SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AND AGREEMENT
FOR
XXX X. XXXXXXX
This Plan and Agreement made as of the 1st day of May, 1997 by
and between CONCORD CAMERA CORP., a New Jersey corporation (the "Employer") and
XXX X. XXXXXXX (the "Executive").
Article I. Introduction
In consideration of the services performed by the Executive
for the Employer in the past and to be performed in the future, the Employer
hereby agrees to pay, in addition to other consideration to be provided by the
Employer, deferred compensation to him under the terms and conditions
hereinafter set forth. This Agreement creates an unfunded, nonqualified plan
maintained for the purposes of providing deferred compensation for the
Executive, a member of senior management and a highly compensated Executive, and
shall be construed and administered accordingly.
Article II. Definitions
When used herein with initial capital letters, the following
words have the following meanings:
Accounts - the special accounts established by the Employer
for the benefit of the Executive reflecting the Monthly Credits and adjustments
for income, gain or loss and any payments from the accounts.
Monthly Credit - the $14,167 to be credited each month to an
Account pursuant to paragraph 1 of Article III.
Term of Employment - the period or periods of such term under
the Amended and Restated Employment Agreement, dated May 1, 1997, by and between
the Employer and the Executive, as such agreement may be amended from time to
time.
Plan and Agreement - this Supplemental Executive
Retirement Plan and Agreement for Xxx X. Xxxxxxx.
Article III. Deferred Compensation
1. During the Term of the Employment, the Employer agrees to
credit $14,167 each month to an Account, and such deferred compensation shall be
paid to the Executive as hereinafter provided.
2. The Employer shall keep separate Accounts for the Monthly
Credits in respect of particular years to the extent necessary to account for
differing elections and designations hereunder regarding benefit distributions
and beneficiaries for such years.
3. During any calendar year of the Term of Employment, the
Employer, in its sole discretion, may accelerate the crediting to the Account of
the Monthly Credits with respect to such year.
4. The balance in each Account shall be deemed for purposes of
this Plan and Agreement to be invested and reinvested in such securities,
investments, instruments or insurance policies as the Executive, in his sole
discretion, shall direct
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from time to time, by one day advance written notice given to the Employer or
its designee. With the consent of the Employer, the Executive may, by giving
written notice to the Employer or its designee, authorize an investment manager
to make the directions specified in the preceding sentence. Any investment
direction or change of investment direction shall be deemed made on the first
business day following the Employer's or its designee's, as the case may be,
receipt of the Executive's or the investment manager's, as the case may be,
written notice of investment direction. Any such investment direction shall
remain in effect until affirmatively changed by a subsequent investment
direction given in the same manner, provided that the proceeds of any investment
which matures shall be deemed to be reinvested in such money market account as
the Employer may determine and thereafter until a new investment direction is
made with respect to such proceeds. Notwithstanding the foregoing, no such
deemed investment shall, in the Employer's reasonable judgment, impose upon the
Employer administrative burdens or financial costs which are inappropriate in
view of all of the circumstances. If no applicable investment direction is given
on or before the date on which a Monthly Credit is credited to an Account, such
amount shall be initially invested in a such money market account as the
Employer may reasonably determine. The Employer, in its discretion and on such
terms as it decides, may waive, or reduce the period of, any notice required
under this paragraph.
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5. Title to and beneficial ownership of any direct or indirect
investments the Employer may make in connection with the Plan and Agreement
(including the transfer of funds to a selected investment manager for
discretionary investment and reinvestment in such investments by such investment
manager or the transfer of funds to a so-called rabbi trust), shall at all times
remain with the Employer, and the Executive and his designated beneficiary or
beneficiaries shall not have any property interest whatsoever in such
investments.
