EXHIBIT 10.15
FORMS OF SECOND AMENDMENT TO
CHANGE IN CONTROL SEVERANCE AGREEMENTS
FORM 1
THIS AMENDMENT to Change in Control Severance Agreement ("Amendment")
dated as of June 28, 2001 is made by and between The PNC Financial Services
Group, Inc., a Pennsylvania corporation (the "Company"), and ____________
("Executive").
WHEREAS, the Company and Executive have previously entered into a
Change in Control Severance Agreement dated as of ____________, as amended by a
first amendment dated as of November 15, 2000 (the "Agreement"); and
WHEREAS, the Board of Directors of the Company has determined that it
is in the best interests of the Company and its shareholders to further amend
the Agreement; and
WHEREAS, Section 7.7 of the Agreement authorizes its modification in a
writing signed by both Executive and a designated officer of the Company;
NOW THEREFORE, in consideration of the premises and the mutual
covenants herein contained and intending to be legally bound hereby, the Company
and Executive hereby amend the Agreement as follows:
1. Defined Terms in Amendment; Headings. The definitions of capitalized
terms used in the Amendment will be the same as are set forth in the Agreement
except as amended herein. Headings used in the Amendment are provided for
reference and convenience only, shall not be considered part of the Amendment,
and shall not be employed in the construction of the Amendment.
2. Lump-Sum Matching Amount. Section 5.2(a) of the Agreement is hereby
amended and restated in its entirety as follows:
"(a) Lump-Sum Severance Payment. In lieu of any further salary
payments to Executive for periods subsequent to the Date of
Termination, the Company shall pay to Executive a lump sum severance
payment, in cash, equal to: (i) the Classification Factor (or, if less,
the Retirement Factor) times the sum of (x) Executive's Annual Base
Salary and (y) Executive's Annual Bonus; plus (ii) the Matching Amount,
if any."
3. Pension Benefits.
(i) Section 5.2(e)(i) of the Agreement is hereby amended and restated
in its entirety as follows:
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"(i) Pension Plan Benefits.
(1) The pension benefits accrued by Executive under the
Pension Plan, the Excess Plan and the SERP (the "Company Pension
Plans") shall be paid to Executive in accordance with the terms of such
plans.
(2) In the event that any amendments are made to the Company
Pension Plans during the Coverage Period that adversely affect in any
manner the amount of pension benefits payable to Executive under the
Company Pension Plans, then the Company shall also pay to Executive a
lump sum amount, in cash, equal to the difference between (A) the
amount that would have been payable on a lump sum basis as of the Date
of Termination without giving effect to such amendments and (B) the
amount actually paid or payable on a lump sum basis as of the Date of
Termination."
(ii) Section 5.2(e)(ii) of the Agreement is hereby amended to: (1)
change the heading from "Benefits Period Pension Accruals" to "Benefits Period
and Other Pension Accruals"; (2) replace the phrase "this Section 5.2(e)" in the
third sentence thereof with "Section 5.2(e)"; (3) add the phrase "at the Date of
Termination" to the end of clause (A)(III) of the definition of Adjusted Lump
Sum Amount in the third sentence thereof; (4) replace the word "his" in clause
(A)(V) of the definition of Adjusted Lump Sum Amount in the third sentence
thereof with "Executive's"; (5) replace the phrase "a lump sum distribution" in
clause (A)(V) of the definition of Adjusted Lump Sum Amount in the third
sentence thereof with the phrase "lump sum distributions"; (6) divide the third
sentence thereof into a third and a fourth sentence thereof by ending the
current third sentence at the end of clause (C) of the definition of Adjusted
Lump Sum Amount, deleting the conjunction "and", and making the remainder of
current sentence three into sentence four; (7) add the phrase "For purposes of
Section 5.2(e)," at the beginning of the fourth sentence thereof immediately
prior to the phrase "Date of Termination Lump Sum Amount"; (8) add the phrase ",
not taking into account any amounts that were not vested at the Date of
Termination," immediately after the phrase "means the total amount" in the
definition of Date of Termination Lump Sum Amount; and (9) replace the word
"his" in the definition of Date of Termination Lump Sum Amount with
"Executive's".
(iii) Section 5.2(e)(iii) of the Agreement is hereby amended by
numbering certain of the clauses in the first sentence thereof so that the
portion of the sentence from the word "assuming" to the end of the sentence
reads as follows: "assuming that Executive: (A) remained employed (after the
Date of Termination) for the Benefits Period; (B) was compensated during such
period at Executive's Annual Base Salary and Annual Bonus; and (C) was fully
vested under the Company Pension Plans."
(iv) Section 5.2(e)(iv) of the Agreement is hereby amended by replacing
the phrase "If the Executive has attained the age of 50" at the beginning of the
first sentence thereof with the phrase "If Executive has attained the age of
49".
(v) Section 5.2(e)(v) of the Agreement is hereby amended to change the
heading from "No Adverse Affect" to "No Adverse Effect" and to insert the phrase
"and calculations" after the word "determinations".
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4. Miscellaneous Amendments.
A. Continued Welfare Benefits.
(i) Section 5.2(c) of the Agreement is hereby amended by dividing the
current provisions of said section into numbered paragraphs as follows: (1) the
first and second sentences will be Section 5.2(c)(i); (2) the third and fourth
sentences will be Section 5.2(c)(ii); (3) the fifth sentence will be Section
5.2(c)(iii); (4) the sixth sentence will be Section 5.2(c)(iv); and (5) the
seventh (currently the last) sentence will be Section 5.2(c)(v).
(ii) Renumbered Sections 5.2(c)(ii) and (iv) of the Agreement are
hereby amended by replacing the phrase "this Section 5.2(c)" with "Section
5.2(c)".
(iii) Renumbered Section 5.2(c)(v) of the Agreement is hereby amended
and restated in its entirety as follows:
"(v) To the extent that the Company is unable to provide
Executive with any of the Welfare Benefits required by Section 5.2(c)
under the Company's benefit plans, the Company shall either (i)
purchase such Welfare Benefits for Executive or (ii) to the extent that
Executive is able to purchase such Welfare Benefits, pay to Executive a
cash payment equal, on an after-tax basis taking into account any
deductibility by Executive of premium payments made by Executive, to
the cost thereof, in either case reduced by an amount equal to the
premiums that Executive would have paid for such Welfare Benefits under
the applicable Company benefit plans immediately prior to the Notice of
Termination, as adjusted pursuant to Sections 5.2(c)(iii) and/or (iv)
if applicable."
