EXHIBIT 10-K-4
THIS AGREEMENT, made this 27th day of May, 1994, by Minnkota
Power Cooperative, Inc., a Minnesota Corporation, herein called
"Minnkota," and Otter Tail Power Company, a Minnesota
Corporation, herein called "Otter Tail, "said parties referred to
herein individually as "Party" and collectively as "Parties":
WITNESSETH
WHEREAS, the Parties and Beltrami Electric Cooperative, a
Minnesota Corporation, herein called "Beltrami," have entered
into that certain agreement concerning electric service dated
November 29, 1971, hereinafter called the "1971 Agreement," and
WHEREAS, the Parties and Beltrami have entered into that
certain agreement concerning electric service dated April 25,
1980, hereinafter called the "Amendment No. 1 1971 Agreement,"
and
WHEREAS, the Parties amd Beltrami have entered into that
certain agreement concerning electric service dated April 4,
1986, hereinafter called the "Amendment No. 2 1971 Agreement,"
and
WHEREAS, the Parties and Beltrami have entered into that
certain agreement concerning electric service dated April 8,
1991, hereinafter called the "Amendment No. 3 1971 Agreement,"
and
WHEREAS, Minnkota and Otter Tail have entered into an
agreement concerning electric service dated August 31, 1962, as
amended, herein called the "1962 Agreement," which has provided
for interconnections and coordinated use of transmission
facilities, and
WHEREAS, the 1962 Agreement between Minnkota and Otter Tail
was replaced by an agreement between Minnkota and Otter Tail
dated July 28, 1988 herein called the "1988 Agreement," which
provided for further interconnections and coordinated use of
transmission facilities, and
WHEREAS, Potlatch Corporation of San Francisco, California,
herein called "Potlatch," has installed a wood waste power
boiler, herein called the "Facility," located in Section 9,
Township 145N, Range 32W, Hubbard County, Minnesota, for the
production of steam and electricity, and
WHEREAS, Potlatch receives retail electric service in
Section 8, Township 145N, Range 32W, and in Section 9, Township
145N, Range 32W, Hubbard County, Minnesota, herein called the
"Plants," through facilities jointly provided by Minnkota and
Otter Tail in
accordance with previously mentioned agreements, and
WHEREAS, Potlatch will generate and wishes to sell, and
Minnkota and Otter Tail jointly wish to purchase, electric power
from the Facility.
NOW, THEREFORE, the Parties agree as follows:
ARTICLE I
PURCHASE OF CAPACITY AND ENERGY
1.01 Minnkota and Otter Tail will each purchase 50% of the
capacity and energy from the Facility. Otter Tail, acting on its
own behalf and on Minnkota's behalf, will execute an agreement
with Potlatch, hereinafter called the "Potlatch Agreement," for
the purchase of energy and capacity.
1.02 For energy, Otter Tail and Minnkota shall pay to
Potlatch an aggregate amount equal to (i) 1.5515 cents per
kilowatt-hour, which includes compensation for 7% average system
loss, for all kilowatt-hours up to the amount of retail
kilowatt-hours consumed by the Plants on a monthly basis, plus
(ii) 1.45 cents per kilowatt-hour for all kilowatt-hours
delivered to Otter Tail and Minnkota in excess of the amount
consumed by the Plants.
1.03 Minnkota and Otter Tail will purchase the capacity
from Potlatch priced at $8.20 per kW for the first 200 kW, and
$6.95 per kW for the remainder of billing capacity per month.
The monthly billing capacity shall be defined as the sum of the
non-coincident monthly metered demands of the Plants. The monthly
billing capacity shall not exceed the Midcontinent Area Power
Pool (MAPP) capacity rating credited to Otter Tail and Minnkota.
The station service requirements of the Facility during
maintenance and outage periods will be measured by the metering
for the oriented strand board mill and will be included in the
calculation of billing capacity. It is the intent of Minnkota
and Otter Tail that the price paid to Potlatch for the capacity
shall be at the same rate paid by Potlatch for retail electric
service under Otter Tail's Large General Service rate C-02M. If
the retail demand charge rate paid by Potlatch is changed during
the period of the Potlatch Agreement, the rates paid by Otter
Tail and Minnkota for the capacity from Potlatch shall be changed
in the same manner.
1.04 The billing cycle for the energy and capacity
purchased from Potlatch shall be the same as the billing cycle
under which Potlatch receives retail electric service.
