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EXHIBIT 99.1
MICHCON
INVESTMENT AND STOCK OWNERSHIP PLAN
(As Amended and Restated Effective as of January 1, 1989)
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MICHCON
INVESTMENT AND STOCK OWNERSHIP PLAN
(As Amended and Restated Effective as of January 1, 1989)
TABLE OF CONTENTS
Article I. The Plan
--------------------
1.1 Establishment and Amendment of the Plan 1
1.2 Applicability of the Plan 1
1.3 Purpose and Type of Plan 2
Article II. Definitions
------------------------
2.1 Definitions 3
2.2 Construction 14
Article III. Participation and Service
---------------------------------------
3.1 Eligibility Requirements 15
3.2 Eligibility Upon Merger or Reemployment 15
3.3 Collective Bargaining Agency 16
3.4 Applications 16
3.5 Years of Service 17
3.6 Break in Service Year 18
3.7 Hours of Employment 19
3.8 Employment by Related Entities 21
3.9 Leased Employees 21
Article IV. Contributions
--------------------------
4.1 Employee Allotments 23
4.2 Employer Investment Plan Contributions 26
4.3 Employer ESOP Contributions 28
4.4 Additional Employer Contributions 30
4.5 Rollover Contributions 30
4.6 Transfers from the MichCon Savings and
Stock Ownership Plan 33
4.7 Transfers from the MichCon Employee Stock
Ownership Plan 34
4.8 Limitations on Salary Reduction Allotments 35
4.9 Distribution of Excess Deferrals 38
4.10 Distribution or Recharacterization of Excess
Contributions 39
4.11 Statutory (Code Section 415) Limitations on
Allocations to Accounts 41
Article V. Vesting in Accounts
-------------------------------
5.1 Employee Salary Reduction Accounts, Employee
Post-1986 Voluntary Deduction Account, and
Employee Pre-1987 Voluntary Deduction Account 46
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MICHCON
INVESTMENT AND STOCK OWNERSHIP PLAN
(As Amended and Restated Effective as of January 1, 1989)
TABLE OF CONTENTS
(Continued)
5.2 Employer Salary Reduction Account,
Employer Voluntary Deduction Account,
and ESOP Account 46
Article VI. Investment Provisions
----------------------------------
6.1 Investment of Contributions and Allotments 47
6.2 Change of Investment Direction 47
6.3 Transfers Between Investment Funds 48
Article VII. Investment Funds
------------------------------
7.1 Investment Funds 49
7.2 Management of Investment Funds 50
7.3 Voting of MCN Stock 50
7.4 Tender Offers 51
7.5 Named Fiduciary Status 53
7.6 Expenses of Funds 53
7.7 Primark Corporation Stock 53
Article VIII. Accounts and Records of the Plan
-----------------------------------------------
8.1 Company to Maintain Accounts 54
8.2 Plan Accounting 54
8.3 Valuation of Funds 55
8.4 Valuation of Investment Plan Account 55
8.5 Valuation of ESOP Account 55
8.6 Valuation of Plan Account 55
8.7 Company to Furnish Annual Statements of
Value of Plan Accounts 56
8.8 Trust Agreement 56
Article IX. Distributions, Withdrawals, and Loans
--------------------------------------------------
9.1 Distribution Upon Termination of Employment
Entitling Participant to Value of Plan
Account 57
9.2 Distribution Upon Termination of Employment
Under Circumstances Resulting in Forfeiture
of Employer Contributions 57
9.3 Certain Distributions from Participant Accounts 58
9.4 In-Service Withdrawals--General 60
9.5 Withdrawal of Voluntary Deduction Allotments 60
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MICHCON
INVESTMENT AND STOCK OWNERSHIP PLAN
(As Amended and Restated Effective as of January 1, 1989)
TABLE OF CONTENTS
(Continued)
9.6 Hardship Withdrawal of Salary Reduction
Allotments 61
9.7 Time of Distributions 63
9.8 Distributions of Stock 67
9.9 Distributions from Fixed Income Fund 68
9.10 Loans 71
9.11 Definition of Allotments and Employer
Contributions 75
9.12 Spousal Consent to Payment 75
9.13 Distributions Pursuant to a Qualified
Domestic Relations Order 75
9.14 Direct Rollovers of Eligible Distributions 76
Article X. Administration
--------------------------
10.1 Plan Administration and Interpretation 79
10.2 Notice to Employees 80
10.3 Notices to Employers 80
10.4 Participants' Acceptance of the Provisions
of the Plan 80
10.5 Audit of Plan Records 81
10.6 Claims Procedure 81
10.7 Effect of a Mistake 82
Article XI. Amendment and Termination
--------------------------------------
11.1 Amendment 83
11.2 Withdrawal 83
11.3 Termination 83
11.4 Allocation of Funds Between Employers 84
11.5 Trust to be Applied Exclusively for
Participants and Their Beneficiaries 84
Article XII. Participation by Affiliated Companies
---------------------------------------------------
12.1 Adoption of the Plan 86
12.2 Withdrawal from the Plan 86
12.3 Company as Agent for Employers 86
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MICHCON
INVESTMENT AND STOCK OWNERSHIP PLAN
(As Amended and Restated Effective as of January 1, 1989)
TABLE OF CONTENTS
(Continued)
Article XIII. Special Provisions Relating to the ESOP
------------------------------------------------------
13.1 Establishment of ESOP 87
13.2 ESOP Account 87
13.3 Discrimination Testing 87
13.4 Loans 88
13.5 Diversification 91
13.6 Put Option 91
13.7 Purchase of MCN Stock 92
Article XIV. Miscellaneous
---------------------------
14.1 Beneficiary Designation 93
14.2 Incompetency 94
14.3 Expenses 95
14.4 Nonassignability 95
14.5 Employment Noncontractual 95
14.6 Merger or Consolidation with Another Plan 95
14.7 Continuance by a Successor 96
14.8 Elimination of Certain Provisions 97
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MICHCON
INVESTMENT AND STOCK OWNERSHIP PLAN
(As Amended and Restated Effective as of January 1, 1989)
Article I. The Plan
1.1 Establishment and Amendment of the Plan. Michigan
Consolidated Gas Company which is also known as MichCon (hereinafter referred
to as the "Company") presently maintains an investment and stock ownership plan
for the benefit of its Eligible Employees and the Eligible Employees of its
participating Affiliated Companies. The plan was last restated effective as of
April 1, 1989, and was amended from time to time thereafter.
The plan as previously restated established the MichCon Employee Stock
Ownership Plan for Union Employees ("ESOP") and incorporated the ESOP into the
Michigan Consolidated Gas Company Union Employee's Investment Plan to form the
MichCon Investment and Stock Ownership Plan.
The plan is hereby further amended and completely restated as set forth herein
effective as of January 1, 1989, except as otherwise provided herein or
required by law, and shall continue to be known as the "MichCon Investment and
Stock Ownership Plan" (the "Plan"). The ESOP provisions of the Plan shall be
effective as of April 1, 1989.
1.2 Applicability of the Plan. Except as otherwise specified
herein or required by law, the provisions of the Plan as amended and restated
herein effective as of January 1, 1989, shall be applicable only with respect
to Eligible Employees of an Employer in current employment on or after January
1, 1989, and their beneficiaries.
Any person who was covered under the Plan as in effect prior to January 1,
1989, and whose employment terminated under the Plan
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prior to January 1, 1989, shall continue to have his rights to receive benefits
determined under the provisions of the Plan in effect when his employment
relationship so terminated.
1.3 Purpose and Type of Plan. The purpose of the Plan is to
provide a convenient way for Participants to save on a regular and long-term
basis for their retirement income needs; to recognize the contribution made to
the Employer's successful operation by its employees and to reward such
contribution for those employees who qualify as participants under the terms of
the Plan; and to facilitate ownership of MCN Stock by participating Eligible
Employees.
The non-ESOP portion of the Plan is intended to qualify as a profit-sharing
plan and the ESOP portion of the Plan is intended to qualify as a stock bonus
and an employee stock ownership plan for purposes of Code sections 401(a), 402,
412, 417, 4975, and related provisions.
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Article II. Definitions
2.1 Definitions. Whenever used in the Plan, the following words
and phrases shall have the respective meanings stated below unless a different
meaning is plainly required by the context.
(a) "Accounting Period" means a period of one calendar month
except that the first accounting period shall commence with
the date on which the Plan first becomes effective with
respect to any Employer and end on the last day of the
calendar month in which such effective date occurs.
(b) "Actual Deferral Percentage" means the ratio (expressed as a
percentage) of the Elective Deferrals of an Employee who is
eligible to participate in the Plan for a Plan Year to the
Compensation of that Employee for such Plan Year.
(c) "Affiliated Company" means--
(1) any corporation other than the Company, i.e., either a
subsidiary corporation or an affiliated or associated
corporation of the Company, which together with the
Company is a member of a "controlled group" of
corporations (as defined in Code section 414(b));
(2) any organization which together with the Company is
under "common control" (as defined in Code section
414(c));
(3) any organization which together with the Company is an
"affiliated service group" (as defined in Code section
414(m)); or
(4) any other entity required to be aggregated with the
Company pursuant to Regulations under Code section
414(o).
(d) "Anniversary Date" means with respect to each Employee, the
anniversary each year of the first day of the first Accounting
Period coincident with or next following the Employee's first
Hour of Employment. If an Employee whose employment was
terminated is reemployed but prior
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to his reemployment he incurs a Break in Service Year or
following his reemployment he incurs a Break in Service Year
before completing a Year of Service, his Anniversary Date
shall be based upon his first Hour of Employment coincident
with or next following his date of reemployment; otherwise,
his Anniversary Date shall not be changed.
(e) "Annual Addition" means the amount allocated to a
Participant's account as such term is defined in section
4.11(a).
(f) "Average Actual Deferral Percentage" means the average
(expressed as a percentage) of the Actual Deferral Percentages
of the Employees in a group who are eligible to participate in
the Plan for a Plan Year.
(g) "Break in Service Year" means a 12-month period described in
section 3.6.
(h) "Code" means the Internal Revenue Code of 1986, as amended.
(i) "Company" means Michigan Consolidated Gas Company.
(j) "Compensation" means a Participant's pay, determined as
follows:
(1) For all purposes of the Plan, except as otherwise
specified in (2) or (3) below or required by the
context, Compensation means Eligible Compensation.
(2) For purposes of satisfying the limits on contributions
described in section 4.8 (ADP test) and applying the
limits of section 415 of the Code as described in
section 4.11, Compensation includes all of the items
listed below as includible (to the extent applicable)
and excludes all of the items listed below as
excludable (to the extent applicable) on a Plan Year
basis:
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(A) Includible.
(i) The Employee's wages, salaries, fees,
for professional services, and other
amounts received (without regard to
whether or not an amount is paid in
cash) for personal services actually
rendered in the course of employment
with the Employer and any Affiliates
to the extent that the amounts are
includible in gross income including,
but not being limited to, commissions
paid salesmen, compensation for
services on the basis of a percentage
of profits, commissions on insurance
premiums, tips, bonuses, fringe
benefits, and reimbursements or other
expense allowances under a
nonaccountable plan (as described in
Treasury regulation section
1.62-2(c));
(ii) Amounts described in Code sections
104(a)(3), 105(a), and 105(h), but
only to the extent that these amounts
are includible in the Employee's
gross income;
(iii) Amounts paid or reimbursed by the
Employer or any Affiliate for moving
expenses incurred by the Employee,
but only to the extent that at the
time of the payment it is reasonable
to believe that these amounts are not
deductible by the Employee under Code
section 217;
(iv) The value of a nonqualified stock
option granted to an Employee by the
Employer or any Affiliate, but only
to the extent that the value of the
option is
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includible in the Employee's gross
income for the taxable year in which
it is granted; and
(v) The amount includible in an
Employee's gross income upon making
the election described in Code
section 83(b).
Compensation under clause (i) includes
foreign earned income as defined in Code
section 911(b), whether or not excludable
from gross income under Code section 911.
Compensation under clause (i) is to be
determined without regard to the exclusions
from gross income in Code sections 931 and
933.
(B) Excludable.
(i) Contributions made by the Employer or
any Affiliate to a plan of deferred
compensation to the extent that,
before the application of the Code
section 415 limitations to that plan,
the contributions are not includible
in the Employee's gross income for
the taxable year in which they are
contributed;
(ii) Contributions made by the Employer or
any Affiliate on an Employee's behalf
to a simplified employee pension
described in Code section 408(k)
(such contributions are not
considered as compensation for the
taxable year in which contributed);
(iii) Distributions from a plan of deferred
compensation, regardless of whether
such amounts are includible in the
Employee's gross income when
distributed, except that amounts
received by an Employee
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pursuant to an unfunded, nonqualified
plan are permitted to be considered
as Compensation for Code section 415
purposes in the year in which the
amounts are includible in the
Employee's gross income;
(iv) Amounts realized from the exercise of
a nonqualified stock option, or when
restricted stock (or property) held
by an Employee either becomes freely
transferable or is no longer subject
to a substantial risk of forfeiture
within the meaning of Code section 83
and regulations thereunder;
(v) Amounts realized from the sale,
exchange, or other disposition of
stock acquired under a qualified
stock option; and
(vi) Other amounts which receive special
tax benefits, such as premiums for
group-term life insurance (but only
to the extent that the premiums are
not includible in the Employee's
gross income).
(3) For purposes of determining whether an individual is a
Highly Compensated Employee, Compensation means an
Employee's Compensation as defined in paragraph (2) of
this section 2.1(j) but without regard to Code
sections 125, 402(a)(8), and 402(h)(1)(B) (i.e., with
the addition of elective deferrals pursuant to a
cafeteria plan, a cash-or-deferred arrangement, or a
simplified employee pension).
For Plan Years beginning on or after January 1, 1989 and prior
to January 1, 1994, the Compensation of each Employee that may
be taken into account under the Plan, except for purposes of
section 4.11 (Code section 415
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limits), shall not exceed the first $200,000 of an Employee's
Compensation (as adjusted by the Secretary of the Treasury
under Code section 415(d)). For Plan Years beginning on or
after January 1, 1994, the Compensation of each Employee that
may be taken into account under the Plan, except for purposes
of section 4.11, shall not exceed the first $150,000 of an
Employee's Compensation (as adjusted pursuant to Code section
401(a)(17)). For purposes of the preceding two sentences, if
an Employee is a 5-percent owner of the Employer or one of the
ten Highly Compensated Employees paid the greatest
Compensation during the year, then any Compensation paid to
the spouse of such Employee or to any lineal descendants of
such Employee who have not attained age 19 before the close of
the year (and any applicable contribution on behalf of any
such individual) shall be treated as if it were paid to (or on
behalf of) such Employee.
(k) "Compensation Rate" means the amount of an Employee's Eligible
Compensation per pay period determined under uniform rules
established by the Company and before recognition of any
Salary Reduction allotment or cafeteria plan election.
(l) "Disability Retirement Date" means the date a Participant--
(1) becomes eligible to receive benefits under a long-term
disability plan maintained by the Employer, or
(2) is determined by the Company to be totally and
permanently disabled.
In determining whether a Participant is totally and permanently
disabled, the Company may, in its discretion, rely on the
opinion of a physician selected by the Company to assist it in
making such a determination.
(m) "Early Retirement Date" means the first day of any month prior
to a Participant's Normal Retirement Date
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on which he terminates his employment by giving at least 60
days' written notice to the Company of his intention to retire
after he has attained age 55 and the sum of his attained age
and the number of his full Years of Service is at least 70.
(n) "Elective Deferrals" means Salary Reduction allotments under
section 4.1(a) and contributions under other plans maintained
by the Company or an Affiliated Company that constitute
elective deferrals within the meaning of Code section
402(g)(3).
(o) "Eligible Compensation" means the regular basic salary or wage
paid to an Employee by the Employer before any payroll
deduction for taxes or any other purpose, and before any
Salary Reduction allotment or cafeteria plan election, but
excluding bonuses, awards, shift differentials, severance
payments, differential payments made by reason of the
Employee's entry into Military Service, all amounts paid for
work in excess of 40 hours in any one week, all overtime or
other premium paid for work in excess of a maximum number of
hours in any one day, for work on holidays or for any other
reason, payments for so-called fringe benefits such as
Employer contributions to this Plan or any pension or
retirement plan, increased wages or salary resulting from
temporary promotion, upgrading or transfer, of whatever
duration, to a higher paid job or classification, and any
other premium, auxiliary, or special pay of any sort
whatsoever.
For Plan Years beginning on or after January 1, 1989 and prior
to January 1, 1994, the Eligible Compensation of an Employee
for purposes of the Plan shall not exceed $200,000; provided,
however, that such limit shall be adjusted as provided in Code
section 415(d). For Plan Years beginning on or after
January 1, 1994, the Eligible Compensation of each Employee
that may be taken into account under the Plan, except for
purposes
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of section 4.11, shall not exceed the first $150,000 of an
Employee's Compensation (as adjusted pursuant to Code section
401(a)(17)). For purposes of the preceding two sentences, if
an Employee is a 5-percent owner of the Employer or one of the
ten Highly Compensated Employees paid the greatest
Compensation during the year, any Compensation paid to the
spouse of such Employee or to any lineal descendants of such
Employee who have not attained age 19 before the close of the
year (and any applicable contribution on behalf of any such
individual) shall be treated as if it were paid to (or on
behalf of) such Employee.
(p) "Eligible Employee" means an Employee of an Employer whose
terms and conditions of employment are covered by an agreement
with a collective bargaining agent which agreement permits
participation in this Plan.
(q) "Employee" means an individual who is an employee of the
Company or an Affiliated Company.
(r) "Employee Post-1986 Voluntary Deduction Account" means an
Employee's Voluntary Deduction allotments after December 31,
1986, and investment gains and losses therefrom.
(s) "Employee Pre-1987 Voluntary Deduction Account" means an
Employee's Voluntary Deduction allotments before January 1,
1987, and investment gains and losses therefrom.
(t) "Employee Salary Reduction Account" means an Employee's Salary
Reduction allotments, and investment gains and losses
therefrom.
(u) "Employer" means the Company and any Affiliated Company which
has adopted the Plan with the consent of the Company and in
the manner prescribed in section 12.1 and any successor
corporation which shall adopt the Plan pursuant to section
14.7. If any such corporation shall withdraw from
participation in the Plan in accordance with section 12.2, the
term Employer shall not thereafter include such corporation.
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(v) "Employer Salary Reduction Account" means the Employer
contributions to the Salary Reduction Account of an Employee
pursuant to section 4.2, and investment gains and losses
therefrom.
(w) "Employer Voluntary Deduction Account" means the Employer
contributions to the Voluntary Deduction Account of an
Employee pursuant to section 4.2, and investment gains and
losses therefrom.
(x) "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
(y) "ESOP" means the employee stock ownership plan established
pursuant to section 13.1.
(z) "ESOP Account" means the account established and maintained on
behalf of each Participant in accordance with sections
8.1(c) and (d) and 13.2.
(aa) "Excess Contributions" means the amount described in section
4.10(a).
(bb) "Excess Deferrals" means the portion of Elective Deferrals for
a calendar year, if any, described in section 4.9.
(cc) "Family Member" means an individual described as a family
member in Code section 414(q)(6).
(dd) "Highly Compensated Employee" means, with respect to any Plan
Year, any Employee who at any time during the preceding
Plan Year (or such other period as the Company may elect
pursuant to Treasury regulations)--
(1) received Compensation (as defined in section 2.1(j)(3)
of the Plan) from the Employer and all Affiliates in
excess of $75,000,
(2) received Compensation (as defined in section 2.1(j)(3)
of the Plan) from the Employer and all Affiliates in
excess of $50,000 and was in the top-paid 20 percent
of Employees,
(3) was an officer who received Compensation (as defined
in section 2.1(k)(3) of the Plan) from the
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Employer and all Affiliates in excess of the amount in
effect under Code section 415(b)(1)(A) for the
preceding Plan Year, or
(4) was a 5-percent owner.
Unless the Company makes the "calendar year calculation
election" under Treasury regulations, Highly Compensated
Employee also means, with respect to any Plan Year, any
Employee who, at any time during that Plan Year, met the
descriptions contained in paragraph (1), (2), or (3) and was
among the top-paid 100 Employees or any Employee who was a
5-percent owner.
