21ST Century Insurance Company 401(K) Supplemental Plan

EXHIBIT 10(x)
21ST CENTURY INSURANCE COMPANY 401(K) SUPPLEMENTAL PLAN
Amended and Restated as of January 1, 2001 Amended as of January 1, 2004

TABLE OF CONTENTS Page Purpose 1 ARTICLE 1 Definitions 1 ARTICLE 2 Selection, Enrollment, Eligibility 4 2.1 Selection by Committee 4 2.2 Enrollment Requirements 4 2.3 Eligibility; Commencement of Participation 4 2.4 Termination of Participation and/or Deferrals 4 ARTICLE 3 Deferral Commitments/Company Matching/Crediting Taxes 5 3.1 Amount of Deferrals 5 3.2 Election to Defer; Effect of Election Form 5 3.3 Withholding of Annual Deferral Amounts 5 3.4 Annual Company Matching Amount 5 3.5 Investment of Trust Assets 6 3.6 Vesting 6 3.7 Crediting/Debiting of Account Balances 6 3.8 FICA and Other Employment Taxes; Federal Income Tax 8 ARTICLE 4 Unforeseeable Financial Emergencies; Withdrawal Election 8 4.1 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies 8 4.2 Withdrawal Election 8 ARTICLE 5 Retirement Benefit 9 5.1 Retirement Benefit 9 5.2 Payment of Retirement Benefit 9 5.3 Death Prior to Completion of Retirement Benefit 9 ARTICLE 6 Pre-Retirement Survivor Benefit 9 6.1 Pre-Retirement Survivor Benefit 9 6.2 Payment of Pre-Retirement Survivor Benefit 9 ARTICLE 7 Termination Benefit 10 7.1 Termination Benefit 10 7.2 Payment of Termination Benefit 10 7.3 Death Prior to Completion of Termination Benefit 10 ARTICLE 8 Disability Waiver and Benefit 11 8.1 Disability Waiver 11
i 8.2 Continued Eligibility; Disability Benefit 11 8.3 Death Prior to Completion of Disability Benefit 11 ARTICLE 9 Beneficiary Designation 12 9.1 Beneficiary 12 9.2 Beneficiary Designation; Change; Spousal Consent 12 9.3 Acknowledgement 12 9.4 No Beneficiary Designation 12 9.5 Doubt as to Beneficiary 12 9.6 Discharge of Obligations 12 ARTICLE 10 Leave of Absence 12 10.1 Paid Leave of Absence 12 10.2 Unpaid Leave of Absence 12 ARTICLE 11 Termination, Amendment or Modification 13 11.1 Termination 13 11.2 Amendment 13 11.3 Plan Agreement 14 11.4 Effect of Payment 14 ARTICLE 12 Administration 14 12.1 Committee Duties 14 12.2 Agents 14 12.3 Binding Effect of Decisions 14 12.4 Indemnity of Committee 14 12.5 Employer Information 14 ARTICLE 13 Other Benefits and Agreements 15 13.1 Coordination with Other Benefits 15 ARTICLE 14 Claims Procedures 15 14.1 Presentation of Claim 15 14.2 Notification of Decision 15 14.3 Review of a Denied Claim 15 14.4 Decision on Review 16 14.5 Legal Action 16 ARTICLE 15 Trust 16 15.1 Establishment of the Trust 16 15.2 Interrelationship of the Plan and the Trust 16 15.3 Distributions From the Trust 16
ii ARTICLE 16 Miscellaneous 16 16.1 Status of Plan 16 16.2 Unsecured General Creditor 16 16.3 Employer's Liability 17 16.4 Nonassignability 17 16.5 Not a Contract of Employment 17 16.6 Furnishing Information 17 16.7 Terms 17 16.8 Captions 17 16.9 Governing Law 17 16.10 Notice 18 16.11 Successors 18 16.12 Spouse's Interest 18 16.13 Validity 18 16.14 Incompetent 18 16.15 Court Order 18 16.16 Distribution in the Event of Taxation 18 16.17 Insurance 19
iii 21ST CENTURY INSURANCE COMPANY 401(K) SUPPLEMENTAL PLAN Amended and Restated as of January 1, 2001 Amended as of November 1, 2003
Purpose The purpose of this Plan is to provide specified benefits to a select group of management and highly compensated Employees who contribute materially to the continued growth, development and future business success of 21st Century Insurance Company and its subsidiaries, if any, that sponsor this Plan. This Plan shall be unfunded for tax purposes and for purposes of Title I of ERISA. This document sets forth an amendment and restatement, effective January 1, 2001, of the Plan as originally adopted effective January 1, 1996. The Plan further is amended as of November 1, 2003.
