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EX-10.E 7 g94184exv10we.txt EX-10(E) Exhibit 10 (e) FLORIDA EAST COAST INDUSTRIES, INC. SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN FLORIDA EAST COAST INDUSTRIES, INC. (the "Company"), does hereby establish and adopt the following Supplemental Executive Retirement Plan (the "Plan"), effective March 28, 2005. The purpose of this Plan is to provide specified benefits to a select group of management or highly compensated employees who contribute materially to the continued growth, development and future business success of the Company. It is intended that this Plan, by providing this benefit, will assist the Company in attracting, motivating and retaining such individuals. This Plan shall be unfunded for tax purposes and for purposes of Title I of ERISA. 1. DEFINITIONS 1.1 "Account" means the account maintained on the books of the Company used solely to calculate the amount payable to the Participant under this Plan and shall not constitute a separate fund of assets. 1.2 "Account Balance" means the amount credited to the Participant's Account under Sections 3.1 and 3.2 of this Plan. 1.3 "Beneficiary" means the Participant's Surviving Spouse or, if none, the person designated in writing as such to the Committee on a form designated for such or, if neither, the Participant's estate. 1.4 "Board" means the Board of Directors of the Company. 1.5 "Cause" shall have the same meaning as that term has under the Participant's employment agreement or, if no such agreement is then in effect, the following meaning: (a) a (i) material breach by the Participant of the obligations under any written agreement with the Company or (ii) failure to attempt in good faith to perform the Participant's duties and responsibilities (other than as a result of incapacity due to physical or mental illness), in either case, which is demonstrably willful and deliberate on the Participant's part provided that such breach or failure is not remedied within ten (10) days after receipt of notice from the Company specifying such breach or failure; (b) the Participant's conviction of a felony or a guilty or nolo contendere plea by the Participant to a felony (other than as a result of vicarious liability where the Participant was not involved in and had no material knowledge of the action or inactions leading to the charges or had such involvement or knowledge but acted upon advice of the Company's counsel as to its legality); (c) the (i) insubordination after written notice from the Board or willful engaging by the Participant in misconduct or (ii) the Participant's gross negligence, in either case, with regard to the Company or the Participant's duties, which have, or is likely to have, a material adverse impact on the Company; or (d) a material act of dishonesty or breach of trust on the Participant's part resulting or intending to result, directly or indirectly, in material personal or family gain or enrichment at the expense of the Company. For purposes of this Section 1.5, no act, or failure to act, on the Participant's part shall be considered "willful" unless done or omitted to be done, by the Participant not in good faith and without reasonable belief that the Participant's action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Participant in good faith and in the best interests of the Company. In the event that the Participant alleges that the failure to attempt to perform the Participant's duties and responsibilities is due to a physical or mental illness, and thus not "Cause" under (a) above, the Participant shall be required to furnish the Company with a written statement from a licensed physician which confirms the Participant's inability to attempt to perform due to such physical or mental illness. 1.6 "Code" means the Internal Revenue Code of 1986, as amended. Any reference to any section of the Code shall also be a reference to any successor provision and any Treasury Regulation promulgated thereunder. 1.7 "Committee" means the Compensation Committee of the Board. 1.8 "Company" means Florida East Coast Industries, Inc., or any successor thereto. 1.9 "Disability" shall have the same meaning as that term has under the Participant's employment agreement or, if no such agreement is then in effect, the following meaning: the absence of the Participant from the Participant's duties with the Company on a full-time basis for one hundred eight (180) consecutive business days as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Participant or the Participant's legal representative (such agreement as to acceptability not to be withheld unreasonably). 1.10 "Effective Date" means March 28, 2005. 1.11 "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. Any reference to any section of ERISA shall also be a reference to any successor provision and any Department of Labor Regulation promulgated thereunder. 1.12 "Good Reason" shall have the same meaning as that term has under the Participant's employment agreement, if any. 1.13 "Participant" means any employee who is eligible, pursuant to Section 2.1, below, to participate in this Plan, and who has elected to do so in accordance with Section 2.2, below. Such employee shall remain a Participant in this Plan until such time as all benefits payable under this Plan have been paid in accordance with the provisions hereof. 2 1.14 "Participation Agreement" means a written agreement, as may be amended from time to time, which is entered into between a Participant and the Company. 