A Family Member of a Highly Compensated Employee and a former
employee shall be treated as a Highly Compensated Employee to
the extent required by sections 414(q)(6) and (9) of the Code
and the regulations thereunder.
The dollar limits described in paragraphs (1), (2), and (3)
will be adjusted to reflect increases in the cost of living,
in the manner and at the times prescribed by the Secretary of
the Treasury.
(ee) "Hour of Employment" means an hour for which an individual
receives credit pursuant to section 3.7.
(ff) "Investment Plan Account" means the total value of an
Employee's Salary Reduction Account and Voluntary Reduction
Account.
(gg) "MCN Stock" means common stock of MCN Corporation.
(hh) "Military Service" means service--
(1) on active duty, in time of national or local
emergency, in the armed forces of the United States or
of any State thereof,
(2) in the armed forces of the United States or of any
State thereof under any compulsory service law, or
(3) in the armed forces of the United States or any of its
allies in time of war in which the United States is
engaged.
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(ii) "Nonhighly Compensated Employee" means an Employee of the
Employer who is neither a Highly Compensated Employee nor a
Family Member of a Highly Compensated Employee who is a
5-percent owner of the Employer or one of the ten Highly
Compensated Employees paid the greatest Compensation during
the year.
(jj) "Normal Retirement Date" means the Participant's sixty-fifth
birthday, if such birthday falls on the first day of the
month; otherwise, the first day of the month next following
the month in which such birthday occurs.
(kk) "Participant" means an Employee who is participating in the
Plan in accordance with its provisions.
(ll) "Plan" means MichCon Investment and Stock Ownership Plan and
any amendments thereto or restatements thereof from time to
time adopted.
(mm) "Plan Account" means the total value of an Employee's
Investment Plan Account and ESOP Account.
(nn) "Plan Year" means the calendar year.
(oo) "Primark Corporation Stock" means common stock of Primark
Corporation.
(pp) "Regulations" means regulations issued by the Department of
Labor construing Title I of ERISA or by the Internal Revenue
Service construing the Code.
(qq) "Salary Reduction" means an election by a Participant to have
the Compensation Rate that would otherwise be payable reduced
and contributed by the Employer to the Plan as a regular
allotment on behalf of the Participant.
(rr) "Salary Reduction Account" means an Employee's Salary
Reduction allotments, related Employer matching contributions,
and investment gains and losses therefrom.
(ss) "Suspense Account" means the account used to reflect MCN Stock
acquired with loan proceeds pursuant to section 13.4.
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(tt) "Trust" means the Trust created by agreement between the
Employers and the Trustee, as from time to time amended.
(uu) "Trust Agreement" means the agreement between the Employers
and the Trustee referred to in section 8.8.
(vv) "Trustee" means the Trustee hereinafter provided for in
section 8.8 or any successor Trustee.
(ww) "Valuation Date" means the last day of each Accounting Period
on which the New York Stock Exchange shall be open for
business.
(xx) "Vesting Requirement" means the requirement for vesting
described in section 5.2.
(yy) "Voluntary Deduction" means an Employee's payroll deduction
allotments other than Salary Reduction allotments.
(zz) "Voluntary Deduction Account" means an Employee's Voluntary
Deduction allotments, related Employer matching contributions,
and investment gains and losses therefrom.
(aaa) "Years of Service" means year(s) of employment of an Employee
by an Employer or nonparticipating Affiliated Company as such
term is defined in section 3.5.
2.2 Construction. Unless the context clearly requires otherwise--
(a) the masculine pronoun whenever used shall include the
feminine, the singular shall include the plural, and vice
versa, and
(b) headings of Articles and sections herein are included solely
for convenience, and if there is any conflict between such
headings and the text of the Plan, the text shall control.
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Article III. Participation and Service
3.1 Eligibility Requirements.
(a) Each individual who was eligible to participate in the Plan on
December 31, 1988, in accordance with the terms of the Plan in
effect on said date shall continue to be eligible to
participate, subject to the provisions of this Plan. Each
other Employee shall become eligible to participate on the
first day of the first Accounting Period coincident with or
next following the latest to occur of--
(1) the date he is employed as an Eligible Employee,
(2) the date on which he completes at least one year of
eligibility service (as defined in section 3.1(b)), or
(3) the date on which he attains age 21;
provided he is employed as an Eligible Employee on such date.
(b) For purposes of this Article III, a year of eligibility
service shall mean the 12-month period beginning on the date
of an Employee's first Hour of Employment, or the 12-month
period beginning on an Employee's Anniversary Date during
which he completes at least 1,000 Hours of Employment.
3.2 Eligibility Upon Merger or Reemployment. Any Employee who is
a Participant in any plan which is merged into this Plan shall become a
Participant in this Plan immediately upon the effective date of the merger.
Such an Employee shall be eligible to actively participate in this Plan in
accordance with section 3.4.
If a Participant's employment is terminated and he is thereafter reemployed
before incurring a Break in Service Year, he shall be eligible again to
actively participate in the Plan commencing with the first day of the first
Accounting Period coincident with or next following his date of reemployment.
In the event
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such Participant does incur a Break in Service Year, he shall be eligible again
to actively participate in the Plan commencing with the first day of the first
Accounting Period coincident with or immediately preceding the day on which he
is reemployed after he has again satisfied the eligibility requirement of
section 3.1(a).
3.3 Collective Bargaining Agency. Effective January 14, 1991, if
any Employee shall become a Participant in the Plan and shall thereafter cease
to be represented by a collective bargaining agency pursuant to a collective
bargaining agreement between his Employer and the collective bargaining agency
representing such Employee, he shall nevertheless continue to be eligible to
actively participate in the Plan until such time as the terms and conditions of
his employment are no longer governed by such a collective bargaining
agreement.
If such an Employee becomes eligible to participate in the MichCon Savings and
Stock Ownership Plan or any successor plan, his entire Plan Account shall be
transferred to such plan and the Employee shall no longer be eligible to
participate in this Plan. The foregoing sentence shall be applicable as of
January 14, 1991 for all Employees who thereafter become eligible to
participate in the MichCon Savings and Stock Ownership Plan, and as of the date
agreed upon by the Employee if the Employee became eligible to participate in
the MichCon Savings and Stock Ownership Plan prior to January 14, 1991,
irrespective of their date of transfer. Effective as of April 1, 1989, the
Participant's Plan Account shall be fully vested upon such transfer.
3.4 Applications. An Employee who is eligible to participate on
the date the Plan becomes effective with respect to his Employer may become a
Participant commencing with such effective date by filing a written application
with his Employer in the form prescribed by the Company not later than 20 days
after such effective date. Thereafter, an Eligible Employee may become a
Participant by filing a written application with his
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Employer in the form prescribed by the Company at least 20 days prior to the
date upon which his participation is to commence. The Employee's application
shall authorize the Employer to deduct allotments from the Employee's Eligible
Compensation in amounts specified by the Employee pursuant to Article IV, and
to have allotments made as a Salary Reduction pursuant to Article IV. The
application shall evidence the Employee's acceptance of and agreement to all of
the provisions of the Plan.
3.5 Years of Service. An Employee shall be credited for Years of
Service for his period of employment with the Employer and each
nonparticipating Affiliated Company, determined as follows:
(a) An Employee shall receive credit, for purposes of vesting, for
all Years of Service. An Employee shall have one "Year of
Service" for each 12-month period beginning on the date of the
Employee's first Hour of Employment and on each subsequent
Anniversary Date, during which the Employee completes 1,000 or
more Hours of Employment.
(b) Years of Service shall not be interrupted--
(1) by any transfer of employment of an Employee between
Affiliated Companies regardless of whether the
Affiliated Company is an Employer hereunder; or
(2) during such period as an Employee is receiving credit
for Hours of Employment under section 3.7.
(c) If an Employee is reemployed following a Break in Service
Year, he shall be considered a new Employee for purposes of
the Plan, except--
(1) If prior to such Break in Service Year he had a vested
interest in his ESOP Account, Employer Salary
Reduction Account, or Employer Voluntary Deduction
Account, Years of Service he had prior to the Break in
Service Year shall be reinstated after such Employee
completes a Year of Service after such Break in
Service Year.
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(2) If section 3.5(c)(1) is not applicable, and if the
Employee's number of consecutive Break in Service
Years does not equal or exceed the greater of five or
the number of Years of Service he had before incurring
a Break in Service Year, the Years of Service he had
prior to such Break in Service Years shall be
reinstated after such Employee completes a Year of
Service after such Break in Service Years.
(d) Notwithstanding the foregoing provisions, an Employee's Years
of Service shall exclude any Years of Service completed before
an Employee attains age 18.
3.6 Break in Service Year. "Break in Service Year" shall mean a
12-month period beginning on an Employee's Anniversary Date during which the
Employee has not completed more than 500 Hours of Employment (as defined in
section 3.7). Notwithstanding the foregoing, the following periods shall not
be deemed to be Break in Service Years:
(a) If a Participant retires on his Disability Retirement Date,
thereafter ceases to be totally and permanently disabled, and
returns to the employ of an Employer, the period between his
Disability Retirement Date and the date as of which he ceases
to be totally and permanently disabled.
(b) If a Participant commences receiving benefits under a
long-term disability benefit program maintained by an Employer
and thereafter ceases to receive benefits under such program
and returns to the employ of the Employer, the period during
which he was receiving benefits under such program.
If an Employee incurs a Break in Service Year and prior to such Break in
Service Year has not completed five Years of Service, his Years of Service
completed prior to such a Break in Service Year shall be disregarded unless he
completes a Year of Service after such Break in Service Year and before the
total of such Break in Service Year and any ensuing consecutive Break in
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Service Years equals the greater of five or the number of his Years of Service
(as defined in section 3.5 but without excluding Years of Service completed
prior to attaining age 18) prior to such Break in Service Year.
3.7 Hours of Employment. "Hours of Employment" shall mean, for
any individual performing or who has performed services for one or more
Employers or nonparticipating Affiliated Companies, the sum of the following:
(a) All hours for which the individual is directly or indirectly
paid or entitled to payment by an Employer or nonparticipating
Affiliated Company for the performance of duties. These hours
shall be credited to the individual for the computation period
or periods in which the duties are performed.
(b) Except as provided in section 3.7(e) below, all hours for
which the individual is directly or indirectly paid or
entitled to payment by an Employer or nonparticipating
Affiliated Company for reasons (such as vacation, holiday,
sickness, incapacity, layoff, jury duty, leave of absence,
Military Service, or disability) other than for the
performance of duties. These hours shall be credited to the
individual for the computation period or periods in which the
period during which no duties are performed occurs, beginning
with the first unit of time to which the payment relates.
(c) All hours for which back pay, irrespective of mitigation of
damages, has been awarded, agreed to, or paid by an Employer
or nonparticipating Affiliated Company, with no duplication of
credit for hours. These hours shall be credited to the
individual for the computation period or periods to which the
award or agreement pertains rather than the computation period
in which the award, agreement, or payment is made.
(d) Except as provided in section 3.7(e) below, eight Hours of
Employment per day for each working day that an
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individual is absent from work without pay for an approved
leave of absence, voluntary time, sick time, disciplinary
layoff, or Military Service if the individual returns to the
employ of an Employer or nonparticipating Affiliated Company
within 90 days after the end of such period. These hours
shall be credited to the individual for the computation period
or periods in which the period during which no duties are
performed occurs, beginning with the first such period.
(e) Eight Hours of Employment per day for each working day that an
individual is absent from work with or without pay because of
pregnancy of the individual, birth of a child to the
individual, placement of a child with the individual in
connection with the adoption of such child by such individual,
or caring for such child for a period beginning immediately
following such birth or placement. The Company may, in its
discretion, request such information from the individual as
the Company shall deem relevant in order to verify that an
absence is for the reasons described in this subsection (e).
Notwithstanding the foregoing, no more than 501 Hours of
Employment shall be credited under this subsection (e) on
account of any such pregnancy or placement if the individual
does not return to the employ of an Employer or participating
Affiliated Company within 90 days after the end of the period
approved for such absence. Hours credited under this
subsection (e) shall be credited to the individual only in the
year in which the absence begins if the crediting is necessary
to prevent a Break in Service Year for such year; or, in any
other case, in the immediately following year; provided,
however, that if more than 501 hours are credited under this
subsection (e) on account of any
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such pregnancy or placement, the excess over 501 hours shall
be credited to the period or periods to which it relates.
Hours of Employment credited under this section 3.7 shall comply with the rules
set forth in 29 C.F.R. section 2530.200b-2(b) and (c), which rules are hereby
incorporated by reference.
3.8 Employment by Related Entities. If an Employee's employer is
a nonparticipating Affiliated Company, any period in which the Employee is
employed by the nonparticipating Affiliated Company, while such membership or
common control as defined in section 2.1(c) exists, shall be taken into account
for purposes of satisfying the eligibility service requirement set forth in
section 3.1 and measuring such Employee's Years of Service to the same extent
it would have been had such period of employment been employment by an
Employer.
3.9 Leased Employees. A person who is not an Employee of an
Employer or nonparticipating Affiliated Company and who performs services for
an Employer or a nonparticipating Affiliated Company pursuant to an agreement
between the Employer or nonparticipating Affiliated Company and a leasing
organization shall be considered a "leased employee" if such person performed
the services on a substantially full-time basis for a year and the services are
of a type historically performed by employees. A person who is considered a
"leased employee" of an Employer or nonparticipating Affiliated Company shall
not be considered an Employee for purposes of participating in this Plan or
receiving any contribution or benefit under this Plan. A leased employee shall
be excluded from this Plan regardless of whether the leased employee
participates in any plan maintained by the leasing organization. However, if a
leased employee participates in the Plan as a result of subsequent employment
with an Employer, his previous service as a leased employee shall be counted in
calculating his Years of Service. Notwithstanding the preceding provisions of
this section 3.9, a leased employee will be
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included as an Employee for purposes of applying the requirements described in
Code section 414(n)(3) and for purposes of determining the number and identity
of Highly Compensated Employees.
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Article IV. Contributions
4.1 Employee Allotments.
(a) Amount of Allotments. Each Participant may make a regular
allotment to the Plan. Such allotment shall not be less than
1 percent nor more than the amount determined as follows:
(1) A Participant represented by S.E.I.U. Local 80
(Detroit) and P.T. & S. and I.C.W.U. Local 799
(P.T. & S.) may make allotments up to a percentage of
his Compensation Rate, in incremental percentages of 1
percent, determined as follows:
Period Percentage
----------------------- ----------
Prior to April 1, 1992 10%
April 1, 1992 -
August 31, 1993 14%
September 1, 1993 and later 15%
(2) A Participant represented by I.C.W.U. Local 70, 132,
and 799 (Northern) may make allotments up to
a percentage of his Compensation Rate, in incremental
percentages of 1 percent, determined as follows:
Period Percentage
------------------------- ----------
Prior to January 1, 1990 8%
January 1, 1990 -
August 31, 1992 10%
September 1, 1992
and later 14%
Allotments will be effected by Voluntary Deductions, Salary
Reductions, or any combination thereof, as elected by the
Participant. The amount of such Voluntary Deductions or
Salary Reductions shall be transferred to the Trustee after
each pay period; provided, however, that a Participant's
Salary Reduction allotments (A) shall be limited as provided
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in section 4.8 and (B) shall not exceed a percentage of the
Participant's Compensation Rate determined as follows:
(i) In the case of Participants referred to in (1) above--
Period Percentage
----------------------- ----------
Prior to April 1, 1992 6%
April 1, 1992 -
August 31, 1993 8%
September 1, 1993 9%
(ii) In the case of Participants referred to in (2) above--
Period Percentage
--------------------------- ----------
Prior to September 1, 1992 6%
September 1, 1992 and later 8%
Notwithstanding the foregoing, the Company may, in its sole
discretion, (1) reduce the Salary Reduction allotments
permitted by a group of Participants if, in the opinion of the
Company, it is advisable to do so in order to satisfy the
requirements of section 4.8 or 4.11; or (2) reduce the
Voluntary Deduction allotments permitted by a group of
Participants if, in the opinion of the Company, it is
advisable to do so in order to satisfy the requirements of
section 4.11.
(b) Changes in Allotments. The allotment of Voluntary Deductions
and/or Salary Reductions designated by a Participant shall
continue in effect, notwithstanding any change in his
Compensation Rate, until the Participant shall change such
allotment; provided, however, that such allotment shall in no
event be less than 1 percent, nor more than the limits of
section 4.1(a)(1) and (2), in incremental percentages of
1 percent.
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A Participant may change his allotment--
(1) prior to August 1, 1991, as of the first day of any
Accounting Period, or
(2) on or after August 1, 1991, but prior to December 1,
1993, as of the first day of any calendar quarter, or
(3) on or after December 1, 1993, as of the first day of
any month,
by giving written directions to his Employer in the form
prescribed by the Company at least 20 days prior to the
effective date of the change. Prior to August 1, 1991, such
changes may be made only once in each calendar year, except
that any time a Participant's Compensation Rate is changed he
shall have the right to change his allotment as of the first
day of any Accounting Period commencing not more than 60 days
thereafter by giving 20 days' written notice to his Employer
in the form prescribed by the Company.
(c) Voluntary Suspension of Allotments. Any Participant may, by
giving 20 days' written notice to his Employer in the form
prescribed by the Company, suspend his allotment of Voluntary
Deductions and/or Salary Reductions, effective as of the end
of any Accounting Period, either indefinitely or for any
specified period provided that in either case the suspension
shall be for at least 12 full Accounting Periods. In case of
any such suspension of any allotments, the Employer's
contributions on behalf of the Participant shall be
automatically suspended for a like period.
(d) Automatic Suspension of Allotments. A Participant's
allotments of Voluntary Deductions and Salary Reductions and
the Employer's contributions on behalf of the Participant
shall be suspended automatically for any period during which
the Participant is absent without pay under any of the
circumstances described in section 3.7(c), (d), or (e), and
such an absence shall not constitute termination of service
for purposes of
-25-
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any of the provisions of Article IX. A Participant may, by
giving 20 days' written notice to his Employer in the form
prescribed by the Company, suspend his allotment of Voluntary
Deductions and/or Salary Reductions for any period during
which he is absent from work under any of the circumstances
described in section 3.7(b) or (c) and receiving Compensation
at a reduced Compensation Rate, in which case the Employer
contributions on behalf of such Participant shall be
automatically suspended for a like period.
4.2 Employer Investment Plan Contributions. Each Employer shall
contribute, to the Salary Reduction Account of each of its participating
Employees, an amount equal to 25 percent of the Salary Reduction allotment of
such Participant; provided, however, that Salary Reduction allotments shall be
disregarded to the extent that they exceed an amount determined by multiplying
the applicable contribution percentage shown in the following schedules by the
Participant's Compensation Rate:
(a) Effective for periods prior to April 1, 1989 for Participants
represented by S.E.I.U. Local 80 (Detroit and P.T. & S.) and
I.C.W.U. Local 799 (P.T. & S.):
Contribution
Years of Service Percentage
---------------------- ------------
1 through 5 2%
More than 5 through 10 3%
More than 10 4%
(b) Effective for periods prior to January 1, 1990, for
Participants represented by I.C.W.U. Locals 70, 132, and 799
(Northern):
Contribution
Years of Service Percentage
---------------------- ------------
1 through 5 2%
More than 5 through 14 3%
More than 14 4%
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(c) Effective April 1, 1989 for Participants referred to in (a)
and January 1, 1990 for Participants referred to in (b):
Contribution
Years of Service Percentage
----------------------- ------------
1 through 5 2%
More than 5 through 10 3%
More than 10 through 14 4%
More than 14 5%
(d) Effective September 1, 1993 for all Participants:
Contribution
Years of Service Percentage
----------------------- ------------
1 through 5 2%
More than 5 through 10 3%
More than 10 through 14 4%
More than 14 through 25 5%
More than 25 6%
In addition, in cases where the Participant's Salary Reduction allotment is
less than the percentage of his Compensation Rate allowed in the above schedule
for his Years of Service, the Employer shall contribute to the Voluntary
Deduction Account of such participating Employee an amount equal to 25 percent
of the smaller of (1) the Participant's Voluntary Deduction allotment, or (2)
an amount equal to (A) the applicable contribution percentage, per the above
schedule, times the Participant's Compensation Rate, minus (B) the
Participant's Salary Reduction allotment. The maximum Employer matching
contributions on behalf of any Participant shall not be increased until such
Participant has filed a new election form with the Company.