ARTICLE 1 Definitions For purposes of this Plan, unless otherwise clearly apparent from the context, the following phrases or terms shall have the following indicated meanings: 1.1 "Account Balance" shall mean, with respect to a Participant, a credit on the records of the Employer equal to the sum of (i) the Deferral Account balance, and (ii) the vested Company Matching Account balance. The Account Balance, and each other specified account balance, shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant, or his or her designated Beneficiary, pursuant to this Plan. 1.2 "Annual Bonus" shall mean any compensation, in addition to Base Annual Salary relating to services performed during any calendar year, whether or not paid in such calendar year or included on the Federal Income Tax Form W-2 for such calendar year, payable to a Participant as an Employee under any Employer's annual bonus and cash incentive plans, excluding stock options. 1.3 "Annual Company Matching Amount" for any one Plan Year shall be the amount determined in accordance with Section 3.4. 1.4 "Annual Deferral Amount" shall mean that portion of a Participant's Base Annual Salary and Annual Bonus that a Participant elects to have, and is deferred, in accordance with Article 3, for any one Plan Year. In the event of a Participant's Retirement, Disability (if deferrals cease in accordance with Section 8.1), death or a Termination of Employment prior to the end of a Plan Year, such year's Annual Deferral Amount shall be the actual amount withheld prior to such event. 1.5 "Base Annual Salary" shall mean the annual base salary payable to the Participant relating to services performed during any calendar year, whether or not paid in such calendar year or included on the Federal Income Tax Form W-2 for such calendar year, excluding bonuses, commissions, overtime, fringe benefits, stock options, relocation expenses, incentive payments, non-monetary awards, directors fees and other fees, automobile and other allowances paid to a Participant for employment services rendered (whether or not such allowances are included in the Employee's gross income). Base Annual Salary shall be calculated before reduction for compensation voluntarily deferred or contributed by the Participant pursuant to all qualified or non-qualified plans of any Employer and shall be calculated to include amounts not otherwise included in the Participant's gross income under Code Sections 125, 402(e)(3), 402(h), or 403(b) pursuant to plans established by any Employer; provided, however, that all such amounts will be included in compensation only to the extent that, had there been no such plan, the amount would have been payable in cash to the Employee. -1- 1.6 "Beneficiary" shall mean one or more persons, trusts, estates or other entities, designated in accordance with Article 9, that are entitled to receive benefits under this Plan upon the death of a Participant. 1.7 "Beneficiary Designation Form" shall mean the form, including any electronic form, established from time to time by the Committee by which a Participant designates one or more Beneficiaries. 1.8 "Board" shall mean the board of directors of the Company. 1.9 "Claimant" shall have the meaning set forth in Section 14.1. 1.10 "Code" shall mean the Internal Revenue Code of 1986, as it may be amended from time to time. 1.11 "Committee" shall mean the committee described in Article 12. 1.12 "Company" shall mean 21st Century Insurance Company and any successor to all or substantially all of the Company's assets or business. 1.13 "Company Matching Account" shall mean (i) the sum of all of a Participant's Annual Company Matching Amounts, plus (ii) amounts credited in accordance with all the applicable crediting provisions of this Plan that relate to the Participant's Company Matching Account, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participant's Company Matching Account. 1.14 "Deferral Account" shall mean (i) the sum of all of a Participant's Annual Deferral Amounts, plus (ii) amounts credited in accordance with all the applicable crediting provisions of this Plan that relate to the Participant's Deferral Account, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to his or her Deferral Account. 1.15 "Disability" shall mean a period of disability during which a Participant qualifies for disability benefits under the Company's long-term disability plan. 1.16 "Disability Benefit" shall mean the benefit set forth in Article 8. 1.17 "Election Form" shall mean the form, including any electronic form, established from time to time by the Committee by which a Participant makes an election under the Plan. 1.18 "Employee" shall mean a person who is an employee of any Employer. 1.19 "Employer(s)" shall mean the Company and/or any of its subsidiaries or joint ventures (now in existence or hereafter formed or acquired) that have been selected by the Board to participate in the Plan and have adopted the Plan as a sponsor. 