(iv) Section 5.2(c) of the Agreement is hereby further amended to add
the following to the end of said Section 5.2(c) as new subsections (vi), (vii),
(viii), (ix) and (x) thereof:
"(vi) To the extent that the Welfare Benefits required to be
provided to Executive pursuant to Section 5.2(c) are group health
benefits within the meaning of Section 4980B of the Code, the Company
may, in its discretion, unless Executive has elected or is eligible to
elect coverage under a Company-sponsored retiree medical plan or plans
that provide medical benefits substantially similar to the medical
benefits Executive was receiving immediately prior to the Notice of
Termination, provide such benefits (hereafter referred to as "COBRA
Welfare Benefits") to Executive during any portion of the Benefits
Period that Executive is entitle to elect and receive continuation
coverage (within the meaning of Section 4980B of the Code) with respect
to such COBRA Welfare Benefits by (i) requiring Executive to elect
continuation coverage with respect to such COBRA Welfare Benefits as
the Company may designate and (ii) reimbursing Executive in cash, on an
after-tax basis taking into account any deductibility by Executive of
premium payments made by Executive, so that the net cost to Executive
of receiving such COBRA Welfare Benefits is not in excess of the cost
to Executive provided for by Section 5.2(c)(i), as adjusted pursuant to
Sections 5.2(c)(iii) and/or (iv) if applicable.
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(vii) If, as of the Date of Termination, Executive is eligible
to elect coverage under a Company-sponsored retiree medical plan or
plans that provide medical benefits substantially similar to the
medical benefits Executive was receiving immediately prior to the
Notice of Termination, the Company may, in its discretion, provide
medical benefits to Executive pursuant to Section 5.2(c) by (i)
requiring Executive to elect coverage under the Company's retiree
medical plan or plans, and (ii), to the extent, if any, that
Executive's retiree medical premiums exceed the premiums for Company
medical benefits that Executive paid immediately prior to the Notice of
Termination (as adjusted pursuant to Section 5.2(c)(iv) if applicable),
paying Executive in cash an amount equal to such difference, such
payment to be made on an after-tax basis taking into account any
deductibility by Executive of premium payments made by Executive.
(viii) If Executive elects retiree medical coverage on or
prior to the Date of Termination and has a post-retirement medical
account ("PRMA") under a Company-sponsored post-retirement medical
account plan ("PRMA Plan") as of the Date of Termination, then the
Company shall pay to Executive a lump sum amount in cash, on an
after-tax basis taking into account any deductibility by Executive of
premium payments made by Executive, equal to the difference between (1)
the Adjusted PRMA Amount and (2) the Date of Termination PRMA Amount.
For purposes of this Section 5.2(c)(viii): (A) "Adjusted PRMA Amount"
means the amount that would have been Executive's PRMA balance as of
the last day of the Benefits Period assuming that (i) Executive
remained employed as a full-time employee after the Date of Termination
through the last day of the Benefits Period, (ii) Executive elected not
to have retiree medical premiums deducted from Executive's PRMA during
the Benefits Period, and (iii) Executive's PRMA was credited with
interest at each year end during the Benefits Period at the same rate
as for the year end immediately preceding the Date of Termination or
the year end immediately preceding the commencement of the Coverage
Period in which the Date of Termination occurs, whichever rate is
higher; and (B) "Date of Termination PRMA Amount" means the amount of
Executive's PRMA balance as of the Date of Termination.
For purposes of this Section 5.2(c)(viii), all determinations
and calculations will be made on the basis of the terms and conditions
of the PRMA Plan as in effect immediately prior to the Date of
Termination or, if the PRMA Plan has been amended during the Coverage
Period in which the Date of Termination occurs so as to adversely
affect in any manner the amount of Executive's PRMA thereunder, as in
effect immediately prior to the commencement of the Coverage Period in
which the Date of Termination occurs.
(ix) If a PRMA would have been established for Executive under
the PRMA Plan had Executive remained employed as a full-time employee
after the Date of Termination through the last day of the Benefits
Period, or if Executive would have had a PRMA as of the Date of
Termination had the PRMA Plan not been terminated or amended during the
Coverage Period in which the Date of Termination occurs, then the
Company shall pay to Executive a lump sum amount in cash, on an
after-tax basis taking into account any deductibility by Executive of
premium payments made by Executive, equal to the difference between (1)
the Adjusted PRMA Amount and (2) the Date of Termination PRMA Amount.
For purposes of this Section
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5.2(c)(ix): (A) "Adjusted PRMA Amount" means the amount that would have
been Executive's PRMA balance as of the last day of the Benefits Period
assuming that (i) Executive remained employed as a full-time employee
after the Date of Termination through the last day of the Benefits
Period, (ii) Executive elected retiree medical coverage on or prior to
the Date of Termination but elected not to have retiree medical
premiums deducted from Executive's PRMA during the Benefits Period, and
(iii) Executive's PRMA was credited with interest at each year end
during the Benefits Period at the same rate as for the year end
immediately preceding the Date of Termination or the year end
immediately preceding the commencement of the Coverage Period in which
the Date of Termination occurs, whichever rate is higher; and (B) "Date
of Termination PRMA Amount" means the amount of Executive's PRMA
balance as of the Date of Termination.
For purposes of this Section 5.2(c)(ix), all determinations
and calculations will be made on the basis of the terms and conditions
of the PRMA Plan as in effect immediately prior to the Date of
Termination or, if the PRMA Plan is no longer in effect on the Date of
Termination or has been amended during the Coverage Period in which the
Date of Termination occurs so as to adversely affect in any manner the
amount of Executive's PRMA thereunder, as in effect immediately prior
to the commencement of the Coverage Period in which the Date of
Termination occurs.
(x) All group health benefits provided to Executive pursuant
to Section 5.2(c) shall constitute continuation coverage for purposes
of Part 6 of Title I of the Employee Retirement Income Security Act of
1974, as amended, and Section 4980B of the Code to the maximum extent
permitted thereby."
B. Other Benefits. Section 5.2(d) of the Agreement is hereby amended
and restated in its entirety as follows:
"(d) Other Benefits. The Company shall pay to Executive a lump
sum cash payment equal to the product of (i) the Classification Factor
(or, if less, the Retirement Factor) and (ii) the greater of (x) the
Perquisites Allowance paid or payable by the Company to Executive for
the Termination Year and (y) the Perquisites Allowance paid or payable
by the Company to Executive for the fiscal year immediately preceding
the commencement of the Coverage Period.
Any club membership bond or certificate held by the Company on
behalf of Executive shall be transferred to Executive as appropriate to
enable Executive to retain such club membership.
In addition, during the Benefits Period, the Company shall
continue to pay for and provide Executive with access to personal
financial consulting services that are substantially similar to that
which the Company provided Executive with during the fiscal year
immediately preceding the Termination Year."
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C. Disability Benefit Offset.
(i) The first sentence of Section 5.2 of the Agreement is hereby
amended to: (1) replace the reference to "Subsections (a) through (e)" with
"Subsections (a) through (f)"; (2) delete the phrase "or Disability" from clause
(ii) thereof; (3) insert "(iii)" immediately before the phrase "after the
Executive attains age sixty-five (65)"; and (4) renumber current clause (iii)
thereof as clause (iv).
(ii) The second sentence of Section 7.1 of the Agreement is hereby
amended by adding "Section 5.2(f)" after the reference to "Section 5.2(c)".
(iii) Section 8 of the Agreement is hereby amended to delete the
definition of Disability, which currently appears as Section 8.17.
