shall mirror the investment alternatives offered pursuant to the CommScope, Inc. Retirement Savings Plan from time-to-time.

2.24 Long-Term Cash Incentive Award Accounts

Long-Term Cash Incentive Award Accounts means the separate accounts established by the Committee for recordkeeping purposes only in the name of each Participant in accordance with Section 4.1 of the Plan.  

2.25 Long-Term Cash Incentive Award Credits

Long-Term Cash Incentive Award Credits means the amounts credited to a Participant’s Long-Term Cash Incentive Award Accounts in accordance with the Participant’s election pursuant to Section 4.2 of the Plan.

2.26 Participant

Participant means any present or former Eligible Individual who has become a Participant in the Plan in accordance with the provisions of Article III and who continues to have an Account balance under the Plan or whose beneficiary has such an Account balance.

2.27 Performance-Based Compensation

Performance-Based Compensation means compensation that is paid contingent on the satisfaction of pre-established objective or subjective performance criteria of at least twelve (12)

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months and constitutes “performance-based compensation” as that term is used in the Code Section 409A Regulations. If subjective, the criteria must relate to participant performance as an individual, or, a group of participants including the individual, and the manner in which a determination regarding satisfaction of such criteria is made is consistent with the requirements set forth in the Code Section 409A Regulations.

2.28 Plan

Plan means the CommScope Deferred Compensation Plan, as set forth in this document and as amended from time to time.

2.29 Plan Year

Plan Year means the calendar year, the twelve-month period beginning each January 1 and ending on December 31. The first Plan Year was a short Plan Year from October 1, 2012 through December 31, 2012.

2.30Prior Tyco Account

Prior Tyco Account means a Participant’s subaccount consisting of a BNS Participant’s account balance under the Tyco Nonqualified Plan, increased or decreased by credits or debits for investment earnings or losses pursuant to Section 4.8 of the Plan. Specific provisions related to the Prior Tyco Account are found in Appendix A.

2.31 Retirement

Retirement means Separation from Service from the Company after either attainment of age 55 with at least 10 Years of Service or attainment of age 65.

2.32 Separation from Service

Separation from Service in general means a termination of an employee’s employment with his or her employer by reason of the employee’s death, retirement or otherwise. However, for purposes of the Plan, an employee’s employment relationship is treated as continuing intact while the individual is on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six months, or if longer, so long as the individual retains a right to reemployment with the employer under an applicable statute or by contract. For these purposes, a leave of absence constitutes a bona fide leave of absence only if there is a reasonable expectation that the employee will return to perform services for the employer. If the period of leave exceeds six months and the individual does not retain a right to reemployment under an applicable statute or by contract, the employment relationship is deemed to terminate on the first date immediately following such six-month period. Notwithstanding the foregoing, where a leave of absence is due to any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than six months, where such impairment causes the employee to be unable to perform the duties of his or her position of employment or any substantially similar position of employment, a 29-month period of absence may be substituted for such six-month period.

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Whether a termination of employment has occurred is determined based on whether the facts and circumstances indicate that the employer and employee reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services the employee would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than 20 percent of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding 36-month period (or the full period of services to the employer if the employee has been providing services to the employer less than 36 months). Facts and circumstances to be considered in making this determination include, but are not limited to, whether the employee continues to be treated as an employee for other purposes (such as continuation of salary and participation in employee benefit programs), whether similarly situated employees have been treated consistently, and whether the employee is permitted, and realistically available, to perform services for other employers in the same line of business. An employee is presumed to have separated from service where the level of bona fide services performed decreases to a level equal to 20 percent or less of the average level of services performed by the employee during the immediately preceding 36-month period. An employee will be presumed not to have separated from service where the level of bona fide services performed continues at a level that is 50 percent or more of the average level of service performed by the employee during the immediately preceding 36-month period. No presumption applies to a decrease in the level of bona fide services performed to a level that is more than 20 percent and less than 50 percent of the average level of bona fide services performed during the immediately preceding 36-month period. The presumption is rebuttable by demonstrating that the employer and the employee reasonably anticipated that as of a certain date the level of bona fide services would be reduced permanently to a level less than or equal to 20 percent of the average level of bona fide services provided during the immediately preceding 36-month period or full period of services provided to the employer if the employee has been providing services to the employer for a period of less than 36 months (or that the level of bona fide services would not be so reduced). For example, an employee may demonstrate that the employer and employee reasonably anticipated that the employee would cease providing services, but that, after the original cessation of services, business circumstances such as termination of the employee’s replacement caused the employee to return to employment. Although the employee’s return to employment may cause the employee to be presumed to have continued in employment because the employee is providing services at a rate equal to the rate at which the employee was providing services before the termination of employment, the facts and circumstances in this case would demonstrate that at the time the employee originally ceased to provide services, the employee and the employer reasonably anticipated that the employee would not provide services in the future.