1.05 Otter Tail shall pay to Potlatch 100% of the monies
billed for the capacity and energy, and Otter Tail shall bill to
Minnkota and Minnkota shall pay to Otter Tail 50% of the monies
paid to Potlatch.
ENERGY ACCOUNTING
2.01 Minnkota and Otter Tail will each account for
receiving 50% of the energy received from the Facility on an
hourly basis. In scheduling energy from the Facility, Potlatch
will provide generation schedules to Otter Tail's system
operators. Otter Tail will provide the generation schedules to
Minnkota, and each company will schedule their share of the
energy hourly.
2.02 Minnkota and Otter Tail will use the existing
procedures for end of the month regulation accounting between the
Parties to adjust for differences between scheduled and received
energy.
GENERAL
3.01 The effective date of this agreement will be the date
of signing, and shall have the same term as the Potlatch
Agreement to be completed between Otter Tail and Potlatch.
3.02 Minnkota shall review and provide Otter Tail with
written approval of the Potlatch Agreement. Upon execution, the
Potlatch Agreement will become an attachment to this Agreement.
3.03 Otter Tail shall submit the necessary documentation
to the Midcontinent Area Power Pool Design Review Committee, and
other committees as necessary to allow the capacity to be
accredited to both Parties.
3.04 This Agreement is subject to the approval of any
regulatory body or bodies having jurisdiction thereof. Unless it
is approved by the Administrator of the Rural Electrification
Administration, this Agreement shall be of no force and effect.
IN WITNESS WHEREOF, the Parties have caused this Agreement
to be executed in duplicate as of the day and year first written
above.
ATTEST: MINNKOTA POWER COOPERATIVE, INC.
Bobby Lofstrand By: Harvey Tallackson
Secretary President
OTTER TAIL POWER COMPANY
Jay D. Myster By: Ward Uggerud
Secretary Vice-President
Exhibit 10-N-2
OTTER TAIL POWER COMPANY
EXECUTIVE SURVIVOR AND SUPPLEMENTAL RETIREMENT PLAN
Restated as of July 1, 1994
Page
ARTICLE I-PURPOSE; EFFECTIVE DATE 1
ARTICLE II-DEFINITIONS 1
2.1 ACTUARIAL EQUIVALENCY 1
2.2 BENEFICIARY 1
2.3 BOARD 1
2.4 CHANGE IN CONTROL 1
2.5 COMMITTEE 2
2.6 DISABILITY 2
2.7 EARLY RETIREMENT DATE 2
2.8 EMPLOYER 2
2.9 FINAL ANNUAL COMPENSATION 2
2.10 FINAL ANNUAL SALARY 3
2.11 NORMAL RETIREMENT DATE 3
2.12 PARTICIPANT 3
2.13 PARTICIPATION AGREEMENT 3
2.14 QUALIFIED RETIREMENT PLAN 3
2.15 RETIREMENT 3
2.16 SALARY 3
2.17 SPOUSE 3
2.18 SUPPLEMENTAL RETIREMENT BENEFIT 3
2.19 TARGET RETIREMENT PERCENTAGE 4
2.20 YEARS OF CREDITED SERVICE 4
2.21 YEARS OF PARTICIPATION 4
ARTICLE III-PARTICIPATION AND VESTING 4
3.1 ELIGIBILITY AND PARTICIPATION 4
3.2 CHANGE IN EMPLOYMENT STATUS 4
3.3 VESTING 5
3.4 SUICIDE 5
ARTICLE IV-BENEFITS-EXECUTIVE OFFICERS 5
4.1 ELIGIBILITY 5
4.2 PRERETIREMENT SURVIVOR BENEFIT 5
4.3 POSTRETIREMENT SURVIVOR BENEFIT 6
4.4 POSTTERMINATION SURVIVOR BENEFIT 6
ARTICLE V-SUPPLEMENTAL RETIREMENT BENEFITS 6
5.1 NORMAL RETIREMENT BENEFIT 6
5.2 EARLY RETIREMENT BENEFIT 7
5.3 TERMINATION BENEFIT 7
5.4 PAYMENT OF BENEFITS 7
5.5 WITHHOLDING; PAYROLL TAXES 8
5.6 ACCELERATED DISTRIBUTION 8
5.7 SUPPLEMENTAL SURVIVOR BENEFIT 8
5.8 PAYMENT TO GUARDIAN 9
ARTICLE VI-BENEFICIARY DESIGNATION 9
6.1 BENEFICIARY DESIGNATION 9
6.2 AMENDMENTS 9
6.3 NO PARTICIPANT BENEFICIARY DESIGNATION 9
6.4 EFFECT OF PAYMENT 10
ARTICLE VII-ADMINISTRATION 10
7.1 COMMITTEE; DUTIES 10
7.2 AGENTS 10
7.3 BINDING EFFECT OF DECISIONS 10
7.4 INDEMNITY OF COMMITTEE 10
ARTICLE VIII-CLAIMS PROCEDURE 10
8.1 CLAIM 10
8.2 DENIAL OF CLAIM 10
8.3 REVIEW OF CLAIM 11
8.4 FINAL DECISION 11
ARTICLE IX-TERMINATION, SUSPENSION OR AMENDMENT 11
9.1 TERMINATION, SUSPENSION OR AMENDMENT OF PLAN 11
ARTICLE X-MISCELLANEOUS 11
10.1 UNFUNDED PLAN 11