(iv) Section 5.2 of the Agreement is hereby further amended to add the
following to the end of said section as new subsection (f):
"(f) Disability Benefit Offset. If, as of the Date of
Termination, Executive is eligible to receive disability benefits under
one or more of the Company's or one of its affiliates' long-term
disability plans that cover Executive (collectively, the "LTD Plan")
because of a determination that Executive is totally or partially
disabled, then:
(i) the aggregate lump-sum cash payment to be paid to
Executive pursuant to Section 5.2(a) shall be reduced (but not
to less than zero) by the product of (x) the gross annualized
cash disability benefit that is payable to Executive pursuant
to the LTD Plan as of the Date of Termination and (y) the
Classification Factor (or, if less, the Retirement Factor);
(ii) notwithstanding Section 5.2(f)(i), if Executive
ceases to receive disability benefits under the LTD Plan prior
to the expiration of a number of years after the Date of
Termination equal to the Classification Factor (or, if less,
the Retirement Factor), then the Company shall promptly pay to
Executive an additional lump-sum cash payment equal to the
difference between (x) the amount by which the aggregate
lump-sum cash payment made to Executive pursuant to Section
5.2(a) was reduced by reason of Section 5.2(f)(i) and (y) the
total gross amount of the cash disability benefits paid to
Executive pursuant to the LTD Plan during the period from the
Date of Termination until the date disability benefit payments
to Executive pursuant to the LTD Plan ceased; and
(iii) for purposes of Benefits Period pension and
SERP accruals pursuant to Section 5.2(e)(ii) and (iii),
Executive's Annual Base Salary and Annual Bonus together shall
not be less than the greater of (x) the gross annualized cash
disability benefit that is payable to Executive pursuant to
the LTD Plan as of the Date of Termination and (y) the amount
of compensation taken into account for purposes of Executive's
earnings credits under the relevant Company Pension Plans
immediately prior to the Date of Termination annualized."
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D. Interest. Certain references to interest in the Agreement are hereby
clarified and amended as follows:
(i) The phrase "plus interest on the amount of such repayment at the
rate provided in Section 1274(b)(2)(B) of the Code" at the end of the first
sentence of Section 5.3(c) of the Agreement is hereby replaced with the
following phrase:
"plus Interest on the amount of such repayment for the period that the
applicable portion of the Gross-Up Payment being repaid was held by
Executive".
(ii) The parenthetical "(together with interest at the rate provided in
Section 1274(b)(2)(B) of the Code from the Date of Termination to the payment of
such remainder)" in the second sentence of Section 5.4 of the Agreement is
hereby replaced with the following:
"(together with Interest from the Date of Termination to the payment
of such remainder)".
(iii) The parenthetical "(together with interest at the rate provided
in Section 1274(b)(2)(B) of the Code from the Date of Termination to the
repayment of such excess)" at the end of the third sentence of Section 5.4 of
the Agreement is hereby replaced with the following:
"(together with Interest from the Date of Termination to the repayment
of such excess)."
(iv) The phrase "together with interest accrued thereon at the rate
provided in Section 1274(b)(2)(B) of the Code" at the end of the last sentence
of Section 6.2 of the Agreement is hereby replaced with the following:
"together with Interest accrued thereon."
E. Timing of Payments. The first sentence of Section 5.4 of the
Agreement is hereby amended by: (1) replacing the reference to "Section 5.2(c)"
with "Sections 5.2(c)(i) through (vii)"; (2) replacing the reference to "Section
5.2(e)(i)" with "Section 5.2(e)(i)(1)"; (3) adding "Section 5.2(f)(ii)" after
the reference to "Section 5.2(e)(i)(1)"; and (4) replacing the phrase "the last
sentence of Section 5.2(d)" with the phrase "the last paragraph of Section
5.2(d)".
F. Reimbursement of Legal Costs. The first sentence of Section 5.5 of
the Agreement is hereby amended by replacing clause (iii) thereof with the
following:
"(iii) in connection with any tax audit or proceeding to the extent
attributable to the application of Section 4999 of the Code to any of
the Total Benefits."
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G. Notice of Termination. The first sentence of Section 6.1 of the
Agreement is hereby amended to add the following phrase immediately after the
parenthetical "(other than by reason of death)" in such sentence:
", whether or not Executive's employment status was classified as
active at the time of termination,".
H. Notices. Section 7.6 of the Agreement is hereby amended to provide
that: (1) notices to the Company shall be sent to the attention of the chief
human resources executive of the Company; and (2) the copy (which shall not be
deemed notice) of notices to the Company shall be sent to the attention of the
general counsel of the Company.
I. Modification; Waiver. The first sentence of Section 7.7 of the
Agreement is hereby amended and restated in its entirety as follows:
"No provision of this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing
and signed by Executive and such officer as may be authorized by the
Board or the Committee."
J. Changes to Statutes, Employee Benefit Plans and Employee
Classification Systems. Section 7.10 of the Agreement is hereby amended by
adding the phrase "or programs" after the phrase "employee benefit plans" in the
heading and in the second sentence thereof and by adding ", programs" after the
phrases "such plans" and "successor plans" in said sentence.
K. Reduction of Agreement Benefits by Other Required Benefits.
(i) Section 7.16 of the Agreement is hereby amended to add the
following phrase immediately prior to the phrase "any Severance Benefits
hereunder" in the first sentence thereof:
", to the extent required to avoid duplication of the same or similar
benefits,".
(ii) Section 7.16 of the Agreement is hereby further amended to add the
following sentence to the end of said section:
"Nothing in this Section 7.16 shall be construed so as to reduce any
Severance Benefits hereunder by the amount or value of any payments or
benefits provided to Executive with respect to any awards under the
Company's 1997 Long-Term Incentive Award Plan, as amended from time to
time, or any successor plan or plans."
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L. Headings. Section 7.17 of the Agreement is hereby amended to delete
the phrase "and captions".
5. Amend Certain Definitions.
(i) The following definitions in Section 8 of the Agreement are hereby
amended and restated in their entirety as follows:
" "Annual Base Salary" means the greater of (a) Executive's
highest annual base salary in effect during the one (1) year period
preceding the commencement of the applicable Coverage Period and (b)
Executive's highest annual base salary in effect during the one (1)
year period preceding Executive's Date of Termination.
For purposes of this definition, at any time when Executive is
receiving disability benefits under the LTD Plan (as defined in Section
5.2(f)), Executive's annual base salary will be deemed to be the same
as Executive's annual base salary immediately prior to the time such
disability benefits commenced."
" "Bonus Percent" means the cash value of the bonus amount
paid or payable to Executive pursuant to the 1996 Plan or any other
Company incentive compensation or bonus plan with respect to a
particular fiscal year (including the cash value of any portion of the
bonus amount paid in stock and of any additional stock or restricted
stock awarded to Executive with respect to the portion of the base
bonus amount paid in stock) divided by the aggregate base salary paid
or payable to Executive for such fiscal year; provided, however, that
with respect to the fiscal year preceding the Termination Year, the
Bonus Percent will not be less than Executive's highest Target
Percentage that was in effect during such fiscal year.