1.15 "Plan" means this Supplemental Executive Retirement Plan, as may be amended form time to time. 1.16 "Surviving Spouse" means, if the Participant dies on or before receipt of all benefits under this Plan, the spouse to whom the Participant is married on the date of the Participant's death. 2. ELIGIBILITY AND PARTICIPATION 2.1 Eligibility. Eligibility to participate in the Plan shall be limited to those select group of management and/or highly compensated employees of the Company who are designated and approved by the Committee, from time to time. 2.2 Participation. An employee's participation in the Plan shall be effective upon notification to the employee by the Committee of eligibility to participate and completion and submission of a Participation Agreement to the Committee. In addition, the Committee may establish from time to time other enrollment requirements as it determines in its sole discretion are necessary. 2.3 Change in Employment Status. If the Committee determines that a Participant's employment performance is no longer at a level that warrants reward through participation in the Plan, but does not terminate the Participant's employment with the Company, the Participant's benefits under the Plan shall be limited to the Account Balance as of the date so specified by the Committee, and no new contributions by the Company shall be made on behalf of such Participant after notice of such determination is given by the Committee, unless the Participant later satisfies the requirements of Sections 2.1 and 2.2, above. 3. Plan Benefits 3.1 Contributions to Account. The Company shall make contributions to the Participant's Account as provided in the Participant's Participation Agreement, provided the Participant is employed by the Company on the dates provided therein. 3.2 Earnings. On (a) the last business day of each calendar year (provided the Participant is employed by the Company on such date), and (b) immediately prior to the distribution of the Participant's benefits pursuant to Section 3.4, 3.5, 3.6 or 3.7, the Participant's Account shall be credited with earnings in an amount equal to the product of the greater of 5% or the applicable federal rate (based on the long term rate for January of each year) times the Account Balance immediately after the last such earnings credit (adjusted pro rata for a partial year). 3.3 Vesting of Benefit and Forfeitures. The vesting of benefits shall be set forth in the Participation Agreement. The Participant shall be 100% vested in the Account Balance if the Participant's employment terminates by reason of death or Disability, or if the Participant's 3 employment is terminated by the Participant with Good Reason (if the same is provided in an employment agreement between the Participant and the Company) or terminated by the Company without Cause. If the Participant's employment terminates for any reason not specified above prior to the Vesting Date, the Participant shall forfeit the entire Account Balance and no benefit shall be payable to either the Participant or the Participant's Beneficiary hereunder. 3.4 Termination Benefit. Except as provided in Section 3.7, within ten (10) business days after the Participant's employment terminates other than for death or Disability, the Company shall pay to the Participant a lump sum payment equal to the Participant's vested Account Balance, if any. 3.5 Disability Benefit. Except as provided in Section 3.7, within ten (10) business days after the Participant's employment terminates due to Disability, the Company shall pay to the Participant a lump sum payment equal to the Participant's Account Balance. 3.6 Death Benefit. If the Participant dies while employed by the Company (or, if the Participant became entitled to benefits under Section 3.4 or 3.5 and dies prior to receipt of such benefits) the Participant's Beneficiary shall receive a lump sum payment equal to the Participant's Account Balance within ten (10) business days after the Participant's death. 3.7 409A Compliance. The payment of the Participant's benefit under this Plan as set forth herein or in the Participation Agreement shall be postponed to the extent necessary to cause such distribution to comply with Section 409A of the Code. 4. SOURCE OF PAYMENTS 4.1 Unfunded and Unsecured. This Plan is an unfunded plan maintained primarily to provide deferred compensation benefits for a select group of management or highly-compensated employees within the meaning of Sections 201, 301, and 401 of ERISA, and therefore is exempt from the provisions of Parts 2, 3 and 4 of Title I of ERISA. No Participant or Beneficiary shall have any interest whatsoever in any specific asset of the Company. To the extent that any Participant or Beneficiary acquires a right to receive payments under this Plan, such right shall be no greater than the right of any unsecured general creditor of the Company. 4.2 Accumulation of Assets to Pay Benefits. At its own discretion, the Company may segregate or otherwise accumulate assets, including insurance, annuity contracts or other types of investments as it deems desirable in order to accumulate the necessary assets to provide for the future benefit payments under this Plan. Notwithstanding anything to the contrary herein, the Company shall be under no obligation to accumulate assets to pay the benefits provided under this Plan nor shall any assets so accumulated be restricted in any way by the Participant. 