AMENDED
AND RESTATED
HARRIS
& HARRIS GROUP, INC
EXECUTIVE
MANDATORY RETIREMENT BENEFIT PLAN
SECTION
I
PURPOSE
1.1 Purpose.
The
purpose of this Amended and Restated Harris & Harris Group, Inc. Executive
Mandatory Retirement Benefit Plan (the “Plan”) is to provide those employees of
Harris & Harris Group, Inc. who are required to retire pursuant to the
Harris & Harris Group, Inc. Executive Mandatory Retirement Program with a
nonforfeitable retirement benefit which will satisfy the requirements for
exempting those employees from any prohibitions against mandatory retirement
which might otherwise apply under any age discrimination laws applicable to
such
terminations of employment. This Plan was originally effective March 20, 2003
and is hereby amended and restated effective January 1, 2005 for compliance
with
Code Section 409A.
SECTION
II
DEFINITIONS
2.1 Definitions.
The
following definitions shall apply for purposes of the Plan, unless a different
meaning is plainly indicated by the context:
(a) Age
Discrimination Acts
shall
mean, collectively, the federal Age Discrimination in Employment Act, 29 U.S.C.
§ 621 et seq., the New York State Human Rights Law, N.Y. Exec. Law § 290 et
seq., the New York City Human Rights Law, § 8-107 and any other applicable law
pertaining to age discrimination, as well as any regulations promulgated under
any such law.
(b) Board
shall
mean the Board of Directors of the Company, as constituted from time to
time.
(c) Code
shall
mean the Internal Revenue Code of 1986, as amended from time to
time.
(d) Committee
shall
mean a committee to administer the Program which shall be comprised of all
members of the Company’s Board of Directors serving from time to time who would
be treated as “non-interested directors” for purposes of determining eligibility
for service on the Board’s Audit Committee.
(e) Company
shall
mean Harris & Harris Group, Inc., and any successor to all or a major
portion of its assets or business, which successor assumes the obligations
of
the Company under this Plan by operation of law or otherwise.
(f) Effective
Mandatory Retirement Date
shall be
the date on which an employee’s employment is actually terminated in a mandatory
retirement pursuant to the Program (whether such date is the Initial Mandatory
Retirement Date or a later date).
(g) ERISA
shall
mean the Employee Retirement Income Security Act of 1974, as amended from time
to time.
(h) Initial
Mandatory Retirement Date,
for an
employee of the Company who has been designated as subject to the Program,
shall
be December 31 of the year in which the employee attains the age of 65 years
(or
December 31 of such later year as the two-year “bona fide executive or high
policymaking position” employment requirement of the Program is first met by the
employee); provided, however, that the employee’s mandatory retirement can be
postponed in accordance with the Program.
(i) Mandatory
Retirement Benefit Amount
shall
mean the lump sum equivalent of a nonforfeitable retirement benefit (within
the
meaning of, and calculated in accordance with, the Age Discrimination Acts)
which will satisfy the requirements for exempting the Participant from any
prohibitions against compulsory retirement under the Age Discrimination Acts
immediately prior to the Participant’s Effective Mandatory Retirement Date. As
of the original effective date of this Plan, the Mandatory Retirement Benefit
Amount is the lump sum equivalent of an immediate nonforfeitable straight life
annuity (with no ancillary benefits) of $44,000.
(j) Offsetting
Benefit Amount
shall
mean the aggregate lump sum equivalent of those benefits to which a Participant
is entitled outside of the Plan which are treated as immediate nonforfeitable
retirement benefits pursuant to the Age Discrimination Acts. The Offsetting
Benefit Amount shall be calculated by adjusting the relevant benefits to lump
sum equivalents in accordance with the Age Discrimination Acts.
(k) Participant
shall
mean any employee of the Company who is being required to retire pursuant to
the
Harris & Harris Group, Inc. Executive Mandatory Retirement Program and
participation shall begin immediately prior to the employee’s Effective
Mandatory Retirement Date.
(l) Plan
shall
mean this Harris & Harris Group, Inc. Executive Mandatory Retirement Benefit
Plan, as set forth in this plan instrument, as it may be amended from time
to
time.