Notwithstanding the foregoing, until January 1, 1990, the Employer
contributions on behalf of the Participants represented by I.C.W.U. Locals 70,
132, and 799 (Northern) shall be determined by substituting "100 percent" for
"25 percent" in each place that it appears in this section 4.2.
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The Employer contributions pursuant to this section 4.2 (including the amount
of any Salary Reduction allotments made by Participants) shall be made only
from the current profits or retained earnings of the Employer. The current
profits and accumulated retained earnings of the Employer shall be determined
in accordance with generally accepted accounting principles and practices and
shall be the amounts reflected in the Employer's certified financial
statements.
4.3 Employer ESOP Contributions.
(a) Basic ESOP Contribution. Subject to subsection (d) of this
section, effective on and after April 1, 1989, each Employer
shall contribute to the ESOP Account of each of its
participating Employees each pay period an amount equal to the
difference, if any, between (1) and (2) below:
(1) 75 percent of the sum of the Salary Reduction and
Voluntary Deduction allotments of such Participant for
such pay period; provided, however, that Salary
Reduction and Voluntary Deduction allotments shall be
disregarded to the extent that they exceed, in the
aggregate, an amount determined by multiplying the
applicable contribution percentage in the schedules
set forth in section 4.2 by such Participant
Compensation Rate.
(2) The value of the shares of MCN Stock allocated to the
ESOP Account of such Participant pursuant to section
13.4(d) for such pay period. The value of shares
allocated under section 13.4(d) shall be the market
value thereof as of the last day of the pay period for
which the shares are allocated, with the market value
to be determined by the Company in a nondiscriminatory
manner.
(b) Contribution of Principal, Interest, or Other Payments. Each
Employer also shall contribute to the ESOP its proportionate
share of any additional amount necessary
-28-
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to make principal, interest, or other payments required by the
terms of any loan made to the ESOP in accordance with section
13.4. Each Employer's proportionate share shall be equal to
the proportion that its contributions under section 4.3(a)
bears to the total contributions under section 4.3(a).
Effective November 1, 1989, each Employer also may make
additional contributions to make principal, interest, or other
payments in accordance with the terms of any loan made to the
ESOP in accordance with section 13.4.
(c) Dividend-Related Contributions. Effective November 1, 1989,
each Employer also shall contribute to the ESOP Account of
each of its participating Employees such amounts as may be
necessary to acquire for the ESOP Account of such Participant
shares of MCN Stock having a fair market value equal to the
amount of any dividends on shares of MCN Stock allocated to
the ESOP Account of such Participant that were used to repay
an ESOP loan in accordance with section 13.4(c). Such
contributions shall be made on, or as soon as practicable
after, each date on which dividends on allocated shares of MCN
Stock are used to repay a loan. In no event shall the shares
of MCN Stock acquired with contributions under this subsection
(c) be allocated to the ESOP Account of such Participant later
than the last day of the Plan Year during which (but for the
use of the dividend to repay the loan) the dividend giving
rise to such contribution would have been allocated to the
ESOP Account of such Participant.
(d) Exception. Notwithstanding any other provision hereof, no
contributions shall be made prior to January 1, 1990 to the
ESOP Account of any Participant represented by I.C.W.U. Locals
70, 132, and 799 (Northern).
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4.4 Additional Employer Contributions. Effective January 14,
1991, if a Participant receiving payments (based upon 40 or more hours per
week) under the terms of any Workers' Compensation law does not have sufficient
compensation to make Salary Reduction or Voluntary Deduction allotments in an
amount equal to the amount of the Participant's allotments as in effect during
the Participant's last period of active service, then the Participant's
Employer shall contribute on behalf of the Participant such additional amount
as would have been contributed by the Employer under sections 4.2 and 4.3 on
behalf of such Participant had the Participant's allotments been continued at
the rate in effect during the Participant's last period of active service.
Additional contributions under this section 4.4 shall be treated for accounting
purposes as if made under section 4.2 or 4.3, as applicable.
4.5 Rollover Contributions.
(a) From Qualified Plan. If an Employee receives, either before
or after becoming an Employee--
(1) prior to January 1, 1993, a qualified total
distribution (within the meaning of Code section
402(a)(5)(E)) or,
(2) effective January 1, 1993, an eligible rollover
distribution (within the meaning of Code section
402(c)(4))
from an employees' trust described in Code section 401(a)
which is exempt from tax under Code section 501(a) or from a
qualified annuity plan described in Code section 403(a) (other
than an employees' trust or an annuity plan under which the
Employee was an Employee within the meaning of Code section
401(c)(1) at the time contributions were made on his behalf
under such trust or annuity plan), then such Employee may
transfer and deliver to the Company, to be credited to his
Employee Salary Reduction Account as if it were a Salary
Reduction allotment, an amount which does not exceed the
amount of such qualified total distribution
-30-
36
or eligible rollover distribution (including any proceeds from
the sale of any property received as a part of such qualified
total distribution or eligible rollover distribution) less, in
the case of a qualified total distribution, the amount
considered contributed to such trust or annuity plan by the
Employee.
(b) From Individual Retirement Account or Annuity. If--
(1) an Employee receives, either before or after becoming
an Employee, a distribution or distributions from an
individual retirement account or individual retirement
annuity (within the meaning of Code section 408) or
from a retirement bond (within the meaning of Code
section 409);
(2) no amount in such account, no part of the value of
such annuity, or no part of the value of the proceeds
of such bond is attributable to any source other
than--
(A) prior to January 1, 1993, a qualified total
distribution (within the meaning of Code
section 402(a)(5)(E)), or
(B) effective January 1, 1993, an eligible
rollover distribution (within the meaning of
Code section 402(c)(4))
from an employees' trust described in Code section
401(a) which is exempt from tax under Code section
501(a) or annuity plan described in Code section
403(a) (other than an employees' trust or an annuity
plan under which the Employee was an Employee within
the meaning of Code section 401(c) at the time
contributions were made on his behalf under such trust
or annuity plan) and any earnings on such a qualified
total distribution or eligible rollover distribution;
and
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37
(3) for rollovers prior to January 1, 1993, the amount
received represents the entire amount in such account,
the entire value of such annuity or the entire value
of such bond,
then such Employee may transfer and deliver to the Company, to
be credited to his Salary Reduction Account as if it were a
Salary Reduction allotment, such distribution or
distributions.
(c) Timing and Substantiation. Any transfer and delivery pursuant
to this section 4.5 shall be delivered by the Employee to the
Company and by the Company to the Trustee on or before the
sixtieth day after the day on which the Employee receives the
distribution or on or before such later date as may be
prescribed by law. Any such transfer and delivery must be
accompanied by--
(1) a statement of the Employee that to the best of his
knowledge the amount so transferred meets the
conditions specified in this section 4.5, and
(2) a copy of such documents as may have been received by
the Employee advising him of the amount and the
character of such distribution.
Notwithstanding the foregoing, the Company shall not accept a
rollover contribution if, in its judgment, such acceptance
would cause the Plan to violate any provision of the Code or
Regulations.
(d) Deemed Allotment for Certain Purposes. A rollover
contribution pursuant to this section 4.5 shall be deemed to
be an allotment of a Participant for purposes of the value of
a Participant's fund account as provided in section 8.2 and in
determining the amount distributable to a Participant, the
provisions of Article IX that are applicable to Salary
Reduction allotments will be used, pursuant to section 9.1,
but not for purposes of determining the amount of the
contribution to be made on behalf of a Participant by his
Employer pursuant to section 4.2, 4.3, or 4.4 or calculating
the Annual Addition of such Participant.
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(e) Deemed Participation for Certain Purposes. If the amount of
rollover contribution is made by an Employee prior to his
becoming a Participant, such Employee shall, until such time
as he becomes a Participant, be deemed to be a Participant for
all purposes of the Plan except for purposes of any
determination of when he becomes a Participant pursuant to
section 3.1 and the making of allotments pursuant to section
4.1(a).
4.6 Transfers from the MichCon Savings and Stock Ownership Plan.
Effective January 14, 1991, if an Employee who previously had participated in
the MichCon Savings and Stock Ownership Plan (the "Savings Plan") becomes a
Participant in the Plan and the Participant's plan account in the Savings Plan
is transferred to the Plan in accordance with section 3.3 of the Savings Plan,
the Plan shall accept such transfer. Amounts transferred shall be 100 percent
vested at all times and shall be treated for all purposes in the same manner as
they were treated under the Savings Plan; that is:
(a) Amounts attributable to Employer salary reduction allotments
under the Savings Plan shall be allocated to the Participant's
Employee Salary Reduction Account;
(b) Amounts attributable to voluntary deduction allotments under
the Savings Plan shall be allocated to the Participant's
Employee Voluntary Deduction Account;
(c) Amounts attributable to Employer Savings Plan contributions
shall be allocated to the Participant's Employer Salary
Reduction Account or Employer Voluntary Deduction Account, as
the case may be; and
(d) Amounts transferred from the ESOP Account of the Participant
in the Savings Plan shall be allocated to the Participant's
ESOP Account.
Notwithstanding the foregoing, amounts transferred shall not be used for
purposes of determining the amount of the contribution to be made on behalf of
a Participant by the Employer pursuant to section 4.2, 4.3, or 4.4, or
calculating the Actual Deferral Percentage or Annual Addition of the
Participant.
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4.7 Transfers from the MichCon Employee Stock Ownership Plan.
(a) In General. The Company has previously maintained the MichCon
Employee Stock Ownership Plan (the "Tax Credit ESOP"), which
was a plan separate and distinct from the MichCon Employee
Stock Ownership Plan for Union Employees which constitutes a
part of the Plan. The Company terminated the Tax Credit ESOP
and, upon such termination, a portion of the assets of the Tax
Credit ESOP were transferred to this Plan. The purpose of
this section 4.7, which is effective as of January_25, 1991,
is to set forth specific provisions applicable to the assets
so transferred. In the event of any conflict between any
other provision of the Plan and this section 4.7 the terms of
this section 4.7 shall govern with respect to amounts
transferred from the Tax Credit ESOP, adjusted for earnings
and losses thereon.
(b) Allocation to ESOP Account. All amounts transferred from the
Tax Credit ESOP attributable to Plan Years 1975 through 1982
on behalf of any Participant or former Participant who has an
account balance in this Plan shall be allocated to the ESOP
Account of such Participant or former Participant. The
amounts transferred to the ESOP Account of a Participant or
former Participant, adjusted for any earnings or losses
thereon, shall, subject to the special rules set forth in this
section 4.7, be treated in the same manner as other assets of
the ESOP Accounts for all purposes of this Plan, including,
but not limited to, distributions, loans, investments, and
diversification of investments. The amounts transferred shall
not be deemed to constitute an Employee Allotment or an
Employer Contribution for discrimination testing or any other
purpose.
(c) Allocation to MCN Salary Reduction Account. All amounts
transferred from the Tax Credit ESOP
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attributable to Plan Years 1983 through 1986 on behalf of any
Participant or former Participant who has an account balance
in this Plan shall be allocated to the Salary Reduction
Account of such Participant or former Participant. The
amounts transferred to the Salary Reduction Account of a
Participant or former Participant, adjusted for any earnings
or losses thereon, shall, subject to the special rules set
forth in this section 4.7, be treated in the same manner as
other assets of the Salary Reduction Accounts for all purposes
of this Plan, including, but not limited to, distributions,
loans, investments, and diversification of investments. The
amounts transferred shall not be deemed to constitute an
Employee Allotment or an Employer Contribution for
discrimination testing or any other purpose.
(d) Vesting. All amounts transferred from the Tax Credit ESOP on
behalf of any Participant or former Participant, adjusted for
any earnings or losses thereon, shall at all times be fully
vested and nonforfeitable.
4.8 Limitations on Salary Reduction Allotments.
(a) Dollar Limitation. In no event shall any Employer make Salary
Reduction allotments for any calendar year, with respect to
any Participant in excess of $7,627 (for 1989) (as adjusted by
the Secretary of the Treasury to reflect increases in the cost
of living). This limit shall be applied by aggregating all
plans and arrangements maintained by the Company and all
Affiliated Companies that provide for elective deferrals (as
defined in Code section 402(g)).
(b) ADP Test. Effective for Plan Years beginning on or after
January 1, 1992, in addition to the limitations set forth
elsewhere in this Plan, one of the following tests must be
satisfied for the Plan Year:
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(1) The Average Actual Deferral Percentage for Highly
Compensated Employees who are eligible to participate
for the Plan Year shall not exceed the Average Actual
Deferral Percentage for Nonhighly Compensated
Employees who are eligible to participate for the Plan
Year multiplied by 1.25; or
(2) The Average Actual Deferral Percentage for Highly
Compensated Employees who are eligible to participate
for the Plan Year shall not exceed the Average Actual
Deferral Percentage for Nonhighly Compensated
Employees who are eligible to participate for the Plan
Year multiplied by two, provided that the Average
Actual Deferral Percentage for such Highly Compensated
Employees does not exceed the Average Actual Deferral
Percentage for such Nonhighly Compensated Employees by
more than two percentage points.
(c) Determination of Actual Deferral Percentages. For purposes of
the Actual Deferral Percentage test described in this section
4.8--
(1) An Elective Deferral will be taken into account for a
Plan Year only if it relates to Compensation that
either would have been received by the Eligible
Employee in the Plan Year (but for the deferral
election) or is attributable to services performed by
the Eligible Employee in the Plan Year and would have
been received by the Eligible Employee within 2_1/2
months after the close of the Plan Year (but for the
deferral election);
(2) An Elective Deferral will be taken into account for a
Plan Year only if it is allocated to the Eligible
Employee as of a date within that Plan Year. For this
purpose, an Elective Deferral is considered allocated
as of a date within a Plan Year if the allocation is
not contingent on
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participation or performance of services after such
date and the Elective Deferral is actually paid to the
Trust no later than 12 months after the Plan Year to
which the contribution relates;
(3) The Actual Deferral Percentage for an Employee who is
eligible to participate shall be computed by treating
any Excess Deferral (as defined in section 4.9) as an
Elective Deferral, except to the extent provided by
Regulations;
(4) The Actual Deferral Percentage for any Employee who is
a participant under two or more section 401(k) plans
or arrangements that are maintained by the Company or
an Affiliated Company shall be determined as if all
such Elective Deferrals were made under a single
arrangement; provided, however, that no Elective
Deferrals under an employee stock ownership plan (as
defined in Code section 4975(e)(7)) shall be taken
into account for purposes of this section 4.8;
(5) In the event that two or more plans which include
cash-or-deferred arrangements are considered as one
plan for purposes of Code section 401(a)(4) or 410(b),
the cash-or-deferred arrangements included in such
plans shall be treated as one arrangement for purposes
of this section 4.8;
(6) For purposes of determining the Actual Deferral
Percentage of an Employee who is a 5-percent owner of
the Company or one of the ten Highly Compensated
Employees paid the most Compensation during the year,
the Elective Deferrals and Compensation of such
Employee shall include the Elective Deferrals and
Compensation of Family Members, and such Family
Members shall be disregarded in determining the Actual
Deferral Percentage for Employees who are Nonhighly
Compensated Employees; and
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(7) The determination and treatment of the Elective
Deferrals and Actual Deferral Percentage of any
Employee shall satisfy such other requirements as may
be prescribed by the Secretary of Treasury.
4.9 Distribution of Excess Deferrals. "Excess Deferrals" means
excess deferrals as defined under Code section 402(g). Notwithstanding any
other provision of the Plan, the Excess Deferral, if any, of each Employee with
respect to a calendar year plus any income and minus any loss allocable thereto
shall be distributed no later than April 15 of the following calendar year to
each Employee who claims an Excess Deferral for the preceding calendar year.
Excess Deferrals shall be treated as Annual Additions under the Plan.
The Employee's claim shall be in writing; shall be submitted to the Company no
later than March 1; shall specify the Employee's Excess Deferral for the
preceding calendar year; and shall be accompanied by the Employee's written
statement that if such amount is not distributed, such Excess Deferral, when
added to amounts deferred under other plans or arrangements described in Code
section 401(k), 408(k), or 403(b), exceeds the limit imposed on the Employee by
Code section 402(g) for the year in which the deferral occurred.
Notwithstanding the preceding paragraph, the Employer may notify the Plan on
behalf of the individual of Excess Deferrals to the extent that the individual
has Excess Deferrals for the calendar year calculated by taking into account
only elective deferrals under this Plan and other plans of the Company and any
Affiliated Company.
The Excess Deferral distributed to an Employee with respect to a calendar year
shall be adjusted for any income or loss thereon for such calendar year and for
the period between the end of such calendar year and the date of distribution.
The income or loss allocable to such calendar year shall be determined by
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multiplying the income or loss for such calendar year allocable to the
Employee's Salary Reduction Account by a fraction, the numerator of which is
the Excess Deferral of the Employee for such calendar year and the denominator
of which is the Employee's Salary Reduction Account balance on the last day of
such calendar year. The income or loss allocable to the period between the end
of such calendar year and the date of distribution shall be equal to 10 percent
of the income or loss allocable to the Excess Deferral for the preceding
calendar year multiplied by the number of calendar months that have elapsed
from the end of the preceding calendar year to the date of distribution. A
distribution occurring on or before the fifteenth day of the month shall be
treated as having been made on the last day of the preceding month and a
distribution occurring after such fifteenth day shall be treated as having been
made on the first day of the following month.
In the event that an Employee's Salary Reduction allotments are distributed to
such Employee under this section 4.9, any Employer contributions attributable
thereto plus any income and minus any loss allocable thereto shall be
forfeited.
4.10 Distribution or Recharacterization of Excess Contributions.
(a) Determination of Excess Contributions. "Excess Contributions"
means, with respect to any Plan Year, the excess of--
(1) the aggregate amount of Elective Deferrals actually
paid over to the Trust on behalf of Highly Compensated
Employees for such Plan Year, over
(2) the maximum amount of such Elective Deferrals
permitted under the limitations of section 4.8(b),
determined by reducing Elective Deferrals as follows:
(A) First, the Actual Deferral Percentage (as
defined in section 2.1(b)) of the Highly
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Compensated Employee with the highest Actual
Deferral Percentage is reduced to the extent
necessary to satisfy the test described in
section 4.8(b) or to cause such percentage to
equal the Actual Deferral Percentage of the
Highly Compensated Employee with the next
highest Actual Deferral Percentage.
(B) Second, this process is repeated until the
test described in section 4.8(b) is satisfied.
Excess Contributions shall be treated as Annual Additions
under the Plan.
For purposes of this section 4.10, to the extent permitted by
the Code, the Excess Contributions shall be reduced by the
amount of any Excess Deferrals included in such Excess
Contributions and distributed to the Employee pursuant to
section 4.9.
(b) Distribution or Recharacterization. Notwithstanding any other
provision of the Plan, either--
(1) Excess Contributions with respect to a calendar year
plus any income and minus any loss allocable thereto
shall be distributed no later than the last day of the
following calendar year to Employees on whose behalf
such Excess Contributions were made for the preceding
calendar year; or
(2) at the election of the Employee and to the extent
permitted by the Code, the Excess Contributions shall
be treated as distributed to the Employee and then
contributed by the Employee to the Plan as a Voluntary
Deduction allotment.
(c) Adjustment for Income and Loss. The Excess Contributions to
be distributed to an Employee with respect to a calendar year
shall be adjusted for any income or loss thereon for such
calendar year and for the period between the end of such
calendar year and
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the date of distribution. The income or loss allocable to
such calendar year shall be determined by multiplying the
income or loss for such calendar year allocable to the
Employee's Salary Reduction Account by a fraction, the
numerator of which is the Excess Contributions for such
calendar year and the denominator of which is the Employee's
Salary Reduction Account balance on the last day of such
calendar year. The income or loss allocable to the period
between the end of such calendar year and the date of
distribution shall be equal to 10 percent of the income or
loss allocable to the Excess Contributions for the preceding
calendar year multiplied by the number of calendar months that
have elapsed from the end of the preceding calendar year to
the date of distribution. A distribution occurring on or
before the fifteenth day of the month shall be treated as
having been made on the last day of the preceding month and a
distribution occurring after such fifteenth day shall be
treated as having been made on the first day of the following
month.