5. ADMINISTRATION 5.1 General Authority. The Committee is authorized to interpret this Plan, to prescribe, amend, and rescind procedures, rules and regulations relating to this Plan, provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company, and to make all other determinations necessary or advisable for the administration of 4 this Plan, but only to the extent not contrary to the express provisions of this Plan. Any determination, interpretation or other action made or taken pursuant to the provisions of this Plan by the Committee shall be final and shall be binding and conclusive for all purposes and upon all persons. 5.2 Delegation. The Committee may, at its discretion, delegate the administrative duties related to this Plan to an officer or employee of the Company to the extent permitted by applicable law, rule or regulation (including any applicable stock exchange listing or corporate governance standards). 6. CLAIMS AND REVIEW PROCEDURE 6.1 For benefit claims other than upon termination of employment due to Disability: (a) Claims Procedure. If the Participant has not received benefits under this Plan that he believes should be paid, the Participant shall make a claim for such benefits as follows: (i) Initiation - Written Claim. The Participant initiates a claim by submitting to the Committee a written claim for the benefits. (ii) Timing of Company Response. The Committee shall respond to the Participant within ninety (90) days after receiving the claim. If the Committee determines that special circumstances require additional time for processing the claim, the Committee can extend the response period by an additional ninety (90) days by notifying the Participant in writing, prior to the end of the initial 90-day period, that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Committee expects to render its decision. (iii) Notice of Decision. If the Committee denies part or all of the claim, the Committee shall notify the Participant in writing of such denial. The Committee shall write the notification in a manner calculated to be understood by the Participant. The notification shall set forth: (A) The specific reasons for the denial; (B) A reference to the specific provisions of this Plan on which the denial is based; (C) A description of any additional information or material necessary for the Participant to perfect the claim and an explanation of why it is needed; (D) An explanation of this Plan's review procedures and the time limits applicable to such procedures; and 5 (E) A statement of the Participant's right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review. (b) Review Procedure. If the Committee denies part or all of the claim, the Participant shall have the opportunity for a full and fair review by the Committee of the denial, as follows: (i) Initiation - Written Request. To initiate the review, the Participant, within sixty (60) days after receiving the Committee's notice of denial, must file with the Committee a written request for review. (ii) Additional Submissions - Information Access. The Participant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim. The Committee shall also provide the Participant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the Participant's claim for benefits. (iii) Considerations on Review. In considering the review, the Committee shall take into account all materials and information the Participant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. (iv) Timing of Committee Response. The Committee shall respond in writing to such Participant within sixty (60) days after receiving the request for review. If the Committee determines that special circumstances require additional time for processing the claim, the Committee can extend the response period by an additional sixty (60) days by notifying the Participant in writing, prior to the end of the initial 60-day period, that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Committee expects to render its decision. (v) Notice of Decision. The Committee shall notify the Participant in writing of its decision on review. The Committee shall write the notification in a manner calculated to be understood by the Participant. If the claim is denied, the notification shall set forth: (A) The specific reasons for the denial; (B) A reference to the specific provisions of this Plan on which the denial is based; (C) A statement that the Participant is entitled to receive, upon request and free of charge, reasonable access to, and 6 copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the Participant's claim for benefits; and (D) A statement of the Participant's right to bring a civil action under ERISA Section 502(a). 6.2 For benefit claims upon termination of employment due to Disability: (a) Claims Procedures. If the Participant has not received benefits under this Plan that he believes should be paid, the Participant shall make a claim for such benefits as follows: (i) Initiation - Written Claim. The Participant initiates a claim by submitting to the Committee a written claim for the benefits. (ii) Timing of Committee Response. The Committee shall notify the Participant in writing or electronically of any adverse determination as set out in this section. (iii) Notice of Decision. If the Committee denies part or all of the claim, the Committee shall notify the Participant in writing of such denial. The Committee shall write the notification in a manner calculated to be understood by the Participant. The notification shall set forth: (A) The specific reasons for the denial; (B) A reference to the specific provisions of this Plan on which the denial is