10.2 UNSECURED GENERAL CREDITOR 11
10.3 TRUST FUND 12
10.4 NONASSIGNABILITY 12
10.5 NOT A CONTRACT OF EMPLOYMENT 12
10.6 PROTECTIVE PROVISIONS 12
10.7 TERMS 12
10.8 CAPTIONS 13
10.9 GOVERNING LAW 13
10.10 VALIDITY 13
10.11 NOTICE 13
10.12 SUCCESSORS 13
OTTER TAIL POWER COMPANY
EXECUTIVE SURVIVOR AND SUPPLEMENTAL RETIREMENT PLAN
ARTICLE I-PURPOSE; EFFECTIVE DATE
The purpose of this Executive Survivor and Retirement Plan
(the "Plan") is to provide survivor and retirement benefits for
certain executive officers and other key management employees as
designated by the Board of Directors of Otter Tail Power Company
(the "Company"). It is intended that the Plan will aid in
securing the goodwill, loyalty and efficiency of the
participating executive officers and other key management
employees, and will attract and retain executive officers and
other key management employees of outstanding competence. This
Plan shall be effective as of November 1, 1983, and is restated
as of July 1, 1994.
ARTICLE II-DEFINITIONS
For purposes of this Plan, the following terms shall have
the meanings indicated, unless the context clearly indicates
otherwise:
2.1 Actuarial Equivalency
"Actuarial Equivalency" means an equivalent value or benefit
determined by an actuary selected by Employer using the actuarial
tables and assumptions being used to determine Actuarial
Equivalency in the Qualified Retirement Plan at the time the
determination is made.
2.2 Beneficiary
"Beneficiary" means the person, persons or entity entitled
under Article VII to receive any Plan benefits payable after a
Participant's death.
2.3 Board
"Board" means the Board of Directors of Employer.
2.4 Change in Control
A "Change in Control" shall mean:
(a)With respect to the Company, a change in control of a
nature that would be required to be reported in response to Item
6(e) of Schedule 14A of Regulation 14A promulgated under the
Securities Exchange Act of 1934, as amended (the "Act") or any
successor thereto; provided that, without limitation, such a
change in control shall be deemed to have occurred if (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Act), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Act),
directly or indirectly, of Voting Securities of the Company
representing forty percent (40%) or more of the combined voting
power of the Company's then outstanding Voting Securities; (ii)
during any period of two (2) consecutive years, individuals who
at the beginning of such period constitute the Board of Directors
of the Company, together with any new directors whose election,
or nomination for election by the shareholders, was approved by a
vote of at least two-thirds (2/3) of the directors then still in
office who were either directors at the beginning of the period
or whose election or nomination for election was previously so
approved, cease for any reason to constitute at least a majority
of the Board of Directors of the Company; or (iii) the
stockholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than a merger or
consolidation which would result in the Voting Securities of the
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into Voting Securities of the surviving entity) at least fifty
percent (50%) of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or the
stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or
disposition by the Company (in one (1) transaction or a series of
transactions) of all or substantially all of the Company's assets
to a person or entity which is not a subsidiary of the Company.
As used herein, "Voting Securities" shall mean any securities
which vote generally in the election of directors.
2.5 Committee
"Committee" means the Committee appointed to administer the
Plan pursuant to Article VII.
