EXHIBIT 10.2
DENTAL CARE PLUS, INC. AND DCP HOLDING COMPANY
DEFERRED COMPENSATION PLAN
Effective January 1, 2006
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS AND GENERAL PROVISIONS............................. 1
ARTICLE II ELIGIBILITY AND PARTICIPATION................................. 4
ARTICLE III DEFERRED COMPENSATION........................................ 5
ARTICLE IV VESTING....................................................... 7
ARTICLE V DISTRIBUTION OF BENEFITS....................................... 8
ARTICLE VI PLAN ADMINISTRATION........................................... 10
ARTICLE VII AMENDMENT AND TERMINATION.................................... 12
ARTICLE VIII MISCELLANEOUS PROVISIONS.................................... 12
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DENTAL CARE PLUS, INC. AND DCP HOLDING COMPANY
DEFERRED COMPENSATION PLAN
The Dental Care Plus, Inc. and DCP Holding Company Deferred Compensation
Plan (the "Plan") is hereby established effective as of January 1, 2006, by DCP
Holding Company, an Ohio corporation (the "Company"), for the benefit of Company
directors and a select group of the management and highly compensated employees
of the Company and its subsidiary, Dental Care Plus, Inc., ("DCP") and of any
other affiliated entities which adopt and participate in this Plan with the
consent of the Company.
Background Information
A. The Company desires to adopt the Plan in order to provide its directors
and certain of its highly compensated and management employees with the
opportunity to defer a portion of the compensation otherwise payable to them.
B. The Company intends for the Plan to be an unfunded, nonqualified
deferred compensation arrangement as provided under the Employee Retirement
Income Security Act of 1974, as amended ("ERISA") and to satisfy the
requirements of a "top hat" plan thereunder and under Labor Reg. Sec.
2520.104-23, to the extent employees participate herein.
C. The Plan is intended to comply with the requirements of the American
Jobs Creation Act of 2004 ("AJCA") and new Section 409A of the Code. To the
extent inconsistent with Code Section 409A or regulations issued thereunder,
this Plan shall be amended to conform to such requirements within applicable
time limitations established by the IRS.
ARTICLE I
DEFINITIONS AND GENERAL PROVISIONS
1.1 Definitions. Unless the context requires otherwise, the terms defined
in this Article shall have the following respective meanings:
(a) Account. The bookkeeping account described in Section 3.6 under which
deferred amounts and earnings are credited on behalf of a Participant.
(b) Administrative Committee. An Administrative Committee of at least three
(3) persons appointed by the Board to oversee the administration of the Plan. If
no Administrative Committee is appointed, the Benefits and Compensation
Committee of the Board of Directors shall be the Administrative Committee.
(c) Beneficiary. The person(s) entitled to receive any distribution
hereunder upon the death of a Participant. The Beneficiary for benefits payable
under this Plan shall be the
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beneficiary designated by the Participant in accordance with procedures
established by the Administrative Committee as of the Participant's date of
death, or, in the absence of any such designation, the Participant's estate.
(d) Board. The Board of Directors of the Company or the Benefits and
Compensation Committee thereof.
(e) Change of Control. For purposes of the Plan, a Change of Control means:
(i) the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act
of 1934 (the "Exchange Act") (a "Person") of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of fifty percent (50%) or more of the combined voting power of the
then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Outstanding Voting
Securities"); provided, however, that for purposes of this Subsection
(i), the following acquisitions shall not constitute a Change of
Control: (I) any acquisition directly from the Company or any
corporation controlled by the Company, (II) any acquisition by the
Company or any corporation controlled by the Company, (III) any
acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the
Company or (IV) any acquisition by any corporation that is a
Non-Control Acquisition (as defined in Subsection (iii) of this
Section); or
(ii) individuals who, as of the beginning of any 24 consecutive month
period after the establishment of this Plan, constitute the Board (the
"Incumbent Directors") cease for any reason other than death to
constitute at least a majority of the Board; provided, however, that a
director who was not a director at the beginning of such 24-month
period shall be deemed to have satisfied such 24-month requirement
(and be an Incumbent Director) if such director was elected by, or on
the recommendation of or with the approval of, at least two-thirds of
the directors who then qualified as Incumbent Directors either
actually (because they were Directors at the beginning of such
24-month period) or by prior operation of this Section 1.1(e)(ii); or
(iii) the occurrence of a transaction requiring shareholder approval
for the acquisition of the Company or any subsidiary by an entity
other than the Company or any subsidiary of the Company, or any of
their respective affiliates, through purchase of assets, by merger, or
otherwise; or
(iv) approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company or its subsidiaries.