In the event that an Employee's Salary Reduction allotments
are distributed to such Employee under this section 4.10, any
Employer contributions attributable thereto plus any income
and minus any loss allocable thereto shall be forfeited.
4.11 Statutory (Code Section 415) Limitations on Allocations to
Accounts. Notwithstanding any other provision of the Plan, contributions under
the Plan shall be subject to the limitations set forth in Code section 415,
which are incorporated herein by reference. For purposes of applying such
limitations to contributions under the Plan, the rules set forth in this
section 4.11 shall be applicable.
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(a) Annual Addition. The term "Annual Addition" means the amount
allocated to a Participant's account during any calendar year
that constitutes--
(1) Employer contributions;
(2) Employee contributions;
(3) forfeitures; and
(4) amounts described in Code sections 415(l)(1) and
419A(d)(2).
The compensation limitation referred to in Code section
415(c)(1)(B) shall not apply to--
(A) any contribution for medical benefits (within the
meaning of Code section 419A(f)(2)) after separation
from service which is otherwise treated as an Annual
Addition, or
(B) any amount otherwise treated as an Annual Addition
under Code section 415(l)(1). The Annual Addition for any
calendar year before 1987 shall not be recomputed to treat all
Employee contributions as an Annual Addition.
(b) Combined-Plan Limits. In the case of an individual who was a
Participant in the Plan on December 31, 1986, an amount shall
be subtracted from the numerator of the defined contribution
fraction (not exceeding such numerator) as prescribed by the
Secretary of Treasury so that the sum of the defined benefit
plan fraction and defined contribution plan fraction does not
exceed 1.0 as of such date.
Code section 415 shall be applied in such manner as to
maximize the permissible contributions and benefits thereunder
and, in determining the permissible amount of contributions
under the Plan, any grandfathering provisions heretofore or
hereafter adopted pursuant to Code section 415 shall be
applicable. For purposes of applying the limitations set
forth in Code section 415(e), the Michigan Consolidated Gas
Company
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Retirement Plan For Employees Covered By Collective Bargaining
Agreement shall be the primary plan and any required
reductions shall be made in the Annual Additions to this Plan.
(c) Reduction of Annual Additions.
(1) If the limitations of Code section 415 would be
exceeded as a result of a reasonable error in
estimating a Participant's compensation or on account
of such other limited facts and circumstances as the
Commissioner of Internal Revenue finds justify the
application of the rules hereinafter set forth, the
Annual Additions to the Participant's account which
exceed the applicable limitation shall be returned to
the Participant to the extent of all or any portion of
any Voluntary Deduction allotments which were made by
him pursuant to Article IV. Any net earnings and
gains allocable to such allotments for the period
between the date of such allotment and the date
returned shall also be repaid to the Participant but
such return of net earnings and gains will not be
deemed a further reduction of any excess Annual
Additions.
(2) If the Participant made no Voluntary Deduction
allotments or if, after returning all or part of such
allotments in accordance with the previous paragraph,
his Annual Additions still exceed the limitations of
Code section 415, then such excess shall be returned
to the Participant to the extent of all or any portion
of any Salary Reduction allotments made on behalf of
such Participant, together with any net earnings and
gains on such allotments as hereinabove described.
(3) If, after returning all or any portion of Voluntary
Deduction and Salary Reduction allotments of a
Participant in accordance with the preceding
paragraphs, his Annual Additions still
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exceed the limitations of Code section 415, such
portion of the Employer contributions under section
4.2 made on behalf of the Participant as must be
removed to meet the limitations shall be allocated and
reallocated to other Participants' Investment Plan
Accounts as contributions by the Employer.
(4) If, after reallocating all or any portion of Employer
contributions under section 4.2, a Participant's
Annual Additions still exceed the limitation of Code
section 415, such portion of the Employer
contributions under section 4.3(a) made on behalf of
the Participant and shares of MCN Stock allocated to
his ESOP Account under section 13.4(d) as must be
removed to meet the limitations shall be allocated and
reallocated to other Participant's ESOP Accounts as
contributions by the Employer.
(5) If, as a result of the allocation of forfeitures, a
reasonable error in estimating a Participant's
Compensation, or under other limited facts and
circumstances which the Commissioner of the Internal
Revenue Service finds justify the availability of the
following rules, any amount cannot be allocated during
the Plan Year in accordance with the foregoing
procedure without exceeding the applicable limitations
for one or more Participants, any remaining amount
shall be held unallocated in a special suspense
account to be allocated to Participants in the
succeeding Plan Year or Plan Years; provided, however,
that (A) no Employer contributions and no Voluntary
Deduction allotments shall be made in such succeeding
Plan Year or Plan Years until such special suspense
account is exhausted by allocations and reallocations;
(B) no investment gains (or losses) or other income
shall be
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allocated to the special suspense account; and (C) the
amounts in the special suspense account shall be
allocated as soon as possible without violating the
limitations of this section 4.11.
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Article V. Vesting in Accounts
5.1 Employee Salary Reduction Accounts, Employee Post-1986
Voluntary Deduction Account, and Employee Pre-1987 Voluntary Deduction Account.
The Employee Salary Reduction Account, the Employee Post-1986 Voluntary
Deduction Account, and the Employee Pre-1987 Voluntary Deduction Account of
each Participant shall be fully vested and nonforfeitable at all times.
5.2 Employer Salary Reduction Account, Employer Voluntary
Deduction Account, and ESOP Account.
(a) In General. A Participant shall have a vested and
nonforfeitable interest in his Employer Salary Reduction
Account, Employer Voluntary Reduction Account, and ESOP
Account after he has completed at least five Years of Service.
Prior to that time he shall have no vested interest in such
accounts.
(b) Accelerated Vesting. Notwithstanding section 5.2(a) above, a
Participant shall be fully vested and have a nonforfeitable
interest in his entire Employer Salary Reduction Account,
Employer Voluntary Deduction Account, and ESOP Account if--
(1) while still an Employee, he attains age 65;
(2) while still an Employee, he dies or suffers a total
and permanent disability as defined in section 2.1(l);
or
(3) while he is an Employee, contributions to the Plan are
completely discontinued or the Plan is terminated, or
the Plan is partially terminated and such Participant
is affected by such partial termination.
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Article VI. Investment Provisions
6.1 Investment of Contributions and Allotments. Employer
contributions under sections 4.2, 4.3, and 4.4 and Employee allotments shall be
invested in accordance with the following provisions:
(a) The Employer contributions made pursuant to section 4.3(a) and
(c) shall be invested in the MCN Stock fund, which fund is
described in Article VII.
(b) Each Participant shall, by written direction to the Company in
the form prescribed by the Company, direct that the Employer
contributions made pursuant to section 4.2 and Employee
allotments, including those made as a Salary Reduction, be
invested in such funds offered by the Trustee as are selected
by the Company.
Employee allotments, including those made as a Salary Reduction, and the
portion of Employer contributions referenced in section 6.1(b) above, need not
be invested in the same fund. A Participant shall direct the manner in which
the total of such allotments and such Employer contributions referenced in
section 6.1(b) above shall be divided, equally or otherwise, among the funds.
With respect to any Employee who is a Participant on April 1, 1989 and who has
not filed a new election form to direct Employer contributions in accordance
with this section 6.1, Employer contributions under section 4.3(a) and (c)
shall automatically be directed to the MCN Stock fund and Employer
contributions under section 4.2 shall automatically be directed to the Fixed
Income fund.
6.2 Change of Investment Direction. Any investment direction
given by a Participant under section 6.1 shall be deemed to be a continuing
direction until changed by the Participant. A Participant may change any such
direction in accordance with such procedures as the Company may from time to
time provide and apply in a nondiscriminatory manner.
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6.3 Transfers Between Investment Funds. A Participant may direct
that all or any part of the value of his interest in any investment fund be
transferred to one or more of the other funds except that a Participant may not
transfer any amount from the MCN Stock fund to the extent that the balance
remaining in such fund immediately after the transfer would be less than the
value of his ESOP Account. Notwithstanding the foregoing, no transfers may be
made to the Primark Corporation Stock fund by a Participant.
A transfer of all or any part of the value of a Participant's interest in the
Fixed Income fund may from time to time be restricted by the terms of
agreements which govern the investment of assets in such fund, in which event
the Company shall give notice of such restrictions to the Participants.
Prior to September 1, 1991, transfers between funds shall be effected only as
of the first day of any Accounting Period upon written directions to the
Company in the form prescribed by the Company given at least 20 days prior to
the effective date of such transfer. Prior to September 1, 1991, if a
Participant shall direct the transfer of all or any part of the value of his
interest in a fund, the Participant shall not be allowed to direct transfers to
such fund for a period of one year from the date of such transfer.
Prior to April 30, 1991, the procedures set forth above were equally applicable
to the Primark Corporation Stock fund. After that date, such fund ceased to
exist.
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Article VII. Investment Funds
7.1 Investment Funds. The Trustee shall establish, operate, and
maintain the following funds exclusively for the collective investment and
reinvestment of monies directed by the Company to be invested in such funds on
behalf of Participants:
(a) MCN Stock Fund. A MCN Stock fund which shall be invested
solely in the common stock of MCN Corporation.
(b) Fixed Income Fund. A Fixed Income fund which shall be
invested, except as hereinafter provided, in accounts or,
effective as of December 18, 1992, in marketable fixed income
securities or accounts maintained by financial institutions
which provide for fixed or variable rates of interest for
specified periods of time. The terms of such agreements and
the selection of such institutions shall be determined by the
Company. Investment advisors for marketable fixed income
securities may use fixed income futures and options to reduce
the effect of market volatility.
(c) Primark Corporation Stock Fund. Until April 30, 1991, a
Primark Corporation Stock Fund to be invested in accordance
with the terms of this paragraph (e). Until April 12, 1991,
the assets of the fund were and are to be invested solely in
Primark Corporation Stock. As soon as practicable after April
12, 1991, the shares of Primark Corporation Stock in the fund
shall be sold and the proceeds of such sales shall be invested
solely in any short-term fixed income fund described in
section 8.1. As of May 1, 1991 (or, if the sale of all shares
of Primark Corporation Stock is not completed by April 30,
1991, then June 1, 1991), the assets of the fund shall be
transferred to the MCN Stock Fund and the Primark Corporation
Stock Fund shall cease to exist. Each Participant shall be
entitled to direct the transfer of all or any portion of the
amounts so
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transferred to the MCN Stock Fund on his or her behalf to any
other fund or funds in accordance with, and subject to the
limitations of section 7.3.
(d) Other Funds. Such other funds offered by the Trustee as the
Company may select.
Notwithstanding the foregoing, the Trustee or the investment manager, as the
case may be, shall invest such portion of the assets of the funds as the
Company may deem necessary or appropriate to facilitate the administration of
such funds in any short-term fixed income fund as may be established under any
common, commingled, or collective trust for employee benefit plans established
and maintained by the Trustee.
7.2 Management of Investment Funds. Except as otherwise provided
in this Article VII, each fund shall be under the exclusive management and
control of the Trustee; the ownership of the assets and investments of the
funds shall be in the Trustee as such; and the Trustee shall have in respect of
any and all assets of the funds the same powers as if it were absolute owner
thereof.
7.3 Voting of MCN Stock.
(a) Instructions from Participants. The Trustee shall vote, in
person or by proxy, shares of MCN Stock held by the Trustee in
the MCN Stock fund in accordance with instructions obtained
from Participants.
Each Participant shall be entitled to give voting instructions
with respect to the number of shares of such respective stock
which bears the same ratio to the total number of shares held
by the Trustee on the record date as the number of shares
allocated to the respective stock fund account of such
Participant as of the Valuation Date preceding such record
date bears to the total number of shares allocated to the
respective stock fund accounts of all Participants as of such
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Valuation Date, excluding shares allocated to the accounts of
persons whose accounts have been distributed prior to such
record date.
Written notice of any meeting of stockholders of MCN
Corporation and a request for voting instructions shall be
given by the Company or the Trustee, at such time and in such
manner as the Company shall determine, to each Participant
entitled to give instructions for the voting of stock at such
meeting.
Shares with respect to which no voting instructions are
received from Participants and unallocated shares of the ESOP
shall be voted by the Trustee in the same proportion as shares
for which voting instructions are received from Participants.
The Trustee shall combine and vote fractional shares to the
extent possible to reflect the voting instructions of
Participants.
(b) Confidentiality. The instructions received by the Trustee
from Participants shall be held by the Trustee in strict
confidence and shall not be divulged or released to any
person, including officers or employees of the Company or any
Affiliated Company.
7.4 Tender Offers.
(a) Rights of Participants. Notwithstanding any other provisions
of this instrument, in the event an offer is made generally to
the shareholders of MCN Corporation to transfer all or a
portion of the common stock of MCN Corporation in return for
valuable consideration including, but not limited to, offers
regulated by section 14(D) of the Securities Exchange Act of
1934, as amended, each Participant owning a beneficial
interest in the MCN Stock fund shall have the sole and
exclusive right to decide if the common stock representing his
interest in such fund shall be tendered. Each Participant
shall have the right, to
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the extent the terms of the tender offer so permit, to direct
the withdrawal of such shares from tender. A Participant
shall not be limited as to the number of instructions to
tender or withdraw from tender which he can give; provided,
however, the Participant shall not have the right to give
instructions to tender or withdraw from tender after a
reasonable time established by the Trustee pursuant to section
7.4(c) below.
(b) Duties of the Company. Within a reasonable time after the
commencement of a tender offer, the Company shall provide to
each Participant having an ownership interest in the MCN Stock
fund--
(1) the offer to purchase as distributed by the offeror to
the shareholders of MCN Corporation,
(2) a statement of the shares representing his interest in
the MCN Stock fund as of the most recent information
available from the Company, and
(3) directions as to the means by which a Participant can
give confidential instructions to the Trustee with
respect to the tender. The Company shall establish
and pay for a means such as, but not limited to,
Datagram by which a Participant can expeditiously
deliver to the Trustee instructions with respect to
the tender.
(c) Duties of the Trustee. The Trustee shall follow the
instructions of the Participants with respect to the tender
offer. The Trustee shall not tender shares for which no
instructions are received. Unallocated shares of MCN Stock of
the ESOP shall be tendered or exchanged by the Trustee in the
same proportion as the allocated shares for which the Trustee
has received written direction are tendered or exchanged,
subject to the terms of any loan or pledge agreement covering
such shares. On the basis of its ability to comply with the
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terms of the offer, the Trustee shall establish a reasonable
time after which it shall not accept the instructions of
Participants.
(d) Confidentiality. The instructions received by the Trustee
from Participants shall be held by the Trustee in strict
confidence and shall not be divulged or released to any
person, including officers or employees of the Company or any
Affiliated Company.
7.5 Named Fiduciary Status. For purposes of sections 7.3 and 7.4,
each Participant is hereby designated a "named fiduciary" within the meaning of
ERISA section 403(a)(1) with respect to shares of MCN Stock as to which he is
entitled to make voting or tender offer decisions.
7.6 Expenses of Funds. Brokerage commissions, transfer taxes, and
other charges and expenses in connection with the purchase and sale of
securities for a fund shall be charged to the fund. Any income and other taxes
payable with respect to a fund shall likewise be charged to the fund.
7.7 Primark Corporation Stock. The provisions of sections 7.3,
7.4, and 7.5 pertaining to MCN Stock shall also be applicable to Primark
Corporation Stock during the period of its existence.
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Article VIII. Accounts and Records of the Plan
8.1 Company to Maintain Accounts. The Company shall maintain, or
cause to be maintained, for each Participant--
(a) an Investment Plan Account attributable to Voluntary Deduction
allotments and related Employer contributions under section
4.2, and
(b) a separate account attributable to Salary Reduction allotments
and related Employer contributions under section 4.2,
each of which shall be composed, to the extent required by the investment
directions of the particular Participant, of a MCN Stock fund account, a Fixed
Income fund account, and an account for each other applicable fund in which his
allotments and related contributions are invested.
The Company also shall maintain, or cause to be maintained, for each
Participant--
(c) an ESOP Account attributable to Employer contributions under
section 4.3(a) and (c), and
(d) shares of MCN Stock allocated to the Participant pursuant to
section 13.4(d),
each of which shall be composed of a MCN Stock fund account and, to the extent
diversification elections are made by the Participant under section 13.5, such
other accounts as the Company or its delegate deems necessary or appropriate in
giving effect to the diversification requirements of section 13.5.
The Company shall maintain, or cause to be maintained, all necessary records.
8.2 Plan Accounting. The interests of each Participant in the
funds shall be his proportionate share of the value of such funds as of any
Valuation Date. The Participant's proportionate share may be determined under
any accounting method selected by the Company that allocates fairly, in the
opinion of the
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Company, the investment gains and losses by or on behalf of each Participant to
the fund and that complies with the Code requirements of the Code and the
Regulations thereunder. The value of Participants' fund accounts shall be
redetermined as of each Valuation Date.
8.3 Valuation of Funds. The value of a fund as of any Valuation
Date shall be the market value of all assets (including any uninvested cash)
held by the fund as determined by the Trustee reduced by the amount of any
accrued liabilities of the fund on such Valuation Date. The Trustee's
determination of market value shall be binding and conclusive upon all parties.
8.4 Valuation of Investment Plan Account. The value of a
Participant's Investment Plan Account as of any Valuation Date shall be the sum
of the values of his MCN Stock fund account, Fixed Income fund account, and any
other of his fund accounts attributable to Salary Reductions, Voluntary
Deductions, and Employer Contributions under section 4.2.
8.5 Valuation of ESOP Account. The value of a Participant's ESOP
Account as of any Valuation Date shall be the sum of--
(a) the value of his MCN Stock fund account attributable to
Employer contributions on his behalf under section 4.3(a) and
(c) and shares of MCN Stock allocated to his ESOP Account
under section 13.4(d); and
(b) the sum of the values of his Fixed Income fund account and any
other of his fund accounts attributable to diversification
elections under section 13.5.
8.6 Valuation of Plan Account. The value of a Participant's Plan
Account as of any Valuation Date shall be the sum of the values of his MCN
Stock fund account, Fixed Income fund account, and any other investment fund
accounts maintained on his behalf under the Plan.
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8.7 Company to Furnish Annual Statements of Value of Plan
Accounts. The Company shall, not less frequently than annually, distribute to
each Participant in the Plan a statement setting forth the Plan Account of such
Participant. Such statement shall be deemed to have been accepted as correct
unless written notice of objections thereto is received by the Company or the
Employer within 30 days after the distribution of such statement to the
Participant.
8.8 Trust Agreement. A Trust has been established to fund
benefits under the Plan. The Employers may, without further reference to or
action by any Employee or Participant, from time to time enter into further
agreements with the Trustee and make such amendments to such Trust Agreement or
such further agreements as they may deem necessary or desirable to carry out
the Plan, and may take such other steps and execute such other instruments as
the Employers may deem necessary or desirable to put the Plan into effect or to
carry it out.
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Article IX. Distributions, Withdrawals, and Loans
9.1 Distribution Upon Termination of Employment Entitling
Participant to Value of Plan Account. Upon termination of a Participant's
employment with his Employer--
(a) due to retirement on his Normal Retirement Date, his Early
Retirement Date, or his Disability Retirement Date,
(b) by the death of the Participant,
(c) because of total and permanent disability or legally
established mental incompetency of the Participant not
qualifying the Participant for retirement pursuant to section
2.1(l), or
(d) under any circumstances after the Participant has satisfied
the Vesting Requirement,
the Company shall, subject to the provisions of section 9.7, direct the Trustee
to distribute to the Participant, or, in a proper case his designated
beneficiary or legal representative, the value of the Participant's Plan
Account as of the Valuation Date coincident with or next following the date of
termination of employment.
Notwithstanding the foregoing, the value of a Participant's Plan Account shall
become nonforfeitable as of the date on which the Participant attains his
sixty-fifth birthday, provided he is an Employee on that date.