2.6 Disability
"Disability" means the Participant is eligible to receive
benefits for permanent disability under the Otter Tail Power
Company's Long-Term Disability Plan or a plan providing
comparable benefits sponsored by Employer. Disability will be
based upon medical reports and/or other evidence satisfactory to
the Committee. In no event shall a Disability be deemed to occur
or to continue after a Participant's Normal Retirement Date.
2.7 Early Retirement Date
"Early Retirement Date" means the date on which a
Participant terminates employment with Employer if such
termination date occurs after the first day of the month
coincidental with or next following a Participant's attainment of
age fifty-five (55) and completion of ten (10) Years of Credited
Service, but prior to the participant"s Normal Retirement Date.
2.8 Employer
"Employer" means Otter Tail Power Company, a Minnesota
corporation, or any successor to the business thereof, and any
affiliated or subsidiary corporations designated by the Board.
2.9 Final Annual Compensation
"Final Annual Compensation" means the annualized base salary
plus any bonuses paid by Employer to the Participant during the
twelve (12) months prior to retirement or termination.
2.10 Final Annual Salary
"Final Annual Salary" means the annualized base salary paid
to a Participant by Employer prior to a Participant's termination
or death.
2.11 Normal Retirement Date
"Normal Retirement Date" means the first day of the month
coincident with or next following the Participant's attainment of
age sixty-five (65).
2.12 Participant
"Participant" means any employee who is participating or has
participated in this Plan as provided in Article III.
2.13 Participation Agreement
"Participation Agreement" means the agreement filed by a
Participant which acknowledges assent to the terms of the Plan.
2.14 Qualified Retirement Plan
"Qualified Retirement Plan" means the Otter Tail Power
Company Pension Plan or any successor defined benefit retirement
income plan or plans maintained by the Employer which qualifies
under Section 401(a) of the Internal Revenue Code. For purposes
of determining benefits and actuarial equivalencies under the
Qualified Retirement Plan, the actuarial principles and
assumptions which have consistently applied to such plan(s) shall
continue to be applied.
2.15 Retirement
"Retirement" means a Participant's separation from
employment with the Employer at the Participant's Early
Retirement Date or Normal Retirement Date.
2.16 Salary
"Salary" means the salary paid to or accrued for a
Participant during the calendar year, before reduction for
amounts deferred under IRC Section 401(k). Salary does not
include expense reimbursements, any form of noncash compensation
or benefits, Employer contributions to the Qualified Retirement
Plan or the Company's 401(k) Plan, or any other payments or
benefits other than normal compensation.
2.17 Spouse
"Spouse" means a Participant's wife or husband who is
lawfully married to the Participant at the time of the
Participant's death.
2.18 Supplemental Retirement Benefit
"Supplemental Retirement Benefit" means the benefit
determined under Article V of this Plan.
2.19 Target Retirement Percentage
"Target Retirement Percentage" means the percentage of Final
Annual Compensation which will be used as a target from which
other forms of retirement benefits are subtracted, as provided in
Article V, to arrive at the amount of the Supplemental Retirement
Benefit actually payable to a Participant. This percentage shall
equal seventy percent (70%).
2.20 Years of Credited Service
"Years of Credited Service" means the number of years of
"Vesting Service," as defined and calculated in the Qualified
Retirement Plan.
2.21 Years of Participation
"Years of Participation" means the number of complete years
in which the Participant has participated in this Plan.
ARTICLE III-PARTICIPATION AND VESTING
3.1 Eligibility and Participation
(a) Eligibility. Eligibility to participate in the Plan
shall be limited to certain executive officers and other key
management employees of Employer who are designated by the Board
of Directors.
(b) Participation. An Employee's participation in the
Plan shall be effective upon the employee's notification of
eligibility to participate, the Participant's completion of a
Participation Agreement, and the Committee's acceptance of the
Participation Agreement. Participation in the Plan shall
continue until such time as the Participant terminates employment
with the Employer, and as long thereafter as the Participant is
eligible to receive benefits under this Plan.
3.2 Change in Employment Status
If the Board determines that a Participant' employment
performance is no longer at a level which deserves reward through
participation in this Plan, but does not terminate the
Participant's employment with the Employer, participation herein
and eligibility to receive benefits hereunder shall be limited to
the Participant's vested interest in such benefits as of the date
designated by the Board.
3.3 Vesting
Participants shall vest in the benefits under this Plan for
which they are eligible based on Years of Participation as
follows:
Vested Years of
Percentage Participation
0% Less than 2
40 2 but less than 3
60 3 but less than 4
80 4 but less than 5
100 5 or more
Regardless of Years of Participation, any Participant who is
age fifty-five (55) and a Plan Participant on or before January
1, 1992, shall be one hundred percent (100%) vested.