(f) Code. The Internal Revenue Code of 1986, as amended from time to time.
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(g) Company. DCP Holding Company or any affiliate thereof or successor
thereto which adopts the Plan with the consent of DCP Holding Company.
(h) Compensation. Amounts paid or payable by the Company to an Eligible
Person for a Plan Year which are includable in income for federal tax purposes,
including base salary and variable compensation in the form of commissions
and/or bonuses (except as otherwise provided herein), Director's fees of all
types, and Shares or other amounts realized from the exercise of a stock option
or when restricted stock (or property) held by a Participant either becomes
freely transferable or is no longer subject to a substantial risk of forfeiture.
Notwithstanding the foregoing, the following amounts are excluded from
Compensation: (i) other cash or noncash compensation, expense reimbursements or
other benefits or contributions by the Company to any other employee benefit
plan, and (ii) any amounts that are required to be withheld from a Participant's
wages from the Company pursuant to Code Section 3102 to satisfy the
Participant's tax obligations under Code Section 3101.
(i) Distribution Options. Annual installment payments over a period of five
(5) or ten (10) years. The standard form of distribution ("Standard Option")
shall be installments over a period of five (5) years unless otherwise elected
by a Participant in accordance with the terms of the Plan or as determined by
the Company to the extent permitted by Code Section 409A and regulations
thereunder.
(j) Effective Date. January 1, 2006.
(k) Eligible Person. Any individual who is (i) a Director of the Company or
DCP, or (ii) among a select group of management or highly compensated employees
(within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA), who
has been designated by the Company as eligible to make Compensation deferral
contributions under Article II of the Plan in accordance with eligibility
criteria established from time to time by the Administrative Committee.
(l) ERISA. The Employee Retirement Income Security Act of 1974, as amended
from time to time.
(m) Participant. Any Eligible Person who meets the eligibility requirements
for participation in the Plan as set forth in Article II and who earns benefits
under the Plan.
(n) Plan. The Dental Care Plus, Inc. and DCP Holding Company Deferred
Compensation Plan, as set forth herein, and as such Plan may be amended from
time to time hereafter.
(o) Plan Year. The fiscal year of the Plan, which is the twelve (12)
consecutive month period beginning January 1 and ending December 31.
(p) Retirement. When a Director or employee "Retires" as defined in the
Company's Code of Regulations.
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(q) Shares. The Class B common shares, without par value, of the Company.
(r) Total Disability. Occurs when a Participant is, by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, either unable to engage in any substantial gainful activity or
receiving income replacement benefits for a period of not less than 3 months
under an accident and health plan covering employees of the Participant's
employer. The Company shall determine the existence of a Total Disability in its
sole discretion (but in compliance with Code Section 409A) and may require the
Participant to submit to periodic medical examinations at the Participant's
expense to confirm the existence and continuation of a Total Disability.
1.2 General Provisions. The masculine wherever used herein shall include
the feminine; singular and plural forms are interchangeable. Certain terms of
more limited application have been defined in the provisions to which they are
principally applicable. The division of the Plan into Articles and Sections with
captions is for convenience only and is not to be taken as limiting or extending
the meaning of any of its provisions.
ARTICLE II
ELIGIBILITY AND PARTICIPATION
2.1 General Eligibility Conditions. To become eligible to participate in
the Plan, an individual must be an Eligible Person and must also meet the
requirements of Sections 2.2 and 2.3.
2.2 Specific Conditions for Active Participation; Deferral Elections. To
participate actively in the Plan (i.e., to make deferrals hereunder), a
Participant must execute or acknowledge a Compensation Deferral Agreement in
accordance with procedures established by the Administrative Committee from time
to time. A Participant's Compensation Deferral Agreement shall be maintained by
or on behalf of the Administrative Committee and must be executed, acknowledged
or filed within thirty (30) days of first becoming eligible to participate in
the Plan and, for all subsequent deferral elections after initial participation,
in advance of the beginning of the calendar year during which such compensation
is expected to be earned, or at such other time as may be permitted or required
by regulations issued under Code 409A. In all cases, a Participant's election to
defer Compensation shall be made prior to the time any of the Compensation
covered by such election is to be earned by such Participant. Elections to defer
Compensation shall be irrevocable with respect to the Compensation to which they
apply and may be amended, revoked or suspended by the Participant only effective
as of the January 1st following the amendment, revocation or suspension in
accordance with procedures established by the Administrative Committee, or at
such other times as are permitted under Code Section 409A.