6. At the end of every month, each Account shall be increased
or decreased by (a) in the case of each investment actually made directly or
indirectly by the Employer with respect to such Account, the net amount of all
income, gain or loss earned or sustained, whether realized or unrealized, with
respect to such investment, and (b) in the case of each deemed investment with
respect to such Account, the net amount of all income, gain or loss which would
have been earned or sustained, whether realized or unrealized, had the balance
in the Account in fact been invested and reinvested in such investment. Each
Account shall also be charged with all payments or other distributions with
respect to such Account and with all fees and expenses (including brokerage
fees) with respect to such Account, in the case of investments actually made, at
the rates actually paid and, in the case of investments deemed to have been
made, at the rates which would have been paid had the investments actually been
made.
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Article IV. Benefit Distributions
1. The balance in each Account shall be paid to the Executive
in one of the two following methods at the election of the Executive: (a) a
lump-sum payment to be paid at such time as is designated by the Executive or
(b) annual installment payments over such period of years as may be designated
by the Executive; provided, however, no payment shall be payable pursuant to
this Article IV prior to the Executive's termination of employment with the
Employer. The Executive's election and designation referred to in the previous
sentence with respect to an Account shall be made by a written notice to the
Employer prior to the first day of the year to which the Account relates. The
Executive may make different elections and designations with respect to the
Monthly Credits of each year, with any such different elections and designations
accounted for through the creation of separate Accounts as contemplated by
paragraph 2 of Article III. In the event that the Executive fails to make an
election pursuant to this paragraph 1 with respect to an Account, the balance in
such Account shall be paid in ten annual installments commencing on the first
day of the month following the termination of the Executive's employment with
the Employer.
2. All payments to be made pursuant to paragraph 1 of this
Article IV with respect to each Account shall be made in cash, and in
furtherance thereof, all investments actually made with respect to such Account
shall be sold by the Employer at
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such time or times as the Employer may determine to effect such payment;
provided, that (a) in the case of an installment payment, unless the Executive
provides the Employer with written notice to the contrary at least five days
prior to the date any such payment is due, the Employer may select the
investments to be sold or deemed sold to provide the cash necessary for such
payment, and (b) to the extent investments have actually been made by the
Employer with respect to such Account, the Executive may elect, subject to the
Employer's approval, to receive payment in kind in lieu of cash by providing
written notice of such election to the Employer at least five days prior to the
date of such payment.
3. For purposes of determining the amount of a payment
referred to in paragraph 1 of this Article IV with respect to an Account, (a)
the balance in such Account shall be adjusted by the Employer in the manner
provided in paragraph 6 of Article III not more than five trading days preceding
such payment, (b) the amount of such payment shall be reduced by the amount of
any expenses actually incurred or deemed to have been incurred in connection
with the sale or deemed sale of investments required to make such payment
("selling expenses"), and (c) if the installment method is elected with respect
to any year, the amount of each installment shall be equal to the balance in the
appropriate Account as of the date of payment (as adjusted pursuant to clause
(a) of this sentence), divided by the number of annual installments remaining,
including the installment then being paid, and then reduced by the amount of any
applicable selling expenses.
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4. Except as provided in this paragraph 4, the Executive shall
have no right to modify in any way his election and designation made pursuant to
paragraph 1 of this Article IV with respect to an Account or, in the event of
his failure to make such an election or designation, the default provisions of
paragraph 1. Provided that a modification election is made at least 12 months
prior to the commencement of the benefit distributions with respect to an
Account, the Executive, may:
(a) delay the date on which a lump-sum payment from such
Account shall be made;
(b) change the form of benefit payment from such Account
from a lump-sum payment to annual installment payments
over such period of years as designated by the
Executive;
(c) change the form of benefit payment from such Account
from annual installments to a lump-sum payment which
shall be paid at the time designated by the Executive
but no sooner than the day on which the installment
payments were to commence;
(d) delay the commencement of annual installment payments
from such Account; or
(e) increase the period of years during which annual
installments shall be made out of such Account.
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5. Notwithstanding anything in this Plan and Agreement to the
contrary, in the event of the termination of the Executive's employment with the
Employer for any reason prior to the Executive's attainment of age 65, the
balance in each Account shall be paid to the Executive in one lump-sum payment
within 30 days of such termination.