1.20 "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as it may be amended from time to time. 1.21 "401(k) Plan" shall mean the 21st Century Insurance Company Savings and Security Plan. 1.22 "Participant" shall mean any Employee (i) who is selected to participate in the Plan, (ii) who elects to participate in the Plan, (iii) who signs a Plan Agreement, an Election Form and a Beneficiary Designation Form, (iv) whose signed Plan Agreement, Election Form and Beneficiary Designation Form are accepted by the Committee, (v) who commences participation in the Plan, and (vi) whose Plan Agreement has not terminated. A spouse or former spouse of a Participant shall not be treated as a Participant in the Plan or have an account balance under the Plan, even if he or she has an interest in the Participant's benefits under the Plan as a result of applicable law or property settlements resulting from legal separation or divorce. -2- 1.23 "Plan" shall mean this 21st Century Insurance Company 401(k) Supplemental Plan, which shall be evidenced by this instrument and by each Plan Agreement, as they may be amended from time to time. 1.24 "Plan Agreement" shall mean the agreement, including any electronic agreement, as may be amended from time to time, which is entered into by and between an Employer and a Participant. Each Plan Agreement executed by a Participant and the Participant's Employer shall provide for the entire benefit to which such Participant is entitled under the Plan; should there be more than one Plan Agreement, the Plan Agreement that was last received by the Employer shall supersede all previous Plan Agreements in their entirety and shall govern such entitlement. The terms of any Plan Agreement may be different for any Participant, and any Plan Agreement may provide additional benefits not set forth in the Plan or limit the benefits otherwise provided under the Plan; provided, however, that any such additional benefits or benefit limitations must be agreed to by both the Employer and the Participant. 1.25 "Plan Year" shall mean a period beginning on January 1 of each calendar year and continuing through December 31 of such calendar year. 1.26 "Pre-Retirement Survivor Benefit" shall mean the benefit set forth in Article 6. 1.27 "Quarterly Installment Method" shall be a quarterly installment payment over the number of quarters selected by the Participant in accordance with this Plan, calculated as follows: The Account Balance of the Participant shall be calculated as of the close of business on the Participant's last day of employment The quarterly installment for the next-following quarter shall be calculated by multiplying this balance by a fraction, the numerator of which is one, and the denominator of which is the remaining number of quarterly payments due the Participant. By way of example, if the Participant elects a 20 Quarterly Installment Method, the first payment shall be 1/20 of the Account Balance, calculated as described in this definition. The following year, the payment shall be 1/19 of the Account Balance, calculated as described in this definition. Each quarterly installment shall be paid on or as soon as practicable after the last business day of the applicable quarter. 1.28 "Retirement", "Retire(s)" or "Retired" shall mean, with respect to an Employee, severance from employment from all Employers for any reason other than a leave of absence, death or Disability on or after the earlier of the attainment of (a) age sixty-five (65) with five (5) Years of Service, or (b) age fifty-five (55) with ten (10) Years of Service. 1.29 "Retirement Benefit" shall mean the benefit set forth in Article 5. 1.30 "Termination Benefit" shall mean the benefit set forth in Article 7. 1.31 "Termination of Employment" or "Terminates" shall mean the severing of employment with all Employers, voluntarily or involuntarily, for any reason other than Retirement, Disability, death or an authorized leave of absence. 1.32 "Trust" shall mean one or more grantor trusts established by the Company. 1.33 "Unforeseeable Financial Emergency" shall mean an unanticipated emergency that is caused by an event beyond the control of the Participant that would result in severe financial hardship to the Participant resulting from (i) a sudden and unexpected illness or accident of the Participant or a dependent (as defined in Code Section 152(a)) of the Participant, (ii) a loss of the Participant's property due to casualty, or (iii) such other extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant, all as determined in the sole discretion of the Committee. -3- 1.34 "Years of Service" shall mean the total number of full years in which a Participant has been employed by one or more Employers. For purposes of this definition, a year of employment shall be a 365 day period (or 366 day period in the case of a leap year) that, for the first year of employment, commences on the Employee's date of hiring and that, for any subsequent year, commences on an anniversary of that hiring date. Any partial year of employment shall not be counted. ARTICLE 2 Selection, Enrollment, Eligibility 2.1 Selection by Committee . Participation in the Plan shall be limited to a select group of management and highly compensated Employees of the Employers, as determined by the Committee in its sole discretion. From that group, the Committee shall select, in its sole discretion, Employees to participate in the Plan. 2.2 Enrollment Requirements . As a condition to participation in the Plan, as amended and restated herein, each selected Employee (even those who participated in the Plan prior to January 1, 2001) shall execute (including electronic execution) a Plan Agreement, an Election Form, and a Beneficiary Designation Form, all within 30 days after he or she is selected to participate in the Plan, and in no event later than the day before the effective date of the Participant's commencement of participation in the Plan. In addition, the Committee shall establish from time to time such other enrollment requirements as it determines in its sole discretion are necessary. 