based; (C) A description of any additional information or material necessary for the Participant to perfect the claim and an explanation of why it is needed; (D) An explanation of the Plan's review procedures and the time limits applicable to such procedures; (E) A statement of the Participant's right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review; (F) Any internal rule, guideline, protocol, or other similar criterion relied upon in making the adverse determination, or a statement that such a rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination and that the Participant can request and receive free of charge a copy of such rule, guideline, protocol or other criterion from the Committee; and 7 (G) If the adverse benefit determination is based on a medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the determination, applying the terms of this Plan to the Participant's medical circumstances, or a statement that such explanation will be provided free of charge upon request. (iv) Timing of Notice of Denial/Extensions. The Committee shall notify the Participant of denial of benefits in writing or electronically not later than forty-five (45) days after receipt of the claim by the Committee. The Committee may elect to extend notification by two 30-day periods subject to the following requirements: (A) For the first 30-day extension, the Committee shall notify the Participant (1) of the necessity of the extension and the factors beyond the Committee's control requiring an extension; (2) prior to the end of the initial 45-day period; and (3) of the date by which the Committee expects to render a decision. (B) If the Committee determines that a second 30-day extension is necessary based on factors beyond the Committee's control, the Committee shall follow the same procedure in (A) above, with the exception that the notification must be provided to the Participant before the end of the first 30-day extension period. (C) For any extension provided under this section, the Notice of Extension shall specifically explain the standards upon which entitlement to a benefit is based, the unresolved issues that prevent a decision on the claim, and the additional information needed to resolve those issues. The Participant shall be afforded 45 days within which to provide the specified information. (b) Review Procedures - Denial of Benefits. If the Committee denies part or all of the claim, the Participant shall have the opportunity for a full and fair review by the Committee of the denial, as set forth below, or in accordance with the dispute resolutions of a Participant's employment agreement, if any. (i) Initiation of Appeal. Within 180 days following notice of denial of benefits, the Participant shall initiate an appeal by submitting a written notice of appeal to the Committee. (ii) Submissions on Appeal - Information Access. The Participant shall be allowed to provide written comments, documents, records, 8 and other information relating to the claim for benefits. The Committee shall provide to the Participant, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant (as defined in applicable ERISA regulations) to the Participant's claim for benefits. (iii) Additional Committee Responsibilities on Appeal. On appeal, the Committee shall: (A) Take into account all materials and information the Participant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination; (B) Provide for a review that does not afford deference to the initial adverse benefit determination and that is conducted by an appropriate named fiduciary of the Committee who is neither the individual who made the adverse benefit determination that is the subject of the appeal, nor the subordinate of such individual; (C) In deciding an appeal of any adverse benefit determination that is based in whole or in part on a medical judgment, including determinations with regard to whether a particular treatment, drug, or other item is experimental, investigational, or not medically necessary or appropriate, consult with a health care professional who has appropriate training and experience in the field of medicine involved in the medical judgment; (D) Identify medical or vocational experts whose advice was obtained on behalf of the Committee in connection with a Participant's adverse benefit determination, without regard to whether the advice was relied upon in making the benefit determination; and (E) Ensure that the health care professional engaged for purposes of a consultation under subsection (C) above shall be an individual who was neither an individual who was consulted in connection with the adverse benefit determination that is the subject of the appeal, nor the subordinate of any such individual. (iv) Timing of Notification of Benefit Denial - Appeal Denial. The Committee shall notify the Participant not later than forty-five (45) days after receipt of the Participant's request for review by the Committee, unless the Committee determines that special circumstances require an extension of time for processing the claim. If the Committee determines that an extension is required, 9 written notice of such shall be furnished to the Participant prior to the termination of the initial 45-day period, and such extension shall not exceed forty-five (45) days. The Committee shall indicate the special circumstances requiring an extension of time and the date by which the Committee expects to render the determination on review. (v) Content of Notification of Benefit Denial. The Committee shall provide the