Exhibit 10.4
SOUTHERN PERU COPPER CORPORATION
SUPPLEMENTAL RETIREMENT PLAN
(As Amended and Restated as of November 4, 1999)
SECTION 1. EFFECTIVE DATE.
The effective date of the Supplemental Retirement Plan (the "Plan") as
originally adopted is December 12, 1990. The effective date of the Plan as
hereby amended and restated is November 4, 1999.
SECTION 2. DEFINITIONS.
1. BENEFITS. The amount calculated under Section 4 for each Eligible Employee.
2. BENEFIT COMMENCEMENT DATE. The date benefits commence under the Pension
Plan.
3. BOARD. The Board of Directors of Southern Peru Copper Corporation.
4. CODE. The Internal Revenue Code of 1986, as amended.
5. COMMITTEE. The Compensation Committee of the Board or any individual or
individuals to whom it delegates authority.
6. COMPANY. Southern Peru Copper Corporation.
7. DEFERRAL AMOUNT. Any Benefit amount, including earnings thereon, receipt of
which is deferred under Section 7.
8. DISABILITY. permanent and total disability as defined in the Pension Plan.
9. ELIGIBLE EMPLOYEE. Any employee who meets the eligibility criteria of
Section 3.
10. INVESTMENT MANAGER. The investment company selected by the Company for
deemed investment of deferred benefits.
11. PENSION PLAN. The Retirement Benefit Plan for Salaried Employees of Southern
Peru Copper Corporation.
SECTION 3. ELIGIBILITY.
All salaried employees of the Company or of any subsidiary specifically
designated by the Company, whose retirement benefits payable under the Pension
Plan, are reduced:
(i) due to the benefit limitations of Section 415 of the Code; or
(ii) due to the requirement of Section 401(a)(17) of the Code that
compensation in excess of the limit in effect for a particular
year thereunder may not be taken into account for Pension Plan
purposes; or
(iii) due to participation in any Company plan or program that provides
for elective pre-tax deferrals (the reductions under this Section
3(i), (ii), and (iii) hereinafter collectively referred to as
"Code Reductions") shall be eligible as to Benefits under this
Plan.
SECTION 4. CALCULATION OF BENEFITS.
The Company will pay or cause to be paid to each Eligible Employee or surviving
spouse of such Eligible Employee (as defined in the Pension Plan), as the case
may be, who receives payment under the Pension Plan (for purposes of this
section 4 each a "Recipient"), a Benefit which is equivalent to the excess, if
any, of
(i) the amount such Recipient would have received under the Pension
Plan for each calendar year, taking into account all provisions of
the Pension Plan in effect and applicable from time to time to the
Recipient, except for the Code Reductions; over
(ii) the amount the Recipient is entitled to receive under the Pension
Plan for such year, taking into account the Code Reductions.
SECTION 5. PAYMENT OF BENEFITS.
(a) Except as otherwise provided herein, Benefits under the Plan shall be paid
in a lump sum, in cash, promptly upon the occurrence of the Eligible Employee's
Benefit Commencement Date.
(b) An Eligible Employee may elect to receive annuity payments under the Plan in
the same form and at approximately the same time as payments are to be made to
the Eligible Employee under the Pension Plan. Such an election must be made in
writing at least twelve (12) months prior to the Benefit Commencement Date,
except in the event of termination by reason of "Disability", in which case the
election may be made at any time prior to the date of termination. An election
under this subsection may be amended at any time provided that no such amendment
shall be given effect unless it is made in writing at least twelve (12) months
prior to the date of termination.
SECTION 6. DEATH OF EMPLOYEE.
Upon the death of an Eligible Employee:
(i) Who has elected an annuity form of payment pursuant to Section
5(b), the Eligible Employee's beneficiary under the Pension Plan
shall receive the Benefit described in Section 4 above, if any, in
the same form and approximately at the same time as payments are
made to such beneficiary under the Pension Plan.
(ii) Who has not elected an annuity form of payment pursuant to Section
5(b), the Eligible Employee's surviving spouse, if any, shall
receive any Benefits at the same time as provided in Section 5,
except a valid election under Section 7 shall survive the death of
the Eligible Employee. In such case, the surviving spouse shall
have the same rights as are provided to the Eligible Employee
pursuant to Section 7 below except that further deferrals will not
be permitted. If there is no surviving spouse, the amount payable
pursuant to this subsection shall be paid as soon as practicable
in a lump sum to the Eligible Employee's beneficiary, or if none,
to his estate
SECTION 7. INVESTMENT OF DEFERRAL AMOUNTS.