2.3 Eligibility List; Suspension of Active Participation. The
Administrative Committee shall maintain a written list of those employees who
then qualify as Eligible Persons under the Plan, as determined by the Company
and the Administrative Committee. Any
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employee not listed as an Eligible Person for a given Plan Year shall cease to
have any right to defer Compensation for such Plan Year. However, any amounts
credited to the Account of a Participant whose participation is suspended shall
otherwise continue to be maintained under the Plan in accordance with its terms.
Members of the Board of Directors of the Company and of DCP shall at all times
during which they are Directors be eligible to participate in the Plan.
2.4 Termination of Participation. Once an Eligible Person becomes a
Participant, such individual shall continue to be a Participant until such
individual (i) ceases to be described as an Eligible Person and (ii) ceases to
have any vested interest in the Plan (as a result of distributions made to such
Participant or his Beneficiary, if applicable, or otherwise).
2.5 Participation by Other Employers. With the consent of the Company, any
corporation that is a member of the same controlled group as the Company (within
the meaning of Code Section 1563(a)) may become a participating employer under
the Plan by taking such action as may be necessary or desirable to put the Plan
into effect with respect to such corporation. DCP is a participating employer in
this Plan.
ARTICLE III
DEFERRED COMPENSATION
3.1 Deferred Compensation Credits. Pursuant to the provisions of Article II
and this Article III, a Participant and the Company may, by mutual agreement,
provide for deferred and postponed payment of a percentage of the Participant's
Compensation which otherwise would be paid during the applicable Plan Year(s)
for services to be rendered in such year(s) or for the deferral of specific
portions of Compensation, such as Shares to be received as restricted stock or
pursuant to the exercise of options granted to the Participant. Deferral
elections with respect to such equity awards must be made for all Shares (or
options to purchase Shares) granted under a single award, whether or not yet
vested or about to vest. All elections to defer Compensation must be made prior
to the calendar year during which the Compensation is expected to be earned, or
at such other time as may be specified under regulations issued under the Code.
With respect to any performance based bonus compensation based on services
performed over a period of at least 12 months, an election to defer such
compensation must be made no later than 6 months before the end of the
performance period. To qualify as performance based bonus compensation, such
compensation must meet applicable requirements under Treasury Notice 2005-1 and
other applicable Treasury guidance or regulations issued under Code Section
409A. Any election to defer Shares must be made prior to the year in which the
right to such Shares becomes vested in the Participant or at such earlier time
as may be mandated under applicable federal law in order to defer the taxability
of the Compensation associated with such Shares. The Company may, in its
discretion, establish and change from time to time a minimum and maximum amount
that may be deferred, and all elections shall be made in accordance with
procedures established by the Administrative Committee. The Company will credit
the deferred Compensation amount agreed to for each Plan Year to the
Participant's Account from time to time as the deferred amounts otherwise would
have been earned by the Participant. All contributions under this provision to
the Accounts of Participants in the Plan, as adjusted for earnings or losses
(described below), are referred to as "Deferred Compensation Credits."
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3.2 Suspension of Deferrals. Participant Deferred Compensation Credits
hereunder will be automatically suspended during any unpaid leave of absence or
temporary layoff. Contributions suspended in accordance with the provisions of
this paragraph shall be automatically resumed, without the necessity of any
action by the Participant, upon return to employment at the expiration of such
suspension period.
3.3 Record of Account. Solely for the purpose of measuring the amount of
the Company's obligations to each Participant or his beneficiaries under the
Plan, the Company will maintain a separate bookkeeping record, an "Account," for
each Participant in the Plan. The Company, in its discretion, may either credit
a hypothetical earnings rate to the Participant's Account balance for the Plan
Year, or may actually invest an amount equal to the amount credited to the
Participant's Account from time to time in an account or accounts in its name
with investment media or companies, as determined by the Company in its
discretion. If such separate investments are made, the Participant may be
permitted to direct the investment of the portion of the Company's accounts
allocable to him under the Plan in the same manner he is permitted to direct the
investment of his account in the tax-qualified retirement plan of the Company,
if applicable, except that certain of the investment options may not be
available options under this Plan unless otherwise required by law. The
Participant may change the allocation of his Account among the applicable
investment alternatives then available under the Plan in accordance with
procedures established by the Administrative Committee from time to time. The
Company is not obligated to make any particular investment options available,
however, if investments are in fact made, and may, from time to time in its sole
discretion, change the investment alternatives. Nothing herein shall be
construed to confer on the Participant the right to continue to have any
particular investment available.