Participant with a notice calculated to be understood by the Participant, which shall contain: (A) The specific reason or reasons for the adverse determination; (B) Reference to the specific Plan provisions on which the benefit determination is based; (C) A statement that the Participant is entitled to receive, upon request and free of charge, reasonable access to, and copies of all documents, records, and other relevant information (as defined in applicable ERISA regulations); (D) A statement of the Participant's right to bring an action under ERISA Section 502(a); (E) Any internal rule, guideline, protocol, or other similar criterion relied upon in making the adverse determination, or a statement that such a rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination and that the Participant can request and receive free of charge a copy of such rule, guideline, protocol or other criterion from the Committee; (F) If the adverse benefit determination is based on a medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the determination, applying the terms of this Plan to the Participant's medical circumstances, or a statement that such explanation will be provided free of charge upon request; and (G) The following statement: "You and your Plan may have other voluntary alternative dispute resolution options such as mediation. One way to find out what may be available is to contact your local U.S. Department of Labor Office and your state insurance regulatory agency." 10 7. MISCELLANEOUS 7.1 Non-transferability. No right or interest of the Participant or any Beneficiary in this Plan shall be assignable or transferable, or subject to any lien, including execution, levy, garnishment, attachment, pledge or bankruptcy, except to the extent as may be required by law. 7.2 Withholding and Payroll Taxes. The Company shall withhold from any and all benefit payments made under this Plan, all federal, state and local income taxes, employment and other taxes required to be withheld by the Company in connection with the benefits hereunder, in amounts to be determined in the sole discretion of the Company. If employment or other taxes are required to be withheld prior to payment of benefits, the Company may reduce the Participant's other compensation, require that the Participant remit to the Company additional amounts, or make such other arrangements with the Participant as the Company shall determine to be necessary to satisfy such obligation. 7.3 Amendments. Subject to the Company's obligations to provide a SERP benefit set forth in an employment agreement between a Participant and the Company, the Company may terminate, modify or amend this Plan at any time or from time to time, in whole or in part; provided, however, that, without the Participant's written consent, no such termination, modification or amendment shall be effective if it would reduce the Participant's right to receive any vested benefits, or the right of a Beneficiary to receive a vested benefit, earned though the date of the termination, modification or amendment in accordance with this Plan as in effect on the date of execution. 7.4 No Right to Employment or Participation. Nothing in this Plan shall interfere with or limit in any way the right of the Company to terminate or change the Participant's employment at any time, nor confer upon any Participant any right to continue in the employ of the Company for any period of time or to continue the Participant's present or any other rate of compensation. 7.5 Non-Exclusivity. Nothing contained herein is intended to amend, modify or rescind any previously approved compensation agreement or program entered into by the Company. The benefits under this Plan shall be in addition to any and all such agreements or programs. 7.6 Headings. The headings of the Articles and sections in this Plan are for the convenience of reading only and are not meant to be of substantive significance and shall not add or detract from the meaning of this Plan. 7.7 Successors and Assigns. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Plan in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Plan, "Company" shall mean the Company as herein before defined and any successor that executes and delivers the agreement provided for in this Section 7.7 or which otherwise becomes bound by all the terms and provisions of this Plan by operation of law. 11 7.8 Severability. If any provision of this Plan or the application of such provision to any person or circumstance shall be held (by a court of competent jurisdiction) to be invalid, illegal, or unenforceable under the applicable law of any jurisdiction, (a) the remainder of this Plan or the application of such provision to other persons or circumstances or in other jurisdictions shall not be affected thereby, and (b) such invalid, illegal, or unenforceable provision shall not affect the validity or enforceability of any other provision of this Plan. 7.9 Governing Law. To the extent not preempted by federal law, this Plan shall be governed by the laws of the State of Florida, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Plan to the substantive law of another jurisdiction. 7.10 409A. The Company intends that this Plan will be in full compliance with Section 409A of the Code and that to the extent any provision would be in violation thereof, it will be adjusted in such manner as the Participant and the Company mutually agree to be in compliance with Section 409A of the Code and maintain the intent hereof to the maximum extent possible. 12