9.2 Distribution Upon Termination of Employment Under
Circumstances Resulting in Forfeiture of Employer Contributions. Upon
termination of a Participant's employment under circumstances other than those
described in sections 9.1 and 9.7(c)(2), the Company shall, subject to the
provisions of section 9.7, direct the Trustee to distribute to the Participant
an amount equal to the value of the Participant's Employee Pre-1987 Voluntary
Deduction Account, Employee Post-1986 Voluntary Deduction Account, and Employee
Salary Reduction Account each of which shall be fully vested and nonforfeitable
at all times. The
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Participant's Employer Voluntary Deduction Account, Employer Salary Reduction
Account, and ESOP Account shall be forfeited and applied in reduction of the
next succeeding contribution which the Participant's Employer would otherwise
contribute to the Trust; provided, however, if such Participant is reemployed
prior to his incurring five consecutive Break in Service Years, then as of the
Valuation Date coincident with or next following his date of reemployment, the
Participant's Employer shall contribute on behalf of such Participant an amount
equal to the amount that was forfeited upon his termination of employment, and
such contribution shall be credited to the same accounts from which it was
forfeited, in the same amounts, except amounts that would otherwise be credited
to the Primark Corporation Stock fund shall be credited to the MCN Stock fund.
Such contributions shall not be taken into account in determining under section
4.11 the Annual Additions to such Participant's Savings Plan Account.
9.3 Certain Distributions from Participant Accounts.
(a) In General. Any Participant may, upon 20 days' written notice
to the Company in the form prescribed by the Company,
terminate his participation in the Plan as of any Valuation
Date. Upon such termination, the Company shall direct the
Trustee to distribute to the Participant an amount equal to
the value of the Participant's Employee Pre-1987 Voluntary
Deduction Account and Employee Post-1986 Voluntary Deduction
Account. Such a Participant shall continue to be considered a
Participant for all purposes of the Plan except for purposes
of Article IV (Contributions), but shall be ineligible to
again elect to make allotments under the Plan for a period of
12 full Accounting Periods from the date of termination of his
participation.
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(b) Withdrawals After Age 59 1/2.
(1) Prior to January 25, 1991, upon 20 days' written
notice to the Company in the form prescribed by the
Company, any Participant who has satisfied the Vesting
Requirement and attained age 59 1/2 may terminate his
participation in the Plan as of any Valuation Date.
Upon such termination, the Company shall direct the
Trustee to distribute to the Participant the value of
his Plan Account as of such Valuation Date and such
Participant shall be ineligible to again elect to make
allotments under the Plan for a period of 12 full
Accounting Periods from the date of termination of
participation.
(2) Effective January 25, 1991, upon 20 days' written
notice to the Company in the form prescribed by the
Company, any Participant who has attained age 59 1/2
may make an election, not more frequently than--
(A) prior to December 1, 1993, once in any
12-month period, or
(B) on or after December 1, 1993, once every
calendar year,
to withdraw all or any portion of the vested amount of
his Plan Account as of any Valuation Date. Upon such
withdrawal, the Company shall direct the Trustee to
distribute to the Participant as of such Valuation
Date the amount the Participant has elected to
withdraw.
(c) Limited Withdrawal in the Event of Hardship. Effective
January 25, 1991, if a Participant incurs a financial hardship
as defined in section 9.6, he may limit the amount of a
distribution from his Voluntary Deduction Account under
section 9.3(a) to the amount necessary to satisfy the hardship
and to pay any taxes resulting from such distribution.
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9.4 In-Service Withdrawals--General. At its discretion, the
Company may adopt rules limiting the number of withdrawals that may be made in
any Plan Year and prescribe a minimum amount that may be withdrawn. All
requests for a withdrawal shall be submitted in a form prescribed by the
Company. A Participant may not rescind a request for withdrawal which has been
submitted to the Company unless the Company consents. A withdrawal shall be
distributed as soon as reasonably practicable after the withdrawal request is
received.
9.5 Withdrawal of Voluntary Deduction Allotments. Any Participant
who shall have actively participated in the Plan for 24 or more calendar months
(for purposes of this section 9.5 active participation means the Participant
shall have made allotments to the Plan in each month in which compensation was
available), may, upon 20 days' written notice to the Company, withdraw as of
any Valuation Date an amount not in excess of 100 percent of his Voluntary
Deduction allotments under the Plan; provided, however, that the amount
withdrawn shall in no event exceed the sum of the values of his Employee
Pre-1987 Voluntary Deduction Account and Employee Post-1986 Voluntary Deduction
Account invested in the MCN Stock fund, the Fixed Income fund, and any other
investment funds under the Plan as of such Valuation Date. Successive
withdrawals may be made at intervals of not less than two full years provided
that the total amount withdrawn may never exceed the limitations prescribed in
the preceding sentence.
Withdrawals under this section 9.5 shall be from the MCN Stock fund, the Fixed
Income fund, or such other investment funds offered by the Trustee as the
Company shall make available for purposes of this section. If the Participant
has an account in more than one fund, he shall specify in his written direction
to the Company the amount to be withdrawn from each fund. The allotments in
all funds in the Employee Pre-1987 Voluntary Deduction Account must be
withdrawn before a withdrawal is permitted from a fund in the Employee
Post-1986 Voluntary
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Deduction Account. The amount of an in-service withdrawal from a specific fund
in a Voluntary Deduction Account shall not exceed the Employee's allotments in
such fund prior to the withdrawal.
9.6 Hardship Withdrawal of Salary Reduction Allotments. A
Participant may request, upon 20 days' written notice to the Company, a
withdrawal from his Salary Reduction Account if the withdrawal is necessary to
satisfy an immediate and heavy financial need of a Participant as defined
below. The amount of such withdrawal shall be limited to the Participant's
Salary Reduction allotments or the total value of the Participant's Employee
Salary Reduction Account as of the latest Valuation Date for which information
is available, whichever is smaller. Withdrawals under this section 9.6 shall
be from the MCN Stock fund, the Fixed Income fund, or such other investment
funds under the Plan as the Participant specifies in his written request for a
hardship withdrawal.
The determination of whether or not a distribution is necessary to satisfy an
immediate and heavy financial need and the amount required to be distributed to
meet the need shall be made by the Company. All determinations regarding
financial need shall be made in accordance with written procedures established
by the Company and applied in a uniform and nondiscriminatory manner. Such
written procedures shall specify the requirements for requesting and receiving
distributions on account of financial need, including the forms that must be
submitted and to whom the forms are to be submitted. All determinations
regarding financial need must comply with applicable Regulations under the
Code.
For purposes of this section 9.6, a financial hardship withdrawal shall be
limited to the amount required to meet the need created by one of the following
situations:
(a) Expenses for medical care described in Code section 213(d)
previously incurred by the Participant, his
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spouse, or any dependents of the Participant or necessary for
these persons to obtain medical care described in Code section
213(d).
(b) Costs directly related to the purchase (excluding mortgage
payments) of the principal residence for the Participant.
(c) Payment of tuition and related educational fees for the next
12 months of post-secondary education for the Participant, his
spouse, children, or dependents (as defined in Code section
152).
(d) The need to prevent the eviction of the Participant from his
principal residence or foreclosure on the mortgage on the
Participant's principal residence.
A distribution will be deemed necessary to satisfy an immediate and heavy
financial need of a Participant only if both of the following conditions are
met:
(1) The distribution is not in excess of the amount of the
immediate and heavy financial need of the Participant.
Effective January 1, 1993, this amount may be increased by the
lesser of the amount withheld from the distribution under Code
section 3405(c), as enacted by section 522(b) of the
Unemployment Compensation Amendments of 1992, Public Law No.
102-318, Stat. 290 or remaining Salary Reduction allotments or
total value of the Salary Reduction Account, if less, after
subtracting the amount of the immediate and heavy financial
need.
(2) The Participant has obtained all distributions, other than
hardship distributions, and all loans available under this
Plan and all other plans maintained by the Employer.
If a Participant receives a hardship distribution, (A) the Participant shall
not be entitled to make Salary Reduction allotments or Voluntary Deduction
allotments for a period of one year after the hardship distribution, and (B)
the Participant may not make Salary Reduction allotments for the Participant's
taxable year immediately following the taxable year of the
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hardship distribution in excess of the amount specified in Code section 402(g)
for such taxable year less the amount of the Participant's Salary Reduction
allotments for the taxable year of the hardship distribution.
9.7 Time of Distributions.
(a) In General. Except as hereinafter provided and subject to the
provisions of section 9.9, distributions made pursuant to
section 9.1 or 9.7(c)(2) shall be made by the Trustee at the
direction of the Company on such date as the Company shall
determine after consultation with the Participant or his
beneficiary, but in no event later than March 1 of the
calendar year following termination of the Participant's
employment.
Except as hereinafter provided, all other distributions or
withdrawals under this Article IX shall be paid as soon as
reasonably practicable by the Trustee at the direction of the
Company after the applicable Valuation Date. Notwithstanding
any other provision of the Plan--
(1) if the vested portion of a Participant's Plan Account
exceeds $3,500, no distribution shall be made to such
Participant pursuant to section 9.1, 9.2, 9.7(c)(2),
or 9.9 prior to the date the Participant attains the
age of 65 without written consent of the Participant;
and
(2) if a distribution to a Participant is deferred
pursuant to (1), the amount that would otherwise have
been distributed to such Participant shall be
invested--
(A) prior to August 1, 1991, in the Fixed Income
fund, and
(B) on and after August 1, 1991, in the Fixed
Income fund or any other investment fund
under the Plan, as the Participant shall
direct,
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except that the ESOP Account of such Participant shall
continue to be invested in the MCN Stock fund, subject
to the diversification rules set forth in section
13.5.
As soon as practicable after the date of adoption of the
Second Amendment to the Plan, the Company shall direct the
Trustee to transfer from the Fixed Income fund to the MCN
Stock fund, on behalf of each former Participant who
terminated employment on or after April 1, 1989 and prior to
the date of adoption of the Second Amendment, and whose
distribution has been deferred, an amount equal to the sum of
(A) the amount required to purchase the number of shares of
MCN Stock credited to his or her ESOP Account immediately
prior to his or her termination of employment, plus (B) the
amount of dividends that would have been credited thereon from
April 1, 1989 to the date of such transfer. Such amount shall
be credited to the ESOP Account of such former Participant.
A former Participant whose distribution has been deferred
pursuant to (1) above will not thereafter be eligible for
withdrawals under section 9.3 or 9.5 or loans under section
9.10 but shall continue to have the voting and tender offer
rights described sections 7.3 and 7.4 and to be treated as a
Participant for purposes of Article VIII.
A former Participant whose distribution has been deferred may
initiate a distribution upon 30 days' prior written notice to
the Company and shall receive an amount equal to the vested
portion of his Plan Account as of the Valuation Date next
following the expiration of such 30-day period, with such
amount to be distributed in a lump sum cash payment except
that--
(i) amounts invested in the MCN Stock fund shall be
distributed in accordance with section 9.8,
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(ii) effective as of August 1, 1991, such former
Participant may upon 30 days' prior notice to the
Company receive a partial distribution rather than a
total distribution, of the vested portion of his
Account, but not more frequently than once in any
calendar year (prior to December 1, 1993, not more
frequently than once in any 12-month period), and
(iii) to the extent that such distribution comes from the
Fixed Income fund account, such distribution shall be
subject to the provisions of section 9.9.
Notwithstanding any other provision of this Plan, if a
Participant attains age 70 1/2 and still has a balance
allocated to his or her Plan Account, a distribution shall be
made under section 9.1 as if the Participant had terminated
employment in the month in which the Participant attains age
70 1/2. Such distribution shall in no event be later than
April 1 of the calendar year following the year in which the
Participant attains age 70 1/2. Distributions to such
Participant shall be made annually thereafter no later than
April 1 of each year and shall be equal to at least the
minimum amount required to be distributed by Code section
401(a)(9). For purposes of this paragraph, the life
expectancy of the Participant and the Participant's spouse
shall be redetermined annually.
(b) Suspension of Participation. If a Participant shall, prior to
termination of his employment, cease to meet the eligibility
requirements of the Plan, his allotments and Employer
contributions on his behalf shall be suspended during the
period of his ineligibility. Subject to section 3.1,
distribution of such Participant's Plan Account shall be
deferred until termination of his employment with the Company
and any Affiliated Company. If the provisions of section 3.3
relating to the transfer of a Participant's Plan Account to
the MichCon Savings and Stock Ownership Plan or its successor
are not applicable--
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(1) with respect to Participants who cease to meet the
eligibility requirements of the Plan prior to
January 1, 1987, the Company shall direct the Trustee
to distribute the value of the Participant's Plan
Account in accordance with section 9.1 whether or not
such termination of employment shall be under the
circumstances set forth in said section 9.1; and
(2) with respect to Participants who cease to meet the
eligibility requirements of the Plan subsequent to
December 31, 1986, such distribution shall be in
accordance with section 9.1 or 9.3, whichever is
applicable.
(c) Transfer of Employment.
(1) A transfer of employment from an Employer to an
Affiliated Company shall not be considered a
termination of employment.
(2) If a Participant shall be transferred to the employ of
an Affiliated Company which has not elected to
participate in the Plan, distribution of such
Participant's Plan Account shall be deferred until the
date on which he is no longer in the employ of the
Company or any Affiliated Company, whereupon the
Company shall direct the Trustee to distribute the
value of the Participant's Plan Account in the manner
prescribed in section 9.1, subject to the provisions
of section 9.7, whether or not termination of
employment shall be under circumstances set forth in
said section 9.1.
(d) Special Rules Relating to Distributions in the Event of Death.
In the event that a Participant dies before a distribution of
his Plan Account, the Company shall direct the Trustee to
distribute the entire value of his Plan Account to his
beneficiary no later than March 1 of the calendar year
following the Participant's death, as provided in section 9.1.
In
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the event of the death of the Participant after the
distribution of his Plan Account has begun, any remaining
balance in his Plan Account at the time of death will be
distributed at least as rapidly as under the method of
distribution in effect at the date of the Participant's death.
9.8 Distributions of Stock. In the case of distributions under
section 9.1, 9.2, 9.3(b), 9.7(a), or 9.7(c)(2), the value of the Participant's
MCN Stock and/or Primark Corporation Stock fund account(s), if any, shall be
paid in full shares of stock except that cash shall be distributed in lieu of
fractional shares; provided, however, that a Participant entitled to such a
distribution may elect to receive cash in lieu of MCN Stock and/or Primark
Corporation Stock. Except in the case of an election to receive cash in lieu
of MCN Stock and/or Primark Corporation Stock--
(a) prior to August 1, 1991, the number of shares to be
distributed from such account shall be the quotient of the
value of such account as of the applicable Valuation Date
divided by the value assigned by the Trustee to a share of MCN
Stock or Primark Corporation stock for purposes of valuing the
fund as of such Valuation Date; and
(b) on and after August 1, 1991, the total number of shares
allocated to such account shall be distributed from such
account.
Any remaining value of such account and, subject to the provisions of section
9.9, the value of the Participant's accounts in other funds shall be
distributed in cash. Any transfer taxes payable with respect to the
distribution of shares of stock shall be charged to the respective MCN Stock or
Primark Corporation Stock fund. Distributions pursuant to section 9.3(a) and
withdrawals under sections 9.5 and 9.6 shall be paid entirely in cash.
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9.9 Distributions from Fixed Income Fund.
(a) Normal Form. Notwithstanding any provision of the Plan, other
than the final paragraph of section 9.7(a), if a distribution
is to be made under section 9.1(a) or (c) and the Participant
has a Fixed Income fund account and at least one Hour of
Employment prior to May 31, 1988, then unless the Participant
or legal representative shall make an election in the manner
prescribed in section 9.9(b), the value of such account
(exclusive of the portion thereof attributable to
diversification elections under section 13.5) shall be
distributed by the purchase of a single premium annuity
contract providing for monthly payments during the
Participant's lifetime and, if the Participant is married on
the date payment of his benefit commences and his spouse shall
survive him, for monthly payments during the remainder of such
spouse's lifetime, each such payment to such spouse being
equal to one-half of the monthly payment received by the
Participant, commencing no later than March 1 of the calendar
year following the calendar year of the Participant's
termination of employment, and delivery of such contract to
the Participant within a reasonable time after the
Participant's termination of employment.
If a distribution is to be made under section 9.1(b) because
of a Participant's death and the Participant had a Fixed
Income fund account at the time of his death and at least one
Hour of Employment prior to May 31, 1988, then unless the
Participant had made or the Participant's spouse or
beneficiary, as the case may be, makes an election at the time
and in the manner prescribed in section 9.9(b), the value of
the Participant's Fixed Income fund account (exclusive of the
portion thereof attributable to diversification elections
under section 13.5) shall be distributed by purchase of a
single premium annuity contract providing
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for monthly payments to the Participant's spouse, or, if the
Participant was not married on the day of his death, to his
beneficiary during such person's lifetime, commencing no later
than March 1 of the calendar year following the calendar year
of the Participant's death and delivery of such contract to
such person within a reasonable time after the date of
Participant's death.
(b) Election to Reject Normal Form. Subject to the provisions of
this section 9.9(b), each Participant entitled to a
distribution under section 9.9(a) (or legal representative on
behalf of such a Participant) may, at any time during the
90-day period ending on the annuity starting date, elect to
have the value of the Participant's Fixed Income fund account
(exclusive of the portion thereof attributable to
diversification elections under section 13.5) distributed by
one or more of the methods set forth in section 9.9(c).
Within 30 days after a Participant provides written notice to
the Company of his intention to retire on his Early Retirement
Date, Normal Retirement Date, or Disability Retirement Date,
or within 30 days after the Company receives notice of a
Participant's death, or within five business days after
determining, pursuant to section 2.1(l), that a Participant is
totally and permanently disabled, or within five business days
after receiving notice of the legally established mental
incompetency of the Participant, if the Participant has a
Fixed Income fund account at such time, the Company shall
deliver to such Participant or his legal representative, by
mail or by personal delivery, written notice in nontechnical
language explaining the terms and conditions of the annuity
provided in section 9.9(a).
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The notice shall explain the Participant's or legal
representative's right to elect an optional form of
distribution and that such election may be revoked by the
Participant or legal representative at any time prior to the
annuity starting date or, if a lump sum payment is elected,
prior to the first day on which all events have occurred which
entitle the Participant or legal representative to the lump
sum payment.
The notice shall explain that a married Participant may elect
a distribution pursuant to section 9.9(c) only if the spouse
consents in writing to such election. Such written consent
shall acknowledge consent to the designated beneficiary and
the optional form of distribution, neither of which may be
changed thereafter without again obtaining written spousal
consent (or the consent of the spouse expressly permits
changes by the Participant without further consent by the
spouse). Such written consent shall acknowledge the effect of
such election and shall be witnessed by a notary public or by
a representative of the Company who is designated to act in
such capacity by the Company.
If the Participant establishes to the satisfaction of the
Company that such written consent cannot be obtained because
his spouse cannot be located, the requirement of such written
consent shall be waived. Any election, change, or revocation
under this section 9.9(b) shall be effective when written
notice is delivered to the Company in a form approved by the
Company for this purpose, provided such election, change, or
revocation is delivered prior to the annuity starting date or,
if a lump sum payment is elected, prior to the first day on
which all events have occurred which entitle the Participant
or legal representative to the lump sum payment. The notice
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shall explain that an effective revocation shall result in the
benefit being provided as an annuity described in section
9.9(a).
(c) Optional Forms. In addition to the form described in section
9.9(a), distribution of the value of a Participant's Fixed
Income fund account (exclusive of the portion thereof
attributable to diversification elections under section 13.5)
may be made either--
(1) in a lump sum payment no later than March 1 of the
calendar year following the calendar year of the
Participant's termination of employment or death; or
(2) by purchase of any form of single premium annuity
contract that satisfies Code section 401(a)(9) as may
from time to time be offered by the legal reserve life
insurance companies with which the Trustee has
agreements governing the investment of assets in the
Fixed Income fund and delivery of such contract to the
Participant or distributee within a reasonable time
after the Participant's termination of employment or
death. Within five business days after the Company
receives an election pursuant to this provision, the
Company shall provide the same written notice provided
under section 9.9(b). An election pursuant to this
provision shall be subject to the provisions of
section 9.9(b).