For purposes of this definition, shares of stock or restricted
stock will be valued without regard to any vesting, transfer or other
restrictions applicable to such stock and will be deemed to have a per
share cash value equal to the closing price of the stock, as of the
date the shares were awarded, on the principal stock exchange on which
the stock is traded.
Also, for purposes of this definition, if Executive is
receiving disability benefits under the LTD Plan (as defined in Section
5.2(f)), base salary paid or payable to Executive during the period in
which Executive is receiving such disability benefits will be deemed to
be the amount Executive would have received if Executive had been
receiving base salary during such period at the same annual base salary
rate that was in effect immediately prior to the time such disability
benefits commenced."
" "Code" means the Internal Revenue Code of 1986, as amended,
including any regulations promulgated thereunder."
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" "Excess Plan" means The PNC Financial Services Group, Inc.
ERISA Excess Pension Plan."
" "Exchange Act" means the Securities Exchange Act of 1934, as
amended, including any regulations promulgated thereunder."
" "SERP" means The PNC Financial Services Group, Inc.
Supplemental Executive Retirement Plan."
" "Subsidiary" means any corporation, limited liability
company, or other entity controlled by the Company, directly or
indirectly."
" "Target Percentage" means the percentage of Executive's
annual base salary on which Executive's target cash incentive award
pursuant to the 1996 Plan or any other Company incentive compensation
or bonus plan then in effect is based for a particular fiscal year.
Such percentage is established annually by the Committee in
administering the applicable plan. In the event that the Committee
established that Executive's incentive award for such fiscal year would
be increased by awarding Executive additional shares of stock or
restricted stock with respect to any portion of the award to be paid in
stock, the Target Percentage will be increased to take into account the
cash value of such additional shares.
For purposes of this definition, shares of stock or restricted
stock will be valued without regard to any vesting, transfer or other
restrictions applicable to such stock and will be deemed to have a per
share cash value equal to the closing price of the stock, as of the
date the shares were awarded, on the principal stock exchange on which
the stock is traded."
(ii) Certain other definitions in Section 8 of the Agreement are hereby
amended as follows:
(1) The phrase "of the Company" is hereby added after the
phrase "the Chief Executive Officer" in the second sentence of the paragraph
following clause (b) of current Section 8.6 of the Agreement.
(2) The phrase "plans of the Company" in current Section
8.7(a) of the Agreement is hereby replaced with the phrase "plans of the Company
and its Subsidiaries".
(3) In the second sentence of current Section 8.13 of the
Agreement, the phrase "to be accorded by the "Company" " is hereby replaced with
the phrase "provided or to be provided by the Company" and the phrase "to be
provided by such Subsidiary" is hereby replaced with the phrase "provided or to
be provided by such Subsidiary".
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(4) The phrase "or program" is hereby inserted after the word
"plan" each time it appears in current Section 8.21(d) of the Agreement, and the
phrase "or programs" is hereby inserted after the phrase "welfare plans" in
current Section 8.21(e) of the Agreement.
(iii) Section 8 of the Agreement is hereby further amended by deleting
the definition of 1994 Plan, which currently appears as Section 8.32.
(iv) The first unnumbered paragraph of the Agreement is hereby amended
by deleting the parenthetical "(the "Company")".
6. New Definitions. Section 8 of the Agreement is hereby further
amended to add the following new definitions:
" "Interest" means interest at the Federal short-term rate,
the Federal mid-term rate, or the Federal long-term, as applicable,
compounded semiannually, under Section 1274(b)(2)(B) of the Code based
on the period over which interest is being accrued."
" "Matching Amount" means the maximum amount that Executive
would have been eligible to have credited to Executive's plan accounts
under The PNC Financial Services Group, Inc. Incentive Savings Plan and
the Supplemental Savings Plan (or similar plan or plans sponsored by a
Subsidiary, if applicable to Executive) (the plans applicable to
Executive being hereafter referred to as the "Savings Plans") by
Executive's employer as a matching contribution or credit assuming: (a)
Executive had remained an employee of the Company after the Date of
Termination for a number of years after the Date of Termination equal
to the Classification Factor (or, if less, the Retirement Factor); (b)
Executive received (i) a base salary and annual bonus equal to the
Annual Base Salary and Annual Bonus with respect to, and paid in, each
year during such period (or, if the Retirement Factor is applicable and
includes a fraction, a base salary and annual bonus equal to the Annual
Base Salary and Annual Bonus for any full year during such period and a
base salary and annual bonus equal to such fraction times the Annual
Base Salary and Annual Bonus during the fraction of a year in such
period) plus (ii) a bonus with respect to the Termination Year equal to
the amount payable to Executive pursuant to Section 5.2(b)(i), paid in
the year after the Termination Year, and a bonus with respect to the
fiscal year preceding the Termination Year equal to the amount, if any,
payable to Executive pursuant to Section 5.2(b)(ii), paid in the
Termination Year; (c) Executive had elected to participate in the
Savings Plans and to defer the maximum percentage of such base salary
and/or bonuses under the Savings Plans; (d) Executive's employer had
made the maximum matching contribution or credit with respect to such
amounts under the Savings Plans; and (e) all such matching
contributions or credits were fully vested.
In calculating the Matching Amount, all determinations and
calculations will be made on the basis of the terms and conditions of
the Savings Plans as in effect immediately prior to the Date of
Termination or, if it would result in a larger Matching Amount, as in
effect immediately prior to the commencement of the Coverage Period in
which the Date of Termination occurs.
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Notwithstanding the foregoing, unless, immediately prior to
the Date of Termination, Executive was eligible to participate in and
receive employer matching contributions or credits under the Savings
Plans, or would have been so eligible had the Savings Plans remained as
in effect immediately prior to the commencement of the Coverage Period
in which the Date of Termination occurs, the Matching Amount will be
deemed to be zero."
" "Perquisites Allowance" means the amount Executive received
or was eligible to receive as a perquisites allowance for any fiscal
year. If Executive was not eligible to receive and did not receive a
perquisites allowance for any fiscal year, then for that fiscal year,
Perquisites Allowance means the value of any perquisites provided to or
paid on behalf of Executive during such fiscal year that would have
been reportable as Other Annual Compensation for Executive for such
fiscal year pursuant to Item 402(b)(2)(iii)(C)(1) of Regulation S-K (or
any similar item) promulgated under the Exchange Act, without regard to
any exclusion in said item for amounts that are less than a specified
amount or aggregate amount, if Company had been subject to such
reporting requirement with respect to Executive for such fiscal year."
" "Total Benefits" has the meaning assigned to such term in
Section 5.3(a)(i)."
7. Renumber Certain Definitions. The definitions in Section 8 of the
Agreement are hereby numbered or renumbered, as the case may be, so that they
appear in alphabetical order after the additions and deletions set forth in the
Amendment, and any references in the Agreement to definitions by section number
are also hereby amended accordingly.