3.4 Suicide
The provisions of Article IV notwithstanding, no benefit
shall be paid to a Beneficiary if the Participant's death occurs
as a result of suicide during the twenty-four (24) successive
calendar months beginning with the calendar month following the
commencement of the employee's participation in this Plan.
Similarly, no benefit shall be paid if death occurs within the
twenty-four (24) successive calendar months following
commencement of an employee's participation in the Plan if the
Participant has made a material misrepresentation in any form or
document provided by the Participant to or for the benefit of
Employer.
ARTICLE IV-BENEFITS-EXECUTIVE OFFICERS
4.1 Eligibility
Survivor benefits under this Plan shall only be due and
payable to Participants who are or have been executive officers
while employed by Employer. In no event shall Participants who
are other key management employees be eligible for a survivor
benefit under this Article.
4.2 Preretirement Survivor Benefit
(a) Amount. If a Participant dies while employed by
Employer or during a period of Disability, Employer shall pay a
survivor benefit to the Participant's Beneficiary equal to four
(4) times the Participant's Final Annual Salary.
(b) Form and Commencement of Benefit Payments. The
benefit payable under this Section shall be paid in monthly
installments equal to one-sixth (1/6) of the Participant's Final
Annual Salary until the benefit has been paid in full, without
interest. Payments shall commence the first day of the month
following the death of the Participant, or as soon thereafter as
is practicable, and shall continue the first day of each month
thereafter for the duration of the payment period.
(c) Commutation of Benefits. The Committee may, in its
sole discretion and at any time upon the request of a
Beneficiary, provide for payment of the Actuarial Equivalent of
the preretirement survivor benefit at such times and in such
forms as it may deem appropriate.
4.3 Postretirement Survivor Benefit
(a) Amount. If a Participant dies following Retirement,
Employer shall pay a survivor benefit to the Participant's
Beneficiary equal to the amount shown on the following schedule:
Age at Death Benefit
55 through 64 2 times Final Annual Salary
65 through 69 1-1/2 times Final Annual Salary
70 through 75 3/4 times Final Annual Salary
Over 75 3/8 times Final Salary
(b) Form and Commencement of Benefit Payment. The
benefit payable under this Section shall be paid to the
Beneficiary in a lump sum form on the first day of the month
following the Participant's death, or as soon as practicable
thereafter.
4.4 Posttermination Survivor Benefit
(a) Amount. If a vested Participant dies following
termination, Employer shall pay a survivor benefit to the
Participant's Beneficiary equal to the amount shown on the
following schedule times the Participant's vested percentage:
Age at Death Benefit
Less than 65 2 times Final Annual Salary
65 through 69 1-1/2 times Final Annual Salary
70 through 75 3/4 times Final Annual Salary
Over 75 3/8 times Final Annual Salary
(b) Form and Commencement of Benefit Payment. The
benefit payable under this Section shall be paid to the
Beneficiary in a lump sum form on the first day of the month
following the Participant's death, or as soon as practicable
thereafter.
ARTICLE V-SUPPLEMENTAL RETIREMENT BENEFITS
5.1 Normal Retirement Benefit
If a Participant retires at the Normal Retirement Date,
Employer shall pay to the Participant a monthly Supplemental
Retirement Benefit equal to the Target Retirement Percentage
multiplied by Final Annual Compensation, less:
(a) The Participant's monthly primary Social Security
benefit commencing at Retirement, and
(b) The Participant's benefit in the form of a monthly
single-life annuity under the Qualified Retirement Plan,
calculated with a maximum of 30 Years of Credited Service,
commencing at Retirement.
In no event shall the benefit under this Section be less
than the Retirement Benefit payable under this Plan prior to its
restatement.
5.2 Early Retirement Benefit
If a Participant retires at an Early Retirement Date,
Employer shall pay to the Participant the monthly Supplemental
Retirement Benefit calculated under Section 5.1 except:
(a) The Target Retirement Percentage shall be reduced by
the following percentage based on the Participant's age at
Retirement:
Age Reduction
62 through 65 0%
61 5
60 10
59 15
58 20
57 25
56 32
55 39
(b) The offset required by 5.1(a) shall be determined at
Retirement using the Social Security Act in effect at Retirement
and assuming zero (0) future earnings from the Participant's
Early Retirement Date to the later of Early Retirement Date or
Participant's attainment of age sixty-two (62).