2.3 Eligibility; Commencement of Participation . Provided an Employee selected to participate in the Plan has met all enrollment requirements set forth in this Plan and required by the Committee, including returning all required documents to the Committee within the specified time period, that Employee shall commence participation in the Plan on the first day of the month following the month in which the Employee completes all enrollment requirements. If an Employee fails to meet all such requirements within the period required, in accordance with Section 2.2, that Employee shall not be eligible to participate in the Plan until the first day of the Plan Year following the delivery to and acceptance by the Committee of the required documents. 2.4 Termination of Participation and/or Deferrals . If the Committee determines in good faith that a Participant no longer qualifies as a member of a select group of management or highly compensated employees, as membership in such group is determined in accordance with Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, the Committee shall have the right, in its sole discretion, to (i) terminate any deferral election the Participant has made for the remainder of the Plan Year in which the Participant's membership status changes, (ii) prevent the Participant from making future deferral elections and/or (iii) immediately distribute the Participant's then Account Balance as a Termination Benefit and terminate the Participant's participation in the Plan. -4- ARTICLE 3 Deferral Commitments/Company Matching/Crediting/Taxes 3.1 Amount of Deferrals . For each Plan Year, a Participant may elect to defer, as his or her Annual Deferral Amount, Base Annual Salary and Annual Bonus up to the following maximum percentages for each deferral elected: Deferral Maximum Amount Base Annual Salary 80% Annual Bonus 100% Notwithstanding the foregoing, if a Participant first becomes a Participant after the first day of a Plan Year, the maximum Annual Deferral Amount, with respect to both Base Annual Salary and Annual Bonus, shall be limited to the amount of compensation not yet earned by the Participant as of the date the Participant submits a Plan Agreement and Election Form to the Committee for acceptance. No amounts shall be deferred as an Annual Deferral Amount under this Plan unless the Employee has elected to make the maximum permissible elective deferrals under the Company's 401(k) Plan. 3.2 Election to Defer; Effect of Election Form . (a) First Plan Year . In connection with a Participant's commencement of participation in the Plan, as amended and restated herein (even including Participants who actually commenced participation in the Plan prior to January 1, 2001), the Participant shall make an irrevocable deferral election for the Plan Year in which the Participant commences participation in the Plan, along with such other elections as the Committee deems necessary or desirable under the Plan. For these elections to be valid, the Election Form must be executed by the Participant in accordance with Section 2.2 above. (b) Subsequent Plan Years . For each succeeding Plan Year, an irrevocable deferral election for that Plan Year, and such other elections as the Committee deems necessary or desirable under the Plan, shall be made by timely delivering to the Committee, in accordance with its rules and procedures, before the end of the Plan Year preceding the Plan Year for which the election is made, a new Election Form. If no such Election Form is timely delivered for a Plan Year, the Annual Deferral Amount shall be zero for that Plan Year. 3.3 Withholding of Annual Deferral Amounts . For each Plan Year, the Base Annual Salary portion of the Annual Deferral Amount shall be withheld from each regularly scheduled Base Annual Salary payroll in equal amounts, as adjusted from time to time for increases and decreases in Base Annual Salary. The Annual Bonus portion of the Annual Deferral Amount shall be withheld at the time the Annual Bonus is or otherwise would be paid to the Participant, whether or not this occurs during the Plan Year itself. 3.4 Annual Company Matching Amount . A Participant's Annual Company Matching Amount for any Plan Year shall be equal to the percentage of matching contributions (the "Matching Percentage") in effect under the Company's 401(k) Plan for the Plan Year multiplied by the sum of the Participant's Annual Deferral Amount and his or her elective deferrals under the Company's 401(k) Plan for such Plan Year, reduced by the amount of any matching contributions made to the 401(k) Plan on his or her behalf for the plan year of the 401(k) Plan that corresponds to the Plan Year. The Matching Percentage for the Plan Year beginning January 1, 2001 shall be an amount equal to seventy-five percent (75%). Thus, the Participant's Annual Company Matching Amount for 2001 shall be seventy-five percent (75%) multiplied by the sum of the Participant's Annual Deferral Amount and his or her elective deferrals to the Company's 401(k) Plan, to the extent such Annual Deferral Amount and elective deferrals do not exceed six percent (6%) of the sum of the Participant's Base Annual Salary and Annual Bonus for such Plan Year less amounts actually credited to the Company's 401(k) Plan for the applicable Plan Year. -5- 3.5 Investment of Trust Assets . The Trustee of the Trust shall be authorized, upon written instructions received from the Committee or investment manager appointed by the Committee, to invest and reinvest the assets of the Trust in accordance with the applicable Trust Agreement, including reinvestment of the proceeds in one or more investment vehicles designated by the Committee. 3.6 Vesting . (a) A Participant shall at all times be 100% vested in his or her Deferral Account. (b) A Participant shall be vested in his or her Company Matching Account in accordance with the following schedule: Years of Service on Date of Termination of Em ...