The Company will credit the Participant's Account with hypothetical or
actual earnings or losses at least quarterly based on the earnings rate declared
by the Company or the performance results of the Company's account(s) invested
pursuant to the Company's or the Participant's directions, and shall determine
the fair market value of the Participant's Account based on the bookkeeping
record or the fair market value of the portion of the Company's accounts
representing the Participant's Account. The determination of the earnings,
losses or fair market value of the Participant's Account may be adjusted by the
Company to reflect its payroll, income or other taxes or costs associated with
the Plan, as determined by the Company in its sole discretion.
3.4 Special Rules Applicable to Shares. Subject to the provisions of this
Article III, if a Participant makes a timely and effective election to defer
Compensation that would have been received in the form of Shares, the
Participant's Account will be credited with a number of hypothetical Shares (and
fractions thereof) ("Phantom Shares") equal to the number of Shares deferred.
Upon distribution of benefits from the Plan, the Phantom Share balance shall be
converted to cash based on the fair market value of an equivalent number of
Shares at that time.
If any Organic Change shall occur, then the Participant's Phantom Shares
held in his Account (if any) shall be adjusted so as to contain such shares of
stock, securities or assets (including cash) as would have been issued or
payable with respect to or in exchange for a like number of Shares credited
thereto immediately before such Organic Change, if such Shares had been
outstanding. An "Organic Change" includes the recapitalization, reorganization,
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reclassification, consolidation, or merger of the Company, or any sale of all or
substantially all of the Company's assets to another person or entity, or any
other transaction which is effected in such a way that holders of Shares are
entitled to receive (either directly or upon subsequent liquidation) other
stock, securities, or assets with respect to or in exchange for Shares. If the
assets held in the Participant's Account immediately after such adjustment are
not equity securities, then the Participant shall be permitted to re-direct the
investment thereof into the other investment choices then available under this
Plan.
In the case of the Phantom Shares credited (if any) to a Participant's
Account, the earnings (or losses) credited to such Account shall consist solely
of dividend equivalent credits pursuant to this paragraph. Whenever a dividend
or other distribution is made with respect to Shares, then the Participant's
Account shall be credited, on the payment date for such dividend or other
distribution (the "Dividend Payment Date"), with a number of additional Phantom
Shares having a value, as of the Dividend Payment Date, based upon the number of
Phantom Shares deemed to be held in the Participant's Account as of the record
date for such dividend or other distribution (the "Dividend Record Date"), as if
such were outstanding Shares. If such dividend or other distribution is in the
form of cash, the number of Phantom Shares so credited shall be a number of
Phantom Shares (and fractions thereof) having a value, as of the Dividend
Payment Date, equal to the amount of cash that would have been distributed with
respect to the Phantom Shares deemed to be held in the Participant's Account as
of the Dividend Record Date, as if such were outstanding Shares. If such
dividend or other distribution is in the form of Shares, the number of Phantom
Shares so credited shall equal the number of such Shares (and fractions thereof)
that would have been distributed with respect to the Phantom Shares deemed to be
held in the Participant's Account as of the Dividend Record Date, as if such
were outstanding Shares. If such dividend or other distribution is in the form
of property other than cash or Shares, the number of Phantom Shares so credited
shall be a number of Phantom Shares (and fractions thereof) having a value, as
of the Dividend Payment Date, equal to the value of the property that would have
been distributed with respect to the Phantom Shares deemed to be held in the
Participant's Account as of the Dividend Record Date, as if such were
outstanding Shares. The value of such property shall be its fair market value as
of the Dividend Payment Date, determined by the Board based upon market trading
if available and otherwise based upon such factors as the Board deems
appropriate.
ARTICLE IV
VESTING
4.1 Vesting. A Participant always will be one hundred percent (100%) vested
in amounts credited to his Account as Deferred Compensation Credits and earnings
allocable thereto.
4.2 Confidentiality and Non-competition Agreement. In its discretion, the
Company may require any Eligible Person selected to become a Participant in the
Plan to execute a Confidentiality and Non-competition Agreement with the Company
and/or its affiliates in consideration of the benefits to be provided hereunder.