9.10 Loans. The Trustee is hereby authorized to establish a loan
program in accordance with this section 9.10. Upon application of a party in
interest (as defined in ERISA section 3(14)) who is a Participant or
beneficiary under the Plan, the
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Company shall direct the Trustee to make a cash loan to such Participant or
beneficiary, secured by 50 percent of the nonforfeitable value of the
Participant's Employee and Employer Salary Reduction and ESOP Accounts
determined as of the date the loan is made. The loan program shall be
administered by the Company subject to the following conditions and such other
conditions that are consistent with Labor Regulation section 2550.408b-1 and
are from time to time set forth in a written document, delivered to
Participants and beneficiaries who are parties in interest (which document may
but need not be the Summary Plan Description), which provisions shall
constitute a part of the Plan and are hereby incorporated by reference:
(a) Effective October 18, 1989, the term of a loan shall not
extend beyond the earlier of four years or the date upon which
the Participant or beneficiary ceases to be a party in
interest; provided, however, that the four years shall be
changed to eight years where the proceeds of the loan are used
by the Participant or beneficiary to acquire the Participant's
principal residence.
(b) Effective October 18, 1989, a loan shall bear interest at a
reasonable rate which shall be based upon the prevailing
interest rate charged by persons in the business of lending
money on similar commercial loans under comparable
circumstances at the time that such loan is granted, as
determined by the Company and uniformly applied.
(c) Effective October 18, 1989, the amount of a loan (when added
to the balance of other outstanding loans) shall not exceed
the lesser of--
(1) $50,000 reduced by the excess (if any) of--
(A) the highest outstanding balance of loans from
the Plan during the one-year period ending on
the day before the date on which such loan
was made, over
(B) the outstanding balance of loans outstanding
on the date such loan was made, or
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(2) 50 percent of the nonforfeitable value of the
Participant's Employee and Employer Salary Reduction
and ESOP Accounts under the Plan which the Participant
would have been entitled to receive if the
Participant's employment had terminated on the date
such loan was made.
In no case shall a Participant be entitled to a loan under
this Plan if the amount of the proposed loan is less than
$500.
(d) A loan shall be evidenced by a promissory note.
(e) Payments of principal and interest shall be made by
approximately equal payments not less frequently than monthly
on a basis that would permit the loan to be fully amortized
over its term. Effective October 18, 1989, loan payments
shall be made by payroll deductions for Participants in active
pay status.
(f) Appropriate disclosure shall be made pursuant to the Truth in
Lending Act to the extent applicable.
(g) Amounts of principal and interest received on a loan shall be
credited to the Participant's account and the outstanding loan
balance shall be considered an investment of the assets of the
account. Payment of principal and interest shall be credited
to the investment funds in the same proportion as the amount
distributed from the funds from which the loan was granted to
the Participant, except amounts that would otherwise be
credited to the Primark Corporation Stock fund shall be
credited to the MCN Stock fund.
(h) The frequency of loans and the minimum amount for a loan shall
be determined through uniform rules prescribed by the Company
and at the sole discretion of the Company.
(i) All applications for a loan shall be submitted to the Company
on a form prescribed by the Company. Distribution shall be
made as soon as reasonably practicable after the application
of the loan is received.
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(j) If a Participant borrows from an account which is invested in
more than one fund, he shall instruct the Company as to the
funds from which the loan is to be applied; provided, however,
that no borrowing shall be applied from the MCN Stock fund
unless and until the Participant's ability to borrow from each
of the other funds has been exhausted.
(k) A married Participant may not borrow any amount from the Plan
unless his spouse executes a written consent as hereinafter
provided. Such consent must be executed during the 90-day
period ending on the date on which the loan is made and shall
specifically provide that the spouse consents both to the loan
and to the use of the Participant's Salary Reduction and ESOP
Accounts as security for the loan. The consent shall
acknowledge the effect of the use of the Participant's
accounts as security for the loan and shall be witnessed by a
notary public or a representative of the Company who is
designated to act in such capacity by the Company.
(l) In the event a Participant defaults on a loan, the entire
outstanding balance of and accrued interest on the loan shall
be due and payable. The Trustee and/or Company may pursue
collection on such defaulted loan by any means generally
available to a creditor where a promissory note is in default,
or if the entire amount due is not paid by such Participant
following the default, the amount of such loan default shall
be charged against the "secured portion" of the Participant's
Plan Account and treated as a distribution with respect to
such Participant; provided, however, that such a charge
against a Participant's Plan Account shall not occur with
respect to funds in his Employee Salary Reduction Account at a
time so as to cause a violation of Code section
401(k)(2)(B)(i).
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9.11 Definition of Allotments and Employer Contributions. For the
purposes of this Article IX, a Participant's allotments shall include only
those allotments made either as a Voluntary Deduction or a Salary Reduction
which have not been previously withdrawn or distributed.
If a Participant has previously had a portion of his Plan Account forfeited
under section 9.2, the Employer contributions, exclusive of those made as a
Salary Reduction to the Plan on his behalf, shall include only such Employer
contributions made subsequent to such forfeiture.
9.12 Spousal Consent to Payment. Subject to section 9.7(a), the
spouse of a married Participant or former Participant shall be required to
consent in writing to any in-service withdrawal, loan, or distribution under
the Plan to the Participant or former Participant; provided, however, for
distributions on account of termination of employment, this sentence shall be
effective as of January 1, 1993. The spouse's consent shall be in such form as
the Company may prescribe.
9.13 Distributions Pursuant to a Qualified Domestic Relations
Order. Upon receipt of a domestic relations order, the Company will notify the
involved Participant and any alternate payee that the order has been received
and explain the Plan's procedures for determining whether the order is a
qualified domestic relations order as defined in Code section 414(p). After
determining that the order is a qualified domestic relations order, the Company
shall direct the Trustee to distribute or segregate the Participant's Account
as provided in the qualified domestic relations order. If required by the
qualified domestic relations order, the Trustee shall make distribution prior
to the time that the Participant, whose account is subject to distribution,
could have received a distribution.
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In a case of a dispute regarding the validity of a domestic relations order or
the amounts or identities of parties to be paid thereunder, the Company may
segregate the portion of the Participant's account in question, and may bring
an action in a court of competent jurisdiction to determine the proper amount
and/or recipient of benefits, or may submit such segregated amount to a court
of competent jurisdiction (through an interpleader action or otherwise) until
resolution of the matter.
Further, if the Company receives notice that a domestic relations order is
forthcoming, the Company may suspend payments from the Participant's Account or
may follow the procedures described in the preceding sentence, until resolution
of the matter.
9.14 Direct Rollovers of Eligible Distributions.
(a) General. This section applies to distributions made on or
after January 1, 1993. Notwithstanding any provision of the
Plan to the contrary that would otherwise limit a
distributee's election under this section, a distributee may
elect, at the time and in the manner prescribed by the
Company, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover.
(b) Definitions.
(1) Eligible rollover distribution. An eligible rollover
distribution is any distribution of all or any portion
of the balance to the credit of the distributee,
except that an eligible rollover distribution does not
include: any distribution that is one of a series of
substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or
joint life expectancies) of the distributee and the
distributee's designated beneficiary, or for a
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specified period of ten years or more; any
distribution to the extent such distribution is
required under Code section 401(a)(9); and the portion
of any distribution that is not includible in gross
income (determined without regard to the exclusion for
net unrealized appreciation with respect to employer
securities).
(2) Eligible retirement plan. An eligible retirement plan
is an individual retirement account described in Code
section 408(a), an individual retirement annuity
described in Code section 408(b), an annuity plan
described in Code section 403(a), or a qualified trust
described in Code section 401(a), that accepts the
distributee's eligible rollover distribution.
However, in the case of an eligible rollover
distribution to the surviving spouse, an eligible
retirement plan is an individual retirement account or
individual retirement annuity.
(3) Distributee. A distributee includes an Employee or
former Employee. In addition, the Employee's or
former Employee's surviving spouse and the Employee's
or former Employee's spouse or former spouse who is
the alternate payee under a qualified domestic
relations order, as defined in Code section 414(p),
are distributees with regard to the interest of the
spouse or former spouse.
(4) Direct rollover. A direct rollover is a payment by
the Plan to the eligible retirement plan specified by
the distributee.
(c) Waiver of 30-Day Notice Period. If a distribution is one to
which Code sections 401(a)(ll) and 417 do not apply, such
distribution may commence less than 30 days after the notice
required under section 1.411(a)-11(c) of the Income Tax
Regulations is given, provided that:
(1) the Company clearly informs the Participant that the
Participant has a right to a period of at
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least 30 days after receiving the notice to consider
the decision of whether or not to elect a distribution
(and, if applicable, a particular distribution
option), and
(2) the Participant, after receiving the notice,
affirmatively elects a distribution.
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Article X. Administration
10.1 Plan Administration and Interpretation.
(a) The Company shall be responsible for the administration of the
Plan. The Company shall have all such powers as may be
necessary to carry out the provisions of the Plan and may from
time to time establish rules and procedures for the
administration of the Plan and the transaction of the Plan's
business.
(b) The Company shall have the exclusive right to make any finding
of fact necessary or appropriate for any purpose under the
Plan. The Company shall have the maximum discretion permitted
by law to interpret and construe the terms of the Plan and to
resolve all issues arising under the Plan including, but not
limited to the authority to--
(1) construe disputed or doubtful terms of the Plan;
(2) determine the eligibility of an individual to
participate in the Plan;
(3) determine the amount, if any, of benefits to which any
Participant, former Participant, beneficiary, or other
person may be entitled under the Plan;
(4) determine the timing and manner of payment of
benefits; and
(5) resolve all other issues arising under the Plan.
To the extent permitted by law, all findings of fact,
determinations, interpretations, and decisions of the Company
shall be conclusive and binding upon all persons having or
claiming to have any interest or right under the Plan.
The Employers shall, from time to time, on request of the
Company, furnish to the Company such data and information as
the Company shall require in the performance of its duties.
(c) The Company shall each month collect Employee allotments and
Employer contributions from each
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Employer and shall deliver the amounts collected to the
Trustee, together with instructions concerning the portions of
such total amount to be invested in each fund.
(d) The Company shall direct the Trustee to make payments of
amounts to be distributed or withdrawn from the Trust under
Article IX and to make any transfers from one fund to another
directed by Participants under section 6.3.
10.2 Notice to Employees. All notices, reports, and statements
given, made, delivered, or transmitted to a Participant shall be deemed to have
been duly given, made, or transmitted when mailed with postage prepaid and
addressed to the Participant at the address last appearing on the books of the
Employer. A Participant may record any change of his address from time to time
by written notice filed with the Employer.
10.3 Notices to Employers. Written directions, notices, and other
communications from Participants to the Employers shall be mailed by first
class mail with postage prepaid or delivered to such location as shall be
specified upon the forms prescribed by the Company for the giving of such
directions, notices, and other communications, and shall be deemed to have been
received by the addressee when received at such location. Any other notice to
the Employers shall be addressed--
(a) If intended for the Company:
MichCon Investment and Stock Ownership Plan
c/o Michigan Consolidated Gas Company
500 Griswold Street
Detroit, Michigan 48226
(b) If intended for any other Employer, at its principal place of
business.
10.4 Participants' Acceptance of the Provisions of the Plan. Each
Participant at the time of becoming a Participant in the
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Plan and as a condition of participation shall sign an instrument evidencing
the fact that he accepts and agrees to all provisions of the Plan.
10.5 Audit of Plan Records. The records of the Company and the
records of the Employers in respect of the Plan shall be examined annually by a
firm of independent public accountants appointed by the Company. Such
accountants shall, on the basis of such examination, make such reports to the
Company and to the Employers as they may request. The audited records of the
Company and the Employers shall be conclusive in respect of all matters
involved in the administration of the Plan.
10.6 Claims Procedure. If any Participant or distributee believes
he is entitled to benefits in an amount greater than those which he is
receiving or has received, he may file a claim with the Secretary of the
Company. Such a claim shall be in writing and state the nature of the claim,
the facts supporting the claim, the amount claimed, and the address of the
claimant.
The Secretary of the Company shall review the claim and, within a reasonable
period of time after receipt of the claim, give written notice by registered or
certified mail to the claimant of his decision with respect to the claim. Such
notice shall be written in a manner calculated to be understood by the claimant
and, if the claim is wholly or partially denied, set forth the specific reasons
for the denial, specific references to the pertinent Plan provisions on which
the denial is based, a description of any additional material or information
necessary for the claimant to perfect the claim, and an explanation of why such
material or information is necessary, and an explanation of the claim review
procedure under the Plan.
The Secretary shall also advise the claimant that he or his duly authorized
representative may request a review by the Company of the denial by filing with
the Company, within 65 days after notice of the denial has been received by the
claimant, a
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written request for such review. The claimant shall be informed that he may
have reasonable access to pertinent documents and submit comments in writing to
the Company within the same 65-day period. If a request is so filed, review of
the denial shall be made by the Company and the claimant shall be given written
notice of the Company's final decision. Such notice shall be provided within
60 days after receipt of such request. Such notice shall include specific
reasons for the decision and specific references to the pertinent Plan
provisions on which the decision is based and shall be written in a manner
calculated to be understood by the claimant.
10.7 Effect of a Mistake. In the event of a mistake or
misstatement as to the eligibility, participation, or service of any
Participant, or the amount of payments made or to be made to a Participant or
beneficiary, the Company shall, if possible, adjust the Plan's records and
cause to be withheld or accelerated or otherwise make adjustment of such
amounts of payments as will in its sole judgment result in the Participant or
beneficiary receiving the proper amount of payments under the Plan.
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Article XI. Amendment and Termination
11.1 Amendment. The Company may at any time and from time to time
amend or modify the Plan by written instrument duly adopted by the Board of
Directors of the Company. Any such amendment or modification shall become
effective on such date as the Company shall determine, may apply to
Participants in the Plan at the time thereof as well as future Participants,
but may not reduce the Plan Account of any Participant as of the date of
adoption of such amendment or modification.
11.2 Withdrawal. If an Employer shall withdraw from the Plan under
section 12.2, or if an Employer shall adopt an amendment to the Plan which
shall render impracticable the continued administration of the Plan as a joint
plan of the several Employers, the Company shall determine the portions of the
various funds held by the Trustee which are applicable to the Participants of
such Employer and shall direct the Trustee to segregate such portions in a
separate trust. Such separate trust shall thereafter be held and administered
as a part of the separate plan of such Employer. After such portions of the
funds have been segregated in a separate trust, no such Participant or any
distributee with respect to such Participant shall have any right to any
benefit under the Plan or any claim against the Trust.
11.3 Termination. Any Employer may at any time terminate its
participation in the Plan by resolution of its Board of Directors without
obtaining the consent of or giving notice to any Participant or collective
bargaining representative. In the event of any such termination, the Company
shall determine the portions of the various funds held by the Trustee which are
applicable to the Participants of such Employer and shall direct the Trustee to
distribute such portions to such Participants ratably in proportion to the
values of their respective fund accounts; provided, however, amounts
attributable to a Participant's Elective Deferrals shall not be distributed on
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account of such termination if the Employer, after such termination, maintains
a defined contribution plan (other than an employee stock ownership plan or a
simplified employee pension). The portions of the MCN Stock fund and the
Primark Corporation Stock fund so distributed shall be distributed in kind
except that cash shall be distributed in lieu of fractional shares. The
portions of the Fixed Income fund and other investment funds so distributed
shall be distributed in cash or in kind, or partly in cash and partly in kind,
as determined by the Company.
Upon termination or partial termination of the Plan by any Employer or upon the
complete discontinuance of contributions by any Employer, the benefits under
the Plan of all affected Participants employed or formerly employed by such
Employer shall become nonforfeitable.
11.4 Allocation of Funds Between Employers. The portion of a fund
applicable to Participants of a particular Employer shall be an amount which
bears the same ratio to the value of the fund which the aggregate value of the
fund accounts of Participants employed by such Employer bears to the total
value of the fund accounts of all Participants.
11.5 Trust to be Applied Exclusively for Participants and Their
Beneficiaries. Subject to section 13.3, any provision of the Plan to the
contrary notwithstanding, it shall be impossible for any part of the Trust to
be used for or diverted to any purpose not for the exclusive benefit of
Participants and their beneficiaries either by operation or termination of the
Plan, by power of amendment, or by other means.
Notwithstanding the preceding paragraph, if a contribution is made to the Trust
by an Employer by a mistake of fact, then such contribution shall be returned
to such Employer within one year after the payment of the contribution; and if
any part or all of a contribution is disallowed as a deduction under Code
section 404, then to the extent such contribution is disallowed as a
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deduction it shall be returned to such Employer within one year after the
disallowance. All Employer contributions are conditioned upon their
deductibility under Code section 404.
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Article XII. Participation by Affiliated Companies
12.1 Adoption of the Plan. Any Affiliated Company may become a
participating Employer under the Plan by (a) taking such corporate action as
shall be necessary to adopt the Plan, and (b) executing and delivering such
instruments and taking such other action as may be necessary or desirable to
put the Plan into effect with respect to such Affiliated Company.
The Plan shall become effective with respect to each particular Affiliated
Company which becomes a participating Employer after January 1, 1993, as of a
date to be determined by the Board of Directors of such Employer after
complying with all legal requirements pertaining to the participation of such
Employer in the Plan.
12.2 Withdrawal from the Plan. Any Employer may withdraw from
participation in the Plan at any time by filing with the Company a duly
certified copy of a resolution of its Board of Directors to that effect and
giving notice of its intended withdrawal to the Company, the other Employers,
and the Trustee at least 30 days prior to the effective date of withdrawal.
12.3 Company as Agent for Employers. Each Employer named under
section 2.1(u), other than the Company, hereby appoints, and each other
corporation which shall become an Employer pursuant to section 12.1 or 13.7 by
so doing shall be deemed to have appointed the Company its agent to exercise on
its behalf all of the powers and authorities hereby conferred upon the
Employers by the terms of the Plan, including, but not by way of limitation,
the power to amend, restate, and terminate the Plan. The authority of the
Company to act as agent shall continue unless and until the portion of the
Trust fund held for the benefit of Employees of the particular Employer and
their beneficiaries is set aside in a separate trust as provided in section
11.2.
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Article XIII. Special Provisions Relating to the ESOP
13.1 Establishment of ESOP. The MichCon Employee Stock Ownership
Plan for Union Employees was originally established effective as of April 1,
1989. Each Employer shall make contributions to the ESOP in accordance with
section 4.3 hereof and the assets of the ESOP shall be invested at all times
primarily in MCN Stock. The Company from time to time may direct the Trustee
to incur debt in accordance with section 13.4 hereof to finance the acquisition
of MCN Stock.
13.2 ESOP Account. The Company shall establish an ESOP Account in
the name of each Participant to which there shall be credited or charged--
(a) the Employer contributions under section 4.3(a) and (c) hereof
made on behalf of such Participant;
(b) the shares allocated to the Participant pursuant to section
13.4(d) hereof; and
(c) the investment gains and losses on such amounts.
A Participant's ESOP Account shall be invested only in the MCN Stock fund,
except to the extent that monies diversified under section 13.5 may, at the
Participant's election, be directed to the Equities fund, the Senior Securities
fund, or the Fixed Income fund.
13.3 Discrimination Testing. For purposes of the limitations on
Salary Reduction allotments set forth in section 4.8 and the limitations on
Voluntary Deduction allotments and Employer contributions set forth in section
4.11, the ESOP and non-ESOP portions of the Plan shall be tested separately.
For purposes of such testing--
(a) the ESOP portion of the Plan shall mean Employer contributions
under section 4.3(a) made on behalf of the Participant and the
shares allocated to a Participant's ESOP Account pursuant to
section 13.4(d); and
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(b) the non-ESOP portion of the Plan shall mean all Elective
Deferrals, Voluntary Deductions and Employer contributions
under section 4.2.
13.4 Loans.
(a) Stock Acquired with Exempt Loan. The Company may direct the
Trustee to incur a loan on behalf of the ESOP in a manner and
under conditions which will cause the loan to qualify as an
"exempt loan" within the meaning of Code section 4975(d)(3).
A loan shall be used primarily for the benefit of Participants
and their beneficiaries. The proceeds of each such loan shall
be used, within a reasonable time after the loan is obtained,
only to purchase MCN Stock, to repay the loan, or to repay any
prior loan.