Notwithstanding the foregoing, with respect to a Participant who is not an employee of the Company, Separation from Service shall have the meaning specified in the Code Section 409A Regulations (which, in the case of an outside director, generally would mean the individual no longer serving as an outside director or other service provider to the Company).

The definition of Separation from Service as set forth above shall be interpreted in a manner consistent with the applicable definition as set out in the Code Section 409A Regulations, including any modifications or amendments to such regulations.

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For clarification, the transfer of a BNS Employee to the Company on the Closing Date shall not constitute a Separation from Service under this Plan or the Tyco Nonqualified Plan.

2.33 Short-Term Cash Incentive Award Accounts

Short-Term Cash Incentive Award Accounts means the separate accounts established by the Committee for recordkeeping purposes only in the name of each Participant in accordance with Section 4.1 of the Plan.  

2.34 Short-Term Cash Incentive Award Credits

Short-Term Cash Incentive Award Credits means the amounts credited to a Participant’s Short-Term Cash Incentive Award Accounts in accordance with the Participant’s election pursuant to Section 4.2 of the Plan.

2.35 Specified Employee

Specified Employee has the meaning set forth in Code Section 409A(a)(2)(B)(i).

2.36 Tyco Nonqualified Plan

Tyco Nonqualified Plan means the Tyco Electronics Corporation Supplemental Savings and Retirement Plan.

2.37 Valuation Date

Valuation Date means each day the New York Stock Exchange is open for trading.

2.38 Written or “in Writing”

Written or in Writing means, with respect to any documentation of an election or other action by a Participant or by the Committee, that such documentation be either in paper or, as permitted by the Committee, in electronic form; provided, however, that such documentation must be adequate to establish a right that is enforceable under applicable law.

2.39 Years of Service

Years of Service means the Participant’s consecutive whole years of service with the Company since the Participant’s most recent hire date.

 

ARTICLE III ELIGIBILITY AND PARTICIPATION

3.1Eligibility to Participate

Any Eligible Individual shall be eligible to become a Participant in this Plan, as described in Article IV, subject to the approval of the Committee (provided that such participation shall be automatic for an outside director of the Company without the need for Committee action).

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3.2Change in Status as Eligible Individual

An Eligible Individual who ceases to satisfy the requirements of eligibility shall continue Deferral Elections only for the calendar year in which such change in status occurred. The Committee shall have complete discretion to exclude one or more individuals from Participant status for one or more Plan Years as the Committee deems appropriate.

If an Eligible Individual subsequent to a change in status as an Eligible Individual again satisfies the requirements of eligibility, such employee shall be subject to the provisions of Section 4.3(b) only if the total Account balance is zero or ceases to be an Active Participant in the Plan for twenty-four (24) months.

3.3Cessation of Participation

 

ARTICLE IV DEFERRAL ELECTIONS

4.1Establishment of Participant Accounts

The Company shall establish and maintain on its books and records an Account in the name of each Participant, with several subaccounts, which may include the following, as well as any other subaccounts and/or credits deemed appropriate by the Committee, to record:

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4.2Participant Deferral Credits

4.3Deferral Election

A Participant may defer such Compensation in a given calendar year, upon the completion of a Deferral Election, based on elections made in a manner prescribed by the Committee as follows:

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4.4Special Rules For Deferral of Performance-Based Compensation

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4.5Other Rules Regarding Deferral Elections

4.6Absence of Election

In the event that a Deferral Election is not made for any Plan Year, Compensation will be paid to Eligible Individuals according to the Company’s normal payroll practices.