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ARTICLE V
DISTRIBUTION OF BENEFITS
5.1 Distribution Timing. A Participant shall receive payment of the amounts
credited to his Account upon his termination from employment or from the Board
due to Retirement, death, Total Disability or any other reason, including upon a
Change of Control, unless the Participant has elected to receive his benefits
commencing on a fixed date selected by the Participant at the time of enrollment
in the Plan. If such a fixed date has been selected, the Participant will begin
to receive the amount credited to his Account as of such date, regardless
whether or not he has terminated employment or Board membership at such date.
The Participant may change the fixed date pursuant to an election made at least
twelve (12) months prior to the original fixed date to a new fixed date that is
at least five (5) years later than the original fixed date. Notwithstanding the
foregoing, if the Participant dies or suffers a Total Disability before the
fixed date, benefits will be payable as a death or disability benefit in
accordance with the provisions of this Article and the fixed date election will
no longer apply.
5.2 Distribution upon Retirement or Other Termination of Employment or
Service as a Director. Upon Retirement or other termination of employment or
membership on the Board, the Participant shall be eligible to receive payment of
the amounts credited to the Participant's Account in the Standard Option
commencing as soon as practicable after such Retirement or other termination.
Alternatively, a Participant may elect another Distribution Option at the time
of initial enrollment in the Plan. The Participant may change his election of a
Distribution Option pursuant to an election made during the annual deferral
election period prior to the beginning of each Plan Year, provided said election
is made at least twelve (12) months prior to the date that payments would have
otherwise begun under such option, and provided that a Participant may not
change a Distribution Option to one that would complete the distribution of the
Participant's Account more quickly than the election in effect at the date of
the new election. In addition, payments will also be deferred to a new
commencement date that is at least five (5) years later than the original
commencement date, if required by applicable federal law. If a Distribution
Option election is made or changed and distribution is triggered before twelve
(12) months have elapsed, the distribution will be made in accordance with the
Distribution Option in effect prior to the change or, if none, in accordance
with the Standard Distribution Option. If an annual installment payment method
is the selected Distribution Option, the amount of the annual benefit shall
equal the amount necessary to fully distribute the Participant's Account as an
annual benefit payable over the installment period, consistent with the
following methodology: the amount payable as the annual installment shall equal
the value of the Participant's Account as of the most recent Account valuation
date, multiplied by a fraction, the numerator of which is one (1) and the
denominator of which is the number of annual installments remaining in the
installment period elected by the Participant. For example, assuming the
standard ten (10) year installment payment period applies, the amount
distributed at each of the distribution dates would represent the value of the
Participant's Account as of the most recent valuation date preceding the actual
distribution date times the following factors: Year 1 - 10% (1/10), Year 2 -
11.11% (1/9), Year 3 - 12.5% (1/8), Year 4 - 14.29% (1/7), Year 5 - 16.66%
(1/6), Year 6 --20% (1/5), Year 7 -- 25% (1/4), Year 8 - 33.33% (1/3), Year 9 --
50% (1/2) and Year 10 - 100% (1/1). The Participant must provide the Company
advance notice of his intention to retire and
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receive benefits hereunder in accordance with uniform procedures established by
the Administrative Committee.
5.3 Distribution upon Death. In the event of the death of the Participant
while receiving benefit payments under the Plan, the Company shall pay the
Beneficiary or Beneficiaries designated by the Participant the remaining
payments due under the Plan in accordance with the method of distribution in
effect to the Participant at the date of death. In the event of the death of the
Participant prior to the commencement of the distribution of benefits under the
Plan, the Company shall pay such benefits to the Beneficiary or Beneficiaries
designated by the Participant, beginning as soon as practicable after the
Participant's death. Such benefits shall be paid in the Standard Option unless
another Distribution Option was timely elected by the Participant at least
twelve (12) months prior to his death.
5.4. Distribution in the Event of Total Disability. Upon the Participant's
Total Disability, the Participant shall be eligible to receive payment of the
amounts credited to his Account in the Standard Option commencing as soon as
practicable after the Administrative Committee is satisfied that the Participant
has been determined to be Totally Disabled. The Participant's Account may also
be payable in one of the other Distribution Options provided such other
Distribution Option was timely elected by the Participant at least twelve (12)
months prior to his Total Disability.
Total Disability shall be considered to have ended and entitlement to a
disability benefit shall cease if the Participant (i) is re-employed by the
Company or one of its affiliates, or (ii) engages in any substantial gainful
activity, except for such employment as is found by the Company in its sole
discretion to be for the primary purpose of rehabilitation or not incompatible
with a finding of total and permanent disability. If entitlement to a disability
benefit ceases in accordance with the provisions of this paragraph, the
Participant shall not be prevented from qualifying for a benefit under another
provision of the Plan.