Any such loan shall provide for a reasonable rate of interest
and an ascertainable period of maturity, and shall be without
recourse against the Plan. Any such loan shall be secured
solely by shares of MCN Stock acquired with the proceeds of
the loan and shares of MCN Stock that were used as collateral
on a prior loan which was repaid with the proceeds of the
current loan.
MCN Stock acquired with the proceeds of a loan, including
shares pledged as collateral, shall be placed in a Suspense
Account and released in accordance with subsection (b) below
as the loan is repaid as if all shares in the Suspense Account
were pledged. MCN Stock released from the Suspense Account
shall be allocated in the manner described in subsection (d)
below.
No person entitled to payment under a loan made pursuant to
this section 13.4 shall have recourse against any assets of
the Plan other than the MCN Stock used as collateral for the
loan, Employer contributions
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under section 4.3 that are available to meet obligations under
the loan, and earnings attributable to such collateral and the
investment of such contributions. Employer contributions
under section 4.3(b) made with respect to any Plan Year during
which the loan remains unpaid, and earnings on such
contributions, shall be deemed available to meet obligations
under the loan, unless otherwise provided by the Employer at
the time such contributions are made.
(b) Release of Pledged Shares. Any pledge of MCN Stock as
collateral under this section 13.4 shall provide for the
release of shares so pledged upon the payment of any portion
of the principal of the loan. Shares so pledged shall be
released in the proportion that the principal paid on the loan
bears to the total principal amount of the loan, as provided
in Treasury Regulation 54.4975-7(b)(8)(ii). The number of
shares of MCN Stock that shall be released with each principal
payment on the loan shall be equal to the number of shares of
MCN Stock held as collateral on the loan immediately prior to
the release multiplied by a fraction the numerator of which is
the amount of principal of the loan repaid on such date and
the denominator of which is the sum of the numerator plus the
remaining outstanding principal amount of the loan after
giving effect to the repayment of principal of the loan on
such date. Each loan under this section 13.4 shall comply
with the requirements of Treasury Regulation
54.4975-7(b)(8)(ii). If such a loan provides for monthly
principal payments, shares of MCN Stock shall be released
monthly.
(c) Repayment of Loan. Payments of principal and interest on any
loan under this section 13.4 shall be made by the Trustee at
the direction of the Company solely from--
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(1) the proceeds of such loan, if any portion of such
proceeds are used for such purpose within a reasonable
period of time after the loan is obtained as provided
in section 13.4(a) above;
(2) Employer contributions under section 4.3(b) available
to meet obligations under the loan;
(3) earnings from the investment of such contributions;
(4) earnings attributable to MCN Stock acquired with the
proceeds of such loan, whether allocated or
unallocated;
(5) the earnings on other allocated shares of MCN Stock
held by the ESOP if the Internal Revenue Service, by
private letter ruling, advises the Company that the
use of such earnings to repay the loan will be
deductible under Code section 404(k)(2)(C) and will
not violate the requirements of Code section 4975; and
(6) the proceeds of a subsequent loan made to repay the
loan.
The contributions and earnings available to pay a loan must be
accounted for separately by the Company until all loans under
this section 13.4 have been paid. If dividends on MCN Stock
allocated to the ESOP Account of any Participant are used to
repay any loan, shares of MCN Stock with a fair market value
not less than the amount of such dividends shall be allocated
in accordance with section 4.3(c) to the ESOP Account of such
Participant prior to the end of the Plan Year during which
(but for the use of the dividends to repay the loan) such
dividend would have been allocated to the ESOP Account of such
Participant.
(d) Allocation of Released Shares. Subject to the limitations in
section 4.11 on Annual Additions to a Participant's accounts,
shares of MCN Stock released from a Suspense Account described
in section 13.4(a) shall be allocated immediately to the ESOP
Accounts of
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each Participant in the proportion that the contribution that
would be required to be made on behalf of such Participant
under section 4.3(a)(1) for the applicable period if no shares
were allocated under section 4.3(a)(2) during such period
bears to the total of all Employer contributions that would be
required under section 4.3(a)(1) hereof for the applicable
period if no shares were allocated under section 4.3(a)(2)
during such period.
13.5 Diversification. Any Participant or any former Participant
whose distribution has been deferred pursuant to section 9.7(a), who, in either
case, has completed at least ten years of participation in the Plan, and who
has attained the age of 55 is a "Qualified Participant". Any Qualified
Participant shall have the right to make an election to direct the investment
of a portion of his ESOP Account. Such a Participant may elect within 90 days
after the close of each Plan Year in the six plan-year period beginning with
the first Plan Year in which the individual becomes a Qualified Participant to
diversify 25 percent of his ESOP Account, less any amount to which a prior
election applies. In the case of the last year to which an election applies,
50 percent shall be substituted for 25 percent.
The portion of a Qualified Participant's ESOP Account which is eligible for
diversification may be invested in the Fixed Income fund and/or any other
investment funds under the Plan, in any combination thereof.
13.6 Put Option. If MCN Stock becomes not readily tradable on an
established market, then any Participant who is otherwise entitled to a
distribution of his ESOP Account, shall have the right (hereinafter referred to
as "Put Option") to require that his Employer repurchase any MCN Stock
allocated to his ESOP Account under a fair valuation formula. The Put Option
shall be exercisable only by written notice to the Participant's Employer
during the 60-day period immediately following the date of
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distribution and if the Put Option is not exercised within such 60-day period,
then it can be exercised for an additional period of 60 days in the following
Plan Year. The period during which the Put Option is exercisable shall not
include any time when a Participant is unable to exercise it because his
Employer is prohibited from honoring it by applicable federal or state law.
This Put Option shall be nonterminable within the meaning of Treasury
Regulation 54.4975-(11)(a)(ii).
The amount paid for MCN Stock under the Put Option shall be paid in
substantially equal periodic payments (not less frequently than annually) over
a period beginning not later than 30 days after the exercise of the Put Option
and not exceeding five years. There shall be adequate security provided and
reasonable interest paid on the unpaid balance due under this section 13.6.
13.7 Purchase of MCN Stock. The ESOP may acquire shares of MCN
Stock on a national securities exchange, from the Company or any Affiliated
Company or otherwise; provided, however, that if any shares of MCN Stock are
purchased from the Company or any Affiliated Company, the price shall not
exceed an amount which constitutes adequate consideration (as defined in ERISA
section 3(18) and any Regulations thereunder) and such purchase shall satisfy
all other requirements of ERISA and the Code applicable to such purchases.
Except as provided in section 13.6 or as otherwise required by applicable law,
no shares of MCN Stock acquired by the ESOP shall be subject to a put, call, or
other option, or buy-sell or similar arrangement while held by and when
distributed from the Plan, whether or not any part of the Plan is then an ESOP.
The protection afforded to Participants in the preceding sentence is
nonterminable within the meaning of Treasury Regulation section
54.4975-(1)(a)(ii).
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Article XIV. Miscellaneous
14.1 Beneficiary Designation. Subject to the provisions of section
9.9 and this section 14.1, each Participant shall have the right to designate a
beneficiary or beneficiaries to receive any distribution to be made under
section 9.1 upon the death of such Participant, or, in the case of a
Participant who dies subsequent to termination of his employment but prior to
the distribution of the entire amount to which he is entitled under the Plan,
any undistributed balance to which such Participant would have been entitled.
In the event of the death of a Participant whose spouse survives him, the
beneficiary of the Participant shall be his surviving spouse unless such spouse
has consented in writing to the designation of another beneficiary or
beneficiaries. Any such written consent shall acknowledge the effect of such
election and shall be witnessed by a notary public or by a representative of
the Company who is designated to act in such capacity by the Company. In the
event a Participant dies without a surviving spouse, or, in the event the
surviving spouse of a Participant has executed the written consent hereinabove
described, any distributions to be made under section 9.1 upon the death of the
Participant shall be made to his designated beneficiary or beneficiaries. If
the Participant establishes to the satisfaction of the Company or its
designated representative that such written consent cannot be obtained because
his spouse cannot be located, the requirement of such written consent shall be
waived.
If no beneficiary has been named by a Participant who dies without a surviving
spouse or if the beneficiary designated by such a Participant or by a
Participant whose surviving spouse has executed the written consent hereinabove
described has predeceased the Participant or such designated beneficiary has
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died prior to complete disbursement of the Participant's Plan Account, the
value of his account, or the undistributed portion thereof, shall be paid by
the Trustee at the direction of the Company--
(a) to the surviving spouse of such deceased Participant, if any;
(b) if there shall be no surviving spouse, to the surviving
children of such deceased Participant, if any, in equal
shares;
(c) if there shall be no surviving spouse or surviving children,
to the executors or administrators of the estate of such
deceased Participant; or
(d) if no executor or administrator shall have been appointed for
the estate of such deceased Participant, to the person or
persons who would be entitled to the personal estate of such
deceased Participant under the laws of his state of domicile
if he had died leaving no will.
In the event that a Participant and his spouse die under circumstances such
that it is not clear whether the spouse survived the Participant, the
Participant shall be presumed to have survived the spouse.
14.2 Incompetency. Any distribution under this Plan which is
payable to a beneficiary who is a minor or to a Participant or beneficiary who,
in the opinion of the Company, is unable to manage his affairs by reason of
illness or mental incompetency, may be made to or for the benefit of any such
Participant or beneficiary in such of the following ways as the Company shall
direct:
(a) Directly to any such minor beneficiary, if, in the opinion of
the Company, he is able to manage his affairs;
(b) To the legal representative of any such Participant or
beneficiary; or
(c) To some near relative of any such Participant or beneficiary
to be used for the latter's benefit.
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14.3 Expenses. Except as otherwise provided in the Plan, all costs
and expenses incurred in administering the Plan, including the expenses of the
Company, the fees and expenses of the Trustee, the fees of its counsel, and
other administrative expenses, shall be borne by the Employers in such
proportions as the Company shall determine to be equitable and proper having
regard to the nature of the particular expense.
14.4 Nonassignability. Except as may be required to comply with a
qualified domestic relations order (as defined in Code section 414(p)), it is a
condition of the Plan, and all rights of each Participant shall be subject
thereto, that no right or interest of any Participant in the Plan or in a Plan
Account shall be assignable or transferable in whole or in part, either
directly or by operation of law or otherwise, including, but not by way of
limitation, execution, levy, garnishment, attachment, pledge, or bankruptcy but
excluding devolution by death or mental incompetency, and no right or interest
of any Participant in the Plan or in his Plan Account shall be liable for, or
subject to, any obligation or liability of such Participant.
14.5 Employment Noncontractual. The Plan confers no right upon any
Employee to continue in employment.
14.6 Merger or Consolidation with Another Plan. A merger or
consolidation with, or transfer of assets or liabilities to, any other plan
shall not be effected unless the terms of such merger, consolidation, or
transfer are such that each Participant, distributee, beneficiary, or other
person entitled to receive benefits from the Plan would, if the Plan then
terminated, receive a benefit immediately after the merger, consolidation, or
transfer which is equal to or greater than the benefit such person would have
been entitled to receive immediately before the merger, consolidation, or
transfer if the Plan had then terminated.
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If any other plan shall be merged into and become a part of this Plan, each
Participant or the person entitled to receive a benefit under such other plan
shall be entitled to receive a benefit under this Plan which is equal to the
benefit such person would have been entitled to receive had such other plan
terminated immediately before the merger.
14.7 Continuance by a Successor. In the event that any Employer
corporation shall be reorganized by way of merger, consolidation, transfer of
assets, or otherwise, so that another Affiliated Company shall succeed to all
or a portion of such Employer's business, such successor corporation, with the
consent of each other participating Employer, may be substituted for such
Employer under the Plan by adopting the Plan and becoming a party to the Trust
Agreement. Employee allotments and Employer contributions shall be
automatically suspended from the effective date of any such reorganization
until the date upon which the substitution of such successor corporation for
the Employer under the Plan becomes effective. If, within 90 days from the
effective date of any such reorganization, such successor corporation shall not
have become a party to the Plan, or, if the Employer shall adopt a plan of
complete liquidation other than in connection with a reorganization, the Plan
shall be automatically terminated with respect to Employees of such Employer as
of the close of business on the ninetieth day following the effective date of
such reorganization or as of the close of business on the date of adoption of
such plan of complete liquidation, as the case may be, and the Trustee shall
distribute the portion of the Trust applicable to Participants of such Employer
in the manner provided in section 11.3.
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14.8 Elimination of Certain Provisions. Effective--
(a) as of May 1, 1991, all references to Primark Corporation Stock
and the Primark Corporation Stock fund shall be deleted from
the Plan; and
(b) as of January 1, 1993, all provisions that ceased to apply on
any date prior to January 1, 1993 shall be deleted from the
Plan.
* * * * * * * * * *
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IN WITNESS WHEREOF, Michigan Consolidated Gas Company has caused its
corporate name to be hereunto affixed by its duly authorized officers as of the
29th day of December, 1993.
MICHIGAN CONSOLIDATED GAS COMPANY
ATTEST:
By /s/ Carol McCallion
-------------------
By /s/ Douglas A. Green
--------------------
(Corporate Seal)
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FIRST AMENDMENT TO THE
1989 AMENDMENT AND RESTATEMENT OF THE
MICHCON INVESTMENT AND STOCK OWNERSHIP PLAN
WHEREAS, Michigan Consolidated Gas Company (the "Company") has
previously established the MichCon Investment and Stock Ownership Plan
(the "Plan"), which was most recently amended and restated effective
January 1, 1989;
WHEREAS, FURTHER, pursuant to Section 11.1 of the Plan, the Company has
reserved the right to amend the Plan from time to time;
WHEREAS, FURTHER, in connection with the process by which the Company is
seeking a favorable determination letter from the Internal Revenue
Service regarding the 1989 Amendment and Restatement of the Plan, the
Internal Revenue Service has requested that certain provisions of the
Plan be amended, effective January 1, 1989.
NOW, THEREFORE, the Plan is hereby amended as follows, effective January
1, 1989:
1. The following shall be added at the end of Section 2.1(j):
If as a result of the application of such rules, the
adjusted $200,000/$150,000 limitation is exceeded, then
the limitation shall be prorated among the affected
individuals in proportion to each such individual's
compensation as determined under this Section prior to
the application of the limitation.
2. Section 2.1(o) shall be amended by the addition of the following
at the end thereto:
If as a result of the application of such rules, the
adjusted $200,000/$150,000 limitation is exceeded, then
the limitation shall be prorated among the affected
individuals in proportion to each such individual's
compensation as determined under this Section prior to
the application of the limitation.
3. Section 3.2 shall be amended in its entirety as follows:
Section 3.2 Eligibility Upon Merger or Reemployment.
Any Employee who is a Participant in any plan which is
merged into this Plan shall become a Participant in this
Plan immediately upon the effective date of the merger.
Such an Employee shall be eligible to actively
participate in this Plan in accordance with Section 3.4.
105
If a Participant's employment is terminated and he is
thereafter reemployed before incurring a Break in
Service Year, he shall be eligible again to actively
participate in the Plan as of the date of his
reemployment. In the event such Participant does incur
a Break in Service Year, he shall be eligible again to
actively participate in this Plan retroactive to his
date of reemployment after he has again satisfied the
eligibility requirement of Section 3.1(a).
4. Section 4.11(a)(4) shall be amended in its entirety to read as
follows:
(4) Amounts described in Code Sections 415(l)(2) and
419(A)(d)(3).
5. Section 4.11(a)(B) shall be amended in its entirety to read as
follows:
(B) Any amount otherwise treated as an Annual
Addition under Code Section 415(l)(2).
6. Section 8.3 shall be amended through the addition of the
following:
To the extent any Employer securities held by the Plan
are not readily tradable on an established securities
market, valuation of such securities shall be made by an
independent appraiser who meets requirements similar to
the requirements of the regulations prescribed under
Code Section 170(a)(1).
7. Section 9.7(a)(1) of the Plan shall be amended in its entirety
to read as follows:
(1) If the vested portion of a Participant's Plan
Account has ever exceeded $3,500, no distribution shall
be made to such Participant pursuant to Section 9.1,
9.2, 9.7(c)(2), or 9.9 prior to the date the Participant
attains the age of sixty-five (65) without written
consent of the Participant; and
8. Section 9.7 of the Plan shall be amended through the addition of
a new subsection (e) thereto, which shall read as follows:
(e) Distribution hereunder must begin not later than the
sixtieth (60th) day after the close of the Plan Year in
which occurs the latest of (a) the Participant's
termination of employment, (b) the Participant's
attainment of age sixty-five (65), or (c) the tenth
(10th) anniversary of the date the Participant first
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became a Participant, unless (1) the Participant elects
a later date by submitting to the Company a written
statement signed by the Participant which describes the
benefit and the date on which payment of such benefit
shall commence, so long as such election does not
violate the incidental benefit rule prescribed by the
Code; or (2) if the amount of the payment required to
commence on the date determined hereinabove cannot be
ascertained by such date, or if it is not possible to
make such payment on such date because the Company has
been unable to locate the Participant after making
reasonable efforts to do so, a payment retroactive to
such date may be made no later than sixty (60) days
after the earliest date on which the amount of such
payment can be ascertained under the Plan or the date on
which the Participant is located, whichever is
applicable. For purposes of this subsection, the
failure of a Participant to consent to a distribution
shall be deemed an election to defer commencement of
payment of any benefit sufficient to satisfy this
section.
9. Section 9.8 of the Plan shall be amended through the addition of
the following language at the end thereof:
The distribution requirements of Code Section 409(o)
shall be met by the Plan, to the extent applicable.
10. Section 9.9(A) of the Plan shall be amended in its entirety to
read as follows:
(a) Normal Form. Notwithstanding any provision of the
Plan, other than the final paragraph of section 9.7(a),
if a distribution is to be made under section 9.1(a) or
(c) and the Participant has a Fixed Income fund account
and at least one Hour of Employment prior to May 31,
1988, then unless the Participant or legal
representative shall make an election in the manner
prescribed in section 9.9(b), the value of such account
(exclusive of the portion thereof attributable to
diversification elections under section 13.5) shall be
distributed by the purchase of an immediately payable
single premium annuity contract providing for monthly
payments during the Participant's lifetime and, if the
Participant is married on the date payment of his
benefit commences and his spouse shall survive him, for
monthly payments during the remainder of such spouse's
lifetime, each such payment to such spouse being equal
to one-half of the monthly payment received by the
Participant, commencing no later than March 1 of the
calendar year following the calendar year of the
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Participant's termination of employment, and delivery of
such contract to the Participant within a reasonable
time after the Participant's termination of employment.
If a distribution is to be made under section 9.1(b)
because of a Participant's death and the Participant had
a Fixed Income fund account at the time of his death and
at least one Hour of Employment prior to May 31, 1988,
then unless the Participant had made or the
Participant's spouse or beneficiary, as the case may be,
makes an election at the time and in the manner
prescribed in section 9.9(b), the value of the
Participant's Fixed Income fund account (exclusive of
the portion thereof attributable to diversification
elections under section 13.5) shall be distributed by
purchase of an immediately payable single premium
annuity contract providing for monthly payments to the
Participant's spouse, or, if the Participant was not
married on the day of his death, to his beneficiary
during such person's lifetime, commencing no later than
March 1 of the calendar year following the calendar year
of the Participant's death and delivery of such contract
to such person within a reasonable time after the date
of Participant's death.
11. The second paragraph of Section 9.9(B) shall be amended through
the addition of the following at the end thereof:
In all cases, such notice shall be provided no less than
thirty (30) days and no more than ninety (90) days prior
to the annuity starting date.
12. A new section 9.15 shall be added to the Plan which shall read
as follows:
Notwithstanding anything herein to the contrary, a
Participant's Salary Reduction contributions shall not
be distributed prior to the Employee's retirement,
death, disability, termination of employment, or
hardship, except that a distribution of such amounts may
be made, in accordance with Code Section 401(k)(10), upon
(a) termination of the Plan without establishment of
another defined contribution plan other than an employee
stock ownership plan (as defined in Code Section 4975(e)
or 409) or a simplified employee pension plan (as
defined in Code Section 408(k));
(b) the disposition by MCN Corporation or the Company to
an unrelated corporation of substantially all
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of the assets (as defined in Code Section 409(e)(2))
used in the trade or business if the Company continues
to maintain the Plan after the disposition, but only
with respect to employees who continue employment with
the corporation acquiring such assets; or
(c) the disposition by MCN Corporation or the Company to
an unrelated entity of its interest in a subsidiary
(within the meaning of Code Section 409(d)(3)) if the
Company continues to maintain the Plan, but only with
respect to employees who continue employment with such
subsidiary.