5.3 Termination Benefit
If a vested Participant terminates, Employer shall pay to
the Participant the monthly Supplemental Retirement Benefit
calculated under Section 5.1 multiplied by the Participant's
vested percentage under Section 3.3 except:
(a) The offset required by 5.1(a) shall be determined at
termination using the Social Security Act in effect at
termination and assuming earnings from the date of termination to
the Participant's Normal Retirement Date are equal to the
Participant's salary at termination; and
(b) The offset required by 5.1(b) shall be the
Participant's benefit under the Qualified Retirement Plan payable
at age sixty-five (65).
5.4 Payment of Benefits
(a) Form of Benefit Payment. The Supplemental Retirement
Benefit shall be paid in the form of a monthly single life
annuity with a fifteen (15) year certain period. If a
Participant dies prior to completion of the fifteen (15) year
payment period, any remaining payments shall be paid to the
Participant's Beneficiary. For the Beneficiaries of executive
officers, this remaining benefit, if any, shall be paid in
addition to the benefits provided in 4.4. For Beneficiaries of
other key management employees, this shall be the only benefit
payable, if any.
(b) Commencement of Benefit Payments. Benefits payable
to a participant under Sections 5.1 and 5.2 shall commence as
soon as practicable after the appropriate application for
benefits has been made but not later than sixty (60) days after
all information necessary to calculate the benefit amount has
been received by Employer. Benefits payable to a vested
Participant under Section 5.3 shall commence on the first day of
the month following the Participant's sixty-fifth (65th)
birthday. All payments shall be made as of the first day of the
month.
(c) Commutation of Benefits. The Committee may, in its
sole discretion and at any time upon the request of a Participant
(or Beneficiary), provide for payment of the actuarial equivalent
of the Supplemental Retirement Benefits at such times and in such
form as it may deem appropriate.
5.5 Withholding; Payroll Taxes
Employer shall withhold from payments made hereunder any
taxes required to be withheld from a Participant's wages for the
federal or any state or local government. However, a Beneficiary
may elect not to have withholding for federal income tax purposes
pursuant to Section 3405(a)(2) of the Internal Revenue Code, or
any successor provision.
5.6 Accelerated Distribution
Notwithstanding any other provision of the Plan, at any time
within twenty four (24) months of a Change in Control or any time
following termination of employment, a Participant shall be
entitled to receive, upon written request to the Committee, a
lump sum distribution equal to ninety percent (90%) of the
Actuarial Equivalent of the Participant's unpaid benefits under
this Plan on the date on which the Committee receives the written
request. The remaining unpaid benefits shall be forfeited by the
Participant and no benefit shall be payable under Section 5.7.
The amount payable under this Section shall be paid in a lump sum
within sixty-five (65) days following the receipt of the notice
by the Committee from the Participant.
5.7 Supplemental Survivor Benefit
Benefits payable under this Section shall be applicable to
all Participants and shall be in addition to any benefit payable
under Article IV.
(a) Pretermination. If a Participant dies while employed
by the Company, the Participant's Beneficiary shall receive the
actuarial equivalent of the Participant's accrued benefit in
fifteen (15) annual installments.
(b) Posttermination. If a Participant has terminated
employment with the Company but benefits have not commenced under
this Plan, the Participant's Beneficiary shall receive the
actuarial equivalent of the Participant's benefit in fifteen (15)
annual installments.
(c) After Benefits Commence. If a Participant dies after
the commencement of benefits under this Plan but before having
received one hundred eighty (180) monthly payments, the
Participant's Beneficiary shall receive a monthly benefit equal
to the amount the Participant was receiving. The benefit shall
be payable for a period equal to one hundred eighty (180) months,
less the number of monthly payments received by the Participant.
5.8 Payment to Guardian
If a Plan benefit is payable to a minor or a person declared
incompetent or to a person incapable of handling the disposition
of his property, the Committee may direct payment of such Plan
benefit to the guardian, legal representative or person having
the care and custody of such minor, incompetent or person. The
Committee may require proof of incompetency, minority, incapacity
or guardianship as it may deem appropriate prior to distribution
of the Plan benefit. Such distribution shall completely
discharge the Committee and the Employer from all liability with
respect to such benefit.