5.5 Lump Sum Distribution of Small Amounts or upon a Change of Control. If
the value of a Participant's entire Account as of the date it becomes
distributable is less than $25,000, then the Participant's entire Account
balance shall be payable as a single lump sum notwithstanding any other election
that may be in effect. In addition, if a Participant terminates employment
within 2 years of a Change of Control, then the Participant's Account shall be
payable in a single lump sum within thirty (30) days after the date of
termination following the Change of Control and alternative elections in effect
by the Participant shall no longer apply.
5.6 Distribution at a Fixed Date. At the Participant's election at the time
of enrollment in the Plan, the Participant's Account will become payable in the
Standard Option upon attainment of a fixed date, and the Participant will begin
to receive the amount credited to his Account as of such date, regardless
whether or not he has terminated employment or Board membership at such date.
The Participant may select an alternative Distribution Option at the same time
that a fixed date distribution is selected. The Participant may change the fixed
date and/or the Distribution Option pursuant to an election made at least twelve
(12) months prior to the original fixed date, provided that the election defers
the commencement of benefit payments to a new fixed date that is at least five
(5) years later than the original fixed date, unless not required by applicable
federal law. Notwithstanding the foregoing, if the Participant dies or
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suffers a Total Disability before the fixed date, benefits will be payable as a
death or disability benefit in accordance with the provisions of this Article
and the fixed date election will no longer apply.
5.7 Distribution of Cash. Payments of amounts credited to the Participant's
Account will be made in U.S. dollars, including amounts credited to the
Participant's Account as Phantom Shares, if any, which shall also be payable in
the form of cash based on the value of a comparable number of Shares at the date
distribution commences.
ARTICLE VI
PLAN ADMINISTRATION
6.1 Administration. The Plan shall be administered by the Administrative
Committee as an unfunded deferred compensation plan that is not intended to meet
the qualification requirements of Code Section 401.
6.2 Administrative Committee. The Administrative Committee will operate and
administer the Plan and shall have all powers necessary to accomplish that
purpose, including, but not limited to, the discretionary authority to interpret
the Plan, the discretionary authority to determine all questions relating to the
rights and status of Eligible Persons and Participants, and the discretionary
authority to make such rules and regulations for the administration of the Plan
as are not inconsistent with the terms and provisions hereof, as well as such
other authority and powers relating to the administration of the Plan, except
such as are reserved by the Plan to the Board. All decisions made by the Board
or the Administrative Committee shall be final.
Without limiting the powers set forth herein, the Administrative Committee
shall have the power (i) with the consent of the Board, to change or waive any
requirements of the Plan to conform with the law or to meet special
circumstances not anticipated or covered in the Plan; (ii) to determine the
times and places for holding meetings of the Administrative Committee and the
notice to be given of such meetings; (iii) to employ such agents and assistants,
such counsel (who may be counsel to the Company herein), and such clerical and
other services as the Administrative Committee may require in carrying out the
provisions of the Plan; and (iv) to authorize one or more of their number or any
agent to execute or deliver any instrument on behalf of the Administrative
Committee.
The members of the Administrative Committee and the Company and its
officers and directors shall be entitled to rely upon all valuations,
certificates and reports furnished by any funding agent or service provider,
upon all certificates and reports made by an accountant, and upon all opinions
given by any legal counsel selected or approved by the Administrative Committee,
and the members of the Administrative Committee and the Company and its officers
and directors shall, except as otherwise provided by law, be fully protected
with respect to any action taken or suffered by them in good faith in reliance
upon any such valuations, certificates, reports, opinions or other advice of a
funding agent, service provider, accountant or counsel.
6.3 Statement of Participant's Account. The Administrative Committee shall,
as soon as practicable after the end of each Plan Year, provide to each
Participant a statement setting
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forth the Account of such Participant under Section 3.3 as of the end of such
Plan Year. Such statement shall be deemed to have been accepted as correct
unless written notice to the contrary is received by the Administrative
Committee within thirty (30) days after providing such statement to the
Participant. Account statements may be provided more often than annually in the
discretion of the Administrative Committee.
6.4 Filing Claims. Any Participant, Beneficiary or other individual
(hereinafter a "Claimant") entitled to benefits under the Plan, or otherwise
eligible to participate herein, shall be required to make a claim with the
Administrative Committee (or its designee) requesting payment or distribution of
such Plan benefits (or written confirmation of Plan eligibility, as the case may
be), on such form or in such manner as the Administrative Committee shall
prescribe. Unless and until a Claimant makes proper application for benefits in
accordance with the rules and procedures established by the Administrative
Committee, such Claimant shall have no right to receive any distribution from or
under the Plan.