4.7 Reduction of Deferral Election by Committee Action

The Committee shall have the authority to limit the amount of any Participant’s deferral to the extent the Committee determines that such limitation is necessary or appropriate for purposes of complying with applicable withholding requirements, which Committee action shall be taken prior to the date the Deferral Election becomes effective, and shall be documented in Writing and notice provided to the Participant.

4.8Credits for Investment Earnings and Debits for Investment Losses

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4.9 Company Contributions

The Company may, in its sole discretion, make additional Company credits ("Discretionary Credits") on behalf of any Eligible Individual. In its sole discretion, the Company shall determine the Eligible Individuals to be credited with any Discretionary Credit, the amount of any such Discretionary Credit and the vesting schedule applicable thereto (including any accelerated vesting thereof and the events of such acceleration). In addition, the Company may permit the Participant to elect the timing and form of distribution of such Discretionary Credits, provided that any such election shall be made no later than the latest time permitted by Code Section 409A.

4.10Prior Tyco Account

BNS Participants had credited to their Accounts an amount equal to the balance of their account under the Tyco Nonqualified Plan as of Closing Date.  This credited amount is maintained in the Participant’s Prior Tyco Account.

 

ARTICLE V VESTING

5.1Vesting of Accounts

Subject to Section 4.9, a Participant shall be fully vested in the amounts credited to his or her Accounts at all times.

 

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ARTICLE VI PAYMENT OF BENEFITS

6.1Distribution of Benefits and Distribution Elections

A Participant shall receive payment of benefits in the form and manner as described in this Article VI or as permitted pursuant to Section 4.9, taking into account such elections as are permitted hereunder.

6.2Distribution Elections

A Participant shall specify the time and form of distribution at such time or times and in such manner as may be established by the Committee, at its discretion; provided, however, that in all cases any election as to time and form of distribution must be in Writing and must be irrevocable no later than the date as of which any Deferral Election to which such election is applicable has been filed and becomes irrevocable.

6.3Timing of Distributions - Benefit Distribution Date

I.Deferral Elections for the 2016 Plan Year or Before

(a)For Deferrals of Compensation attributable to any period on or before December 31, 2016, a Participant shall elect, at the time of each election to defer Compensation with respect to each Plan Year, to receive the benefit distribution from the portion of his or her Accounts attributable to such deferral of Compensation, in accordance with one of the following options:

(b)A time of distribution election shall be made separately for each type of Compensation deferred for that Plan Year.

(c)In the event a Participant fails to make a distribution election, Section 6.3-I(a)(1) of the Plan shall apply.

(d)The time of distribution elected under this Section may be revised, with the consent of the Committee pursuant to Section 6.6, below.

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II.Deferral Elections for the 2017 Plan Year or Later

(a)For Deferrals of Compensation attributable to any period on or after January 1, 2017, a Participant shall elect, at the time of each election to defer Compensation with respect to each Plan Year, to receive the benefit distribution from the portion of his or her Accounts attributable to such deferral of Compensation, in accordance with one of the following options:

(b)A time of distribution election shall be made separately for each type of Compensation deferred for that Plan Year.

(c)In the event a Participant fails to make a distribution election, Section

6.3-II(b)(1) of the Plan shall apply.

(d)The time of distribution elected under this Section may be revised, with the consent of the Committee pursuant to Section 6.6, below.

6.4Distributions to Specified Employees

Notwithstanding the foregoing, in the event that, as of the date a distribution is to be made on account of a Participant’s Separation from Service, any class of the Company’s stock is publicly traded on an established securities market or otherwise, as determined under the Code Section 409A Regulations, any distribution due hereunder to such Participant on account of his or her Separation from Service shall, if such Participant is determined to be a Specified Employee, not commence earlier than the six (6) month anniversary of such Participant’s Separation from Service. In the event a distribution is delayed by reason of this Section and the affected Participant’s death occurs prior to commencement of such distribution, such distribution shall be made as soon as practicable following such Participant’s death. For the avoidance of doubt, a Participant’s status as a Specified Employee will be determined as of the date of the Participant’s

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Separation from Service, without regard to the year for which Compensation is deferred, even if the application of this Section 6.4 results in the portion of the Participant’s Account payable under Section 6.3-I being paid on a different date than as the portion payable under Section 6.3-II.