(m) Plan
Benefit
shall
mean the benefit payable to a Participant hereunder and calculated pursuant
to
Section 3.1 hereof.
(n) Program
shall
mean the Harris & Harris Group, Inc. Executive Retirement Program, as it may
be amended from time to time, attached hereto as Exhibit A.
SECTION
III
BENEFITS
3.1 Plan
Benefit.
Each
Participant shall be entitled under this Plan to receive a Plan Benefit
actuarially equivalent to the result obtained by reducing the Mandatory
Retirement Benefit Amount by the Participant’s Offsetting Benefit Amount (if
any), but only if such result is a positive amount.
3.2 Payment
of Plan Benefit.
(a) The
Plan
Benefit shall be payable to the Participant in the form of a lump sum six months
and one day after the Participant’s separation from service, provided that if
the Participant is not a key employee as defined in Code Section 416 and as
applicable under Code Section 409A, such benefit shall be paid 60 days after
the
participant's separation from service. Calculation of the lump sum benefit
shall
be made in accordance with the Age Discrimination Acts. A Participant's
separation from service for this purpose occurs on the last day on which the
Employee performs services for the Company (or any other entity considered
a
single employer with the Company under Section 414(b) or (c) of the Code)
substantially on his regular, full-time schedule, if on that date both the
Company and the Employee reasonably anticipate that (i) no further services
will
be performed thereafter, or (ii) the level of bona fide services performed
after
that date (as an employee or independent contractor, but not including service
as a member of the Board of Directors of the Company) will permanently decrease
to no more than 20% of the average level of bona fide services performed over
the previous 36 months, or on such later date on which the parties first
reasonably anticipate service has reduced in such manner.
(b) Section
3.2(a) shall not apply to payment of Plan Benefits to a Participant whose
Effective Mandatory Retirement Date was on or before December 31, 2004. The
terms of the Plan prior to this Amendment shall control the timing of payment,
except that neither the Company nor the Participant may adjust or change the
timing of payment.
3.2 Vesting.
Each
Participant shall become completely vested in his or her Plan Benefit
immediately prior to his or her Effective Mandatory Retirement Date and the
Plan
Benefit shall be nonforfeitable.
SECTION
IV
ADMINISTRATION
4.1 Administration.
The
Plan shall be administered by the Committee.
4.2 Duties.
The
Committee shall perform the duties required, and shall have the powers
necessary, to administer the Plan and carry out the provisions
thereof.
4.3 Powers.
The
powers of the Committee shall be as follows:
(a) To
determine any question arising in connection with the Plan, including factual
matters, and its decision or action in respect thereof shall be final,
conclusive and binding upon the Company and the Participants and any other
individual interested herein;
(b) To
engage
the services of counsel or attorney (who may be counsel or attorney for the
Company) and an actuary, if it deems necessary, and such other agents or
assistants as it deems advisable for the proper administration of the Plan;
and
(c) To
receive from the Company and from Participants such information as shall be
necessary for the proper administration of the Plan.
4.4 Claims
Procedure.
Subject
to the provisions of this Plan, the Committee shall make all determinations
as
to the right of any individual to a benefit. Any denial by the Committee of
the
claim for benefits under the Plan by a Participant or any other individual
interested herein shall be stated in writing by the Committee and delivered
or
mailed to the Participant or such individual. Such notice shall set forth the
specific reasons for the denial, written to the best of the Committee’s ability
in a manner that may be understood without legal or actuarial counsel. In
addition, the Committee shall afford to any Participant whose claim for benefits
has been denied a reasonable opportunity for a review of the decision denying
the claim.
SECTION
V
NONALIENATION
OF BENEFITS
Neither
the Participant nor any other individual shall have any right to assign or
otherwise to alienate the right to receive payments under the Plan, in whole
or
in part.
SECTION
VI
AMENDMENT
AND TERMINATION
The
Company reserves the right at any time by action of the Board to terminate
the
Plan or to amend its provisions in any way. Notwithstanding the foregoing,
no
termination or amendment of the Plan may reduce the benefits payable under
the
Plan to the Participant if the Participant’s termination of employment with the
Company has occurred prior to such termination of the Plan or amendment of
its
provisions.