6.5 Notification to Claimant. If a Claimant's application is wholly or
partially denied, the Administrative Committee (or its designee) shall, within
ninety (90) days, furnish to such Claimant a written notice of its decision.
Such notices shall be written in a manner calculated to be understood by such
Xxxxxxxx, and shall contain at least the following information:
(i) the specific reason or reasons for such denial;
(ii) specific reference to pertinent Plan provisions upon which such denial
is based;
(iii) a description of any additional material or information necessary for
such Claimant to perfect his claim, and an explanation of why such material
or information is necessary; and
(iv) an explanation of the Plan's claim review procedure describing the
steps to be taken by such Xxxxxxxx, if he wishes to submit his claim for
review.
6.6 Review Procedure. Within sixty (60) days after the receipt of such
notice from the Administrative Committee, such Claimant, or the duly authorized
representative thereof, may request, by written application to the Plan, a
review by the Administrative Committee of the decision denying such claim. In
connection with such review, such Claimant, or duly authorized representative
thereof, shall be entitled to receive any and all documents pertinent to the
claim or its denial and shall also be entitled to submit issues and comments in
writing. The decision of the Administrative Committee upon such review shall be
made promptly and not later than sixty (60) days after the receipt of such
request for review, unless special circumstances require an extension of time
for processing, in which case a decision shall be rendered as soon as possible,
but not later than one hundred twenty (120) days after the Administrative
Committee's receipt of a request for review. Any such decision on review shall
be in writing and shall include specific reasons for the decision and specific
references to the pertinent Plan provisions on which the decision is based.
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6.7 Payment of Expenses. All costs and expenses incurred in administering
the Plan shall be paid from the Plan unless the Company elects to pay the costs
and expenses.
ARTICLE VII
AMENDMENT AND TERMINATION
7.1 Amendment. The Company has reserved, and does hereby reserve, the right
at any time and from time to time by action of the Administrative Committee or
of its Board (or by action of an officer or officers of the Company to whom the
Board has delegated the authority to amend the provisions of the Plan) to amend,
modify or alter any or all of the provisions of the Plan without the consent of
any Eligible Persons or Participants; provided, however, that no amendment shall
operate retroactively so as to affect adversely the vested Account balance to
which a Participant may be entitled under the provisions of the Plan as in
effect prior to such action. Any such amendment, modification or alteration
shall be expressed in an instrument executed by an authorized officer or
officers of the Company, and shall become effective as of the date designated in
such instrument.
7.2 Termination. The Company reserves the right to suspend, discontinue or
terminate the Plan, at any time in whole or in part; provided, however, that a
suspension, discontinuance or termination of the Plan shall not accelerate the
obligation to make payments to any person not otherwise currently entitled to
payments under the Plan, unless otherwise specifically so determined by the
Company, relieve the Company of its obligations to make payments to any person
then entitled to payments under the Plan, or reduce any existing Account
balance.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
8.1 Employment Relationship. A Participant shall be considered to be in the
employ of the Company and its related affiliates and subsidiaries as long as he
remains an employee of the Company, any subsidiary corporation of the Company,
or any corporation to which substantially all of the assets and business of the
Company are transferred. For this purpose, a subsidiary corporation of the
Company is any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if, as of the date such determination is
to be made, each of the corporations other than the last corporation in the
unbroken chain owns stock possessing eighty percent (80%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain. Nothing in the adoption of the Plan or the crediting of deferred
compensation shall confer on any Participant the right to continued employment
by the Company or an affiliate or subsidiary corporation of the Company, or
affect in any way the right of the Company or such affiliate or subsidiary to
terminate his employment at any time. Any question as to whether and when there
has been a termination of a Participant's employment, and the cause of such
termination, shall be determined by the Administrative Committee, and its
determination shall be final.
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8.2 Facility of Payments. Whenever, in the opinion of the Administrative
Committee, a person entitled to receive any payment, or installment thereof, is
under a legal disability or is unable to manage his financial affairs, the
Administrative Committee shall have the discretionary authority to direct
payments to such person's legal representative or to a relative or friend of
such person for his benefit; alternatively, the Administrative Committee may in
its discretion apply the payment for the benefit of such person in such manner
as the Administrative Committee deems advisable. Any such payment or application
of benefits made in good faith in accordance with the provisions of this Section
shall be a complete discharge of any liability of the Administrative Committee
with respect to such payment or application of benefits.