13. Other than as provided herein, the Plan shall remain unchanged.
IN WITNESS WHEREOF, this Amendment has been executed as of this _____
day of __________, 1994.
MICHIGAN CONSOLIDATED GAS COMPANY
By /s/ SUSAN K. MCNISH
---------------------------------------
Its GENERAL COUNSEL & SECRETARY
-------------------------------------
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109
SECOND AMENDMENT TO THE
1989 AMENDMENT AND RESTATEMENT OF THE
INVESTMENT AND STOCK OWNERSHIP PLAN
WHEREAS, Michigan Consolidated Gas Company (the "Company") has
previously established the MichCon Investment and Stock Ownership Plan (the
"Plan"), which was most recently restated effective January1, 1989;
WHEREAS, FURTHER, pursuant to Section 11.1 of the Plan, the Company has
reserved the right to amend the Plan from time to time;
NOW, THEREFORE, the Plan is hereby amended as follows, effective
January1, 1995, except as otherwise provided below:
1. The first paragraph of Section 2.1(o) is amended in its
entirety as follows:
(o) "Eligible Compensation" means the regular basic salary
or wage paid to an Employee by the Employer before any payroll
deduction for taxes or any other purpose, and before any Salary
Reduction allotment or cafeteria plan election, but excluding merit,
incentive and other similar payments made in the form of a lump sum,
bonuses, awards, shift differentials, severance payments, differential
payments made by reason of the Employee's entry into Military Service,
all amounts paid for work in excess of 40 hours in any one week, all
overtime or other premium paid for work in excess of a maximum number
of hours in any one day, for work on holidays or for any other reason,
payments for so-called fringe benefits such as Employer contributions
to this Plan or any pension or retirement plan, increased wages or
salary resulting from temporary promotion, upgrading or transfer, of
whatever duration, to a higher paid job or classification, and any
other premium, auxiliary, or special pay of any sort whatsoever.
2. Section 3.7 is amended by adding the following at the end
thereof:
Notwithstanding anything herein to the contrary, Hours of
Employment shall be credited hereunder at all times in compliance with
the requirements of the Family and Medical Leave Act.
3. Section 4.1(a) is amended in its entirety as follows, effective
March 1, 1995:
(a) Amount of Allotments. Each Participant may make a
regular allotment to the Plan. Such allotment shall not be less than
1 percent nor more than the amount determined as follows:
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(1) A Participant represented by S.E.I.U. Local 80
(Detroit), P.T.& S. and I.C.W.U. Local 799 (P.T.& S.) and, prior to
March 1, 1995, I.C.W.U. Local 70, may make allotments up to a percentage
of his Compensation Rate, in incremental percentages of 1 percent,
determined as follows:
Period Percentage
------ ----------
Prior to April 1, 1992 10%
April 1, 1992 - August 31, 1993 14%
September 1, 1993 - February 28, 1995 15%
March 1, 1995 and later
(for Highly Compensated Employees) 15%
March 1, 1995 and later
(for Nonhighly Compensated Employees) 20%
(2) A Participant represented by I.C.W.U. Local 132 and 799
(Northern) and, on and after March1, 1995, I.C.W.U. Local 70, may make
allotments up to a percentage of his Compensation Rate, in incremental
percentages of 1 percent, determined as follows:
Period Percentage
------ ----------
Prior to January 1, 1990 8%
January 1, 1990 - August 31, 1992 10%
September 1, 1992 - August 31, 1995
(except for I.C.W.U. Local 70) 14%
March 1, 1995 - August 31, 1995
(for I.C.W.U. Local 70) 15%
September 1, 1995 and later
(for Highly Compensated Employees) 15%
September 1, 1995 and later
(for Nonhighly Compensated Employees) 20%
Allotments will be effected by Voluntary Deductions, Salary
Reductions, or any combination thereof, as elected by the Participant.
The amount of such Voluntary
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Deductions or Salary Reductions shall be transferred to the Trustee after each
pay period; provided, however, that a Participant's Salary Reduction allotments
(A) shall be limited as provided in section 4.8 and (B) shall not exceed a
percentage of the Participant's Compensation Rate determined as follows:
(i) In the case of Participants referred to in (1) above --
Period Percentage
------ ----------
Prior to April 1, 1992 6%
April 1, 1992 - August 31, 1993 8%
September 1, 1993 9%
(ii) In the case of Participants referred to in (2) above --
Period Percentage
------ ----------
Prior to September 1, 1992 6%
September 1, 1992 - June 30, 1995 8%
(February 28, 1995 for I.C.W.U. Local 70)
July 1, 1995 (March 1, 1995 for
I.C.W.U. Local 70) and later 9%
Notwithstanding the foregoing, the Company may, in its sole discretion, (1)
reduce the Salary Reduction allotments permitted by a group of Participants if,
in the opinion of the Company, it is advisable to do so in order to satisfy the
requirements of section 4.8 or 4.11; or (2) reduce the Voluntary Deduction
allotments permitted by a group of Participants if, in the opinion of the
Company, it is advisable to do so in order to satisfy the requirements of
section 4.11.
4. Subsection (d) of Section 4.2 is amended in its entirety,
effective September1, 1993:
(d) Effective September 1, 1993 through December 31, 1994
for all Participants:
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Contribution
Years of Service Percentage
---------------- ------------
1 through 3 2%
More than 3 through 7 3%
More than 7 through 10 4%
More than 10 through 25 5%
More than 25 6%
5. Section 4.2 is amended by adding new subsections (e), (f) and (g),
which shall read as follows:
(e) Effective January 1, 1995 for all Participants:
Contribution
Years of Service Percentage
---------------- ------------
1 through 3 2%
More than 3 through 6 3%
More than 6 through 10 4%
More than 10 through 25 5%
More than 25 6%
(f) Effective July 1, 1995 for all Participants except
Participants described in subsection (g) below:
Contribution
Years of Service Percentage
---------------- ------------
1 through 3 2%
More than 3 through 6 3%
More than 6 through 10 4%
More than 10 through 23 5%
More than 23 6%
(g) For all Participants who became Eligible Employees on or after
July1, 1995, who are utility employees represented by I.C.W.U. Local 799
(Northern):
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Contribution
Years of Service Percentage
---------------- ------------
0 through 4 0%
More than 4 through 6 3%
More than 6 through 10 4%
More than 10 through 23 5%
More than 23 6%
6. A new subsection (e) is added to Section 4.3, which shall read as
follows:
(e) Longevity Contributions. Effective (1) April1, 1995 (with
respect to Participants represented by S.E.I.U. Local 80 (Detroit and P.T. &
S.) and I.C.W.U. Local 799 (P.T. & S.)) or (2) September 1, 1995 (with respect
to Participants represented by I.C.W.U. Locals 70, 132 and 799 (Northern)),
within a reasonable time after such initial date and each April1 of each Plan
Year thereafter (in each case, the "Measurement Date"), each Employer shall
contribute to the ESOP Account of each of its participating Employees on active
payroll as of the Measurement Date who has at least 30 Years of Service as of
such Measurement Date, twenty-five (25) shares of MCN stock (or an equivalent
value determined by the Company in a nondiscriminatory manner, which may be
used to purchase MCN stock).
7. The second paragraph of subsection 4.11(b) is amended in its entirety
as follows:
Code section 415 shall be applied in such manner as to maximize the
permissible contributions and benefits thereunder and, in determining the
permissible amount of contributions under the Plan, any grandfathering
provisions heretofore or hereafter adopted pursuant to Code section 415 shall
be applicable. For purposes of applying the limitations set forth in Code
section 415(e), this Plan shall be the primary plan and any required reductions
shall be made from the Michigan Consolidated Gas Company Retirement Plan for
Employees Covered by Collective Bargaining Agreements (or other applicable
defined benefit plan of the Employer).
8. Subsection 6.1(a) is amended in its entirety as follows:
(a) The Employer contributions made pursuant to section 4.3(a),
(c), and (e) shall be invested in the MCN Stock Fund (through each
Participant's ESOP Account), which fund is described in Article VII.
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114
9. The last paragraph of Section 6.1 is amended in its entirety as
follows:
Employee allotments, including those made as a Salary Reduction, and
the portion of Employer contributions referenced in section 6.1(b) above, need
not be invested in the same fund. A Participant shall direct the manner in
which the total of such allotments and such Employer contributions referenced
in section 6.1(b) above shall be divided, equally or otherwise, among the
funds. With respect to any Employee who is a Participant on April1, 1989 and
who has not filed a new election form to direct Employer contributions in
accordance with this section 6.1, Employer contributions under section 4.3(a),
(c) and (e) shall automatically be directed to the MCN Stock Fund (through each
Participant's ESOP Account) and Employer contributions under section 4.2 shall
automatically be directed to the Fixed Income Fund.
10. Subsection 8.1(c) is amended in its entirety as follows:
(c) an ESOP Account attributable to Employer contributions under
section 4.3(a), (c) and (e), and
11. Subsection 8.5(a) is amended in its entirety as follows:
(a) the value of his MCN Stock fund account attributable to
Employer contributions on his behalf under section 4.3(a), (c) and (e) and
shares of MCN Stock allocated to his ESOP Account under section 13.4(d); and
12. Section 9.7(a)(ii) is amended in its entirety as follows:
(ii) such former Participant may upon 30 days' prior notice to the
Company receive a partial distribution rather than a total distribution, of the
vested portion of his Account, but not more frequently than (1) once in any
calendar year (for the period ending June 30, 1995 for any Participant
represented by I.C.W.U. Locals 70, 132 and 799 (Northern) (1) three times in
any calendar year (during the period beginning January1, 1995 and ending
June30, 1995 for any Participant represented by S.E.I.U. Local 80 (Detroit and
P.T. & S.) and I.C.W.U. Local 799 (P.T. & S.))) or (2) four times per year
(effective July1, 1995 for all Participants), and
13. Section 13.2(a) is amended in its entirety as follows:
(a) the Employer contributions under section 4.3(a), (c) and (e)
hereof made on behalf of such Participant;
14. Other than as provided herein, the Plan shall remain unchanged.
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115
IN WITNESS WHEREOF, this Amendment has been executed as of this day of
December, 1995.
MICHIGAN CONSOLIDATED GAS COMPANY
By /s/ SUSAN K. MCNISH
------------------------------------
Its SECRETARY AND GENERAL COUNSEL
---------------------------------
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116
THIRD AMENDMENT TO THE
1989 AMENDMENT AND RESTATEMENT OF THE
MICHCON INVESTMENT AND STOCK OWNERSHIP PLAN
WHEREAS, Michigan Consolidated Gas Company (the "Company") has
previously established the MichCon Investment and Stock Ownership Plan (the
"Plan"), which was most recently restated effective January 1, 1989;
WHEREAS, FURTHER, pursuant to Section 11.1 of the Plan, the Company has
reserved the right to amend the Plan from time to time;
NOW, THEREFORE, the Plan is hereby amended as follows, effective
January 1, 1996 except as otherwise provided below:
1. Section 2.1(ww) shall be amended in its entirety as follows:
"Valuation Date" means each business day on which the New York Stock
Exchange shall be open for business.
2. Section 4.5(a) shall be clarified by adding the following at the end
thereof, effective January 1, 1995:
Former Employees who are Participants and who receive an eligible
rollover distribution from another plan sponsored by an
Employer may make rollover contributions in accordance with
this section.
3. Section 9.10(g) shall be amended in its entirety as follows:
(g) Amounts of principal and interest received on a loan shall be
credited to the Participant's account and the outstanding loan balance
shall be considered an investment of the assets of the account.
Payment of principal and interest related to loans made from a
Participant's ESOP Account shall be credited to such Participant's ESOP
Account. Payment of principal and interest related to loans made from
a Participant's Investment Plan Account shall be credited to the
Participant's Investment Plan Account and shall be invested in the
investment funds in the same proportions as the investment election
then in effect by the Participant under Article VI.
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117
4. A new Section 14.9 shall be added to the Plan, effective October 12,
1996, which shall read as follows:
14.9 USERRA Rights. Notwithstanding any provision of the Plan to the
contrary, contributions, benefits and service credit with respect to
qualified military service will be provided in accordance with
Code Section 414(u), to the extent applicable. Loan repayments will be
suspended under this Plan as permitted under Code Section 414(u).
5. A new Article XV shall be added to the Plan, effective as of January 1,
1996 provided that a favorable private letter ruling in connection with this
addition is received from the Internal Revenue Service on or before January 31,
1997, and which is otherwise effective on the January 1 of the year in which
such favorable private letter ruling is received, which such Article XV shall
read as follows:
Article XV. Redesignation of ESOP
This Article XV designates that part of the non-ESOP portion of the
Plan which is invested in the MCN Stock Fund becomes part of the ESOP
portion of the Plan. This Article XV also sets forth certain
provisions regarding the operation of the ESOP portion of the Plan,
such provisions to supersede any contrary provisions of the Plan.
Except as specifically provided in this Article XV, the provisions of
this Article XV, including the redesignation of the ESOP portion
of the Plan described herein, shall not affect any beneficiary
designations or any other applicable agreements, elections, or consents
that Participants, spouses, or beneficiaries validly executed under the
terms of the Plan before the execution date of the Plan amendment which
first adopts this Article XV, and such designations, agreements,
elections and consents shall continue to apply in the same manner as
they did prior to such amendment.
The ESOP, as set forth in this Article XV, is intended to meet with
requirements of an employee stock ownership plan, as defined in Section
4975(e)(7) of the Code and the accompanying regulations, and Section
407(d)(6) of ERISA. As provided below, the ESOP is designed to invest
primarily in qualifying employer securities of MCN Corporation.
15.1 REDESIGNATION OF ESOP PORTION OF PLAN. Effective as of January 1,
1996, the ESOP portion of the Plan shall consist of the ESOP Account
of each Participant plus the remaining part of each Participant's Plan
Account that is invested in the MCN Stock Fund. The put option
provisions of Section 13.6 shall apply to the entire ESOP portion of
the Plan. However, only a Participant's ESOP Account shall be subject
to the restrictions described in the first sentence of Section 6.3.
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118
15.2 ALLOCATION OF INVESTMENT PLAN ACCOUNT BALANCES TO ESOP PORTION OF
PLAN. On and after January 1, 1996, all amounts contributed,
transferred or designated as allocable to the Investment Plan Account
of any Participant shall be treated as part of the ESOP portion of the
Plan to the extent the Participant has directed the investment of such
amounts in the MCN Stock Fund in accordance with Article VI of the
Plan.
15.3 DISTRIBUTION OF DIVIDENDS ON MCN STOCK. At the direction of the
Company exercised in its sole discretion, the Trustee will, after
dividends are paid on MCN Stock held in the Trust, but in no event
later than 90 days following the end of the Plan Year in which such
dividends are paid (to the extent such dividends are not used to make
payment on an exempt loan as provided for in section 13.4(c) of the
Plan), either (i) distribute to Participants such portion of the
dividends attributable to the interests in MCN Stock held in their Plan
Accounts (or, if so determined by the Company, their ESOP Accounts) as
described below or, (ii) arrange to have such dividends distributed
directly to Participants by the Employer, or (iii) arrange to have such
dividends distributed to Participants by a dividend disbursement agent
selected by the Company, which may be the Employer's payroll
department. In its sole discretion, the Company may direct the Trustee
to have such dividends distributed only to Participants who elect to
receive such dividend distributions in accordance with procedures
established by the Company (which such procedures may apply to all
Participants, solely to Participants described in (a) below, or solely
to Participants not described in (a) below). Further, in its sole
discretion, the Company may establish procedures that would permit
Participants to elect to have dividends distributed to them in a single
sum rather than over periods that might otherwise be determined by the
Company to correspond with Employer payroll practices.
The distribution of dividends on MCN Stock held in a
Participant's Plan Account (or, if so determined by the Company, a
Participant's ESOP Account ) shall be in the following amounts:
a. Participants who have terminated employment with
the Employers and all other nonemployees with Plan
Account balances (such as QDRO alternate payees and
beneficiaries of deceased Participants) shall receive
distributions of all of the dividends paid on the MCN
Stock held in their Plan Accounts (or, if so determined
by the Company, their ESOP Accounts), provided,
however, that the aggregate amount of such
distributions to each such Participant or other
individual shall not exceed $3,500 in any Plan Year
(unless the Company, in its sole discretion, uniformly
permits such Participants to elect to receive such
distributions without limitation).
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119
b. Participants who are employees who
participate in the MCN Supplemental Savings Plan
shall receive distributions of all of the dividends
paid on the MCN Stock held in their Plan Accounts
(or, if so determined by the Company, their ESOP
Accounts).
c. Each other Participant not described in (a)
or (b) above shall receive distributions equal to
the amount of Additional Allotments that he or she
would be permitted to make under Section 15.4
below, subject to the limitations of Section 15.5
below, unless such Participant affirmatively elects
to receive a distribution of 100% of the dividends
paid on the MCN Stock held in his or her Plan
Account (or, if so determined by the Company, his
or her ESOP Account).
For purposes of this Section 15.3, the ESOP portions of both
the MichCon Savings and Stock Ownership Plan and the MichCon Investment
and Stock Ownership Plan shall be considered in the aggregate for
each Participant and the payment of dividend amounts on MCN Stock held
in the Plan Accounts (or, if so determined by the Company, the ESOP
Accounts) under both plans shall not exceed the limitations on
distributions of dividends set forth in subsections (a) and (c) above.
In this regard, the limitations under subsections (a) and (c) shall be
allocated among the two plans for a Participant by multiplying such
limitation by a percentage derived by dividing the total of ESOP
portion under each plan by the total ESOP portions under both plans
(or, if so determined by the Company, by dividing the total ESOP
Account under each plan by the total ESOP Account under both plans).
15.4 ADDITIONAL ALLOTMENTS. All active Employee-Participants will be
deemed to have elected to make additional Salary Reduction allotments
similar to those elected under Section 4.1 ("Additional Allotments")
for each calendar year unless they affirmatively elect (under
procedures established by the Company) not to make such allotments at
least 15 days prior to the scheduled commencement of any distributions
under Section 15.3 above (the "Election Date"). The amount of
Additional Allotments deemed to be elected under this Section 15.4
shall be equal to the amount of ESOP dividends distributed to the
Participant under Section 15.3 above, but subject to applicable legal
limitations, including but not limited to the restrictions of Code
Sections 402(g) and 415. Such restrictions shall be applied in the
manner determined by the Company in its sole discretion . The amount
of Additional Allotments shall be calculated by the Company utilizing
uniform methodologies and assumptions established by the Company in its
sole discretion.
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15.5 PROVISIONS FOR FURTHER REDUCTION OF ADDITIONAL ALLOTMENTS. A
Participant's Additional Allotments shall be further reduced as
necessary below the level described in Section 15.4 above so as to
limit Additional Allotments to an amount equal to or not exceeding:
a. The lesser of (i) the residual of a
Participant's gross wages less all deductions
other than Additional Allotments or (ii) the
maximum further reduction permitted under
applicable law.
b. Zero, in the event that the Participant
does not make allotments pursuant to Section 4.1
of the Plan at the time of any distribution of
dividends pursuant to Section 15.3 above.
c. Zero, in the event that the Participant's
Plan Account is invested in less than one share
of MCN Stock immediately prior to the distribution
of dividends.
15.6 EMPLOYER CONTRIBUTIONS. Additional Allotments shall not be subject
to the limitations on Salary Reduction and Voluntary Deduction
allotments described in Section 4.1. In addition, Additional
Allotments shall not be treated as Salary Reduction or Voluntary
Deduction allotments under Section 4.1 for the purposes of determining
Employer contributions under 4.2 and 4.3 of the Plan, and shall be
disregarded for these purposes.
IN WITNESS WHEREOF, this Amendment has been executed as of this 23rd
day of December, 1996.
MICHIGAN CONSOLIDATED GAS COMPANY
By /s/ Susan K. McNish
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Its V.P., General Counsel & Secretary
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