SECTION
VII
MISCELLANEOUS
7.1 No
Right to Employment.
This
Plan shall not be construed as providing any Participant with the right to
be
retained in the Company’s employ or to receive any benefit not specifically
provided hereunder.
7.2 No
Effect on Other Compensation and Benefits.
Nothing
contained herein shall exclude or in any manner modify or otherwise affect
any
existing or future rights of any Participant to participate in and receive
the
benefits of any compensation, bonus, pension, life insurance, medical and
hospitalization insurance or other employee benefit plan or program to which
he
or she otherwise might be or become entitled as an officer or employee of the
Company.
7.3 Governing
Law.
This
Plan shall be construed in accordance with and governed by the laws of the
State
of New York, without regard to its conflicts of law principles.
7.4 Status.
This
Plan is not intended to satisfy the requirements for qualification under Section
401(a) of the Code. It is intended to be a nonqualified plan that is not subject
to ERISA. The Plan shall be construed and administered so as to effectuate
this
intent.
7.5 Plan
Expenses; Plan Unfunded.
All
expenses of establishing and administering the Plan shall be paid by the
Company. No individual interested herein shall have any interest in any specific
assets of the Company by reason of the individual’s interest under the Plan, and
such individuals shall have only the status of unsecured creditors of the
Company with respect to any benefits that become payable under this Plan. The
Company is not required to purchase any annuity from any third party to provide
a Plan Benefit.
7.6 Successors.
The
Company shall require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of the Company to expressly assume the Company’s obligations
hereunder in the same manner and to the same extent that the Company would
be
required to perform if no such succession had taken place.
7.7 Withholding
Requirements.
Payment
of benefits under this Plan shall be subject to applicable withholding
requirements.
IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
duly authorized officer as of January 1, 2005, but actually on the date set
forth below
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HARRIS
&
HARRIS GROUP, INC. |
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/s/ Douglas
W. Jamison |
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Douglas
W. Jamison, President |
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Date: August
2, 2007 |
HARRIS
& HARRIS GROUP, INC.
EXECUTIVE
MANDATORY RETIREMENT PROGRAM
1. Employees
Covered.
Individuals who are employed by Harris & Harris Group, Inc. (the “Company”)
in a bona fide executive or high policymaking position (as determined in
accordance with the “Age Discrimination Acts”) and who are designated in the
sole discretion of the “Committee” as subject to this Program are subject to
automatic “mandatory retirement” upon and after December 31 of the year in which
a designated individual attains the age of 65 years (or December 31 of such
later year as the two-year employment position requirement set forth in the
next
sentence is first met). The designated individual must have been employed in
such a bona fide executive or high policymaking position for at least the
two-year period immediately preceding the effective mandatory retirement date.
Notwithstanding the foregoing, the Committee may determine, in its sole
discretion and on an annual basis beginning in the year in which the designated
individual attains the age of 65 years and prior to December 31 of that year
(or
prior to December 31 of such later year as the two-year employment position
requirement is first met), to postpone the then-governing mandatory retirement
date for that individual for one additional year for the benefit of the
Company.
2. Definitions.
The
following definitions shall apply for purposes of the Program, unless a
different meaning is plainly indicated by the context:
A. “Age
Discrimination Acts” shall mean, collectively, the federal Age Discrimination in
Employment Act, 29 U.S.C. § 621 et seq., the New York State Human Rights Law,
N.Y. Exec. Law § 290 et seq., the New York City Human Rights Law, § 8-107 and
any other applicable law pertaining to age discrimination, as well as any
regulations promulgated under any such law.
B. “Committee”
shall mean a committee to administer the Program which shall be comprised of
all
members of the Company’s Board of Directors serving from time to time who would
be treated as “non-interested directors” for purposes of determining eligibility
for service on the Board’s Audit Committee.
C. “Company”
shall mean Harris & Harris Group, Inc., a New York corporation, and any
successor thereto.
D. “Mandatory
retirement” shall have the meaning given “compulsory retirement” by and under
the Age Discrimination Acts.
E. “Program”
shall mean this Executive Mandatory Retirement Program, as it may be amended
from time to time.