10.19 Executive Benefit Restoration Plan effective April 9, 2019

If the Cooperative participated in the RS Plan:

The Participant satisfies the requirements necessary for the receipt of total disability benefits under the Long-Term Disability Plan for Employees of NRECA Member Systems (the “LTD Plan”), as the LTD Plan may be amended from time to time (whether or not the Cooperative for whom the Participant was employed actually participates in the LTD Plan); and

The Participant has continued to make participant contributions to the RS Plan, if required, for the six-month period commencing with the first day of the month coincident with or next following the date his or her active employment ceased.

If the Cooperative does not participate in the RS Plan, “Disability” or “Disabled” shall be determined in accordance with the description of Disability in any addendum to this EBR.  

Participation.  

The participants in the EBR eligible for benefits shall be a select group of management or highly compensated employees of the Cooperative whose compensation exceeds the limits of Code § 401(a)(17) and/or whose benefit exceeds the limits of § 415, and who are designated in writing by the Board on any Addendum as participants, and who on the date of their attainment of the Normal Retirement Date, or upon such other date as the Board may designate, have a Pension Limitation, as defined in any Addendum to this EBR, applied to reduce the amount of payment that would otherwise be payable by a Qualified Plan sponsored by NRECA or directly by the Cooperative.  

Benefit Payment.

The EBR Benefit payable for a Participant under the EBR is the amount of the Pension Limitation for the Participant as outlined in any Addendum to this Plan.  A Participant may have multiple Pension Limitations defined on multiple Addenda to this Plan.

The EBR Benefit shall be paid as a single lump sum as of the vesting date defined on any Addendum to this Plan.

When calculating an EBR Benefit, the Cooperative shall ensure that periods of benefit service as defined in any Addendum are only included once in any determination of EBR Benefit accruals.  To do so, the Cooperative shall include in the calculation all amounts from any RS Plan:

Paid in cash to the Participant or his or her beneficiary,

Transferred to any individual retirement account or annuity for the benefit of the Participant or Beneficiary, or

Transferred to the Participant’s account in the NRECA 401(k) Pension Plan.

If a Participant attains the stated vesting date, but continues to be employed by the Cooperative, any subsequent EBR accruals are subject to the following conditions:

Subsequent Vesting Date established by the Board, if any, shall not be less than 24 months from the previous vesting date, provided that the Cooperative must establish the subsequent vesting date no later than sixty (60) days following the original vesting date;

If no Subsequent Vesting Date is established, then the first day of each Plan Year shall be treated for Section 4 as a new Subsequent Vesting Date.  Further benefits under the EBR shall be calculated as of the last day worked in each Plan Year and benefits shall become payable no later than the last day worked in each Plan Year.  

In the event of either (i) or (ii) above, the Pension Limitation shall be calculated for each benefit payment.  In addition, any subsequent EBR Benefit shall be offset to take into account any EBR Benefit previously paid to the Participant by adding the differences between the accrued benefits determined for each of the items (i) and (ii) described in the Pension Limitation definition for the previous payments to the amount under (ii) in the Pension Limitation definition for the current payment.

If the Cooperative elects to restore benefits using a Defined Benefit EBR Calculation as outlined on any Addendum to this Plan, and if a Participant incurs an RS Plan Benefit Election Date prior to the Participant’s Initial Vesting Date, then the Participant’s Pension Limitation as defined on any Addendum to this Plan shall be determined as of such date and the Participant’s benefit under this Plan shall be based on such amount with respect to participation in the RS Plan through the RS Plan Benefit Election Date.  

The lump sum value of such amount may, solely in the discretion of the Cooperative, be credited to an account.  The account shall be adjusted based upon the investment experience of such amount whether held in trust or otherwise separately accounted for, to provide the basis pursuant to which earnings and losses may be attributed and credited to the account of the Participant.  The investment vehicle, vehicles, or funds for purposes of measuring the value of the amount credited to the account of the Participant shall be determined by the Cooperative.  However, the Participant, in the sole discretion of the Cooperative, may designate the investment vehicle to be used for purposes of measuring the value of the amount credited to the account of the Participant.  Neither the trustee of the trust with respect to which assets may be held nor the Cooperative shall be obligated to make actual investments in any such investment vehicles or funds.  The account established pursuant to this subsection (f) shall be maintained for bookkeeping purposes only and shall not represent any actual investment made by the Cooperative or a trust.  The Participant shall at all times remain an unsecured creditor of the Cooperative.  If the Cooperative decides not to credit an account based on investment experience as described in this subsection (f), then the Participant’s benefit under this Plan, if and when paid, shall be based on such amount with respect to periods of participation in the RS Plan through the RS Plan Benefit Election Date.