6.5Form of Distribution

(a)A Participant shall elect, at the time of each election to defer Compensation with respect to each Plan Year, the form of distribution in a manner prescribed by the Committee in accordance with one of two payment options:

(b)A form of distribution election shall be made separately for each type of Compensation deferred for that Plan Year.

 

(c)In the event a Participant fails to make an election, Section 6.5(a)(1) of the Plan shall automatically apply.

 

(d)The benefit form of distribution elected under this Section may be revised, with the consent of the Committee pursuant to Section 6.6, below.

6.6 Elections to Defer Beyond Original Distribution Commencement Date.

With respect to previously deferred Compensation, a Participant may elect to change the Benefit Distribution Date otherwise elected pursuant to this Article VI and Section 4.9 and/or to modify the form of benefit elected pursuant to applicable provisions of this Article VI and Section 4.9 (a “revised election”), if the following requirements are met:

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6.7Permitted Acceleration of Payment

Notwithstanding the Participant’s elected time and form of distribution pursuant to Article VI and Section 4.9 of the Plan, the time or schedule of a payment shall be accelerated in the following circumstances (but only to the extent permitted under the Code Section 409A Regulations):

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6.8 Payment For Unforeseeable Emergency

A Participant who incurs an unforeseeable emergency may apply to the Committee for an immediate distribution from his or her Account in an amount necessary to satisfy such financial hardship and the tax liability attributable to such distribution, subject to the rules set forth below.

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6.9Payment of Disability Benefits

If a Participant incurs a Disability, the entire value of his or her Account shall be distributed to the Participant in a single lump sum. Any distribution pursuant to this Section will occur following the determination of the Disability as approved by the Committee.

In the event that a Participant requests, and the Committee approves, a payment pursuant to this Section, the Participant’s Deferral Election shall be cancelled.

6.10 Payment of Death Benefits

(a)Each Participant shall designate a beneficiary on the proper beneficiary form as prescribed by the Committee to receive his or her Accounts in the event of death. If a Participant dies with a balance credited to his or her Accounts, such balance shall be paid to the applicable beneficiary or beneficiaries in a single lump sum as soon as practical following the Participant’s death.  

(b)Notwithstanding the above, if no beneficiary designation is on file with the Company at the time of death of the Participant or such designation is not effective for any reason then the designated beneficiary to receive such benefits shall be as follows:

(1)the Participant’s surviving spouse; or

(2)if there is no surviving spouse, then to the Participant’s estate.

All decisions made by the Committee in good faith and based upon affidavit or other evidence satisfactory to the Committee regarding questions of fact in the determination of the identity of such beneficiary(ies) shall be conclusive and binding upon all parties, and payment made in accordance therewith shall satisfy all liability hereunder.

6.11 Change of Control

Within ten (10) days following a Change of Control of the Company, the entire value of his or her Account shall be distributed to the Participant in a single lump sum.

6.12 Valuation of Distributions

The benefit amount of a Participant’s Account to be distributed pursuant to this Article VI and Section 4.9 shall be based on the value of such Account on any Valuation Date after instructions are received in good order by the Committee.

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6.13 Timing of Distributions

Distributions made pursuant to this Article VI and Section 4.9 shall be made at the following times:

6.14  Prior Tyco Account

Notwithstanding the foregoing, any Participant’s Prior Tyco Account shall be paid according to the elections in place for such Participant as of the Closing Date, as described in Appendix A, unless otherwise deferred pursuant to Section 6.6.  Until a BNS Participant designates a different beneficiary under this Plan, the BNS Participant’s beneficiary designation (if any) under the Tyco Nonqualified Plan shall apply under this Plan.  

 

ARTICLE VII AMENDMENT AND TERMINATION OF PLAN

7.1 Amendments Generally

The Company reserves the right to amend the Plan at any time. No amendment, however, may reduce the amount credited to Accounts at the time of the amendment’s adoption, except as may otherwise be required by law or necessary or desirable to comply with the requirements of Code Section 409A. Without limiting the generality of the foregoing, the Committee may amend the Plan to impose such restrictions upon the timing, filing and effectiveness of Deferral Elections, the investment procedures and investment alternatives available under the Plan and the distribution provisions of Article VI and Section 4.9 which the Committee deems appropriate or advisable in order to avoid the current income taxation of amounts deferred under the Plan which might otherwise occur as a result of changes to the tax laws and regulations governing deferred compensation arrangements such as the Plan and may also, in such event, cease further deferrals under the Plan.