ARTICLE VI-BENEFICIARY DESIGNATION
6.1 Beneficiary Designation
Each Participant shall have the right, at any time, to
designate any person or persons as Beneficiary (both primary as
well as secondary) to whom benefits under this Plan shall be paid
as a result of the Participant's death prior to complete
distribution to Participant of the benefits due under the Plan.
Each Beneficiary designation shall be in a written form
prescribed by the Committee, and will be effective only when
filed with the Committee during the Participant's lifetime.
6.2 Amendments
Any Beneficiary designation may be changed by a Participant
without the consent of any designated Beneficiary by the filing
of a new Beneficiary designation with the Committee. The filing
of a new Beneficiary designation form will cancel all Beneficiary
designations previously filed. If a Participant's Compensation
is community property, any Beneficiary Designation shall be valid
or effective only as permitted under applicable law.
6.3 No Participant Beneficiary Designation
In the absence of an effective Beneficiary Designation, or
if all designated Beneficiaries predecease the Participant or die
prior to complete distribution of the Participant's benefits,
then Participants designated Beneficiary shall be deemed to be
the person or persons surviving the Participant in the first of
the following classes in which there is a survivor, share and
share alike:
(a) The surviving Spouse;
(b) The Participant's children, except that if any of the
children predecease the Participant but leave issue surviving,
then such issue shall take by right of representation the share
their parent would have taken if living;
(c) The Participant's estate.
6.4 Effect of Payment
The payment to the deemed Beneficiary shall completely
discharge Employer's obligations under this Plan.
ARTICLE VII-ADMINISTRATION
7.1 Committee; Duties
This Plan shall be supervised by the Committee. The
Committee shall consist of at least three (3) individuals
appointed by the Board. The Committee shall have the authority
to make, amend, interpret, and enforce all appropriate rules and
regulations for the administration of this Plan and decide or
resolve any and all questions, including interpretations of this
Plan, as may arise in connection with the Plan. A majority vote
of the Committee members shall control any decision. Members of
the Committee may be Participants under this Plan.
7.2 Agents
The Committee may, from time to time, employ other agents
and delegate to them such administrative duties as it sees fit,
and may from time to time consult with counsel who may be counsel
to the Company.
7.3 Binding Effect of Decisions
The decision or action of the Committee in respect of any
question arising out of or in connection with the administration,
interpretation and application of the Plan and the rules and
regulations promulgated hereunder shall be final and conclusive
and binding upon all persons having any interest in the Plan.
7.4 Indemnity of Committee
The Company shall indemnify and hold harmless the members of
the Committee against any and all claims, loss, damage, expense
or liability arising from any action or failure to act with
respect to this Plan, except in the case of gross negligence or
willful misconduct.
ARTICLE VIII-CLAIMS PROCEDURE
8.1 Claim
Any person claiming a benefit, requesting an interpretation
or ruling under the Plan, or requesting information under the
Plan shall present the request in writing to the Committee which
shall respond in writing within thirty (30) days.
8.2 Denial of Claim
If the claim or request is denied, the written notice of
denial shall state:
(a) The reason for denial, with specific reference to the
Plan provisions on which the denial is based.
(b) A description of any additional material or
information required and an explanation of why it is necessary.
(c) An explanation of the Plan's claim review procedure.
8.3 Review of Claim
Any person whose claim or request is denied or who has not
received a response within thirty (30) days may request review by
notice given in writing to the Committee. The claim or request
shall be reviewed by the Committee who may, but shall not be
required to, grant the claimant a hearing. On review, the
claimant may have representation, examine pertinent documents,
and submit issues and comments in writing.
8.4 Final Decision
The decision on review shall normally be made within sixty
(60) days. If an extension of time is required for a hearing or
other special circumstances, the claimant shall be notified and
the time limit shall be one hundred twenty (120) days. The
decision shall be in writing and shall state the reason and the
relevant plan provisions. All decisions on review shall be final
and bind all parties concerned.
ARTICLE IX-TERMINATION, SUSPENSION OR AMENDMENT
9.1 Termination, Suspension or Amendment of Plan
The Board may, in its sole discretion, terminate or suspend
this Plan at any time or from time to time, in whole or in part.
The Board may amend this Plan at any time or from time to time.
Any amendment may provide different benefits or amounts of
benefits from those herein set forth. However, no such
termination, suspension or amendment shall adversely affect the
benefits of Participants which have accrued prior to such action
or the benefits of any Beneficiary of a Participant who has
previously died.