8.3 Funding. All benefits under the Plan are unfunded and the Company shall
not be required to establish any special or separate fund or to make any other
segregation of assets in order to assure the payment of any amounts under the
Plan; provided, however, that in order to provide a source of payment for its
obligations under the Plan, the Company may establish a trust fund. The right of
a Participant or his Beneficiary to receive a distribution hereunder shall be an
unsecured claim against the general assets of the Company, and neither the
Participant nor his Beneficiary shall have any rights in or against any amounts
credited under the Plan or any other specific assets of the Company. All amounts
credited under the Plan to the benefit of a Participant shall constitute general
assets of the Company and may be disposed of by the Company at such time and for
such purposes as it may deem appropriate.
8.4 Anti-Assignment. No right or benefit under the Plan shall be subject to
anticipation, alienation, sale, assignment, pledge, encumbrance or charge; and
any attempt to anticipate, alienate, sell, assign, pledge, encumber or charge
the same shall be void. No right or benefit shall be liable for or subject to
the debts, contracts, liabilities, or torts of the person entitled to such
benefits. If a Participant, a Participant's spouse, or any Beneficiary should
become bankrupt or attempt to anticipate, alienate, sell, assign, pledge,
encumber or charge any right to benefits under the Plan, then those rights, in
the discretion of the Administrative Committee, shall cease. In this case, the
Administrative Committee may hold or apply the benefits at issue or any part
thereof for the benefit of the Participant, the Participant's spouse, or
Beneficiary in such manner as the Administrative Committee may deem proper.
8.5 Unclaimed Interests. If the Administrative Committee shall at any time
be unable to make distribution or payment of benefits hereunder to a Participant
or any Beneficiary of a Participant by reason of the fact that his whereabouts
is unknown, the Administrative Committee shall so certify, and thereafter the
Administrative Committee shall make a reasonable attempt to locate such missing
person. If such person continues missing for a period of three (3) years
following such certification, the interest of such Participant in the Plan
shall, in the discretion of the Administrative Committee, be distributed to the
Beneficiary of such missing person.
8.6 References to Code, Statutes and Regulations. Any and all references in
the Plan to any provision of the Code, ERISA, or any other statute, law,
regulation, ruling or order shall be deemed to refer also to any successor
statute, law, regulation, ruling or order.
8.7 Liability. The Company, and its directors, officers and employees,
shall be free from liability, joint or several, for personal acts, omissions,
and conduct, and for the acts,
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omissions and conduct of duly constituted agents, in the administration of the
Plan, except to the extent that the effects and consequences of such personal
acts, omissions or conduct shall result from willful misconduct. However, this
Section shall not operate to relieve any of the aforementioned from any
responsibility or liability for any responsibility, obligation, or duty that may
arise under ERISA.
8.8 Tax Consequences of Compensation Reductions. The income tax
consequences to Participants of Compensation reductions under the Plan shall be
determined under applicable federal, state and local tax law and regulation and
neither the Company, the Board, nor any officer or employee of the Company makes
any representations as to the tax consequences of participation in the Plan.
8.9 Company as Agent for Related Employers. Each corporation that becomes a
participating employer pursuant to Section 2.5 shall, by so doing, be deemed to
have appointed the Company its agent to exercise on its behalf all of the powers
and authority hereby conferred upon the Company by the terms of the Plan,
including, but not limited to, the power to amend and terminate the Plan. The
Company's authority shall continue unless and until the related employer
terminates its participation in the Plan.
8.10 Governing Law; Severability. The Plan shall be construed according to
the laws of the State of Ohio, including choice of law provisions, and all
provisions hereof shall be administered according to the laws of that State,
except to the extent preempted by federal law. A final judgment in any action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. In the event that
any one or more of the provisions of the Plan shall for any reason be held to be
invalid, illegal, or unenforceable, such invalidity, illegality or
unenforceability shall not affect any other provision of the Plan, but the Plan
shall be construed as if such invalid, illegal, or unenforceable provisions had
never been contained herein, and there shall be deemed substituted such other
provision as will most nearly accomplish the intent of the parties to the extent
permitted by applicable law.
8.11 Taxes. The Company shall be entitled to withhold any taxes from any
distribution hereunder or from other compensation then payable, as it believes
necessary, appropriate, or required under relevant law.
DCP Holding Company Dental Care Plus, Inc.
By: By:
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Title: Title:
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Date: Date:
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