IN WITNESS WHEREOF, the Company has caused the Amendment to be
executed by its officer, thereunto duly authorized, and Executive has executed
the Amendment, all as of June 28, 2001.
THE PNC FINANCIAL SERVICES
GROUP, INC.
By:
----------------------------
[Name]
[Title]
EXECUTIVE
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[Name]
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FORM 2
THIS AMENDMENT to Change in Control Severance Agreement ("Amendment")
dated as of June 28, 2001 is made by and between The PNC Financial Services
Group, Inc., a Pennsylvania corporation (the "Company"), and _______________
("Executive").
WHEREAS, the Company and Executive have previously entered into a
Change in Control Severance Agreement dated as of __________________, as amended
by a first amendment dated as of November 15, 2000 (the "Agreement"); and
WHEREAS, the Board of Directors of the Company has determined that it
is in the best interests of the Company and its shareholders to further amend
the Agreement; and
WHEREAS, Section 7.7 of the Agreement authorizes its modification in a
writing signed by both Executive and a designated officer of the Company;
NOW THEREFORE, in consideration of the premises and the mutual
covenants herein contained and intending to be legally bound hereby, the Company
and Executive hereby amend the Agreement as follows:
1. Defined Terms in Amendment; Headings. The definitions of capitalized
terms used in the Amendment will be the same as are set forth in the Agreement
except as amended herein. Headings used in the Amendment are provided for
reference and convenience only, shall not be considered part of the Amendment,
and shall not be employed in the construction of the Amendment.
2. Lump-Sum Matching Amount. Section 5.2(a) of the Agreement is hereby
amended and restated in its entirety as follows:
"(a) Lump-Sum Severance Payment. In lieu of any further salary
payments to Executive for periods subsequent to the Date of
Termination, the Company shall pay to Executive a lump sum severance
payment, in cash, equal to: (i) the Classification Factor (or, if less,
the Retirement Factor) times the sum of (x) Executive's Annual Base
Salary and (y) Executive's Annual Bonus; plus (ii) the Matching Amount,
if any."
3. Pension Benefits.
(i) Section 5.2(e)(i) of the Agreement is hereby amended and restated
in its entirety as follows:
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"(i) Pension Plan Benefits.
(1) The pension benefits accrued by Executive under
the Pension Plan, the Excess Plan and the SERP (the "Company Pension
Plans") shall be paid to Executive in accordance with the terms of such
plans.
(2) In the event that any amendments are made to the
Company Pension Plans during the Coverage Period that adversely affect
in any manner the amount of pension benefits payable to Executive under
the Company Pension Plans, then the Company shall also pay to Executive
a lump sum amount, in cash, equal to the difference between (A) the
amount that would have been payable on a lump sum basis as of the Date
of Termination without giving effect to such amendments and (B) the
amount actually paid or payable on a lump sum basis as of the Date of
Termination."
(ii) Section 5.2(e)(ii) of the Agreement is hereby amended to: (1)
change the heading from "Benefits Period Pension Accruals" to "Benefits Period
and Other Pension Accruals"; (2) replace the phrase "this Section 5.2(e)" in the
third sentence thereof with "Section 5.2(e)"; (3) add the phrase "at the Date of
Termination" to the end of clause (A)(III) of the definition of Adjusted Lump
Sum Amount in the third sentence thereof; (4) replace the word "his" in clause
(A)(V) of the definition of Adjusted Lump Sum Amount in the third sentence
thereof with "Executive's"; (5) replace the phrase "a lump sum distribution" in
clause (A)(V) of the definition of Adjusted Lump Sum Amount in the third
sentence thereof with the phrase "lump sum distributions"; (6) divide the third
sentence thereof into a third and a fourth sentence thereof by ending the
current third sentence at the end of clause (C) of the definition of Adjusted
Lump Sum Amount, deleting the conjunction "and", and making the remainder of
current sentence three into sentence four; (7) add the phrase "For purposes of
Section 5.2(e)," at the beginning of the fourth sentence thereof immediately
prior to the phrase "Date of Termination Lump Sum Amount"; (8) add the phrase ",
not taking into account any amounts that were not vested at the Date of
Termination," immediately after the phrase "means the total amount" in the
definition of Date of Termination Lump Sum Amount; and (9) replace the word
"his" in the definition of Date of Termination Lump Sum Amount with
"Executive's".
(iii) Section 5.2(e)(iii) of the Agreement is hereby amended by
replacing the phrase "If the Executive has attained the age of 50" at the
beginning of the first sentence thereof with the phrase "If Executive has
attained the age of 49".
(iv) Section 5.2(e)(iv) of the Agreement is hereby amended to change
the heading from "No Adverse Affect" to "No Adverse Effect" and to insert the
phrase "and calculations" after the word "determinations".
4. Miscellaneous Amendments.
A. Continued Welfare Benefits.
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(i) Section 5.2(c) of the Agreement is hereby amended by dividing the
current provisions of said section into numbered paragraphs as follows: (1) the
first and second sentences will be Section 5.2(c)(i); (2) the third and fourth
sentences will be Section 5.2(c)(ii); (3) the fifth sentence will be Section
5.2(c)(iii); (4) the sixth sentence will be Section 5.2(c)(iv); and (5) the
seventh (currently the last) sentence will be Section 5.2(c)(v).
(ii) Renumbered Sections 5.2(c)(ii) and (iv) of the Agreement are
hereby amended by replacing the phrase "this Section 5.2(c)" with "Section
5.2(c)".
(iii) Renumbered Section 5.2(c)(v) of the Agreement is hereby amended
and restated in its entirety as follows:
"(v) To the extent that the Company is unable to provide
Executive with any of the Welfare Benefits required by Section 5.2(c)
under the Company's benefit plans, the Company shall either (i)
purchase such Welfare Benefits for Executive or (ii) to the extent that
Executive is able to purchase such Welfare Benefits, pay to Executive a
cash payment equal, on an after-tax basis taking into account any
deductibility by Executive of premium payments made by Executive, to
the cost thereof, in either case reduced by an amount equal to the
premiums that Executive would have paid for such Welfare Benefits under
the applicable Company benefit plans immediately prior to the Notice of
Termination, as adjusted pursuant to Sections 5.2(c)(iii) and/or (iv)
if applicable."
(iv) Section 5.2(c) of the Agreement is hereby further amended to add
the following to the end of said Section 5.2(c) as new subsections (vi), (vii),
(viii), (ix) and (x) thereof:
"(vi) To the extent that the Welfare Benefits required to be
provided to Executive pursuant to Section 5.2(c) are group health
benefits within the meaning of Section 4980B of the Code, the Company
may, in its discretion, unless Executive has elected or is eligible to
elect coverage under a Company-sponsored retiree medical plan or plans
that provide medical benefits substantially similar to the medical
benefits Executive was receiving immediately prior to the Notice of
Termination, provide such benefits (hereafter referred to as "COBRA
Welfare Benefits") to Executive during any portion of the Benefits
Period that Executive is entitle to elect and receive continuation
coverage (within the meaning of Section 4980B of the Code) with respect
to such COBRA Welfare Benefits by (i) requiring Executive to elect
continuation coverage with respect to such COBRA Welfare Benefits as
the Company may designate and (ii) reimbursing Executive in cash, on an
after-tax basis taking into account any deductibility by Executive of
premium payments made by Executive, so that the net cost to Executive
of receiving such COBRA Welfare Benefits is not in excess of the cost
to Executive provided for by Section 5.2(c)(i), as adjusted pursuant to
Sections 5.2(c)(iii) and/or (iv) if applicable.