(a) Any Deferral Amount shall be deemed invested in accordance with an election
to be made by the Eligible Employee in such investment vehicles as are provided
under rules established by the Committee. SPCC will attempt to follow the
Eligible Employee's elections, but will not be required to do so. Regardless of
whether the Eligible Employee's elections are followed, the Deferral Amount
shall be credited with deemed earnings, gains, losses, expenses, and changes in
the fair market value of such Deferral Amount as if SPCC had followed such
investment designations. All elections and amendments to elections shall be in
accordance with rules, if any, as shall be established by the Committee.
(b) The election of a deemed investment option is the sole responsibility of
each Eligible Employee. Neither SPCC, nor the Committee that administers the
Plan, nor any trustee of any trust that may be established in connection with
the Plan are authorized or permitted to advise (or shall have any liability with
respect to) an Eligible Employee as to the election of any option or the manner
in which his Deferral Amount shall be deemed to be invested.
SECTION 8. VALUE OF BENEFITS.
The amount of the lump sum referred to in Section 5(a) shall be the present
value of the Benefit amount determined under Section 4 (after taking into
account, if applicable, any reductions as set forth in the Pension Plan to
reflect the commencement of payments prior to age 65) by assuming that the
Eligible Employee has elected a single life annuity under the Pension Plan and
by using the following actuarial assumptions:
(a) DISCOUNT RATE. The discount rate used in computing the present value of
benefits payable under the Plan is the yield on 10-year treasury notes on the
Eligible Employee's Benefit Commencement Date, or if a legal holiday, the first
business day immediately following the Benefit Commencement Date. At any time
during a thirteen month period ending with the Benefit Commencement Date, an
Eligible Employee may designate an alternative date for fixing the interest rate
(the Alternative Date) used to calculate the value of the lump sum distribution.
The designation must be in writing, and the Alternative Date must be within 7
calendar days of the date the designation is received by the Company. The
designation of the Alternative Date for fixing the interest rate, once made, may
not be changed for any reason. Notwithstanding the foregoing, if an Eligible
Employee designates an Alternative Date under this subsection in contemplation
of commencing benefits under the Pension Plan, such designation will survive a
subsequent postponement of the commencement of benefits under the Pension Plan
by such Eligible Employee, except that, if the yield on 10-year treasury notes
on the Benefit Commencement Date is higher than on the Alternative Date, the
yield on the Benefit Commencement Date will be used.
(b) MORTALITY TABLE. The Mortality Table used will be that contained in U.S.
Internal Revenue Service Revenue Ruling 95-6 or any succeeding Revenue Ruling
issued by the Internal Revenue Service for use in applying the provisions of
Sections 415 and 417(e) of the Internal Revenue Code.
SECTION 9. EMPLOYEE'S RIGHTS UNSECURED.
The right of any Eligible Employee to receive benefits under the provisions of
the Plan shall be contractual in nature only; however, the amounts of such
benefits may be held in a trust, the assets of which shall be subject to the
claims of the Company's general creditors in the event of bankruptcy or
insolvency only. Any amounts paid from such trust shall reduce the amount of
benefits owed by the Company.
SECTION 10. SEVERABILITY.
The provisions of this Plan shall be severable, and if any one or more
provisions shall be considered or held to be invalid or unenforceable, or shall
result in a portion of the Plan being treated as a pension plan under Title I of
ERISA, the remaining provisions shall continue to be valid and enforceable.
SECTION 11. PARTICIPATION IN OTHER PLANS.
Nothing in this Plan will affect any right which an Eligible Employee may
otherwise have to participate in any other retirement plan, or agreement, which
the Company may have now or hereafter.
SECTION 12. DISCRETION OF COMPANY AND BOARD.
Any decision made or action taken by the Company or by the Board arising out of
or in connection with the construction, administration, interpretation, and
effect of the Plan shall lie within the absolute discretion of the Company or
the Board, as the case may be, and shall be final, conclusive and binding upon
all persons.
SECTION 13. ASSIGNMENT.
No right or interest of the Eligible Employee under this Plan shall be subject
to voluntary or involuntary alienation, assignment or transfer of any kind.
SECTION 14. COST TO BE BORNE BY SUBSIDIARY.
If any payment under this Plan is to be made to an Eligible Employee on account
of any employee's service for a subsidiary of the Company, the cost of such
payment shall be borne in such proportions as the Company and such subsidiary
shall determine.
SECTION 15. AMENDMENT.
This Plan may at any time or from time to time be amended, modified,
discontinued or terminated by the Board if, in its sole discretion, such a
change is deemed necessary and desirable.
SECTION 16. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the laws of
the State of New York.
IN WITNESS WHEREOF, the Company has caused this Amendment to its
Supplemental Retirement Plan to be duly adopted and executed by its duly
authorized officers and its corporate seal affixed hereto as of November 4,
1999.
Southern Peru Copper Corporation
By: /s/ Oscar Gonzalez Rocha
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President
By: /s/ Daniel Tellechea Salido
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Vice President
Attest:
/s/ Susana D. Delanney
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Assistant Secretary
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