Benefit Forfeitable by Participant.

The benefit described in any Addendum to this Plan is subject to a substantial risk of forfeiture.  The benefit shall be forfeited in its entirety if the Participant’s employment with the Cooperative is terminated by Cooperative for Cause or terminated by Participant without Good Reason before the vesting date the Cooperative has specified on any Addendum.  For purposes of this default rule, in the case of a Cooperative’s RS Plan that defines Normal Retirement Date as the earlier of a stated age or completion of a stated years of service, participation, or similar measure, the Normal Retirement Age for vesting shall be the stated age.

In any event, no forfeiture shall occur if the termination of the Participant’s employment with the Cooperative is caused by death, Disability, termination by Cooperative without Cause, or voluntary termination by Participant for Good Reason.  Only the following shall constitute “Cause” for forfeiture upon Cooperative’s termination of Participant’s employment:

gross incompetence, insubordination, gross negligence, willful misconduct in office or breach of a material fiduciary duty, which includes a material breach of confidentiality, owed to Cooperative;

conviction of a felony, a crime of moral turpitude or commission of an act of embezzlement or fraud against Cooperative;

Participant’s material failure to perform a substantial portion of his or her duties and responsibilities; but only after Employer provides Participant written notice of such failure and gives him or her thirty (30) days to remedy the situation, or such failures reoccur after such written notice and an opportunity to cure has been provided;

deliberate dishonesty of Participant with respect to Cooperative; and

a violation of one of Cooperative’s written policies which is not cured, if curable, within thirty (30) days after written notice is delivered to Participant or such violation reoccurs after such written notice and an opportunity to cure has been provided.  

a material diminution of Participant’s base salary and/or benefits;

a material diminution in Participant’s authority, duties, or responsibilities;

a material diminution in the authority, duties, or responsibilities of the supervisor to whom Participant is required to report, including a requirement that the President and Chief Executive Officer report to a corporate officer or employee instead of reporting directly to the board of directors of Cooperative;

a material diminution in the budget over which Participant retains authority;

cooperative requiring Participant to be permanently based anywhere other than within fifty (50) miles of Participant’s job location immediately prior to the reassignment; or

any other action that constitutes a material breach by Cooperative of any employment agreement between Participant and Cooperative.

Participant’s eligibility for benefits under this plan shall not be transferrable to another employer.

It is the intention of the Cooperative that the forfeiture provision of this EBR shall constitute a substantial risk of forfeiture as defined in Code § 457(f)(3)(B).  

Timing and Form of Payment.

The EBR Benefit shall be payable to the Participant (or if deceased to his or her Beneficiary) from the general assets of the Cooperative in a lump sum payment immediately upon the lapse of the substantial risk of forfeiture specified by the Cooperative in writing pursuant to Section 4, above, but in no event later than two and a half months following the calendar year in which the lapse of the substantial risk of forfeiture occurs; however, payments received by a Participant in the year following the year of the lapse of the risk of forfeiture shall be treated as includable income for the year the risk of forfeiture lapsed.  The Cooperative has the sole responsibility for compliance with the timely payment of EBR benefits.  Payment of benefits may be delayed if calculation of the Pension Limitation cannot be performed for any reason (including because necessary data is not available or has not been provided to NRECA, or if Qualified Plan benefit elections are pending), but in no event will payment occur later than two and a half months following the calendar year in which the lapse of the substantial risk or forfeiture occurs.  If a Participant has one or more Subsequent Vesting Dates, then payment shall occur no later than two and a half months following the calendar year in which each such Subsequent Vesting Date occurs.

The Cooperative shall make arrangements to satisfy any federal, state or local income tax withholding requirements, employment taxes, or other requirements applicable to the granting, crediting, vesting, or payment of benefits under the Plan.  There shall be deducted from any payment under the Plan or any other compensation payable to the Participant all taxes which are required to be withheld by the Cooperative in respect to such payment or the Plan.  Determining withholding and payment of taxes shall be the sole responsibility of the Cooperative.