(vii) If, as of the Date of Termination, Executive is eligible
to elect coverage under a Company-sponsored retiree medical plan or
plans that provide medical benefits substantially similar to the
medical benefits Executive was receiving immediately prior to the
Notice of Termination, the Company may, in its discretion, provide
medical benefits to Executive pursuant to Section 5.2(c) by (i)
requiring Executive to elect coverage under the Company's
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retiree medical plan or plans, and (ii), to the extent, if any, that
Executive's retiree medical premiums exceed the premiums for Company
medical benefits that Executive paid immediately prior to the Notice of
Termination (as adjusted pursuant to Section 5.2(c)(iv) if applicable),
paying Executive in cash an amount equal to such difference, such
payment to be made on an after-tax basis taking into account any
deductibility by Executive of premium payments made by Executive.
(viii) If Executive elects retiree medical coverage on or
prior to the Date of Termination and has a post-retirement medical
account ("PRMA") under a Company-sponsored post-retirement medical
account plan ("PRMA Plan") as of the Date of Termination, then the
Company shall pay to Executive a lump sum amount in cash, on an
after-tax basis taking into account any deductibility by Executive of
premium payments made by Executive, equal to the difference between (1)
the Adjusted PRMA Amount and (2) the Date of Termination PRMA Amount.
For purposes of this Section 5.2(c)(viii): (A) "Adjusted PRMA Amount"
means the amount that would have been Executive's PRMA balance as of
the last day of the Benefits Period assuming that (i) Executive
remained employed as a full-time employee after the Date of Termination
through the last day of the Benefits Period, (ii) Executive elected not
to have retiree medical premiums deducted from Executive's PRMA during
the Benefits Period, and (iii) Executive's PRMA was credited with
interest at each year end during the Benefits Period at the same rate
as for the year end immediately preceding the Date of Termination or
the year end immediately preceding the commencement of the Coverage
Period in which the Date of Termination occurs, whichever rate is
higher; and (B) "Date of Termination PRMA Amount" means the amount of
Executive's PRMA balance as of the Date of Termination.
For purposes of this Section 5.2(c)(viii), all determinations
and calculations will be made on the basis of the terms and conditions
of the PRMA Plan as in effect immediately prior to the Date of
Termination or, if the PRMA Plan has been amended during the Coverage
Period in which the Date of Termination occurs so as to adversely
affect in any manner the amount of Executive's PRMA thereunder, as in
effect immediately prior to the commencement of the Coverage Period in
which the Date of Termination occurs.
(ix) If a PRMA would have been established for Executive under
the PRMA Plan had Executive remained employed as a full-time employee
after the Date of Termination through the last day of the Benefits
Period, or if Executive would have had a PRMA as of the Date of
Termination had the PRMA Plan not been terminated or amended during the
Coverage Period in which the Date of Termination occurs, then the
Company shall pay to Executive a lump sum amount in cash, on an
after-tax basis taking into account any deductibility by Executive of
premium payments made by Executive, equal to the difference between (1)
the Adjusted PRMA Amount and (2) the Date of Termination PRMA Amount.
For purposes of this Section 5.2(c)(ix): (A) "Adjusted PRMA Amount"
means the amount that would have been Executive's PRMA balance as of
the last day of the Benefits Period assuming that (i) Executive
remained employed as a full-time employee after the Date of Termination
through the last day of the Benefits Period, (ii) Executive elected
retiree medical coverage on or prior to the Date of Termination but
elected not to have retiree medical premiums deducted from Executive's
PRMA during the Benefits Period, and (iii) Executive's PRMA was
credited with interest at
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each year end during the Benefits Period at the same rate as for the
year end immediately preceding the Date of Termination or the year end
immediately preceding the commencement of the Coverage Period in which
the Date of Termination occurs, whichever rate is higher; and (B) "Date
of Termination PRMA Amount" means the amount of Executive's PRMA
balance as of the Date of Termination.
For purposes of this Section 5.2(c)(ix), all determinations
and calculations will be made on the basis of the terms and conditions
of the PRMA Plan as in effect immediately prior to the Date of
Termination or, if the PRMA Plan is no longer in effect on the Date of
Termination or has been amended during the Coverage Period in which the
Date of Termination occurs so as to adversely affect in any manner the
amount of Executive's PRMA thereunder, as in effect immediately prior
to the commencement of the Coverage Period in which the Date of
Termination occurs.
(x) All group health benefits provided to Executive pursuant
to Section 5.2(c) shall constitute continuation coverage for purposes
of Part 6 of Title I of the Employee Retirement Income Security Act of
1974, as amended, and Section 4980B of the Code to the maximum extent
permitted thereby."
B. Other Benefits. Section 5.2(d) of the Agreement is hereby amended
and restated in its entirety as follows:
"(d) Other Benefits. The Company shall pay to Executive a lump
sum cash payment equal to the product of (i) the Classification Factor
(or, if less, the Retirement Factor) and (ii) the greater of (x) the
Perquisites Allowance paid or payable by the Company to Executive for
the Termination Year and (y) the Perquisites Allowance paid or payable
by the Company to Executive for the fiscal year immediately preceding
the commencement of the Coverage Period.
Any club membership bond or certificate held by the Company on
behalf of Executive shall be transferred to Executive as appropriate to
enable Executive to retain such club membership.
In addition, during the Benefits Period, the Company shall
continue to pay for and provide Executive with access to personal
financial consulting services that are substantially similar to that
which the Company provided Executive with during the fiscal year
immediately preceding the Termination Year."
C. Disability Benefit Offset.
(i) The first sentence of Section 5.2 of the Agreement is hereby
amended to: (1) replace the reference to "Subsections (a) through (e)" with
"Subsections (a) through (f)"; (2) delete the phrase "or Disability" from clause
(ii) thereof; (3) insert "(iii)" immediately before the phrase "after the
Executive attains age sixty-five (65)"; and (4) renumber current clause (iii)
thereof as clause (iv).
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(ii) The second sentence of Section 7.1 of the Agreement is hereby
amended by adding "Section 5.2(f)" after the reference to "Section 5.2(c)".
(iii) Section 8 of the Agreement is hereby amended to delete the
definition of Disability, which currently appears as Section 8.17.