7.2Right to Terminate

The Company may terminate the Plan at any time in whole or in part.

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(i)The termination and liquidation does not occur proximate to a downturn in the financial health of the Company;

(ii)The Company terminates and liquidates all agreements, methods, programs, and other arrangements sponsored by the Company that would be aggregated with the Plan under applicable provisions of the Code Section 409A Regulations assuming a Participant in the Plan also had deferrals credited under all such other agreements, methods, programs;

(iii)No payments in liquidation of the plan are made within 12 months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan (other than amounts distributed under the terms of the Plan without regard to the action to terminate and liquidate the Plan;

(iv)All payments in liquidation of the Plan are made within 24 months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan; and

(v)The Company does not adopt a new plan that would be aggregated with the Plan under applicable provisions of the Code Section 409A Regulations if assuming a Participant participated in both plans, at any time within three years following the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan.

 

ARTICLE VIII MISCELLANEOUS

8.1 Unfunded Plan

This Plan is an unfunded deferred compensation arrangement for Eligible Individuals. While it is the intention of the Company that this Plan shall be unfunded for federal tax purposes and for purposes of Title I of ERISA, the Company may establish a grantor trust to satisfy part or

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all of its Plan payment obligations so long as the Plan remains unfunded for federal tax purposes and for purposes of Title I of ERISA. The Company shall not establish or contribute to a trust under the prior sentence to satisfy its obligations regarding either of the following (i) any Participant’s Prior Tyco Account or (ii) credits for any Participant related to any period beginning on or after January 1, 2016.  Nothing contained in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company and any employee or other person. To the extent any person acquires a right to receive a payment from the Company under the Plan, such right shall be no greater than that of an unsecured general creditor of the Company.

8.2 Nonguarantee of Employment

Nothing contained in the Plan shall be construed as a contract of employment between the Company and any Participant, or as a right of any Participant to be continued in the employment of the Company, or as a limitation of the right of the Company to discharge any Participant with or without cause.

8.3Nonalienation of Benefits

8.4 Taxes and Withholding

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8.5 Applicable Law

This Plan shall be construed and enforced in accordance with the laws of the state of Delaware.

8.6 Headings and Subheadings

Headings and subheadings in this Plan are inserted for convenience only and are not to be considered in the construction of the provisions.

8.7Severability

The invalidity and unenforceability of any particular provision of this plan shall not affect any other provision and the Plan shall be construed in all respects as if such invalid or unenforceable provisions were omitted.

8.8 Expenses

In addition to the expenses and costs that may be charged against Participants’ Accounts pursuant to other provisions of the Plan, each Participant’s Account shall also be charged with its allocable share of all other costs and expenses incurred in the operation and administration of the Plan, except to the extent one or more Participating Employers elect in their sole discretion to pay all or a portion of those costs and expenses.

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ARTICLE IX ADMINISTRATION OF THE PLAN

9.1Powers and Duties of the Committee

The Company, or its designee, shall appoint members of the Committee. The Committee will be responsible for the administration of the Plan. The Committee shall have full responsibility to represent the Company and the Participants in all things it may deem necessary for the proper administration of the Plan. Subject to the terms of the Plan, the decision of the Committee upon any question of fact, interpretation, definition or procedures relating to the administration of the Plan shall be conclusive. The responsibilities of the Committee shall include, but not be limited to, the following:

9.2Claims Procedure

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EXECUTION OF DOCUMENT

 

 

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Appendix A

 

Prior Tyco Account

 

The provisions of this Appendix A apply only to a Participant’s Prior Tyco Account.  

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If payment in a specific year is selected, the year chosen cannot be later than the year in which the BNS Participant reaches age 70.  The payment will occur (or installments will begin) in March of the year selected.

Payments made upon Separation from Service will be paid (or installments will begin) as of March of the year following the year in which Separation from Service occurs.

A Participant shall be permitted to make changes to the time and form of payment of the Participant’s Prior Tyco Account in accordance with Section 6.6 of the Plan, provided that in no event may a Participant elect to defer commencement of payment of his Prior Tyco Account past the year in which the Participant reaches age 70.  

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