Death Prior to Vesting Date.  In the event of a Participant’s death prior to his or her attainment of the Initial Vesting Date, the amount of vested benefits to be paid to the Participant’s Beneficiaries is determined using the same calculation methodology used in the Qualified Plan to determine the amount payable to the Participant’s beneficiaries from the Qualified Plan.

Termination by Cooperative without Cause or Termination by Participant for Good Reason. In the event of termination by Cooperative without Cause, or voluntary termination by Participant for Good Reason prior to his or her attainment of the initial Vesting Date, the amount of vested benefits to be paid to Participant shall be determined pursuant to section three and calculated as of the date of termination.

Death Following Vesting Date.   In the event of the death of a Participant who has attained an Initial Vesting Date or Subsequent Vesting Date and has received an EBR benefit, the death benefit payable by the EBR is calculated using the same methodology as used by the Qualified Plan to determine the amount of a death benefit payable from the Qualified Plan including, if applicable, any reductions in Qualified Plan payments to beneficiaries.  If the total of all EBR benefits paid previously to the Participant, plus the amount due as a result of death, exceed the total of the EBR benefit, no adjustment of the EBR benefit previously paid will be made.  The EBR benefit will be separately calculated as of the date of death and include the period of service measured from the date of the most recent calculation and payment of an EBR benefit.

Beneficiary.  A Participant’s Beneficiary shall be designated at such times and on the forms prescribed by the Board.  If the Participant fails to name a Beneficiary, the Beneficiary shall be the Participant’s beneficiary under the RS Plan.  

General administration of the Plan shall be placed in the Board.  The Board shall have the power to take all actions required to carry out the provisions of the EBR and shall further have the following powers and duties which shall be exercised in a manner consistent with the provisions of the EBR:

To construe and interpret the provisions of the EBR and make rules and regulations under the EBR to the extent deemed advisable by the Board,

To decide all questions as to eligibility to become a Participant in the EBR to the extent the Board has not delegated that authority to the Cooperative,

To decide all questions as to the rights of Participants under the EBR,

To make any determinations as to the Pension Limitation (as defined in any Addendum to this EBR) to be used when calculating benefits payable under this EBR to any Participant,

To file or cause to be filed all such reports and other statements as may be required by any federal or state statute, agency or authority for the EBR, and

To do such other acts as it deems necessary to administer the EBR, including the establishment of any vesting date under this EBR, in accordance with the provisions of this EBR or as may be required by law.

Within 90 days following receipt of notice of a claim denial, or within 90 days following close of the 90-day period referred to in Section 13 of the Plan, the claimant must file an appeal of the denial of a claim in writing with the Board requesting a review of such denial.

Prior to a decision on the appeal by the Board, the claimant or the claimant’s duly authorized representative may review pertinent documents and submit issues and comments in writing for consideration.  The issues and comments submitted by a claimant or the claimant’s duly authorized representative shall supplement the administrative record on which the appeal is to be decided and should contain all of the additional information the claimant wishes to be considered in the review.  

Within 60 days following receipt of an appeal, the Board shall render a written decision.  If circumstances require an extension of time for reviewing an appeal, written notice of the extension shall be furnished to the claimant or the claimant’s authorized representative prior to the commencement of the extension.  If an extension of time is elected, the Board shall render its decision within 120 days after receipt of the appeal.

The Board’s decision on the appeal shall be in writing, worded in a manner calculated to be understood by the claimant, and shall set forth (a) the reason or reasons for the decision and (b) specific reference to pertinent provisions of the plan on which the decision is based.

Any action brought for judicial review of the Board’s decision may be made only after the claims review process is completed and must commence within one year of the date on which the Board renders its final decision to the claimant in writing.

Notices.

The Cooperative shall notify NRECA in writing upon the occurrence of any of the following events:

The date each plan Participant is vested in the EBR benefit and due a payment,

The payment of any benefits to a Participant in the EBR, including the amount and time of the benefit payment,

The adoption, amendment or termination of the EBR, including a copy of the signed EBR as adopted or amended and the Board resolution authorizing such action or the resolution authorizing the termination of the EBR, and

The date on which the Participant incurs an RS Plan Benefit Election Date under the RS Plan.

All notices sent to NRECA shall be mailed to the address provided by NRECA in any Consulting Services Agreement to which NRECA and the Cooperative are both a party.