(iv) Section 5.2 of the Agreement is hereby further amended to add the
following to the end of said section as new subsection (f):
"(f) Disability Benefit Offset. If, as of the Date of
Termination, Executive is eligible to receive disability benefits under
one or more of the Company's or one of its affiliates' long-term
disability plans that cover Executive (collectively, the "LTD Plan")
because of a determination that Executive is totally or partially
disabled, then:
(i) the aggregate lump-sum cash payment to be paid to
Executive pursuant to Section 5.2(a) shall be reduced (but not
to less than zero) by the product of (x) the gross annualized
cash disability benefit that is payable to Executive pursuant
to the LTD Plan as of the Date of Termination and (y) the
Classification Factor (or, if less, the Retirement Factor);
(ii) notwithstanding Section 5.2(f)(i), if Executive
ceases to receive disability benefits under the LTD Plan prior
to the expiration of a number of years after the Date of
Termination equal to the Classification Factor (or, if less,
the Retirement Factor), then the Company shall promptly pay to
Executive an additional lump-sum cash payment equal to the
difference between (x) the amount by which the aggregate
lump-sum cash payment made to Executive pursuant to Section
5.2(a) was reduced by reason of Section 5.2(f)(i) and (y) the
total gross amount of the cash disability benefits paid to
Executive pursuant to the LTD Plan during the period from the
Date of Termination until the date disability benefit payments
to Executive pursuant to the LTD Plan ceased; and
(iii) for purposes of Benefits Period pension and
SERP accruals pursuant to Section 5.2(e)(ii), Executive's
Annual Base Salary and Annual Bonus together shall not be less
than the greater of (x) the gross annualized cash disability
benefit that is payable to Executive pursuant to the LTD Plan
as of the Date of Termination and (y) the amount of
compensation taken into account for purposes of Executive's
earnings credits under the relevant Company Pension Plans
immediately prior to the Date of Termination annualized."
D. Interest. Certain references to interest in the Agreement are hereby
clarified and amended as follows:
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(i) The phrase "plus interest on the amount of such repayment at the
rate provided in Section 1274(b)(2)(B) of the Code" at the end of the first
sentence of Section 5.3(c) of the Agreement is hereby replaced with the
following phrase:
"plus Interest on the amount of such repayment for the period that the
applicable portion of the Gross-Up Payment being repaid was held by
Executive".
(ii) The parenthetical "(together with interest at the rate provided in
Section 1274(b)(2)(B) of the Code from the Date of Termination to the payment of
such remainder)" in the second sentence of Section 5.4 of the Agreement is
hereby replaced with the following:
"(together with Interest from the Date of Termination to the payment
of such remainder)".
(iii) The parenthetical "(together with interest at the rate provided
in Section 1274(b)(2)(B) of the Code from the Date of Termination to the
repayment of such excess)" at the end of the third sentence of Section 5.4 of
the Agreement is hereby replaced with the following:
"(together with Interest from the Date of Termination to the repayment
of such excess)."
(iv) The phrase "together with interest accrued thereon at the rate
provided in Section 1274(b)(2)(B) of the Code" at the end of the last sentence
of Section 6.2 of the Agreement is hereby replaced with the following:
"together with Interest accrued thereon."
E. Timing of Payments. The first sentence of Section 5.4 of the
Agreement is hereby amended by: (1) replacing the reference to "Section 5.2(c)"
with "Sections 5.2(c)(i) through (vii)"; (2) replacing the reference to "Section
5.2(e)(i)" with "Section 5.2(e)(i)(1)"; (3) adding "Section 5.2(f)(ii)" after
the reference to "Section 5.2(e)(i)(1)"; and (4) replacing the phrase "the last
sentence of Section 5.2(d)" with the phrase "the last paragraph of Section
5.2(d)".
F. Reimbursement of Legal Costs. The first sentence of Section 5.5 of
the Agreement is hereby amended by replacing clause (iii) thereof with the
following:
"(iii) in connection with any tax audit or proceeding to the extent
attributable to the application of Section 4999 of the Code to any of
the Total Benefits."
G. Notice of Termination. The first sentence of Section 6.1 of the
Agreement is hereby amended to add the following phrase immediately after the
parenthetical "(other than by reason of death)" in such sentence:
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", whether or not Executive's employment status was classified as
active at the time of termination,".
H. Notices. Section 7.6 of the Agreement is hereby amended to provide
that: (1) notices to the Company shall be sent to the attention of the chief
human resources executive of the Company; and (2) the copy (which shall not be
deemed notice) of notices to the Company shall be sent to the attention of the
general counsel of the Company.
I. Modification; Waiver. The first sentence of Section 7.7 of the
Agreement is hereby amended and restated in its entirety as follows:
"No provision of this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing
and signed by Executive and such officer as may be authorized by the
Board or the Committee."
J. Changes to Statutes, Employee Benefit Plans and Employee
Classification Systems. Section 7.10 of the Agreement is hereby amended by
adding the phrase "or programs" after the phrase "employee benefit plans" in the
heading and in the second sentence thereof and by adding ", programs" after the
phrases "such plans" and "successor plans" in said sentence.
K. Reduction of Agreement Benefits by Other Required Benefits.
(i) Section 7.16 of the Agreement is hereby amended to add the
following phrase immediately prior to the phrase "any Severance Benefits
hereunder" in the first sentence thereof:
", to the extent required to avoid duplication of the same or similar
benefits,".
(ii) Section 7.16 of the Agreement is hereby further amended to add the
following sentence to the end of said section:
"Nothing in this Section 7.16 shall be construed so as to reduce any
Severance Benefits hereunder by the amount or value of any payments or
benefits provided to Executive with respect to any awards under the
Company's 1997 Long-Term Incentive Award Plan, as amended from time to
time, or any successor plan or plans."
L. Headings. Section 7.17 of the Agreement is hereby amended to delete
the phrase "and captions".
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5. Amend Certain Definitions.
(i) The following definitions in Section 8 of the Agreement are hereby
amended and restated in their entirety as follows:
" "Annual Base Salary" means the greater of (a) Executive's
highest annual base salary in effect during the one (1) year period
preceding the commencement of the applicable Coverage Period and (b)
Executive's highest annual base salary in effect during the one (1)
year period preceding Executive's Date of Termination.
For purposes of this definition, at any time when Executive is
receiving disability benefits under the LTD Plan (as defined in Section
5.2(f)), Executive's annual base salary will be deemed to be the same
as Executive's annual base salary immediately prior to the time such
disability benefits commenced."
" "Bonus Percent" means the cash value of the bonus amount
paid or payable to Executive pursuant to the 1996 Plan or any other
Company incentive compensation or bonus plan with respect to a
particular fiscal year (including the cash value of any portion of the
bonus amount paid in stock and of any additional stock or restricted
stock awarded to Executive with respect to the portion of the base
bonus amount paid in stock) divided by the aggregate base salary paid
or payable to Executive for such fiscal year; provided, however, that
with respect to the fiscal year preceding the Termination Year, the
Bonus Percent will not be less than Executive's highest Target
Percentage that was in effect during such fiscal year.
For purposes of this definition, shares of stock or restricted
stock will be valued without regard to any vesting, transfer or other
restrictions applicable to such stock and will be deemed to have a per
share cash value equal to the closing price of the stock, as of the
date the shares were awarded, on the principal stock exchange on which
the stock is traded.