ARTICLE X-MISCELLANEOUS
10.1 Unfunded Plan
This Plan is intended to be an unfunded plan maintained
primarily to provide deferred compensation benefits for a select
group of management or highly compensated employees.
10.2 Unsecured General Creditor
In the event of Employer's insolvency, Participants and
their Beneficiaries, heirs, successors and assigns shall have no
legal or equitable rights, interest or claims in any property or
assets of Employer, nor shall they be Beneficiaries of, or have
any rights, claims or interests in any life insurance policies,
annuity contracts or the proceeds therefrom owned or which may be
acquired by Employer. In that event, any and all of Employer's
assets and policies shall be, and remain, the general, unpledged,
unrestricted assets of Employer. Employer's obligation under the
Plan shall be that of an unfunded and unsecured promise of
Employer to pay money in the future.
10.3 Trust Fund
Employer shall be responsible for the payment of all
benefits provided under the Plan. At its discretion, Employer
may establish one or more trusts, with such trustees as the Board
may approve, for the purpose of providing for the payment of such
benefits. Such trust or trusts may be irrevocable, but the
assets thereof shall be subject to the claims of Employer's
creditors. To the extent any benefits provided under the Plan
are actually paid from any such trust, Employer shall have no
further obligation with respect thereto, but to the extent not so
paid, such benefits shall remain the obligation of, and shall be
paid by, Employer.
10.4 Nonassignability
Neither a Participant nor any other person shall have any
right to commute, sell, assign, transfer, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate or convey
in advance of actual receipt the amounts, if any, payable
hereunder, or any part thereof, which are, and all rights to
which are, expressly declared to be unassignable and
nontransferable. No part of the amounts payable shall, prior to
actual payment, be subject to seizure or sequestration for the
payment of any debts, judgments, alimony or separate maintenance
owed by a Participant or any other person, nor be transferable by
operation of law in the event of a Participant's or any other
person's bankruptcy or insolvency.
10.5 Not a Contract of Employment
The terms and conditions of this Plan shall not be deemed to
constitute a contract of employment between Employer and the
Participant, and the Participant (or the Participant's
Beneficiary) shall have no rights against Employer except as may
otherwise be specifically provided herein. Moreover, nothing in
this Plan shall be deemed to give a Participant the right to be
retained in the service of Employer or to interfere with the
right of Employer to discipline or discharge the Participant at
any time.
10.6 Protective Provisions
A Participant will cooperate with Employer by furnishing any
and all information requested by Employer, in order to facilitate
the payment of benefits hereunder, and by taking such physical
examinations as Employer may deem necessary and taking such other
action as may be requested by Employer.
10.7 Terms
Wherever any words are used herein in the singular or in the
plural, they shall be construed as though they were used in the
plural or the singular, as the case may be, in all cases where
they would so apply.
10.8 Captions
The captions of the articles, sections and paragraphs of
this Plan are for convenience only and shall not control or
affect the meaning or construction of any of its provisions.
10.9 Governing Law
The provisions of this Plan shall be construed and
interpreted according to the laws of the State of Minnesota.
10.10 Validity
In case any provision of this Plan shall be held illegal or
invalid for any reason, said illegality or invalidity shall not
affect the remaining parts hereof, but this Plan shall be
construed and enforced as if such illegal and invalid provision
had never been inserted herein.
10.11 Notice
Any notice or filing required or permitted to be given to
the Committee under the Plan shall be sufficient if in writing
and hand delivered, or sent by registered or certified mail to
any member of the Committee or the Secretary of the Employer.
Such notice shall be deemed given as of the date of delivery or,
if delivery is made by mail, as of the date shown on the postmark
on the receipt for registration or certification.
10.12 Successors
The provisions of this Plan shall bind and inure to the
benefit of Otter Tail Power Company and its successors and
assigns. The term successors as used herein shall include any
corporate or other business entity which shall, whether by
merger, consolidation, purchase or otherwise acquire all or
substantially all of the business and assets of Otter Tail Power
Company, and successors of any such corporation or other business
entity.
IN WITNESS WHEREOF, and pursuant to resolution of the Board
of Directors of Otter Tail Power Company, such corporation has
caused this instrument to be executed by its duly authorized
officers effective as of July 1, 1994.
OTTER TAIL POWER COMPANY
By: Jay D. Myster
Its Vice President,
Governmental & Legal/
Corporate Secretary
Dated: March 23, 1995