6. Employer is authorized to withhold from any payments made
hereunder such amounts for income tax, social security, unemployment
compensation and other taxes as shall be necessary or appropriate to comply with
applicable laws and regulations.
Article V. Hardship
The Employer may, in its sole discretion, distribute all or a
portion of the balances in the Accounts to the Executive upon a demonstration by
the Executive of an immediate and heavy financial need. The amount of any
distribution made pursuant to this Article V shall be limited to the amount
necessary to satisfy such financial need.
Article VI. Death
In the event of the Executive's death prior to the payment of
all of the balances in the Accounts, unless the Executive otherwise elects with
the consent of the Employer, the Employer shall pay all remaining balances in
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the Accounts at such time, not later than 60 days following the Executive's
death, in one lump-sum to such beneficiary or beneficiaries designated by the
Executive in a writing filed by the Executive with the Employer, or in the
absence of such a beneficiary designation, to the Executive's estate.
Article VII. Claims Procedures
1. At any time the Employer makes a determination adverse to
the Executive or his beneficiary with respect to a claim for payment, the
Employer shall notify the claimant in writing of such determination, setting
forth:
(a) the specific reason for such determination;
(b) a reference to the specific provision or provisions of
this Plan on which such determination is based;
(c) a description of any additional material or information
necessary to perfect the claim, and an explanation of
the reason that such material is required, and
(d) an explanation of the rights and procedures set forth
in this Article VII.
2. A person who receives notice of an adverse determination by
the Employer with respect to a claim may request, within 60 days of receipt of
such notice, that the Employer review its determination. This request may be
made on behalf of a claimant by a duly authorized representative. The claimant
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or representative may review pertinent documents and submit issues and comments
with respect to the controversy to the Employer. The Employer shall render a
decision within 60 days of a request for review (or within 120 days under
special circumstances), which decision shall be in writing and shall set forth
the specific reasons for the decision reached and the specific provisions of
this Plan and Agreement on which the decision is based. A copy of the ruling
shall be forwarded to the claimant.
Article VIII. Miscellaneous
1. Benefits provided in this Plan and Agreement will not be
subject to garnishment, attachment, or assignment, or any other legal process by
creditors of the Executive or any person or persons designated as beneficiaries
of this Plan and Agreement or any other payee of the benefits provided herein,
except as specifically provided herein.
2. The Executive and his beneficiaries shall have the status
of unsecured creditors of the Employer and this Plan and Agreement constitutes a
mere promise by the Employer to make benefit payments as required by Articles
IV, V and VI.
3. This Plan and Agreement creates no rights in the Executive
to continue in the employment of the Employer for any length of time, nor does
it create any rights in the Executive or his beneficiaries nor any obligations
on the part of the Employer, other than those specifically provided herein.
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4. This Plan and Agreement shall be binding upon and inure to
the benefit of the Employer, its successors and assigns, and the Executive, his
heirs, executors, administrators and legal representatives.
5. The waiver by any party of any term of this Plan and
Agreement on any occasion shall not be deemed to be a further or continuing
waiver of any such term.
6. Written notices which the Executive must provide to the
Employer under this Plan and Agreement (including, but not limited to,
investment directions, benefit distribution elections and beneficiary
designations) shall be addressed to the Employer at: 00 Xxxxxx Xxx, Xxxxxx, Xxx
Xxxxxx 00000.
7. This Plan and Agreement shall be governed by, construed and
enforced in accordance with the laws of the State of New Jersey without giving
effect to principles governing choice of law.
8. This Plan and Agreement may be terminated or amended only
by a writing signed by both of the parties hereto.
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IN WITNESS WHEREOF, this Plan and Agreement has been duly
executed by the Employer and by the Executive as of the day and year first above
written.
Witness: CONCORD CAMERA CORP
/s/ Xxxxxxxxx X. Xxxxxxxx By: /s/ Xxxxxx X. Press
------------------------- ------------------------
Xxxxxx X. Press
Witness:
/s/ XXXXXXXXXXXXX /s/ Xxx X. Xxxxxxx
------------------------- ------------------------
Xxx X. Xxxxxxx
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