Also, for purposes of this definition, if Executive is
receiving disability benefits under the LTD Plan (as defined in Section
5.2(f)), base salary paid or payable to Executive during the period in
which Executive is receiving such disability benefits will be deemed to
be the amount Executive would have received if Executive had been
receiving base salary during such period at the same annual base salary
rate that was in effect immediately prior to the time such disability
benefits commenced."
" "Code" means the Internal Revenue Code of 1986, as amended,
including any regulations promulgated thereunder."
" "Excess Plan" means The PNC Financial Services Group, Inc.
ERISA Excess Pension Plan."
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" "Xxxxxxxx Xxx" means the Securities Exchange Act of 1934, as
amended, including any regulations promulgated thereunder."
" "SERP" means The PNC Financial Services Group, Inc.
Supplemental Executive Retirement Plan."
" "Subsidiary" means any corporation, limited liability
company, or other entity controlled by the Company, directly or
indirectly."
" "Target Percentage" means the percentage of Executive's
annual base salary on which Executive's target cash incentive award
pursuant to the 1996 Plan or any other Company incentive compensation
or bonus plan then in effect is based for a particular fiscal year.
Such percentage is established annually by the Committee in
administering the applicable plan. In the event that the Committee
established that Executive's incentive award for such fiscal year would
be increased by awarding Executive additional shares of stock or
restricted stock with respect to any portion of the award to be paid in
stock, the Target Percentage will be increased to take into account the
cash value of such additional shares.
For purposes of this definition, shares of stock or restricted
stock will be valued without regard to any vesting, transfer or other
restrictions applicable to such stock and will be deemed to have a per
share cash value equal to the closing price of the stock, as of the
date the shares were awarded, on the principal stock exchange on which
the stock is traded."
(ii) Certain other definitions in Section 8 of the Agreement are hereby
amended as follows:
(1) The phrase "of the Company" is hereby added after the
phrase "the Chief Executive Officer" in the second sentence of the paragraph
following clause (b) of current Section 8.6 of the Agreement.
(2) The phrase "plans of the Company" in current Section
8.7(a) of the Agreement is hereby replaced with the phrase "plans of the Company
and its Subsidiaries".
(3) In the second sentence of current Section 8.13 of the
Agreement, the phrase "to be accorded by the "Company" " is hereby replaced with
the phrase "provided or to be provided by the Company" and the phrase "to be
provided by such Subsidiary" is hereby replaced with the phrase "provided or to
be provided by such Subsidiary".
(4) The phrase "or program" is hereby inserted after the word
"plan" each time it appears in current Section 8.21(d) of the Agreement, and the
phrase "or programs" is hereby inserted after the phrase "welfare plans" in
current Section 8.21(e) of the Agreement.
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(iii) Section 8 of the Agreement is hereby further amended by deleting
the definition of 1994 Plan, which currently appears as Section 8.32.
(iv) The first unnumbered paragraph of the Agreement is hereby amended
by deleting the parenthetical "(the "Company")".
6. New Definitions. Section 8 of the Agreement is hereby further
amended to add the following new definitions:
" "Interest" means interest at the Federal short-term rate,
the Federal mid-term rate, or the Federal long-term, as applicable,
compounded semiannually, under Section 1274(b)(2)(B) of the Code based
on the period over which interest is being accrued."
" "Matching Amount" means the maximum amount that Executive
would have been eligible to have credited to Executive's plan accounts
under The PNC Financial Services Group, Inc. Incentive Savings Plan and
the Supplemental Savings Plan (or similar plan or plans sponsored by a
Subsidiary, if applicable to Executive) (the plans applicable to
Executive being hereafter referred to as the "Savings Plans") by
Executive's employer as a matching contribution or credit assuming: (a)
Executive had remained an employee of the Company after the Date of
Termination for a number of years after the Date of Termination equal
to the Classification Factor (or, if less, the Retirement Factor); (b)
Executive received (i) a base salary and annual bonus equal to the
Annual Base Salary and Annual Bonus with respect to, and paid in, each
year during such period (or, if the Retirement Factor is applicable and
includes a fraction, a base salary and annual bonus equal to the Annual
Base Salary and Annual Bonus for any full year during such period and a
base salary and annual bonus equal to such fraction times the Annual
Base Salary and Annual Bonus during the fraction of a year in such
period) plus (ii) a bonus with respect to the Termination Year equal to
the amount payable to Executive pursuant to Section 5.2(b)(i), paid in
the year after the Termination Year, and a bonus with respect to the
fiscal year preceding the Termination Year equal to the amount, if any,
payable to Executive pursuant to Section 5.2(b)(ii), paid in the
Termination Year; (c) Executive had elected to participate in the
Savings Plans and to defer the maximum percentage of such base salary
and/or bonuses under the Savings Plans; (d) Executive's employer had
made the maximum matching contribution or credit with respect to such
amounts under the Savings Plans; and (e) all such matching
contributions or credits were fully vested.
In calculating the Matching Amount, all determinations and
calculations will be made on the basis of the terms and conditions of
the Savings Plans as in effect immediately prior to the Date of
Termination or, if it would result in a larger Matching Amount, as in
effect immediately prior to the commencement of the Coverage Period in
which the Date of Termination occurs.
Notwithstanding the foregoing, unless, immediately prior to
the Date of Termination, Executive was eligible to participate in and
receive employer matching contributions or credits under the Savings
Plans, or would have been so eligible had the Savings Plans remained as
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in effect immediately prior to the commencement of the Coverage Period
in which the Date of Termination occurs, the Matching Amount will be
deemed to be zero."
" "Perquisites Allowance" means the amount Executive received
or was eligible to receive as a perquisites allowance for any fiscal
year. If Executive was not eligible to receive and did not receive a
perquisites allowance for any fiscal year, then for that fiscal year,
Perquisites Allowance means the value of any perquisites provided to or
paid on behalf of Executive during such fiscal year that would have
been reportable as Other Annual Compensation for Executive for such
fiscal year pursuant to Item 402(b)(2)(iii)(C)(1) of Regulation S-K (or
any similar item) promulgated under the Exchange Act, without regard to
any exclusion in said item for amounts that are less than a specified
amount or aggregate amount, if Company had been subject to such
reporting requirement with respect to Executive for such fiscal year."
" "Total Benefits" has the meaning assigned to such term in
Section 5.3(a)(i)."
7. Renumber Certain Definitions. The definitions in Section 8 of the
Agreement are hereby numbered or renumbered, as the case may be, so that they
appear in alphabetical order after the additions and deletions set forth in the
Amendment, and any references in the Agreement to definitions by section number
are also hereby amended accordingly.
IN WITNESS WHEREOF, the Company has caused the Amendment to be
executed by its officer, thereunto duly authorized, and Executive has executed
the Amendment, all as of June 28, 2001.
THE PNC FINANCIAL SERVICES
GROUP, INC.
By:
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[Name]
[Title]
EXECUTIVE
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[Name]
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